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Flashcards in Final Deck (58)
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1

If total assets decreased by $88,000 during a period of time and stockholders' equity increased by $71,000 during the same period, then the amount and direction of the period's change in total liabilities is:

$159,000 decrease

2

declaring and paying cash dividends:

decrease stockholders' equity

3

how does receiving a bill to be paid next month for services received affect the accounting equation?

Liabilities increase, Stockholders' equity decreases

4

Allen Marks, Great Marks

45,000

5

transactions affecting stockholders' equity include

shares of capital stock issued to stockholders, dividends declared and paid to stockholders, revenues and expenses

6

A credit balance in which of the following would indicate a likely error?

Salary Expense

7

Office supplies purchased by Ari's alarm service on account were returned. Which of the following entries for Ari's alarm service records this transaction?

Accounts Payable, debit. Office Supplies, Credit

8

Which of the following entries records the receipt of cash from patients on account?

Cash, Debit. Accounts Receivable, Credit.

9

Using accrual accounting, expenses are recorded and reported only

when they are incurred, whether or not cash is paid

10

If the effect of the credit portion of an adjusting journal entry is to increase the balance of a liability account, which of the following describes the effect of the debit portion of the entry?

increases the balance of an expense account

11

prior to the adjusting process, accrued expenses have

been incurred, not paid, and not recorded

12

the cash basis of account records revenues and expenses when the cash is exchanged while the accrual basis of accounting...

records revenues and expenses when they are incurred

13

which of the following is an example of an accrued revenue?

swimming pool cleaning that has been provided but has not been billed or paid

14

a summary of selected ledger accounts appear below for Alberto's Plumbing Services for the current calendar year-end. Net Income for the period is

$15,000

15

Amir designs purchased a one year liability insurance policy

$600

16

The primary difference between periodic and perpetual inventory system is that a

Periodic system determines the inventory on hand only at the end of the accounting period

17

When the perpetual inventory system is used, the inventory sold is shown on the income statement as

Cost of Merchandise sold

18

Using the following information, what is the amount of Cost of Merchandise Sold

$31,880

19

Sales to customers who use bank credit cards such as mastercard and visa are usually recorded by a

debit to cash and a credit to sales

20

merchandise with an invoice price of 3,000 is purchased on September 2

$2,940

21

assuming that the company uses the perpetual inventory system, determine the cost of merchandise sold for the sale of May 20, using the LIFO inventory method

$144

22

assuming that the company uses the perpetual inventory system, determine the COMS for the sale of May 20 use the FIFO method

$136

23

assuming that the company uses the perpetual inventory system, determine the ENDING INVENTORY VALUE for the month of May using the FIFO method

$372

24

The value of the ending inventory using FIFO is

$1,375

25

the value of the ending inventory using LIFO is

$1,150

26

The value of the ending inventory using average cost is

$1,263

27

If merchandise inventory is being valued at a cost and the price level is steadily rising, the method of costing that will yield the highest net income is

LIFO

28

During a period of falling prices, which of the following inventory methods generally results in the lowest balance sheet amount for inventory

FIFO

29

During the taking of its physical inventory on December 31, 2014, Barry's Bike Shop

Assets and R/E overstated by $70,000; net income overstated by $70,000

30

If the estimated rate of gross profits is 30%, what is the estimated Cost of Merchandise Inventory on September 30, based on the following data?

$320,000