During the Year,Cathy Received the Following: • Dividends of $4,000

question 32

Multiple Choice

During the year,Cathy received the following: • Dividends of $4,000 from Lindsay Corporation.Cathy's father owns the stock and directed the corporation to send the dividends to Cathy.
• A car worth $30,000 for being the 1,000^th customer at a car dealership.
• $5,500 cash gift from her uncle.
• $10,000 inheritance from her grandmother.
What amount must Cathy include in gross income?

• A)$30,000
• B)$34,000
• C)$39,500
• D)$49,500

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Definitions:

Outstanding Checks

Checks that have been written and recorded in the payer's account but not yet cashed or processed by the recipient.

Adjusting Entries

Entries recorded in the journals at the close of an accounting period to distribute income and expenditures to the period they actually took place.

Bank Reconciliation

Bank reconciliation is the process of matching the balances in an entity's accounting records for a cash account to the corresponding information on a bank statement.

NSF Check

A check that is not honored by a bank due to insufficient funds in the account of the person who wrote it; also known as a bounced check.