Accounting Final
estimated liability
A warranty is an example of an: contingent liability, estimated liability, settled liability, or a known liability.
free on board
FOB means
to help investors, creditors, and others make decisions
What is the purpose of financial accounting information?
date of record
Will determine which shareholders receive the dividends
accounts receivable
a T-account has a $759 credit balance. this account is most like NOT: accounts payable (credit), sales revenue (credit), common stock (credit), accounts receivable (debit)
$58,000 58,000+65,000=123,000
a company has $123,000 in assets and $65,000 in liabilities. How much does the company have in stockholders' equity?
$16,450
a company has $235,000 in credit sales. the company used the allowance method of determining uncollectible accounts expense. the allowance for doubtful accounts now has a $7,250 credit balance. If the company uses the allowance method based on 7% of credit sales, what will be the amount of the journal entry credited to allowance for uncollectible amounts?
$1,300????
a company has $4,500 in net sales, $3,200 in gross profit, $1,300 in ending inventory, and $1,800 in beginning inventory. the company's cost of good sold is....
$80,000 23,500+ 56,500=80,000
a company has liabilities of $23,500 and stockholders' equity of $56,500. How much does the company have in assets?
56700-26700=30000/56700=*52.9%*
a company has net sales of $56,700 and a cost of goods sold of $26,700. the company's gross profit percentage is approximately:
outweighs the benefits of the system
a company may be limited in their internal control procedures because the cost of hiring enough people to implement the procedures:
$10,400: 1/estimated useful life x 2 x book value at the beginning of the year= depreciation expense per year.
a company purchased furniture on Jan. 1, 2012. its cost was $15,600 and it had residual value of $1,600. Its useful life is determined to be 3 years. using double-declining balance depreciation, the depreciation for 2012 to the nearest dollar will be
reduces the risk of undetected errors
a good internal control system does which of the following?
LIFO method
a method of valuing inventory based on the assumption that the newest goods will be sold first is called the
FIFO method
a method of valuing inventory based on the assumption that the oldest goods will be sold first is called the
specific cost method
a method of valuing inventory based on the costs for each individual item is called
specific-identification method of inventory costing
a new car lot would probably cost its inventory using the _____method of inventory costing
cumulative preferred stock
a type of stock that pay dividends in arrears is: cumulative preferred or common stock
accrued revenue
accounts receivable (asset) would be an example of
liabilities
all payables are listed as...
rationalization
an employee's moral beliefs make it impossible to commit a fraud. this contradicts which part of the fraud triangle?
intangible assets
assets that cannot be seen, touched, or held are called
($3,500) 29,500-33,000=(3,500) sales-expenses
beginning retained earnings are $65,000; sales are $29,500; expenses were $33,000 and dividends paid are $3,500. How much is the net income or loss for the company?
ensure larger bonuses to upper management at year-end
besides using the overstatement of earnings to inflate a company's stock price, overstating earnings may also:
secured bonds
bonds that are backed by collateral are: callable bonds, secured bonds, unsecured bonds, or convertible bonds?
unsecured bonds
bonds that are backed only by the credit of the issuing company are: collateral bonds, callable bonds, unsecured bonds, or term bonds?
convertible bonds
bonds that can be exchanged for stock are called: debenture bonds, convertible bonds, callable bonds, or serial bonds?
callable bonds
bonds that may be retired at a prearranged price are called: convertible bonds, callable bonds, term bonds, or secured bonds?
depreciated
buildings, vehicles, and desks are: amortized, depleted, expensed, or depreciated
$47,304 -50 43267-5288+9325
casey Company's bank statement shows a bank balance of $43,267. the statement shows a bank service charge of $50. Casey's book balance shows outstanding checks of $5,288 and deposits in transit of $9,325. the bank side reconciliation would show cash of:
depleted
coal, oil, and timber are depreciated, depleted, amortized, or expensed
perceived pressure
committing a fraud because of a drug habit or living beyond your means is an example of
left side of the account
debit means:
added to the bank balance
deposits in transit are: subtracted or added to the book or bank balance
assets
expenses paid in advance such as rent and insurance are classified as prepaid expenses. into what category are they placed?
