The following are transactions recorded by Trimm Corporation during the current year.

1. Ordinary operating maintenance on equipment was recorded as follows:

Equipment ......................................... 2,500

Accounts Payable .......................................... 2,500

2. Trimm received an advance on a custom order for merchandise that will be shipped during the next accounting year.

Cash ................................................. 8,000

Sales Revenue .............................................. 8,000

3. Trimm Corporation is holding inventory on consignment for Rubber Ltd. Trimm will only pay Rubber when a sale is made to a customer. Trimm made the following entry when it received the inventory:

Inventory ........................................... 15,000

Accounts Payable ........................................... 15,000

4. On the last day of the accounting period, a 12-month insurance policy was purchased. The insurance coverage is for the next accounting year.

Insurance Expense .................................... 4,000

Cash ............................................................. 4,000

Instructions

For each transaction, determine which component of the conceptual framework (i.e., qualitative characteristic, element, or principle) was violated, if any, and give the entry that should have been recorded if there was a violation.