Assume you wanted to buy a new laptop, and you paid $100 as deposit when placing the order. You will collect the laptop one month later. The outstanding amount will be paid 15 days after you receive the laptop. Can the shop owner recognise the revenue:

• When you place the order?
• When you receive the laptop?
• When you pay for the laptop?

You need to explain why or why not.

Identify the impact of the following events on cash and profit (increase, decrease or no change). Briefly state the reason, explaining the impact of the events.

• Issue of shares worth $10,000.
• Repayment of bank loan of $5,000.
• Purchase of inventory on credit for $3,000.
• Sales of inventory on credit for $1000.

Thank you!