7. The following is selected information from Corporation for the fiscal year ending October Cash received from customers $150,000 Revenue recognized 225,000 Cash paid for expenses 85,000 Cash paid for computers on November 1, 2016 that will be used for 3 years 24,000 Expenses incurred including any depreciation 119,000 Proceeds from a bank loan, part of which was used to 50,000 pay for the computers Based on the accrual basis of accounting, what is C Corporation's net income for the year ending October 31, 2017? A) $132,000 B) $116,000 C) $106,000 D) $140,000 8. Wang Company had the following transactions during 2016: Sales of $10,800 on account Collected $4,800 for services to be performed in 2017 Paid $2,600 cash in salaries for 2016 Purchased airline tickets for $600 in December for a trip to take place in 2017 What is Wang's 2016 net income using accrual accounting? A) $8,800 B) $13,600 C) $13,000 D) $8,200 9. Which of the following would not be an application of the revenue recognition or expense recognition principle? A) Recording accrued salaries and wages expense. B) Recording accrued interest revenue. C) Recording the collection of an advance customer payment as revenue. D) Recording prepaid expense adjustments. 10. Each of the following is a major type (or category) of adjusting entry except: A) earned expenses. B) prepaid expenses. C) accrued expenses. D) accrued revenues. 11. The preparation of adjusting entries is: A) straightforward because the accounts that need adjustment will be out of balance. B) needed to ensure that the expense recognition principle is followed. C) only required for accounts that do not have a normal balance. D) optional when financial statements are prepared