Define accrual basis accounting and contrast it with cash basis accounting.

What five steps are to be followed when applying the core revenue recognition principle?

Explain why stockholders' equity is increased by revenues and decreased by expenses.

For each of the following situations, indicate whether it represents an accounting error and explain why it is or is not an error

Cash received from a customer on account was debited to Accounts Receivable and credited to Cash.

Revenue was recognized when a customer purchased a gift card for future use.

An expense was recorded as an asset.

The debit side of a journal entry was recorded in the accounts, but the credit side was not.

A company shareholder purchased a new car, but this was not recorded by the company.