6 Lane Lenge Florists in West Hartford makes a large sale f

6) Lane & Lenge Florists in West Hartford makes a large sale for $1,200 on November 30. The shop\'s chief accountant, Ashley Doris Wilson (Hall High 2007) sends an invoice that day. The customer receives the invoice on December 5. Lane & Lenge receives a check for $1,200 on Dec. 10. The flower shop follows GAAP and applies the revenue recognition principle. When is the $1,200 considered to be recognized? a. November 30. b. December 5. c. December 10. d. December 31. 7) If a company fails to make an adjusting entry to record supplies expense, then a. owner\'s equity will be understated. 6 expense will be understated. c. assets will be understated. d. net income will be understated. 8) On June 1, during its first month of operations, Brodeur Spa purchased supplies for $4,200 and debited the supplies account for that amount. At June 30, an inventory of supplies showed $1,000 of supplies on hand. What adjusting journal entry should be made for June? ) UConn sold season tickets for the 2017 football season for $640,000. A total of 8 home ames will be played during September, October and November. In September, three games vere played. In October, three games were played. What is the balance in Unearned Ticket evenue as of October 31 (after adjusting entries has been made)?

Solution

Answer to question 6

Option A- November 30

Under US GAAP In case of sale of goods revenue to be recognized when following conditions are satisfied.

· There is persuasive evidence of an arrangement.

· Delivery has occurred (e.g., an exchange has taken place).

· The sales price is fixed or determinable.

· Collectability is reasonably assured.