In its first year of operations, Sheridan Company recognized $31,000 in service revenue, $7,700 of which was on account and still outstanding at year-end. The remaining $23,300 was received in cash from customers.

The company incurred operating expenses of $20,100. Of these expenses, $13,090 were paid in cash; $7,010 was still owed on account at year-end. In addition, Sheridan prepaid $2,950 for insurance coverage that would not be used until the second year of operations.

Required:
a. Calculate the first year’s net earnings under the cash basis of accounting, and accrual basis of accounting.
b. Which basis of accounting (cash or accrual) provides more useful information for decision-makers?

The advertisement demonstrates a popular way companies try to sell a product. what should consumers consider when it comes to the price of this product? it includes shipping and handling costs. it takes into account maintenance costs. it explains why this price is a good deal. it makes the full cost appears lower than it is.

Analyzing and computing accrued warranty liability and expense waymire company sells a motor that carries a 60-day unconditional warranty against product failure. from prior years' experience, waymire estimates that 2% of units sold each period will require repair at an average cost of $100 per unit. during the current period, waymire sold 69,000 units and repaired 1,000 units. (a) how much warranty expense must waymire report in its current period income statement? (b) what warranty liability related to current period sales will waymire report on its current period-end balance sheet? (hint: remember that some units were repaired in the current period.) (c) what analysis issues must we consider with respect to reported warranty liabilities?

If you would like to ask a question you will have to spend some points