For each of the following items, calculate the amount of revenue or expense that should be recognized

Question:

For each of the following items, calculate the amount of revenue or expense that should be recognized on the income statement for Pelkey Co. for the year ended December 31, 2019:

a. Cash collected from customers during the year amounted to $147,000, and accounts receivable increased by $31,000. How much were sales on account for the year ended December 31, 2019?

b. Cash payments for income taxes during the year were $85,000, and income taxes payable increased by $13,000. How much was income tax expense?

c. Cash paid to suppliers during the year amounted to $168,000, accounts payable decreased by $26,700, and inventories decreased by $14,000. How much was cost of goods sold?

d. The net book value of buildings increased by $275,000. No buildings were sold, and a new building costing $430,000 was purchased during the year. How much was depreciation expense?

Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...

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