Question

A summary of Agg Corporation’s transactions during September 2020 is reproduced below. State which of the...

A summary of Agg Corporation’s transactions during September 2020 is reproduced below. State which of the events would be recorded on the income statement for September.

a. The owners needed additional funds, and they borrowed $200,000 from the bank

b. The firm collected $20,000 on account from a credit sale made in August

c. Cash Sales during September totaled $5,000

d. The firm received its September utility bill of $75

e. The firm paid its August utility bill of $67

f. The firm made sales on account in September totaling $7,500

g. A dividend of $500 was declared and paid in September

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Answer #1

Following transaction will be recorded in the income statement for September:

c. Cash Sales during September totaled $5,000

d. The firm received its September utility bill of $75

f. The firm made sales on account in September totaling $7,500

g. A dividend of $500 was declared and paid in September

Funds borrowed are recorded on balance sheet and not on income statement

Sales of August will be recoded in August as per accrual system

Utility bill of August will be recorded in August irrespective of payment date

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