Note 21 - exam prep PDF

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8100 - 500 = 7600

On September 1, 2015, Gold Magazine sold 400 one-year subscriptions for $90 each. The total amount received was credited to unearned revenue. What should be the required adjusting entry on December 31, 2015? - Debit: Unearned Revenue 12,000 Credit: Service Revenue 12,000

you are adjusting the entry, so you debit what you credited (unearned revenue)

One disadvantage of the corporate form of business is - double taxation

operating cash flows include - current assets and liabilities, net income, interest, taxes

patent - exclusive right to manufacture a product, 20 years

pay $7000 for employee salaries - debit: salaries expense 7000 credit: cash 7000

premium rate - market rate < stated rate

provide $50 of services to customers on account - accounts receivable 50 service revenue 50

Provide services worth $8,000 to customers on account - Debit: Accounts Receivable Credit: Service Revenue

Purchase supplies of $1500 on account - Debit: Supplies Credit: Accounts Payable

recording a bond issuance when YOU receive it - Cash

Bonds Payable

(this is when you GET a bond, other way around when issuing it)

retained earnings represents a company's: - net income - dividends since the company first began operations.

sales discount sales allowance sales returns are all apart of what accounts - contra-revenues (debit)

solvency - - long term focus - long term liabilities

STEAK LEASING received $12,000 for 24 months rent in advance. How should STEAK record this transaction? - Cash Deferred Revenue

straight-line depreciation formula - cost - residual/ useful life (depreciation expense)

Summer Leasing received $10,300 for 24 months rent in advance. How should summer record this transaction? - Debit: cash Credit: unearned revenue

T/F about the statement of cash flows? - paying dividends to investors creates a cash outflow from financing activities.

T/F: You use cash in adjusting entries - FALSE - adjusting entries never involve cash

The accounts payable account has a beginning balance of $10,600 and the company purchased $55,000 of supplies on account during the month. The ending balance was $19,500. How much did the company pay to creditors during the month? - $46,100

(10,600+55,000-19,500)

the act of collusion refers to? - two or more people acting in coordination to circumvent internal controls.

the balance of cash reported in the balance sheet this year minus the balance of cash reported in the balance sheet last year equals: - net cash flows from operating, investing, and financing activities

the correct order from the largest number of shares to the smallest number of shares is: - 1. authorized 2. issued 3. outstanding

the correct order from the smallest number of shares to the largest number of shares is: - 1. outstanding 2. issued 3. authorized

The dividends account would be shown only on: - the statement of stockholders equity

the payment of salaries is classified in the statement of cash flows as a(n): - operating activity

The purpose of recording an allowance for uncollectible accounts is to: - report accounts receivable at net realizable value.

the receivables turnover ratio - depicts the companys' frequency of cash collections

times interest earned ratio - income before interest & taxes / interest expense

trademark - word, slogan, symbol that identifies company, 10 years

treasury stock is normally reported as: - a reduction of total stockholders equity. also is a contra stockholders equity account

Using the information above in problem 66, the journal entry on May 1, 2019 to record the amount of cash needed to pay back the note payable plus any accrued interest would include: - A credit to cash for $206,000.

weighted average ratio calculation - total cost / total # of units

what account(s) are reported in the stockholders equity section of the balance sheet? - common stock preferred stock treasury stock retained earnings additional pic

what are examples of noncash activities? - - "exchange in/of" - purchase of land by issuing debt

what are the 2 requirements to record a contingent liability - 1) probable 2) reasonably estimated

what are the only ratios that shows solvency (ability to pay long term liabilities)? - debt to equity ratio & times earned interest ratio

what are the reasons that a corporation would prefer to issue a stock instead of a bond? - the risk of going bankrupt is less

what do employees pay taxes to? - fica + federal/state income taxes

what do employers pay taxes to? - FICA + unemployment

what do you not use when calculating operating income? - income and interest expense

what does "authorized" mean? - number of shares allowed to be issued

what does "issued" mean? - number of shares sold

what does "outstanding" mean? - number of shares issued, minus treasury stock

what falls under financing activities? - stockholder equity longterm liabilities notes payable "bonds payable" "borrowing" + issuance of bonds/stock - dividends...