The cash basis of accounting is acceptable primarily in enterprises that do not have substantial credit transactions or inventories.

Under the transactions approach used in financial accounting, every transaction has a single effect upon each party engaging in it.

A. True
B. False

If the debit subtotal of the Income Statement on the work sheet is $159,000 and the credit subtotal is $147,000, there is a: income of $12,000. loss of $12,000. loss of $159,000. income of $147,000

In adjusting and closing the books of Sally Smith Company at the end of the fiscal year, no provision was made for accrued sales salaries expense of $600. The effect of this omission was as follows:

A.the assets on the balance sheet were the same regardless of the omission.
B.stockholders’ equity on the balance sheet is understated by $600.
C.the liabilities reported on the balance sheet are overstated by $600. income for the year was understated by $600.
E.None of the preceding answers is correct.