Which of the Following Is True

question 26

Multiple Choice

Which of the following is true?

• A) Tuition and fees charged are included in income and the fees waived for graduate assistants are expensed.
• B) Scholarship allowances for which no services are required are expensed.
• C) Fees waived for graduate assistantships for which services are required are deducted directly from tuition revenue.
• D) Revenues for summer sessions are recorded in deferred revenues and recorded as revenue when the semester ends.

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Definitions:

Net Income

The residual financial gain of a business following the deduction of every expense, tax, and cost from its total revenue.

Accounting Cycle

The collective process of recording and processing the accounting events of a company, culminating in the production of financial statements within a specific period.

Income Summary

An account used in the closing process that summarizes the revenues and expenses for an accounting period before transferring the net income or loss to owner's equity.

Revenue and Expense Accounts

Accounts in the general ledger that track the income generated from sales and the costs incurred during business operations, respectively.