Question

On July 29, 2022, Wagner Trucking recorded $24,000 in services that they had performed but had not yet received payment for from the customer. On the same day, Dixon Trucking recorded $24,000 that they need to pay to their suppliers for gas and oil. What is the difference between how these two transactions will be recorded?

Answer 1

Answer:

Explanation:

In the first transaction, the services are performed but the payment is not received from the customer for $24,000. This amount would come in the accounts receivable under the asset side in the balance sheet.  

In the second transaction, the company has the need to pay the $24,000 to their suppliers for gas and oil. This transaction would come under the accounts payable in the liabilities side of the balance sheet