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faisy
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Joined: 08 May 2010
Location: Australia
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Posted: 09 May 2012 at 07:53 \| IP Logged

There is one more simple approach i guess.

Income (Rental Revenue) -- Increases $200k (cash collected under cash basis approach)

with the increase of

Current Assets (Rental Rcvable) -- Increase $15k

and decreased with a

Current Liability (Unearned Rental Revenue) -- Increase ($5k)

So the Net effect is $215 which is Rental Revenue.

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Faisy

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Posted: 04 Aug 2012 at 20:16 \| IP Logged

Wenlue wrote:

Use BASE method for both questions

First Question:
Beginning Cash collection Y-2: 80,000
Addition: Rent receivable:     2,800
Subtract unearned revenue:     -(8,000) *(-(-8000)=8000)
Ending balance:        &nbs p;        74,800

Second Question:
Beginning cash collection Y-2: 200,000
Addition:A/R          ;           ;   20,000
Subtract unearned revenue:      (5,000)
Ending balance:        &nbs p;        215,000

Hope it helps :)

The answer you supplied for the first question of 74,800 is not correct.
The answer is 90,800. Do you know how to use the base formula to get
the 90,800?

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