Journalize the revenue transaction

Assignment Help Accounting Basics
Reference no: EM132059733

Question - Grant film production wishes to expand and has borrowed 100,000. As a condition for making this loan, the bank required that the business maintain a current ratio of at least 1.50. Business has been good but not great. Expansion cots have brought the current ratio down to 1.40 on December 15. Rita Grant, owner of the business, is considering what might happen if she reports a current ratio of 1.40 to the bank. One course of action for Grant is to record in December 10,000 of revenue that the business will earn in January of next year. The contract for this job has been signed.

Journalize the revenue transaction, and indicate how recording this revenue in December would affect the current ratio.

Discuss whether it is ethical to record the revenue in December. Identify the accounting principle relevant to this situation, an give the reasons underlying your conclusion.

Reference no: EM132059733

Questions Cloud

Perform an after-tax analysis for each option : The production manager and manufacturing engineer in the assembly department of WM3's facility in Tennessee have designed a new assembly fixture.
Find the greatest and least values : Find the greatest and least values of f(x, y) = x2 - y2 on the triangular region T with vertices at (0; 2) and (?±?1, -1)
How fast is the length of the side? decreasing : An ice cube that is 7 cm on each side is melting at a rate of 2 cm cubed per minute. How fast is the length of the side? decreasing?
What is the estimated quantity of the product : A project team developing a new medical device completed a concept test survey. Current data shows (100,000) of these type of units sold annually.
Journalize the revenue transaction : Grant film production wishes to expand and has borrowed 100,000. Journalize the revenue transaction, and indicate how recording this revenue
How financial statements vary across industries : What are the differences between financial statement requirements for governmental and nonprofit organizations. Explain in detail.
Body mass of yearling bighorn sheep on ram mountain : The body mass of yearling bighorn sheep on Ram Mountain in Alberta, Canada, can be estimated by
Determine the operating cash flow value : A project requries 80,000 in fixed assets, 20,000 in net working capital. Sales are 110,000 with costs of 70,000. Project has 4 year life.
Table of values to find the exact value of limx : Use your calculator and a table of values to find the exact value of Limx->0 (sin(x^2))/x. (The limit as x approaches zero)

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd