怀尔德会计学原理答案Chapter_03.doc

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1、Chapter3AdjustingAccountsandPreparingFinancialStatementsQUESTIONS1.Thecashbasisofaccountingreportsrevenueswhencashisreceivedwhiletheaccrualbasisreportsrevenueswhentheyareearned.Thecashbasisreportsexpenseswhencashispaidwhiletheaccrualbasisreportsexpenseswhentheyareincurr

2、edandmatchedwithrevenuestheygenerated.2.Theaccrualbasisofaccountinggenerallyprovidesabetterindicationofcompanyperformanceandfinancialconditionthandoesthecashbasis.Also,theaccrualbasisincreasesthecomparabilityoffinancialstatementsfromoneperiodtothenext.Thus,businessdecis

3、ionmakersgenerallyprefertheaccrualbasis.3.Businessesthathavemajorseasonalvariationsinsalesaremostlikelytoselectthenaturalbusinessyearasthefiscalyear.4.Aprepaidexpenseisanitempaidforinadvanceofreceivingitsbenefits.Assuch,itisreportedasanassetonthebalancesheet.5.Long-term

4、tangibleplantassetssuchasequipment,buildings,andmachineryleadtoadjustmentsfordepreciation.Generally,landistheonlylong-termtangibleplantassetthatdoesnotrequiredepreciation.©McGraw-HillCompanies,2009237SolutionsManual,Chapter36.TheAccumulatedDepreciationcontraaccountisuse

5、dfordepreciation.Itprovidesfinancialstatementuserswithadditionalinformationabouttherelativeageoftheassets.Withoutthecontraaccountinformation,thereaderwouldnotbeabletotellwhethertheassetsareneworinneedofreplacement.7.Unearnedrevenuereferstocashreceivedinadvanceofprovidin

6、gproductsandservices.Anothernameforunearnedrevenueisdeferredrevenue.Itisreportedasaliabilityonthebalancesheet.8.Accruedrevenueisrevenuethatisearnedbutisnotyetreceivedincash(and/orotherassets)andthecustomerhasnotbeenbilledpriortotheendoftheperiod.Therefore,end-of-perioda

7、djustmentsaremadetorecordaccruedrevenue.Examplesareinterestincomethathasbeenearnedbutnotcollectedandrevenuesfromservicesperformedthatareneithercollectednorbilled.9.AIfprepaidexpensesareinitiallyrecordedwithdebitstoexpenseaccounts,thentheprepaidexpensesassetaccountsarede

8、bitedintheadjustingentries.©McGraw-HillCompanies,2009237SolutionsManual,Chapter310.ForBestBuy,alloftheaccounts