accounting final exam

If assets are expected to be realized in cash, sold, or consumed within one year, how are they reported on a classified balance sheet?

current assets

Expenses should be matched against revenue

in the same period as the revenue that they helped generate.

which financial statement would you analyze to asses a firm's operating performance for the past year

income statement

which statement summarizes the result of the company's operation

income statement

which of the following is not a reason to revise the amount of depreciation expense

permanent decline of an assets fair market value below book value.

the process on transactions amounts from the book of original entry into specific account record is referred to as.

posting

balance sheet accounts are also known as which of the following

prepaid accounts

which inventory cash flow method assigns the same cost to all units whether sold or left in the ending inventory

weighted averaged cost

Under accrual accounting, when is revenue recognized?

when earned and expenses when incurred

camper city started business on January 1 2013. station performed service for costumer totaling 250,000 which is 40% remain uncollected at the end of December. Under the accrual basis what amounts would appear on the company's financial statement for 2013

250,000 150,000

a tax service prepared tax returns for 20 clients at 200 each by the end of June the service had collected from the 8 clients. Under the accrual basic what amounts will be reported on the income statement and the statement of cash flow for June

4, 000 1,600

cleaning service received advanced payments from the customers during the 2013 f 24,000 at the december 31 2013 5,000 of the advanced payments still had not been earned. after the adjustments are recorded and posted december 31 2013 the balance in the unearned services revenue and the service revenue accounts will be

5,000 19,000

a tool company purchased equipment as a cost of 100,000in January 2004 as of January 1 2013, depreciation of 45,000 has been recorded on the assets. Depreciation expense for 2013 is 5,000 after the adjustment are recorded and posted December 2013 what are the balance for the depreciation expense and accumulated depreciation.

5,500 50,000

on the balance sheet the cumulative amount of plants and equipment already expensed is reported in the account called

accumulated depreciation

depreciation is

an effort to achieve proper matching of the cost of operating assets with the related revenue

which one of the following s a correct fundamental accounting equation

asset= liabilities + stockholder's equity

Two friends decide to launch a new business by investing 25,000 each a hot spot tanning. they are given shares of stocks as evidence of their ownership investment what effect does this transaction have on the accounting equation

assets and contributed capital increase.

Machinery is purchased on credit. What effect does this transaction have on the accounting equation?

assets and liabilities increase

the effects does "recognizing accrued interest revenue at the end of the accounting period" have on the accounting equations.

assets increase and stockholder's equity increase

You are a potential creditor and are concerned that a particular company you are ready to give a loan to might have too much debt. Which financial statement would provide you information needed in order to evaluate your concern?

balance sheet

If the amount assigned to ending inventory is incorrect, then

both the balance and income statement are affected.

adjusting journal entries are made at the end of the period when

cash receipts and payments occur before or after the point in the revenue and the expense should be recognized under the accrual basis accounting

which one of the following is the last steps of accounting cycle

closing the account.

an account in uncertain about the best estimate of an amount for a business transaction. if there are two possible amounts that could be recorded, the amount least likely to over state assets and earnings selected. which of the following qualities is characterized by this action

conservatism

in which form of organization are the owners legal responsibility for the debt of the business limited to the amount they invest in the business

corporation

which of the following accounts would not be reported in the property plat and equipment section of a balance sheet

depreciation expense- building

the system of accounting in which there are at least two accounts affects in every transactions so that the accounting equation stays in balance is called

double entry

assets classified as property, plant, and equipment are recored at

each asset's original cost less depreciation sense acquisition

which inventory cost flow methods assigns to the cost of the most recent items purchased to ending

fifo- first in first out

what is the name of the branch of accounting concerned with providing outside of decisions makers with information to asses the amounts timing and uncertainties of the company's future cash flows

financial accounting

which of the following organizations is primarily responsible for establishing GAAP in the united states.

financial accounting standards board (FASB)

business engage in which of the following three main activity categories.

financing, interest,operating

the inventory account a manufacturer uses to record the cost of products completed and available for the sale is called

finished good inventory

which of the following is an intangible asset

goodwill

"revenues" are best described as

increases in assets resulting from sale of product or services.

accused expenses originated from

incurring expense without yet having paid cash for them.

operating assets with no physical properties are called

intangible assets

which of the following would not be considered to be an intangible asset

investment

the chronological record in which transactions are initially recorded in the order in which they occur is called

journal

the term for the process of recording business events in a book of original entry is

journalizing

which of the following typed of inventory accounts would be used by a wholesaler or retailer

merchandise inventory

current accounts standard indicated that the cost of the intangible assets with the indefinite life such as goodwill should

not be amortized but should be reviewed annually for impairment.

which of the following is an example of a deferred revenue

payment are received prior to providing the service to costumers

the securities exchange commission (SEC) id concerned with

setting accounting rules for public traded companies in the united states.

which statement presents financial information not based on accural accounting

statement of cash flow

income statements accounts are also known as which of the following

temporary accounts

plant assets are depreciations because

the accrual basis of accounting requires matching of cost and revenue

which of the following best described the term "retained earnings" of a company

the accumulated net income of a company that has not been distributed to owner in the form of dividends.

the financial statement are prepared after

the adjustment trial balance is prepared.

the principle of conservatism is concerned with

the avoidance of overspending assets or income in the preparation f financial statement

the going concern assumption of concerned with

the company's ability to continue operation long enough to carry out existing obligations

which of the following best describe the term "expense"

the cost of an asset used in the operation of a business

the cost of goods sold equals

the cost of goods available for sale less ending inventory.

depreciation is a process in which

the cost of plant and equipment is allocated to expense over the time period which benefit from the use of the assets

calmar corporation sold merchandise to a customer for 30,000 on credit on july 15th. the costumer paid calmer corporation the amount due july 31st under the accrual basis of accounting, how should calmer corporation record the transaction

the july 31st transaction as no effect on total assets under the accrual basis

research and development cost are

treated as an expense when incurred.