XYZ Coreceived $3,000 in Payments from Clients for Services Billed in in a Previous

question 80

Multiple Choice

XYZ Co.received $3,000 in payments from clients for services billed in a previous month.Which accounts will be affected and by what amounts under the accrual basis of accounting?

• A) Cash will increase by $3,000 and accounts receivable decrease by $3,000.
• B) Cash will increase by $3,000 and revenues will increase $3,000.
• C) Accounts receivable will increase by $3,000 and revenue will increase by $3,000.
• D) Accounts receivable will increase by $3,000 and cash will increase by $3,000.

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Definitions:

Job-Order Costing System

An accounting method that tracks costs individually for each job rather than for a process or period.

Job Cost Sheet

A document that records the materials, labor, and overhead costs incurred for a specific job or project.

Job Completion

Job completion refers to the finalization of a task or project, marking the point at which all work has been finished as per the requirements.

Cost of Goods Sold

The expenses directly associated with manufacturing the products a company sells.