a. Explain the accounting effects on income statement and balance sheet if expense is accrued while income
Question:
a. Explain the accounting effects on income statement and balance sheet if expense is accrued while income (other than sales) is earned and accrued at year end.
b. (i) List the FOUR (4)factors which cause non-current assets to depreciate.
(ii) Based on four factors at part (i),identify ONE (1) factor which will cause each of the following to depreciate:
1. A gold mine;
2. A van;
3. A fifty-year lease (rental contract) on building;
4. A machinery;
5. A ship temporarily used to ferry passengers and vehicles across a river before the completion of constructing a new bridge;
6. A franchise to market new computer software package in a certain country.
(b) Describe the difference of carriage inwards and carriage outwards and their accounting treatments to the ledger
Financial Accounting
ISBN: 978-0077862268
2nd edition
Authors: J. David Spiceland, Wayne Thomas, Don Herrmann