medium · Investment Banking accounting
Which of the following describes the impact of a $50 million increase in 'Deferred Revenue' on the three financial statements?
- No impact on IS; CFS Operating Cash Flow increases by $50 million; BS Cash increases and Liabilities increase by $50 million.
- Net income increases by 35 million after tax; CFO increases by 50 million; and the balance sheet still balances out.
- Revenue increases by $50 million on the income statement; cash increases on the balance sheet; and shareholders equity increases too.
- There is no impact on any of the three financial statements until the underlying revenue is actually recognized as earned by the company.
Sign up free to see the explanation and track your rank →
More Investment Banking accounting practice
- A company recognizes $100.0 million in Deferred Revenue on i… — How does this impact the c
- A company switching from LIFO to FIFO inventory accounting during a period of rising price
- Assuming a 0% tax shield (non-deductible), what is the impact on the year-end Balance Shee
- Which item is a non-cash expense that is recorded on the Income Statement but added back o
- SaaSCo recognizes 25 million of stock-based compensation (SB… — How does this appear on th
- Which of the following would cause a company to have a Deferred Tax Liability (DTL)?
- Under modern lease accounting (ASC 842), what is the primary impact of an operating lease
- If a company has a negative Shareholders' Equity balance, which of the following is the mo