On December 15 we performed 5000 of service for a customer a

On December 15 we performed $5,000 of service for a customer and billed the customer, who will pay us in January. What is our revenue for December if we use the cash basis of accounting, assuming that this is the only transaction that affected revenue in December? O$2,500 o $5,000 O cannot be determined

Solution

In december we performed $5000 of service for a customer but not receive cash only billed to customer.

So if we use accural basis accounting then $5000 will be taken as revenue

but not in this question we use cash basis accounting so $0 will be taken as revenue.

so answer is a) $0