University of Georgia Week 1 Three Tasks Questions

Description

Task 1

Mandy Moore Dance Studio wishes to expand her dance studio and the bank has loaned her $100,000. The bank requires the business to maintain a current ratio of no less than 1.50. The expansion of the dance studio has been solid but not as well as expected. Due to the expansion, the current ratio is 1.40 as of December 15th. In reviewing the books, there is a contract for $10,000 which was signed on December 5th, but the dance studio will not earn the money until January. In order to raise the current ratio, Mary is thinking of recording this as revenue in December.

  1. By recording the revenue in December, determine the accounting principle that would dictate when the revenue should be recognized.
  2. Identify the standard the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) have issued and how it pertains to this situation.

Task 1: Create a new discussion topic on or before Friday at 11:55 p.m. by clicking the ‘**REPLY HERE**’ post. In your reply, you will post your answers to the Week 2 Critical Thinking Exercise questions. Your response to the exercise questions should be a minimum of 150 words.

Task 2

In the Week 1 Discussion (also known as a small business scenario), you developed a specific business good or service. You should use this specific good or service for all of the remaining weeks, please do not change your good or service.

Consider the market for your good or service

  1. List one characteristic (shift factor) of demand for your specific good or service.
  2. List one characteristic (shift factor) of supply for your specific good or service.
  3. Describe how the market achieves equilibrium.

Task 3

  • Explain the rationale for closing temporary accounts