accounting final

bonds sell at premium

market rate of interest is less

Cash collected and recorded by a company but NOT yet reflected in a bank statement are known as

deposit in transit

Assets classified as property, plant, equipment are reported at

each assets original cost less depreciation since acquisition

Cash flows from issuing and repurchasing stock or issuing and repaying debt are classified as

financing activities

cash flows from acquiring and disposing of long-term assets are classified as

investing activities

what is the distinguishing characteristic between accounts receivable and notes receivable?

accounts: liquified 30-60 days, current assets notes: liquified 3-12 months, long term assets

graphic design

$800,000

What is the impact on the accounting equation of recording the accrual interest expense?

liabilities increases and stock holders equity decreases

When the market value of inventory items has declined below their cost, which method would be the most appropriate in complying with GAAP?

lower of cost or market

long term debt generally includes

obligations that extend beyond one year

Under accrual accounting when is revenue recognized?

performed service

When should a shipping company recognize revenue from its delivery service?

the good/service has been received

Which inventory costing method is NOT acceptable for financial accounting purposes?

retail cost

Which inventory cost flow method assigns the cost of the most recent items purchased to cost of good sold?

LIFO

Which of the following items would be added to the company's cash balance on a bank reconciliation?

cash (savings, checking, CA, cash equity)

Which of the following best describes cost of goods available for sale?

cost of goods available for sale is allocated into cost of goods on hand and COGS at the end of the fiscal year

general lighting

debit: accounts receivable 636,000 credit: sales revenue 600,000 credit: sales tax payable 36,000

The effect of recording depreciation for the year is a(n)

decrease in assets, decrease in net income

which one of the following is an accurate description of the allowance for doubtful accounts?

extra money in account money we may not receive (NSF checks)

For which type of merchandise would a company most likely use the specific identification method of inventory costing?

fine jeweler

a bond issuing at 102.25 means that the bond

sold for 1,012.50

total stockholders equity includes $50,000 of common stock with a stated value of $0.50 and 5000 shares of treasury stock with a total cost of $25,000. How many total shares are outstanding?

95,000

The following items were reported by Morris Plumbing Company: What amount would be reported [...] assuming that all sales are on credit?

975,000

A check returned by a bank because the issuers cash account balance could NOT cover the check is called

NSF check

What happens to the accounting equation when the adjustment is recorded to recognize earned revenue previously recorded as unearned revenue?

liability decreases, Revenue and SE increases

authorized stock represents

maximum number of shares

Depreciation is a process by which

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

When determining the amount of interest to be paid on bond, which of the following information is necessary

the stated rate of interest on the bonds

Which one of the following is an example of a deferred revenue?

unearned revenue

Klinc Company What is the cost of ending inventory at June 30th under specific identification method?

$1,395

During a period of increasing purchase prices, which inventory costing method will yield the lowest cost of goods sold?

FIFO

The current portion of long term debt would appear on the balance sheet as

current liability

company borrowed $60,000

interest payable $1050

Eli Company

$1,980

The College store accepts MasterCard for payments made by students. The Credit card drafts are [...]. Recording the sales and deposits will result in an increase in

The service charge expense 155

On January 1st, 10,000 shares of 10% [...] How much of the 2021 dividend should be paid to common stockholder?

$170,000

company purchased land and incurred

$572,500

What will be the increase in the paid in capital in excess of par account if a corp. issues 20000 shares of $1.00 per consumer stock for $6 per share?

100,000

While preparing April 30 bank reconciliation, the accountant identified the following items: What is the company's adjusted cash balance at April 30th?

14,885

A company receiving payment of a $20,000 accounts receivable within 10 days with terms 2/10, n/30, would record a sales discount of:

2% of 20,000= 400

a treasure preparing the October bank reconciliation identified the following items What is the company's adjusted cash balance at October 31?

32,500

On December 15th, the accounts receivable balance was $50,000 [...] The net realizable value of accounts receivable immediately after the write-off is:

45,000

If the stated interest rate is 12% per year, but it is compounded semiannually, the the adjusted rate used for present or future vales calculations will be

6% per 6 month period

The statement of cash flows

along with the balance sheet and statement of retained earnings is dated as of a specific year end date

par value represents

arbitrary amount that establishes a minimum price for the stock when it is first issued

What happens to the accounting equation when the argument for depreciation expense for the accounting period is recorded?

assets and stockholders equity decrease

On August 1, Genuine services accepted a $6,000 [...] What is the impact on the accounting equation of recording this transaction on August 1st?

assets increase and liabilities increase

Equipment with residual value of $50,000 at the end of 10 years was acquired [...] depreciation expense for 2021 will have debt to

depreciation expense and a accumulated depreciation credit $45,000

a company acquired land by issuing its common stock. How should this transaction be disclosed when a statement of cash flows is prepared?

in a supplemental schedule of noncash investing and financing activities or in a note

Which method of preparing activities of a statement of cash flows adjusts net income to remove the effects of deferrals and accruals for revenues and expenses?

indirect method

Operating assets with no physical properties are called

intangible

Failure to record accrued interest expense would result in which of the following?

overstated net income

Equipment purchased at the beginning of the year for $200,000 [...] Which statement is correct concerning the financial statements at the end of the year?

the accumulated depreciation account balance is now $80,000