-Amounts received from customers for services performed in the current month would be revenues on the income statement. -Costs incurred in the current month but not paid as of the end of the month would be expenses on the income statement for the current month. If revenue exceeds expen c. Changes in which we consider should be made to the financial statements. A tax-exempt organization doesn't have to file Form 8300 for a charitable cash contribution. Any cash transactions are combined and treated as a single transaction, and those transactions count toward the $10,000 limit. -Prepaid insurance. Generally, any person in a trade or business who receives more than $10,000 in cash in a single transaction or in related transactions must file a Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business. Which of the following statements regarding the presentation of a trial balance is correct? 31. A company received $10,000 for services the company will perform in the future. A person may voluntarily file Form 8300 to report a suspicious transaction below $10,000. 225 E 64th Pl, Inglewood 90302. A company received $2,724 cash for services performed. , this problem (X,Y)? A company receives $10 000 in cash for services yet to be performed using the accrual method. The order of accounts is assets, liabilities, stockholders' equity, dividends, revenues and expenses. Using the accrual method. Prepare the general journal entry to record this transaction. Note that under a separate reporting requirement, banks and other financial institutions report cash purchases of cashier's checks, treasurer's checks and/or bank checks, bank drafts, traveler's checks and money orders with a face value of more than $10,000 by filing currency transaction reports. info@communitytax.com. -The income statement shows the effects of the transactions in May. Jane will not provide any services to the bank and she is unable to influence the engagement. Dont get flagged by the IRS for an error that could have been prevented by a tax professional; call Community Tax today (888) 684-5803. In accordance with the revenue recognition principle, sales revenues are recorded when. The matching principle mandates that costs be equal to the income they produce. A wire transfer isn't cash. The dealer doesn't need to file Form 8300 unless the accessories purchase was related to the original vehicle purchase. Prepare the general journal entry to record this transaction. For example, dealers in jewelry, furniture, boats, aircraft or automobiles; pawnbrokers; attorneys; real estate brokers; insurance companies and travel agencies are among those who typically need to file Form 8300. Form 8300 is essentially for the IRSs record keeping to make sure that your business is being honest about its transactional reporting. A company received $3,000 from a customer who had previously purchased services on account. Colleges and universities must file Form 8300 if they receive more than $10,000 in cash in one or more transactions within 12 months. Find out how you can intelligently organize your Flashcards. -Amounts received from customer as deposits for services to be rendered next month will not be recorded as revenues on the income statement for the current month. One of the major advantages of making adjustments in order to improve the quality of financial statements is that they: -ensure that revenues and expenses are recognized during the period they are earned and incurred. -If a company has a net loss, the amount of revenues to be closed will be greater than the amount of expenses to be closed in the closing process. Sign up for our newsletter for tax tips & tricks! A bail-bonding agent must file Form 8300 when they receive more than $10,000 in cash from a person. Is Jane's independence impaired under the CVS does not currently bill medicare part b for? (A) Debit cash $10,000, credit accounts receivable $10,000, (B) Debit cash $10,000, credit sales revenue$1 0,000, (C) Debit sales revenue $10,000, credit cash $10,000, (D) Debit cash $10,000, credit unearned revenue $10,000, (E) Debit cash $10,000, credit accounts payable $10,000. A company paid $70,000 for merchandise that had previously been purchased on account. A company paid $100 for furniture that had previously been purchased on account. A company received $5,000 cash for performing services for a customer. Assume she pays $30,986 in self-employment tax for 2021. Message and data rates may apply. Prepare the general journal entry to record this transaction. A company made a $200 payment on account for supplies that had been previously purchased. (C) Debit sales revenue $10,000, credit cash $10,000 Prepare the general journal entry to record this transaction. See the Frequently Asked Questions for more information about the Marijuana Industry. Include the name, address and phone number of the person filing the Form 8300. -Credits increase revenues. This site is using cookies under cookie policy . Per company policy, tools with a purchase price greater than $1,000 are capitalized. A company provided services on account for $22,500. The difference between what was earned and the costs incurred during a period. There is no credit given to the customer for the provision of the service. -The order of accounts is assets, liabilities, stockholders' equity, dividends, revenues and expenses. Prepare the general journal entry to record this transaction. In two or more related payments within 24 hours. Prepare the general journal entry to record this transaction. g. Received a $500 deposit on a townhouse to be rented for five days in January 2014. Results of Journal Entry Cash balance increases by --> Increase in Assets Owner's Equity balance increases by $10,000. by 7256bru, Further, the Company announces a non-brokered private placement financing of up to 9,090,910 units of the Company (the "Units") at a price of 0.11 per Unit for aggregate gross proceeds of up to . A company paid $36,000 of previous inventory purchases on account. $40,000$10,000$30,000$20,000 Question Prepare the general journal entry to record this transaction. (0,0) Examples of companies who have received the WRT are Marriott Hotels, T-Mobile and Shake Shack. A company billed customers $3,700 for services performed. A company receives $10,000 in cash for services yet to A company received a cash payment of $10,000 in advance from a client. (A) Debit cash $10,000, credit accounts receivable $10,000 (B) Debit cash $10,000, credit sales revenue$1 0,000 (C) Debit sales revenue $10,000, credit cash $10,000 Owner's Equity Example 2: Financing Activities The company borrowed $20,000 from a bank. 6X + 3Y 300 A company received $588 cash from a customer who had previously purchased services on account. A designated reporting transaction is the retail sale of tangible personal property that's generally suited for personal use, expected to last at least one year and has a sales price of more than $10,000. The matching principle requires that expenses are matched to the revenue that they generate. The