Which of statement is true under accrual basis of accounting

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Problem 1: Fox Auto sold merchandise to a customer for $3,000 on credit on March 10. The customer paid Fox Auto the amount due on March 31. Under the accrual basis of accounting, which of the following statements is true?

a. Fox Auto will recognize the revenue on March 31.

b. The March 10 transaction increases revenue, but has no effect on assets because cash has not been received.

c. The March 31 transaction has no effect on total assets under the accrual basis.

d. Revenue is recognized after the cost of the merchandise sold has been paid by Fox Auto.

Problem 2: Statements prepared monthly, quarterly, or at other intervals are called

a. trial balance statements.

b. temporary statements.

c. closing statements.

d. interim statements.

Reference no: EM132776916

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