70.2K

Verified Solution

Link Copied!

Use the following information to answer the next 6 questions: You have recently been hired by XYZ Company as an accountant. You discover that the company neglected to make several adjusting entries as of the end of the fiscal year, December 31, 2017. Assuming that XYZ maintains its books on the accrual basis, and that all external transactions were correctly reported, suggest the appropriate adjusting entries for the following events.

XYZ has accepted a contract with a customer to deliver merchandise costing $10,000, every month for the first three months of 2018. The total sales revenue will be $25,000 for each month. XYZs accountant made no entry to record this sales contract. The appropriate adjusting entry as of December 31, 2017 is:

		Cost of Goods Sold 30,000 Net Income 45,000 Sales Revenue 75,000
		Accounts Receivable 75,000 Cost of Goods Sold 30,000 Sales Revenue 75,000 Inventory 30,000
		Accounts Receivable 75,000 Unearned Revenue 75,000
		Unearned Revenue 75,000 Sales Commitments 75,000
		No Entry Required or None of the Above

Answer & Explanation Solved by verified expert

See Answer