A company receives payment from one of its customers on August 5 for services performed on July 21. Which of the following entries would be recorded if the company uses accrual basis accounting?

A

Cash	1000
Accounts Receivable		1,000

B

Accounts Payable	1000
Cash		1,000

C

Cash	1000
Service Revenue		1,000

D

Service Revenue	1000
Cash		1,000

Which of the following accounts would be used under the accrual basis of accounting, but not under cash basis accounting?

A) Cash

B) Unearned Revenue

C) Service Revenue

D) Salaries Expense

What is the difference between cash basis accounting and accrual basis accounting?

The revenue recognition principle guides accountants in ________.

A) ensuring only revenues received in cash are recorded

B) determining when to record expenses

C) determining when to record revenues

D) ensuring expenses are deducted from revenues