Press "Enter" to skip to content

Which of the following is an example of prepaid expenses?

An example of a prepaid expense is insurance, which is frequently paid in advance for multiple future periods; an entity initially records this expenditure as a prepaid expense (an asset), and then charges it to expense over the usage period. Another item commonly found in the prepaid expenses account is prepaid rent.

Which of the following is an application of accrual accounting?

Question 6Which of the following is an application of accrual accounting? recording revenue at the time payment is receivedCorrect! Recording a utilities expense in the accounting period covered by the monthly bill is an application of accrual accounting.

What is cash to accrual adjustment?

Cash to accrual conversion refers to the process of adjusting records prepared under the cash basis of accounting to produce accounts which reflect the accruals basis of accounting. Under the cash basis of accounting revenue is recorded when cash is received, and expenses are recorded when cash is paid.

How is accrued bonus calculated?

Compound Reversionary bonus (CRB) CRB is calculated as a percentage of the sum assured and all previously accrued bonuses. The bonus of each year is added to the sum assured and the next years bonus is calculated on the enhanced amount. Rahul Khanna has two participating policies of Rs 5,00,000 each.

What is an accrued bonus?

An accrued bonus is a bonus that is contingent on performance. An employer determines whether or not to offer an accrued bonus to an employee. Or, you can temporarily accrue a smaller bonus payment. After the employee’s performance is substantial, you can increase the bonus payment amount going forward.

How much of my bonus will I get back?

Federal and state taxes While bonuses are subject to income taxes, they don’t simply get added to your income and taxed at your top marginal tax rate. Instead, your bonus counts as supplemental income and is subject to federal withholding at a 22% flat rate.