Surname: 1Students NameInstructorCourseDateThe Accrual Basis of Accounting1. The revisions of the financial statement were correct as far as accrual principle ofaccounting is concerned. This is because the financial statements prepared did not includethe loan that had not been approved, hence, not earned, realized, or realizable. Had thebank approved the loan, then it would be appropriate to include it as a liability on thebalance sheet.2. The inclusion of the $20,000 in accounts receivable was correct. This was because the$20,000 was realizable. In accrual basis, revenue is recognized when it is earned, it Irealized, or it is realizable ( International Federation of Accountants.). The $20,000 isrealizable in the sense that it is very reasonable to expect that such cash will be received,given that a time period has been specified for the delivery of goods.3. Cliff Hal ...
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