Use the Information Below to Answer the Following Questions:
a $\quad$

question 2

Multiple Choice

Use the information below to answer the following questions:
A consultant performs accounting services for a client on 30 June 2012 and bills the client $350, to be paid within 60 days. Payment is duly made on 29 August 2012. Accrual accounting is used by both parties.
-What is the journal entry made by the client on 30 June 2012?

• A) DR Accounts payable \(\quad\)\(\quad\)CR Accounting expenses
• B) DR Accounting expenses \(\quad\)CR Accounts payable
• C) DR Accounting expenses\(\quad\) CR Cash
• D) DR Accounts payable\(\quad\) \(\quad\) CR Cash

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Definitions:

Depreciation Expense

Spreading out the expense of a physical asset over the period it's in use.

Operating Activities

Components of a business's cash flow statement that relates to its core operations, including cash received from sales and cash paid for goods and services.

Net Income

The amount of money remaining after all operating expenses, taxes, and other costs have been subtracted from total revenue.

Net Cash Flows

Net cash flows illustrate the amount of money being received minus the amount of money being spent by a business over a specific period, reflecting its financial health.