ACG midterm 1

Question 0

A pension plan that promises employees a fixed annual pension benefit at retirement, based on years of service and compensation levels.

Answer 0

Defined Benefit Plan

Question 1

Liabilities that may arise from past transactions if certain events occur in the future.

Answer 1

Contingent Liabilities

Question 2

A pension plan that requires a fixed amount of money to be invested on the employee’s behalf during the employee’s working years

Answer 2

Defined Contribution Plan

Question 3

The interest deducted from the maturity value of a note or the excess of the face amount of bonds over the issue price.

Answer 3

Discount

Question 4

The rate used in computing the interest to be deducted from the maturity value of a note.

Answer 4

Discount Rate

Question 5

A detailed record of each employee’s earnings

Answer 5

Employees earning record

Question 6

Federal Insurance Contributions Act tax used to finance federal programs for old-age and disability benefits (social security) and health insurance for the aged (Medicare).

Answer 6

FICA tax

Question 7

Benefits provided to employees in addition to wages and salaries

Answer 7

Fringe Benefits

Question 8

The total earnings of an employee for a payroll period.

Answer 8

Gross pay

Question 9

Gross pay less payroll deducations; the amount the employer is obligated to pay the employee

Answer 9

Net Pay

Question 10

The total amount paid to employees for a certain period.

Answer 10

Payroll

Question 11

A multicolumn report used to assemble and summarize payroll data at the end of each payroll period.

Answer 11

Payroll Register

Question 12

A cash payment to retire employees

Answer 12

Pension

Question 13

The net amount available from discounting a note payable.

Answer 13

Proceeds

Question 14

Cash and other current assets that can be quickly converted to cash, such as marketable securities and receivables.

Answer 14

Quick Assets

Question 15

A financial ratio that measures the ability to pay current liabiliteis with quick assets (Cash, marketable securities, account receivables).

Answer 15

Quick Ratio

Question 16

A cash distribution of earnings by a corporation to its shareholders

Answer 16

Cash Dividends

Question 17

The stock outstanding when a corporation has issued only one class of stock.

Answer 17

Common Stock

Question 18

Stock that has a right to receive regular dividends that were not declared (paid) in prior years

Answer 18

Cumulative Preferred Stock

Question 19

Net income per share of common stock outstanding during a period.

Answer 19

Earnings Per Common Share (EPS)

Question 20

Cumulative preferred stock dividends that have not been paid in prior years are said to be in arrears

Answer 20

In arrears

Question 21

The stock in the hands of stockholders

Answer 21

Outstanding stock

Question 22

The monetary amount printed on a stock certificate

Answer 22

Par

Question 23

A class of stock with preferntial rights over common stock.

Answer 23

Preferred Stock

Question 24

The excess of the issue price of a stock over its par value or the excess of the issue price of bonds over their face amount.

Answer 24

Premium

Question 25

Corrections of material errors related to a prior period or periods, excluded from the determination of net income

Answer 25

Prior Period Adjustment

Question 26

Amounts of retained earnings that have been limited for use as dividends.

Answer 26

Restrictions

Question 27

A summary of the changes in the stockholders' equity in a corporation that have occurred during a specific period of time.

Answer 27

Statement of Stockholder's Equity

Question 28

Shares of ownership of a corporation

Answer 28

Stock

Question 29

A distribution of shares of stock to its stockholders.

Answer 29

Stock Dividends

Question 30

A reduction in the par or stated value of a common stock and the issuance of a proportionate number of additional shares

Answer 30

Stock Split

Question 31

The owners of a corporation

Answer 31

Stockholders

Question 32

Stock that a corporation has once issed and then reacquires

Answer 32

Treasury Stock

Question 33

The number of shares that the company has actually sold for cash or issued in exchange for an asset other than cash.

Answer 33

Shares Issued

Question 34

Shares a corporations charter states that can be issued

Answer 34

Shares authorized

Question 35

The date the board of directors formally authrizes the payment of the dividend.

Answer 35

Date of Declaration

Question 36

The date the corporation uses to determine which stockholders will receive the dividend

Answer 36

Date of Record

Question 37

The date the corporation will pay the dividend to the stockholders who owned the stock on the date of record.

Answer 37

Date of Payment

Question 38

A depreciation method that provides for a higher depreciation amount in the first year of the assets use, followed by a gradually declining amount of depreciation.

Answer 38

Accelerated Depreciation Method

Question 39

The periodic transfer of the cost of an intangible asset to expense.

Answer 39

Amortization

Question 40

The cost of a fixed asset minus accumulated depreciation on the asset.

Answer 40

Book Value

Question 41

The amount a buyer owes a seller when a fixed asset is traded in on a similar asset

Answer 41

Boot

Question 42

The costs of acquiring fixed assets, adding to a fixed asset, improving a fixed asset, or extending a fixed asset's useful life.

Answer 42

Capital Expenditures

Question 43

Leases that include one or more provisions that result in treating the leased assets as purchased assets in the account

Answer 43

Capital Leases

Question 44

An exclusive right to publish and sell a literary, artistic, or musical corporation

Answer 44

Copyright

Question 45

The process of transferring the cost of natural resources to an expense account.

Answer 45

Depletion

Question 46

The systematic periodic transfer of the cost of a fixed asset to an expense account during its expected useful life.

Answer 46

Depreciation

Question 47

A method of depreciation that provides periodic depreciation expense based on the declining book value of a fixed asset over its estimated life.

Answer 47

Double Declining Balance Method

Question 48

The number of dollars of sales that are generated from each dollar of average fixed assets during the year, computed by dividing the net sales by the average net fixed assets.

Answer 48

Fixed Asset Turnover Ratio

Question 49

Long-term assets that are useful in the operations of a business, are not held for sale, and are without physical qualities.

Answer 49

Fixed assets

Question 50

An intangible asset that is created from such favorable factors as location, product quality, reputation, and managerial skills.

Answer 50

Goodwill

Question 51

Long-term assets that are useful in the operations of a business, are not held for sale, and are without physical qualities.

Answer 51

Intangible Assets

Question 52

Leases that do not meet the criteria for capital leases and thus are accounted for as operating expenses.

Answer 52

Operating Leases

Question 53

Exclusive rights to produce and sell goods with one or more unique features.

Answer 53

Patents

Question 54

The estimated value of a fixed asset at the end of its useful life.

Answer 54

Residual value

Question 55

Costs that benefit only the current period or costs incurred for normal maintenance and repairs of fixed asset.

Answer 55

Revenue Expenditures.

Question 56

A mothod of depreciation that provides for equal periodic depreciation expense over the estimated life of a fixed asset.

Answer 56

Straight-line Method

Question 57

The amount a seller allows a buyer for a fixed asset that is traded in for a similar asset.

Answer 57

Trade-in Allowance.

Question 58

A name, term, or symbold used to identify a business and its products.

Answer 58

Trademarks

Question 59

A method of depreciation that provides for depreciation expense based on the expected productive capacity of a fixed asset.

Answer 59

Units-of-Production Method