tvlaptop Posts: 8, Reputation: 1 New Member #1 Sep 22, 2007, 06:02 PM
Revenues for the month
Help me with this question also,

The following transactions were extracted from the accounting records of a Corporation:

Borrowed \$150,000 from a bank.
Collected \$30,000 from a sale made in March.
Sold \$35,000 in cash and \$65,000 on account.

company's revenues for the month of April were:

a. \$280,000
b. \$215,000
c. \$100,000
d. \$130,000
e. \$245,000

I think the answer is c . Is this correct?
Thanks a lot
 Kygall Posts: 9, Reputation: 1 New Member #2 Sep 22, 2007, 10:56 PM
I think the answer is 'D'.
Because when calculating revenue, you look at your total revenues and expenses, and you acknowledge cash in on you B/S when reporting your assets (plus liabilities for money borrowed). I believe the \$150K is just extra information.

That's just my two cents.. This is my first accounting class, so please don't be upset if someone responds with a different answer.
 CaptainForest Posts: 3,645, Reputation: 393 Ultra Member #3 Sep 23, 2007, 01:52 PM

How much you borrowed is irrelevant as is how much you collected from LAST months sales.

Revenue does not mean profit, it means sales.

You had cash sales of 35,000 and credit sales of 65,000 which totals 100,000

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