During 20B,Melon Company incurred operating expenses amounting to $250,000,of which $120,000 were paid in cash; the balance will be paid in January 20C.On the 20B income statement of the company,what amount should be reported for operating expenses?
A)$120,000.
B)$130,000.
C)$250,000.
D)$370,000.

Question

Quizplus · Accepted Answer

The total amount of operating expenses incurred during 20B is $250,000. Even though only $120,000 were paid in cash during the year, the entire amount should be reported on the income statement since the remaining $130,000 will be paid in January 20C, which is still within the same accounting period. Therefore, the correct amount to report for operating expenses on the 20B income statement is $250,000.

During 20B,Melon Company Incurred Operating Expenses Amounting to $250,000,of Which