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Revenue Recognition based on accrual basis.
Please provide explanation as to how you derived to your answers
Suppose you start up your own photography business to shoot videos at 9 college parties. The freshman class pays you $100 in advance just to guarantee your services for its parry. The sophomore class promises you a minimum of $250 for filming its formal, and you end up collecting cash of S400 for this party. Answer the following questions about the correct way to account for your revenue under the accrual basis.
a. When did you earn your revenue for both parties? What caused you to earn the revenue? Did you earn the revenue at the moment you received cash?
b. In addition to cash, what type of account was created when you received $100 from the freshman class? Name the new account.
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