Revenue and Other Income

Income refers to the amount earned through the activities of a business.

• True

• False

According to the __________________, sales revenue is recognised when goods are sold and delivered and service fee revenue is recognised when services have been provided.

• accrual basis of accounting theory

• matching theory

• revenue recognition theory

The _______________ account is used only during the closing stage of the accounting cycle.

• income

• income summary

• profit and loss

• current assets

Income receivable is to be recorded as a current liability.

• True
• False

Prepare journal entry to record rent income received in advance at the end of the financial year.

• Debit Rent Income

• Debit Rent Income Received in Advance

• Credit Rent Income

• Credit Rent Income Received in Advance

Income received in advance is to be recorded as a current liability.

• True
• False

Prepare journal entry to record interest income receivable at the end of the financial year.

• Debit Interest Income

• Debit Interest Income Receivable

• Credit Interest Income

• Credit Interest Income Receivable

State the debit entry when a business received a cheque for commission income.

Debit ____________________

Credit Commission income

Prepare journal entries to reverse rent income receivable at the start of the next financial year.

• Debit Rent Income Receivable

• Debit Rent Income

• Credit Rent Income

• Credit Rent Income Receivable

For the year ended 31 December 2024, the following information is provided for interest income:

Cheques received for interest income = $4 200

On 31 December 2024, interest income yet to be received amounts to $300.

Calculate the interest income earned for the year.