Computer Consultants Inc

question 14

Essay

Computer Consultants Inc., began business as an adviser to chains of retail stores. The company assisted the stores in the selection of hardware and the development of software used by retail chain stores. Later the company developed software and sold it to its customers. The company also began selling some of the equipment to the customers. That is, the company would bid on a job to purchase and install equipment and the software. The company has consistently reported its income by the cash method. At the end of the year, the company has substantial accounts receivables from clients and a small amount of inventory on hand. What advice can you offer the company regarding its accounting method?

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Definitions:

Precognition

The claimed ability to see or know about events before they happen through extrasensory perception.

Context Effects

The influence of environmental factors on one's perception, interpretation, or behavior in a given situation.

Relative Luminance

Relative Luminance refers to the amount of light that is emitted, reflected, transmitted, or received by an object, relative to a given reference brightness.

Ponzo Illusion

The Ponzo Illusion is a visual illusion where two horizontal lines of identical length appear to be different lengths due to their context within converging lines, illustrating how the human brain perceives depth and distance.