Shadow's Cleaning Service provides weekly cleaning services for $41 per week. In January, they collected payments from 60 customers for 3 months (12 weeks) of service each. For the month of January, they will recognize ________ of revenue under the cash basis, and ________ under the accrual basis.
A) $2,460; $720
B) $3,180; $0
C) $9,840; $29,520
D) $29,520; $9,840

Question

Quizplus · Accepted Answer

Under the cash basis, all cash received is recognized as revenue, so $41 x 60 customers x 12 weeks = $29,520. Under the accrual basis, only the revenue for services provided in January is recognized, so $41 x 60 customers x 3 weeks (for January) = $9,840.

Shadow's Cleaning Service Provides Weekly Cleaning Services for $41 Per