Acc 280 Week 3 Exercises

Chapter 3 / Questions

2. State two generally accepted accounting principles that relate to adjusting the accounts.

Matching Principles is where the expenses could be coordinated with revenues. Revenue Recognition Principle states that an accountant should acknowledged revenue because it is the principle that deals with what has been earned in the accounting period.

3. Rick Marsh, a lawyer, accepts a legal engagement in March, performs the work in April, and is paid in May. If Marsh's law firm prepares monthly financial statements, when should it recognize revenue from this engagement? Why?

Rick should recognize revenue in April because this is the month that the revenue was earned. Reason being is that the questions states what month the revenues...