Which of the Following Entries Would Be Used to Record

question 49

Multiple Choice

Which of the following entries would be used to record the billing of fees earned?

• A) Debit Accounts Receivable and credit Rental Fees
• B) Credit Cash and credit Rental Fees
• C) Debit Accounts Payable and credit Rental Fees
• D) Debit Rental Fees, credit Accounts Receivable.

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Definitions:

Reciprocal Method

An accounting technique used in managerial accounting to allocate costs between support departments, taking into account the mutual services they provide to each other.

Sequential Method

An approach to cost allocation in which support department costs are allocated to other support and operating departments sequentially, one after another, based on a predetermined order.

Reciprocal Services

Services exchanged between departments within an organization, used in cost accounting to allocate service department costs to producing departments.

Reciprocal Services

Services exchanged between departments within an organization or between companies without direct monetary payment, often valued and accounted for through internal mechanisms.