long-term liabilities and equity accounts
financing activities affect: long-term liabilities and equity accounts or current and long-term liabilities
rationalization
finding good reasons for doing things that we really know are wrong is an example of:
cost of goods sold is overstated and net income is understated in Period 1
if Period 1 ending inventory is understated then,
par
if a bond 's stated rate of interest is equal to the market rate of interest, the bond will be issued at:
cash basis of accounting
if a business records expenses when paid, the company is using the
accrual basis of accounting
if revenues are recognized and recorded when earned, the company is using the
discount
if the market rate of interest is greater than the bond's stated rate of interest, the bond will be issued at: 5<10
operating
in order to be successful over the long run, the main source of a company's cash must come from: operating, financing, or investing accounts?
2nd
inventory errors cancel out at the end of ____ accounting periods
asset
inventory for a merchandising business is classified as an
long-term assets
investing cash flows affect: long-term assets, current assets and current liabilities, equity accounts, or long-term liabilities
capital leases
leases that are treated as financed purchases are called: revenue leases, expensed leases, capital leases, or operating leases?
not treated as fixed assets
long-term investments (assets) by a corporation are: not treated as fixed assets, amortized, depreciated, or depleted
preemption
maintaining their proportionate share in the ownership of a corporation when new stock is available to be purchased is an example of which stockholder right?: preemption, vote, liquidation, or dividends?
$33,350----> 125000-10000=115000/50000=2.3 x 14500=33350
meranda corporation purchases a machine for $125,000.it has an estimated salvage value of $10,000 and is expected to produce 50,000 units in its lifetime. during the first year of operation, it produced 14,500 units. to the nearest dollar, the depreciation for the first year under the units of production method will be
liabilities
obligations that are owed to others due to past transactions are categorized as
Balance sheet
of the financial statements, which is dated as of a specific date?
assets
of the following, which are reported on the balance sheet? assets, expenses, net income or net loss, or revenues
current assets and current liabilities
operating cash flows affect: current assets and current liabilities, long-term assets, long-term liabilities, or equity accounts?
subtracted from the bank balance
outstanding checks are added or subtracted to or from bank balance
amortized
patents, goodwill, and trademarks are: depreciated, depleted, amortized, or expensed
regardless of method inventory
physical inventory counts must be done
deferred expense
prepaid rent (asset) would be an example of
permanent, temporary, and permanent
respectively, cash(asset) rent expense, and accounts payable (liability) are: temporary or permanent assets permanent and liability temporary
paid-in capital
stockholders' stake in stock appears in: paid-in capital, cash, owner's equity, and retained earnings.
general ledger
the _____ keeps a running balance of an individual account
retained earnings
the account to which revenue and expenses are closed is called
assets, liabilities, and stockholder's equity
the accounts that are NOT closed are:
balance sheet approach
the aging method is called AB
subtracting $9 from the bank balance
the bank recorded a $56 deposit as $65. this bank error would be corrected by: adding or subtracting $9 to or from the bank balance
cash reported on the balance sheet and the accrual based income statement
the cash flow statement is the communicating link between the:
perceived opportunity
the chance to commit a fraud, conceal it, and avoid punishment is an example of:
0.456 current assets/current liabilities
the company has current assets of $35,600, total assets of $67,000 and current liabilities of $78,000. the company's current ratio is approximately:
income statement
the cost of goods sold accounts appears on the
straight-line method
the depreciation method in which the depreciable cost of an asset is apportioned equally over its estimated life in terms of month or years is called
that it may help to increase the stock price of a company
the goal of overstating earnings by using fraud is:
general ledger
the information from the general journal is transferred to the:
dividing cost of goods sold by average inventory cogs/average inventory
the inventory turnover rate is computed by
declaration
the liability "dividend payable" is recognized on the date of: record, declaration, stock issue, or payment
income statement approach
the percent-of-sales method is called the PI
how cash was received and used during the period
the purpose of the statement of cash flows is to show:
debit, credit, debit
the retained earnings accounts of dividends (debit), revenues (credit), and expenses (debit) have normal balances of.... Debit=ADE Credit=LEQR
managerial
the statement of cash flows reports the sources and uses of cash from all of the following EXCEPT: financing, investing, managerial, or operating
income statement
this reports the results of operations for a specific period
only known when a physical count is taken
under the periodic inventory method, the amount of inventory is
deferred revenue
unearned subscriptions revenue would be an example of
$3,570
using a 360-day year, the maturity value of a 90 day note for $3,500 at 8% annual interest is: 90/360=.250 x .08 x 3500= 70 + 3500= 3570
accrued expense
wages payable (liability) would be an example of
short-term liabilites
wages payable, income taxes payable, and accounts payable are:
cash
which is not included in paid-in capital?: additional paid-in capital, cash, common stock, or preferred stock?
