Crue Company Had the Following Transactions During 2018

question 117

Multiple Choice

Crue Company had the following transactions during 2018:
.Sales of $4,500 on account
.Collected $2,500 for services to be performed in 2019
.Paid $1,625 cash in salaries
.Purchased airline tickets for $250 in December for a trip to take place in 2019
What is Crue's 2018 net income using cash-basis accounting after cash?

• A) $625.
• B) $875.
• C) $5,125.
• D) $5,375.

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Definitions:

Affordable Care Act

A comprehensive healthcare reform law enacted in 2010 in the United States, aimed at increasing health insurance coverage and reducing healthcare costs.

Part-Time Employees

Workers who are employed for fewer hours than the full-time standard, often receiving reduced benefits and compensation.

Implicit Marginal Tax Rate

The amount of additional (marginal) earnings that must be paid explicitly in taxes or implicitly in the form of reduced income supplements. The marginal tax rate establishes the fraction of an additional dollar earned that an individual is permitted to keep, so it is an important determinant of the incentive to work and earn.

Poverty Level

The minimum level of income deemed necessary to achieve an adequate standard of living in a given country or region.