Celebra sold some goods to Frankfurt Corp.Frankfurt sent a cheque to Celebra to pay for the goods on December 24.Celebra received the cheque on January 4.At December 31,Celebra still showed an account receivable from Frankfurt while Frankfurt no longer had an account payable to Celebra.This situation represents a

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The situation described is a timing difference, where the payment was made by Frankfurt but not yet received by Celebra at the end of the reporting period. This will result in an account receivable being shown for Celebra, even though Frankfurt no longer has an account payable. Cutoff errors occur when transactions are recorded in the wrong accounting period, errors in presentation relate to how information is organized and presented, and a lack of communication would not result in this specific situation.

Celebra Sold Some Goods to Frankfurt Corp