Question
On December 31st, 2020, a company (which has a December 31st year-end) received and paid a telephone bill of $18,000 comprised of calls for the
On December 31st, 2020, a company (which has a December 31st year-end) received and paid a telephone bill of $18,000 comprised of calls for the three months for $14,000, to December 31, 2020, and line rental costs of $4,000 for six months ending on March 31st, 2021. How should these transactions appear in the 2020 income statement and on the closing 2020 balance sheet based on this bill?
This question is based on accrual accounting and the matching principle. I need to create a transaction sheet (example below) that shows where the transaction are recorded
example from another question:
AssetsLiabilitiesShareholders EquityCashAccrualsIS2021Opening Balance-30,000-30,000Accrued Rent: Jan - Feb 2021-10,000-10,000Rent - March - August-36,000-36,000Pre-paid Rent: Oct - Dec-42,000-28,000Pre-paid Rent: Jan - Feb 2022-14,000Closing Balance-118,000-24,000-94,000Step by Step Solution
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