(For questions 18-23) Shortly after year-end you are reviewing the following exp
ID: 2536145 • Letter: #
Question
(For questions 18-23)
Shortly after year-end you are reviewing the following expenses to ascertain if they should be recorded in the year just ended. Indicate “2014” if the expense belongs in the year just ended it “2015” if it is not an expense at year-end. The year just ended is 2014.
A deposit of $25,000 on 12/1/14 for printing materials subsequently received on 1/10/2015.
Rent paid on 12/15/14 for January 2015.
A $25,000 down payment made on 12/1/14 for the annual convention to be held in June 2015.
Office supplies ordered and paid on 11/15/14…received on 1/12/15.
Prepaid repair cost schedule to start on January 15,2015.
Explanation / Answer
A deposit of $25,000 on 12/1/14 for printing materials subsequently received on 1/10/2015.
2015 Expense as the material is received in 2015 and would be used in 2015
Rent paid on 12/15/14 for January 2015.
The Rent is paid for 2015. Hence, It would be 2015 Expense
A $25,000 down payment made on 12/1/14 for the annual convention to be held in June 2015.
The expense pertains to 2015 Expense.Hence, 2015
Office supplies ordered and paid on 11/15/14…received on 1/12/15.
2015 Expense as the material is received in 2015 and would be used in 2015
Prepaid repair cost schedule to start on January 15,2015.
Since, Schedule starts in 2015, it is 2015 Expense
To decide if its 2014 or 2015 Expense, we need to consider when are the benifits availed for that expense
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