operating
which of the following activities is computed differently using the two methods of formatting a statement of cash flows? financing, operating (indirect), investing, or both operating and investing?
corporations
which of the following are considered to be legal entities that exist separate and distinct from their owners?: organizations with more than 100 partners, partnerships, corporations, or sole proprietorships?
Balance sheet
which of the following financial statements illustrates the accounting equation? A=L+SE
FOB shipping point
which of the following indicates that the shipment is free on board and the buyer pays all of the shipping and freight costs? BP
FOB destination
which of the following indicates that the shipment is free on board and the seller pays all of the shipping and freight costs? SD
date of issuance
which of the following is NOT a date associated with dividends?: date of issuance, date of record, date of declaration, or date of payment? (declaration, record, payment)
buying land
which of the following is NOT a part of financing activities? paying off loans, issuing stock, paying dividends, or buying land?
paying dividends
which of the following is NOT part of operating activities? paying utilities, earnings revenue, paying payables, or paying dividends?
realization
which of the following is NOT part of the fraud triangle? perceived opportunity, rationalization, realization, or perceived pressure
mortgage payable
which of the following would NOT be considered a contingent liability? pending a legal action, cosigning a loan, potential fines from the EPA, or mortgage payable?
land
which of the following would NOT be considered an intangible asset? franchise, goodwill, copyright, or land
timber
which of the following would be considered a natural resource? wheat, livestock, corn, or timber
separation of duties
which of the following would be considered a part of control activities in an internal control system? locating weaknesses in an internal control system, having a leadership philosophy, separation of duties, having large quantities of cash on hand?
stock split
which of the following would be used to decrease the par value of a company's stock?: sale of additional stock, stock split, stock dividend, or cash dividend?
Corporation
which type of organization has stockholders?
GAAP
The guidelines that describe the rules of accounting are called
decrease on debit side, increase on credit side and are liabilities
Accounts payable (credit), taxes payable (credit), and notes payable (credit): increase or decrease on debit or credit side and are expenses, revenues, liabilities, or assets?
known liability
Accounts payable would be an example of a: known liability, accrued liability, estimated liability, or contingent liability?
cost of goods sold available for sale
Beginning inventory + net purchases =
Accounting
GAAP is the acronym for generally accepted ______ principles
LIFO (pay less, get less)
In order to pay the least income tax possible in periods of rising inventory costs, the company should use which of the following inventory costing methods?
assets
Land, cash, office equipment and accounts receivable belong to what category of accounts?
subtracted from the book balance
NSF check amounts are added or subtracted from book balance
add $450 to their book balance
PNC bank collected a $450 note from a customer for ABC company. When doing the bank reconciliation, ABC should
$48,000 preferred stock paid-in preferred common stock paid-in common no retained earnings
RH corporation stockholders' equity section includes the following information: preferred stock- $11,000 paid-in capital in excess of par-preferred- 17,000 common stock-16,000 paid-in capital in excess par-common-4,000 retained earnings- 7,000 total paid-in capital is?
