Deck 20 Flashcards Preview

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Flashcards in Deck 20 Deck (20):
1

Journal entry to record a cash dividend

Date of declaration: Dr. RE and Cr. dividend payable

2

Costs related to a patent that should be capitalized include:

Successful patents and legal costs

3

Calculation of a gain for a non monetary exchange that has commercial substance

FV asset given up - BV asset given up

4

Calculation of a gain for a non monetary exchange that lacks commercial substance

Gain is determined by the proportion of cash (boot) received to the total consideration

5

Value of a machine in the company's balance sheet at lease inception

Record at the lessor of the fair value of the asset or lease cost (guaranteed residual value + required payments)

6

Cash received from bond issuance =

sales price + accrued interest

7

Definition of a fund

A checkbook; self balancing set of accounts

8

Government-wide vs. Fund-financial statements

Gov't wide: accrual method (economic resources focus); fund-financials: modified accrual (current financial resources focus)

9

Governmental funds vs. Proprietary funds vs. Fiduciary funds

Gov't: modified accrual (current focus); Proprietary and Fiduciary: accrual (economic focus)

10

Modified accrual method

Revenue is recognized when it is: measurable and available (not exceed 60 days after year end); expenses are recognized when the fund liability is incurred

11

Journal entry for property taxes levied:

Dr. property taxes receivable; Cr. Allowance for uncollectible taxes and revenue

12

Journal entry for recording a budget:

Dr. Estimated revenues; Cr. appropriations

13

Journal entry for encumbrances (purchase order)

Dr. Encumbrances; Cr. Budgetary control

14

Journal entry for expenditures (When goods are received)

Dr. expenditures and cr. vouchers payable; Also need to reverse the encumbrance journal entry

15

Under the general fund, what is included in expenditures:

General fixed assets (ex: receiving equipment)

16

Available appropriations =

Budget appropriations - expenditures - encumbrances (ignore vouchers payable)

17

Revenues included in budgetary accounting

Taxes (income, sales, and property tax), fines/penalties, debt proceeds, and inter fund transfers

18

Appropriations

Approved spending

19

Derived tax revenue examples (gov't accounting):

Income and sales tax

20

Imposed non-exchange revenues (gov't accounting):

Real estate taxes and fines/penalties