Accoutning Final

G capital balance in the partnership is $64,000 and J Capital balance is $61,000. G&J have agreed to share equally in income and loss. Accept Block with a 20% interest. Block will invest $35,000 in the partnership. The bonus that is granted to G&J equals:

$1,500 each

After these closing entries what will be the balance in the Jay Travis captital account? Revenues 125,000 Expenses 60,000 Capital 80,000 Withdraws 15,000

$130,000

Rice contributing $60,000. Hepburn contributing $50,000. DiMarco contributing $40,000. Income division based on the ratio of capital investments. If the partnership had income of $75,000 for its first year of peration, what amount of income would be credited to DiMarco's capital account?

$20,000

Historical Cost of Asset 76,000 Accumulated depreciation on the asset 40,000 Notes payable 18,000 Agreed upon market value of asset 45,000 Trump's beginning equity balance in the partnership will be:

$27,000

The interest accured on $6,500 at 6% for 60 days is:

$65

S&M with capital contribution of 30,000 and 40,000. Calls for S to recieve a 60,000 per year salary. Interest equal to 10% of beginning capital investments. Remaining income or loss is to be divided equally. It the net income for the current year is 135,000, then S&M's repective shares are:

$92,500 & $42,500

ABC total quick assets were $5,888,000, its current assets were $11,700,000 and its current liabilities were $8,000,000. It's acit-test ration equals:

0.74

A company purchased $1,800 of merchandise on Dec. 5. On Dec. 7, it returned $200 worth of merchandise. On Dec.8 it paid the balance in full, taking 2% discount. The amount of cash paid on Dec. 8 equals:

1,568

The credit terms 2/10, n/30 are interpreted as:

2% cash discount if the amount is paid within 10 days, or the balance due in 30 days

Beginning of year bal. $22,000 His share of partnership $8,500 Withdrawls made $6,000 What is Smith's parter return on equity during the year in question?

36.6%

The accounting process begins with:

Analysis of business transactions and source documents

Damages and obsolete goods that can be sold:

Are included in inventory at their net realizable value

If a company mistakenly forgot to record depreciation on office equipment at the end of an accounting period, the financial statements prepared at that time would show:

Assets, net income and equity overstated

Closing entries are required:

If the temporary accounts are to reflect correct amounts for each accounting period

A debit:

Is the left-hand side of a T-account

Partnership accounting:

Is the same as accounting for sole proprietorship, except that separate capital and withdrawal accounts are kept for each partner

A collection of all accounts and their balances used by a business is called a:

Ledger

A properly designed internal control system:

Lowers the company's risk of loss

B.T. Contributed $14,000 cash plus office equipment values at $7,000 to the JT partnership. The journal entry to record the transaction for the partnership is:

Debit cash $14,000 Debit office Equipment $7,000 Credit B.T Capital $21,000

In the absence of a partnership the law says that income (and loss) should be allocated based upon:

equal shares

Merchandise inventory:

is a current asset

A subsidiary ledger:

is a listing of individual accounts and amounts with a common characteristic

The person who signs a note receivable and promises to pay the principal and interest is the:

maker

The area of accounting aimes at serving the decision making needs of internal users is:

managerial accounting

The primary objective of financial accounting is:

to provide financial statements to help external users analyze an organizations activities

The inventory valuation method that tends to smooth out erratic changes in costs is:

weighted average

Source Documents

Provide the basis information processed by an accounting system

A credit sale of $3,275 to a customer would result in:

A debit to the accounts recievable account in the ledger and a debit to the customer's account in the accounts recievable subsidiary ledger

Of record of the increases and decreases in a specific asset, liability, equity, revenue, or expense is a(n):

Account

The approach to preparing financial statements based on recognizing revenues when they are earned and matching expenses to those revenues is:

Accural basis accounting

C&W are forming a partnership. Building has a market value of $90,000. Assume responsibility for a $30,000 note secured by a mortgage on that building. W will invest $50,000 cash. For the partnership, the amounts to be recorded for the building and Chen's Capital account are:

Building $90,000 Chen, Capital $60,000

In a partnership agreement, if the partners agreed to an interest allowance of 10% annually on each partner's investment, the interest allowance:

Can make up for unequal capital contributions

The system of preparing financial statements based on recognizing revenues when the cash is recieved and reporting expenses when the cash is paid is called:

Cash basis accounting

The assests section of a classified balance sheet usually includes:

Current assets, long-tem investments, plant assets, and intangible assets

Prior to recording adjusting entries, the office supplies account had a 4359 debit balance. A physical count of the supplies showed $105 of unused supplies available. The required adjusting entry is:

Debit Office Supplies Expense $254; Credit Office Supplies $254

When two clerks share the same cash register it is a violation of which interal control principle?

Established responsibilities

The inventory valuation method that has the advantages of assigning an amount to inventory on the balance sheet that approximates its current cost, and also mimics the actual flow of goods for most businesses is:

FIFO

The broad principle that requries expenses to be reported in the same period as the revenues that were earned as a result of the expenses is the:

Matching principle

The accounting concept that requires financial statement information to be supported by independent, unbiased evidence other than someone's belief or opinion is:

Objectivity

The flexibility priciple of accounting information systems prescribes that the:

System be able to adapt to changes in the company, business environment, and needs of decision makers

The impact of technology on internal controls incules:

Reduce processing errors

Enterprise-resource planning software:

Refers to programs that can help manage a company's vital operations

The accounting principle that prescibes an accounting information system to report useful, understandable, timely, and pertinent information for effective decision making is the:

Relevance Principle

Internal control systems are:

Required by SOX to be documented and certified if the company's stock is traded on an exchange

Rule that 1. requires revenue to be recognized at the time it is earned. 2. Allows the inflow of assets associated with revenue to be in a form other than cash. 3. Measures the amount of revenue as the cash plus the cash equivalent value of any noncash assets recieved from customers in exchange for goods or services, is called the:

Revenue recognition principle

Partners' withdrawals of assets are:

debited to their withdrawals accounts