Paul's Premium Pillows has the following events occur during the current year. a. Paul paid his...
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Paul's Premium Pillows has the following events occur during the current year. a. Paul paid his employees $90,000 cash for work done in the current year. He also owes an additional $10,000 for work done in the current year, which he plans to pay at the beginning of next year. This is his first time making a journal entry related to wages this year. b. Paul purchases premium pillow inventory for $300,000. He paid for 80% of the amount using cash; Paul purchases the remaining 20% on account. c. Paul purchases a TV advertisement during the current year, costing $20,000 cash. The advertisement is planned to run on the first local football game of next year. d. Paul received $375,000 cash during the current year from customers. $260,000 of cash received was payment for pillows (costing $150,000) shipped to customers in this period. The remaining amount Paul received represents orders placed by customers that will not receive pillows until next period. 1. If Paul used the accrual basis, total Revenues would be 2. If Paul used the accrual basis, total Expenses would be 3. If Paul used the cash basis, total Revenues would be 4. If Paul used the cash basis, total Expenses would be Paul's Premium Pillows has the following events occur during the current year. a. Paul paid his employees $90,000 cash for work done in the current year. He also owes an additional $10,000 for work done in the current year, which he plans to pay at the beginning of next year. This is his first time making a journal entry related to wages this year. b. Paul purchases premium pillow inventory for $300,000. He paid for 80% of the amount using cash; Paul purchases the remaining 20% on account. c. Paul purchases a TV advertisement during the current year, costing $20,000 cash. The advertisement is planned to run on the first local football game of next year. d. Paul received $375,000 cash during the current year from customers. $260,000 of cash received was payment for pillows (costing $150,000) shipped to customers in this period. The remaining amount Paul received represents orders placed by customers that will not receive pillows until next period. 1. If Paul used the accrual basis, total Revenues would be 2. If Paul used the accrual basis, total Expenses would be 3. If Paul used the cash basis, total Revenues would be 4. If Paul used the cash basis, total Expenses would be
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Answer rating: 100% (QA)
1 If Paul used the accrual basis total revenues would be 415000 calculated as follows Cash received ... View the full answer
Related Book For
South-Western Federal Taxation 2018 Comprehensive
ISBN: 9781337386005
41st Edition
Authors: David M. Maloney, William H. Hoffman, Jr., William A. Raabe, James C. Young
Posted Date:
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