Question

In: Accounting

Which of the following amounts will appear on X Company's April Income Statement and Statement of Cash Flows?

X Company is a service company and prepares monthly financial statements. In March, it billed customers $416,000 for services it provided; in April, it billed customers $363,000 for services it provided. In April, the company received $286,000 from its March customers and $269,000 from its April customers.

Which of the following amounts will appear on X Company's April Income Statement and Statement of Cash Flows?

a. both statements, $269,000
b both statements, $363,000
c Income Statement, $555,000; Statement of Cash Flows, $779,000
d Income Statement, $363,000; Statement of Cash Flows, $555,000
e Income Statement, $779,000; Statement of Cash Flows, $555,000

Solutions

Expert Solution

Option D: Income Statement, $363,000; Statement of Cash Flows, $555,000

Explanation:

Income statement records the amount of services that are billed during the month.

Statement of cash flows records the total cash received during the month.

In April, the company billed $ 363,000 and so Income statement will show $ 363,000.

Company received $ 286,000 + $ 269,000 = $ 555,000, and so this will be shown in Statement of cash flows.

ekkarill92 answered 1 year ago
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