business that received cash: This section asks the business name, address, nature of your business, employee ID, and social security number. During April, the Grass is Greener Company buys and pays for a six-month supply of fertilizer in order to receive a bulk discount. The Form 8300, Report of Cash Payments Over $10,000 in a Trade or Business, provides valuable information to the Internal Revenue Service and the Financial Crimes Enforcement Network (FinCEN) in their efforts to combat money laundering. It provides eligible employers with a tax credit of up to $10,000 per employee. The income statement needs to increase by $1,500.00 under the expense category and Use LEFT and RIGHT arrow keys to navigate between flashcards; Use UP and DOWN arrow keys to flip the card; Which one of the following statements regarding the debit/credit processing of revenues and expenses is true? Prepare the general journal entry to record this transaction. A company receives $10,000 in cash for services yet to be performed.Using the accrual method, what's the correct entry to record the transaction? We'll bring you back here when you are done. (0,100) At the same time, the cash balance decreased by $22,750 (30%) during the year. Other important requirements include: There are more detailed requirements listed at the end of Form 8300 that you should read and understand if you plan on including items as a part of your sales and transactions. Multiple Choice Debit Cash, $10,000; credit Accounts Payable, $10,000. Do you need an answer to a question different from the above? a decrease in an asset and an equal increase in expenses. Any outlay of money by a company for any purpose. Prepare the general journal entry to record this transaction. Place an Ad. -An adjusted trial balance presents account balances in the same level of detail as in the presentation of the financial statements. in two or more related payments within 24 hours, (e.g., a 24-hour period is 11 a.m. Tues-day to 11 a.m. Wednesday); or. 8300 XML batch processing technical webinar and. D. Rabine Company collected $3,700 from customers for services previously purchased on account. c. 3% cash discount may be taken if payment is made within 10 days of the invoice date; otherwise the full amount is due at the end of the month. Prepare the general journal entry to record this transaction. -Depreciation expense. -increasing assets and expenses or increasing liabilities and revenues. Get access to this video and our entire Q&A library, The Differences Between Accrual & Cash-Basis Accounting. Prepare the general journal entry to record this transaction. increasing assets and revenues or increasing liabilities and expenses moving in the same direction. copyright 2003-2023 Homework.Study.com. Prepare the general journal entry for this transaction. (A) Debit cash $10,000, credit accounts receivable $10,000 Option A is correct because we have to Debit tools expense and credit cash. Adjustments help the financial statements to present the best picture of whether the company's activities were profitable for the period. Businesses that deal in large cash transactions are required to report all of their dealings accurately and honestly with the IRS. If your business makes less than $5 million per year, the maximum amount you can pay the IRS in penalties is $500,000 per fiscal year. Which of the following general journal entries will the company make to record this transaction? debit to Wage Expense for $700 and a credit to Wages Payable for $700. -an increase in an asset and a decrease in expenses. The calculation and explanation is as shown below: The unearned revenue ismoney received by an individual or company for a service or product that has yet to be provided or delivered. a. loaded out with options and bimini top. The December 31, 2013, adjusted trial balance of a company, where all accounts have normal balances is: Cash $ 1,620 Supplies 3,120 Service revenue 6,600 Retained earnings, January 1 560 Accounts Payable 460 Dividends declared 2,120 Unearned revenue 3,000 Wages expense 3,200 Supplies expense 560 Given this information, after all closing entries are made, the balance in the retained earnings account is: Which of the following statements regarding the need for adjustments is not true? Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you. Tao records it by debiting Cash and crediting Unearned Revenue both for $10,000. A person must file Form 8300 if they receive cash of more than $10,000 from the same payer or agent: These businesses must report cash receipts greater than $10,000, in a single transaction and/or related transactions. A company purchased $500 of supplies on account. Ohio, that received two high-pressure alarms for the South Lawrence gas pressure system, the workers at that facility had no way to control the . -If a company has a net loss, the closing entry will include debits to the revenue accounts, credits to the expense accounts, and a credit to Retained earnings. You have created 2 folders. Line 1 - List the name of the entity which owns the business and files Income tax returns.That annual return is the amount winners receive each year for annuity period. Transcribed Image Text: a. Tao Co. receives $10,000 cash in advance for four months of evenly planned legal services beginning on October 1. Prepare the general journal entry to record this transaction. Cricket Wireless Listings Cricket - DOLLAR GENERAL 1740 N UNION ST, LIMA, OH 45801. The inventory records for Radford Co. reflected the following Beginning inventory @ May 1 100 Unearned revenues are a. received and recorded as liabilities before they are earned. Option Bis incorrect because we ha. AboutPressCopyrightContact. Company A receives $10,000 in advance this month for work to be performed next month. Subject to: 2X + 4Y 800 The IRS has little tolerance for errors and failure to file Form 8300 can result in penalties. The Worker Retention Tax Credit (WRT) is a great benefit for companies in 2023. b Debit Accounts Receivable $10,000; credit Landscaping Revenue, $10,000. In January, a company pays for advertising space in the local paper for ads to be run during the months of January, February, and March at $1,500 a month. Prepare the general journal entry to record this transaction. Prepare the general journal entry to record this transaction. (50,0) a A Form 8300 exception applies for government entities but not for educational entities. Prepare the general journal entry to record this transaction. Learn more about the accrual method at brainly.com/question/17233434 Cash 10,000 Accounts Receivable 10,000 c. Cash 10,000Unearned Revenue 10,000 d. Accounts Receivable 10,000Service Revenue 10, c . See Publication 526, Charitable Contributions, for details. These amounts are needed to complete the Income Statement. A person can file Form 8300 electronically using the Financial Crimes Enforcement Network's BSA E-Filing System. Purchase any used PWC from now until Dec. 31 2022 and receive a free, installed PWC Brackets Bluetooth sound system!