Service revenue earned on account, Accounting Basics

Assignment Help:

Service revenue earned on account

Metro performed courier deliverance services for a customer who agreed to pay USD 900 at a later date. The company approved credit rather than requiring the customer to pay cash immediately. This is called as earning revenue on account. The transaction comprise of exchanging services for the customer's promise to pay later. This transaction is alike to the preceding transaction in that stockholders' equity retained earnings enhance because the company has earned revenues. But the transaction differs for the reason that the company has not received cash. In its place the company has received another asset an account receivable. As noted previously an account receivable is the amount unpaid from a customer for goods or services already provided. The company has a lawful right to collect from the customer in the future. Accounting makes out such claims as assets. The accounting equation counting this USD 900 item is as follows:

1589_Service revenue earned on account.png


Related Discussions:- Service revenue earned on account

As part of their divorce agreement, As part of their divorce agreement , Ha...

As part of their divorce agreement , Harry transfers to Mary, his former spouse, GM stock with a market value of 30000, Harry had $20000 invested in the stock. How does this transf

A tabular analysis of the transactions, A tabular analysis of the transacti...

A tabular analysis of the transactions made during August 2010 by Witten Company during its first month of operations is shown below. Each increase and decrease in stockholders'

Determining needed adjustments, Determining needed adjustments Adjustme...

Determining needed adjustments Adjustments are required since certain changes take place during the accounting period. As time passes, although, the value of the asset is consu

State the classified balance sheet, State the classified balance sheet ...

State the classified balance sheet ASSETS Current Assets are cash and any other assets which are expected to be realized in cash, sold, used up or expire within one year.

What do you mean by management consulting, Q. What do you mean by Managemen...

Q. What do you mean by Management consulting ? Management consulting or advisory services before Sarbanes-Oxley management advisory services were the fastest growing service ar

Bonds issued giving the holder the option of exchanging, Bonds issued givin...

Bonds issued giving the holder the option of exchanging the bonds for capital stock of the corporation are called

State and local income taxes, State and local income taxes Some states ...

State and local income taxes Some states also withhold state income taxes. Texas doesn't. If state withholds taxes, there will be form similar to the federal one to determine t

Buffer inventory is required, Compensation for the uncertainties inherent i...

Compensation for the uncertainties inherent in supply and demand

Manufacturing, Weston Corporation manufactures a product that is available ...

Weston Corporation manufactures a product that is available in both a deluxe and a regular model. The company has made the regular model for years; the deluxe model was introduced

In between fifo and lifo which one is the correct method, Q. In between FIF...

Q. In between FIFO and lifo which one is the correct method? The differences for the four methods take place because the company paid different prices for goods purchased. No d

Write Your Message!

Captcha
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