The cash basis of accounting is acceptable primarily in enterprises that do not have substantial credit transactions or inventories. A. TRUE B. FALSE

Under the transactions approach used in financial accounting, every transaction has a single effect upon each party engaging in it.

A. True

B. False

If the debit subtotal of the Income Statement on the work sheet is $159,000 and the credit subtotal is $147,000, there is a:

A.net income of $12,000.

B.net loss of $12,000.

C.net loss of $159,000.

D.net income of $147,000

In adjusting and closing the books of Sally Smith Company at the end of the fiscal year, no provision was made for accrued sales salaries expense of $600. The effect of this omission was as follows:

A.the assets on the balance sheet were the same regardless of the omission.
B.stockholders equity on the balance sheet is understated by $600.
C.the liabilities reported on the balance sheet are overstated by $600.
D.net income for the year was understated by $600.
E.None of the preceding answers is correct.