KidVid, a maker of electronic games for kids, has just completed its first year of operations. The
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(a) Explain how cash and accrual accounting would differ for each of the events listed above and describe the proper accrual accounting.
(b) Assume that at the end of the year KidVid reported a favorable net income, yet the company’s management is concerned because the company is very short of cash. Explain how KidVid could have positive net income and yet run out of cash.
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Related Book For
Financial Accounting Tools for business decision making
ISBN: 978-0470534779
6th Edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
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