Earlier articles describe both the accrual concept and profit versus cash concept.
Append below is a simple test to understand the cash versus accrual accounting.
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Jim Co is a consulting company which have the following revenue and expenses for the month of October 2008
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The company earned $10,000 but received only $8,000 in cash
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Expenses were as follows
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(i) Rent $2,000 which was paid
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(ii) Wages expense:$1,600 of which only 3 /4 was paid
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(iii) Utilities expense:$700 was paid
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(iv) Repairs expenses:$500 was unpaid
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(v) Stationery expenses:$200 was unpaid
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(vi) Miscellaneous expenses:$100 was paid
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Accrual Accounting
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Cash Accounting
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Revenue
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Rent expense
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Wages expense
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Utilities expense
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Repairs expense
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Stationery expense
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Miscellaneous expenses
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Net Profit or (Loss)
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Required:
Fill up the table based on cash and accrual accounting
[ Refer ANSWER ]
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