in order for revenues to be recorded in the period in which the performance obligations are satisfied and for expenses to be recognized in the period in which they are incurred companies make adjusting entries adjusting entries ensures that the revenue – exclusivewritings.com

1- Prior to beginning work on this discussion, read the Accounting Standards Update (ASU) No. 2017-13. Revenue from Contracts with Customers (Topic 606) (Links to an external site.) from the Financial Accounting Standards Board.Users of accrual accounting recognize revenues and expenses in the period in which they occur, regardless of when cash is collected or paid. In order for revenues to be recorded in the period in which the performance obligations are satisfied and for expenses to be recognized in the period in which they are incurred, companies make adjusting entries. Adjusting entries ensures that the revenue recognition and expense recognition principles are followed.

In this chapter, four types of adjustments are described: prepaid expenses, unearned revenues, accrued expenses, and accrued revenues. Select one of the four adjustments as an area of expertise, and in a minimum initial post of at least 200 words address the following:

  • Description of the adjustment and why it’s necessary.
  • Example of a transaction or event, with dates and amounts that require
    • Adjusting entries for the example.
    • Status of the affected accounts before and after the adjustment.
  • Effects on financial statements of not making the adjustment.

(200 to 250 words)

2- Prior to beginning work on this discussion, read Netflix’s Inc. most recent Annual Report retrieved from www.netflix.com (Links to an external site.). Netflix is the world’s leading internet entertainment service with over 117 million members in over 190 countries enjoying more than 140 million hours of TV shows and movies per day, including original series, documentaries and feature films. Using the most recent financial statements for Netflix, Inc., list of all the accrual-type accounts and deferral-type accounts that you can find on the balance sheet. Then, in a minimum post of at least 200 words, discuss the differences between these accrual and deferral accounts.

Follow the steps below to obtain the financial statements of Netflix, Inc.:

  • Visit Netflix’s website at www.netflix.com (Links to an external site.).
  • Click on the “Investor Relations,” link found at the bottom of the website
  • Click on the “Annual Reports and Proxies” link found on the left side of the webpage.
  • Click on the PDF version of the most recent “Annual Report” (the year will precede the title).
  • On the 2016 Annual Report, Netflix’s balance sheet can be found towards the end of Form 10-K on page 48. The “Index” to Financial Statements on page 43 can also help you locate the financial statements. (Realize that the configuration of Netflix’s website may have been changed since these steps were written.)

(200 to 250 words)

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