Schumacher Restorations Specializes in Restoring Antique Cars

question 59

Multiple Choice

Schumacher Restorations specializes in restoring antique cars.Normally the company requires the customer to pay a deposit before proceeding with the restoration; the balance is due when the car is returned to the client.The car is not returned if the amount is not paid.Sometimes the cars are stored, for a fee, for the winter months before being returned to the client.When should Schumacher recognize the revenue from storage fees?

• A)When the winter season is over.
• B)Gradually on a month by month basis.
• C)When the car is delivered.
• D)When the cash is collected.

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Definitions:

Inflation

A sustained increase in the general price level of goods and services in an economy over a period of time, leading to a decrease in the purchasing power of money.

Vault Cash

Physical currency held by banks within their vaults, used to meet customer withdrawals and other cash needs.

Primary Reserve

It is the part of a country's reservable deposits held in cash or in deposits with the central bank, used to manage liquidity and fulfill regulatory requirements.

Secondary Reserve

Secondary Reserve includes assets that are not as liquid as primary reserves but can still be quickly converted into cash.