A Company Received a $10,000 Deposit from a Customer for Goods

question 95

Multiple Choice

A Company received a $10,000 deposit from a customer for goods to be delivered the following month. Under the accrual and cash basis of accounting respectively thedeposit would be recorded as:

• A)Accrual Basis: income | Cash Basis: income
• B)Accrual Basis: income | Cash Basis: a liability
• C)Accrual Basis: a liability | Cash Basis: income
• D)Accrual Basis: a liability | Cash Basis: a liability
• E)Accrual Basis: an asset | Cash Basis: an asset

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