Langley Inc

question 74

Multiple Choice

Langley Inc.accepted a $24,000 retainer for which the company agreed to provide services in the future.Recognizing this event would

• A) defer the recognition of revenue.
• B) increase the balance in the company's cash account.
• C) cause the company's liabilities to increase.
• D) All of the answers are correct.

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Definitions:

Bond Issue Costs

Expenses associated with the issuance of bonds, including legal, accounting, underwriting fees, and other costs that are often amortized over the life of the bond.

IFRS

International Financial Reporting Standards; a set of accounting standards developed by the International Accounting Standards Board (IASB) aiming for global consistency in financial reporting.

Maturity Value

The amount of money an investment will earn and pay out at the end of its life, including the initial principal and all accumulated interest.

Capitalize Interest

The process of adding interest costs to the balance sheet for the construction of long-term assets, instead of expensing them in the period they are incurred.