If a Company Incorrectly Records Cash Received for Services to Be

question 61

Multiple Choice

If a company incorrectly records cash received for services to be provided in the future with a debit to Cash and credit to Sales Revenue,how will this error affect net income for the current period?

• A)Net income will be too high.
• B)Net income will be too low.
• C)Net income will not be affected by this error.
• D)Net income will be too high in the following period.

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Definitions:

Peristomal Skin

The skin surrounding a stoma, which can be sensitive and requires careful maintenance to prevent irritation.

Rolled Gauze

A type of medical dressing made of a thin, woven fabric that is rolled and used for wound care.

Ileal Portion

The final part of the small intestine that connects to the large intestine.

Small-Intestine

The part of the gastrointestinal tract between the stomach and large intestine that digests and absorbs nutrients from food.