20. Otto\'s Tune-Up Shop follows the revenue recognition principle. Otto service
ID: 2590998 • Letter: 2
Question
20. Otto's Tune-Up Shop follows the revenue recognition principle. Otto services a car on August 31. The customer picks up the vehicle on September 1 and mails the payment to Otto on September 5.Otto receives the check in the mail on September 6. When should Otto show that the revenue was recognized? A) August 31 B) August 1 C) September 5 mber 21. A furniture factory's employees work overtime to finish an order that is sold on January 31. The office sends a statement to the customer in early February and payment is received by mid-February. The overtime wages should be expensed in: B) C) D) February the period when the workers receive their checks. either January or February depending on when the pay period ends. 22. Boyce Company purchased office supplies costing $5,000 and debited Supplies for the full amount the end of the accounting period, a physical count of office supplies revealed $1,800 still on hand. appropriate adjusting journal entry to be made at the end of the period would be: A) debit Supplies Expense, $3,200; credit Supplies, $3,200. B) debit Supplies, S1,800; credit Supplies Expense, $1,800. C) debit Suppli ) debit Supplies, $3,200; credit Supplies Expense, $3,2 800 se LI 23. The entry to record the return of goods from a customer would include a A) debit to Sales Revenue. B) credit to Sales Revenue ) debit to Sales Returns and Allowancess D) credit to Sales Returns and Allowances 4. The entry to record the receipt of payment within the discount period on a sale of $700 with t 2/10, n/30 will include a A) credit to Sales Discounts for $14. B) debit to Sales Revenue for $686 ccounts Receivable for $7 D) credit to Sales Revenue for $700Explanation / Answer
Solution:-
20. A) August 31.
21. A) January.
22. A) debit Supplies Expense, $3,200; credit Supplies, $3,200.
23. C) Debit to sales return and allowances.
24. C) Credit to account receivable for $700.
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