Question

Assets such as inventory and equipment, as well as liabilities such as accounts payable, are absent...

Assets such as inventory and equipment, as well as liabilities such as accounts payable, are absent from a cash basis balance sheet. (True or False)

Homework Answers

Answer #1

Under cash basis accounting, everything is recorded when there is an impact in cash. For example revenues are recorded when cash is received and expenses are recorded when cash is paid. So under this method, the balance sheet doesn't includes inventory, fixed assets, accounts payable.

So the assets such as inventory and equipment, as well as liabilities such as accounts payable are absent from a cash basis balance sheet.

Hence, the given statement is true.

SUMMARY:

The given statement is true.

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
A firm bought $10,000 worth of inventory using half cash and half accounts payable. Which of...
A firm bought $10,000 worth of inventory using half cash and half accounts payable. Which of the following statements are true? [select all that apply] Question 18 options: A) total liabilities would increase B) inventory in the balance sheet would decrease C) inventory in the balance sheet would increase D) net income would decrease E) total assets would decrease F) in the statement of cash flows inventory would be entered as a negative number G) in the statement of cash...
Gross plant & equipment 5,000,000 Accounts payable 230,000 Inventories 200,000 Other current liabilities 80,000 Net accounts...
Gross plant & equipment 5,000,000 Accounts payable 230,000 Inventories 200,000 Other current liabilities 80,000 Net accounts receivable 550,000 Accrued expenses 90,000 Accumulated depreciation 110,000 Long-term debt 4,000,000 Cash 310,000 Prepare a balance sheet. What does this tell you?
Privett Company Accounts payable $35,172 Accounts receivable 61,830 Accrued liabilities 6,449 Cash 18,199 Intangible assets 36,789...
Privett Company Accounts payable $35,172 Accounts receivable 61,830 Accrued liabilities 6,449 Cash 18,199 Intangible assets 36,789 Inventory 85,546 Long-term investments 93,954 Long-term liabilities 72,236 Marketable securities 37,578 Notes payable (short-term) 20,447 Property, plant, and equipment 668,167 Prepaid expenses 1,246 Based on the data for Privett Company, what is the amount of quick assets? a.$1,608,400 b.$55,777 c.$809,490 d.$117,607
Acme Company Balance Sheet As of January 5, 2020 (amounts in thousands) Cash 9,900 Accounts Payable...
Acme Company Balance Sheet As of January 5, 2020 (amounts in thousands) Cash 9,900 Accounts Payable 2,700 Accounts Receivable 4,500 Debt 3,500 Inventory 3,800 Other Liabilities 1,000 Property Plant & Equipment 16,800 Total Liabilities 7,200 Other Assets 1,600 Paid-In Capital 8,000 Retained Earnings 21,400 Total Equity 29,400 Total Assets 36,600 Total Liabilities & Equity 36,600 Update the balance sheet above to reflect the transactions below, which occur on January 6, 2020 1. Purchase equipment for $43,000 in cash 2. Issue...
Torche Corporation Balance Sheet As of January 3, 2018 (amounts in thousands) Cash 14,700 Accounts Payable...
Torche Corporation Balance Sheet As of January 3, 2018 (amounts in thousands) Cash 14,700 Accounts Payable 2,400 Accounts Receivable 4,800 Debt 3,700 Inventory 3,800 Other Liabilities 5,000 Property Plant & Equipment 15,800 Total Liabilities 11,100 Other Assets 900 Paid-In Capital 6,000 Retained Earnings 22,900 Total Equity 28,900 Total Assets 40,000 Total Liabilities & Equity 40,000 Transfer the journal entries to T-accounts for the transactions below, compute closing amounts for the T-accounts, and construct a final balance sheet to answer the...
Harding Company Accounts payable $40,000 Accounts receivable 65,000 Accrued liabilities 7,000 Cash 30,000 Intangible assets 40,000...
Harding Company Accounts payable $40,000 Accounts receivable 65,000 Accrued liabilities 7,000 Cash 30,000 Intangible assets 40,000 Inventory 72,000 Long-term investments 110,000 Long-term liabilities 75,000 Marketable securities 36,000 Notes payable (short-term) 30,000 Property, plant, and equipment 625,000 Prepaid expenses 2,000 What is the amount of working capital? a.$238,000 b.$128,000 c.$203,000 d.$168,000
Changes in Current Operating Assets and Liabilities—Indirect Method Mohammed Corporation's comparative balance sheet for current assets...
Changes in Current Operating Assets and Liabilities—Indirect Method Mohammed Corporation's comparative balance sheet for current assets and liabilities was as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Accounts receivable $14,200 $13,800 Inventory 64,600 65,300 Accounts payable 11,500 11,200 Dividends payable 21,000 23,000 Adjust net income of $106,800 for changes in operating assets and liabilities to arrive at net cash flow from operating activities.
Changes in Current Operating Assets and Liabilities—Indirect Method Covington Corporation's comparative balance sheet for current assets...
Changes in Current Operating Assets and Liabilities—Indirect Method Covington Corporation's comparative balance sheet for current assets and liabilities was as follows: Dec. 31, Year 2 Dec. 31, Year 1 Accounts receivable $14,000 $12,100 Inventory 62,400 71,700 Accounts payable 16,600 20,500 Dividends payable 22,000 24,000 Adjust net income of $110,000 for changes in operating assets and liabilities to arrive at net cash flow from operating activities.
Changes in Current Operating Assets and Liabilities—Indirect Method Covington Corporation's comparative balance sheet for current assets...
Changes in Current Operating Assets and Liabilities—Indirect Method Covington Corporation's comparative balance sheet for current assets and liabilities was as follows: Dec. 31, Year 2 Dec. 31, Year 1 Accounts receivable $16,700 $21,100 Inventory 57,600 50,500 Accounts payable 17,100 21,900 Dividends payable 26,000 28,000 Adjust net income of $129,100 for changes in operating assets and liabilities to arrive at net cash flow from operating activities. $
Changes in Current Operating Assets and Liabilities—Indirect Method Victor Corporation's comparative balance sheet for current assets...
Changes in Current Operating Assets and Liabilities—Indirect Method Victor Corporation's comparative balance sheet for current assets and liabilities was as follows: Dec. 31, Year 2 Dec. 31, Year 1 Accounts receivable $15,700 $14,400 Inventory 52,400 53,100 Accounts payable 11,100 9,600 Dividends payable 25,000 27,000 Adjust net income of $124,600 for changes in operating assets and liabilities to arrive at net cash flow from operating activities.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT