Customers paid $8,000 on their accounts. Which accounts are affected by this transaction?

Multiple Choice

• Cash and revenue increase $8,000. liabilities and expenses increase $8,000.

• Revenue and retained earnings increase $8,000.

• Revenue and retained earnings decrease $8,000.

• Cash increases $8,000 and accounts receivable decreases $8,000. Revenue and retained earnings remain unchanged.

During June, The Grass Is Greener Company mows 100 lawns a week and is paid in July by those customers. The company uses the accrual basis of accounting. How will these events affect the company's financial statements?

Multiple Choice

• The transactions have no effect on the Balance Sheet.

• The Income Statement shows the effects of the transactions in July.Incorrect

• The Income Statement shows the effects of the transactions in June.

• The Balance Sheet shows no effect from the transactions in June.

Your company received payment last month for a service that you provided this month. How will the business activity of the current month affect the basic accounting equation?

Multiple Choice

• Assets and liabilities will increase, shareholders' equity will remain unchanged.Incorrect

• Assets and shareholders' equity will increase, liabilities will remain unchanged.

• Assets will remain unchanged, liabilities will decrease, shareholders' equity will increase.

• Assets will decrease, liabilities will remain unchanged, shareholders' equity will increase.