Flashcards in FINAL Deck (53):
What is ACCOUNTS RECEIVABLE classified as?
What is ACCOUNTS PAYABLE classified as?
What is MISC. EXPENSE classified as?
What is FEES EARNED classified as?
What is UNEARNED RENT classified as?
What is CAPITAL classified as?
What is CASH classified as?
What is WAGES EXPENSE classified as?
What is DRAWING classified as?
What is PREPAID INSURANCE classified as?
What is EQUIPMENT classified as?
What is SUPPLIES EXPENSE classified as?
What is LAND classified as?
What is RENT EXPENSE classified as?
What is SUPPLIES classified as?
What is the normal balance for ASSETS?
What is the normal balance for LIABILITIES?
What is the normal balance for OWNSER'S EQUITY (DRAWING)?
What is the normal balance for OWNER'S EQUITY (CAPITAL)?
What is the normal balance for REVENUES?
What is the normal balance for EXPENSES?
What are the PERMANENT accounts?
What are the TEMPORARY accounts?
What is the BASIC ACCOUNTING EQUATION?
assets = liabilities + owner's equity
What is the order in which FINANCIAL STATEMENTS are prepared?
1. Income Statement
2. Statement of Owner's Equity
3. Balance Sheet
What appears on the INCOME STATEMENT?
What appears on the STATEMENT OF OWNER'S EQUITY?
What appears on the BALANCE SHEET?
What is used to PREPARE the FINANCIAL STATEMENT?
Adjusted Trial Balance
What is the order of CLOSING ENTRIES?
3. income summary
4. owner's equity
What is the PURPOSE of CLOSING ENTRIES?
to 0 out temporary accounts
What accounts appear on the POST-CLOSING TRIAL BALANCE?
ONLY permanent accounts
(capital, assets, liabilities)
What does FOB stand for?
Free On Board
What is FOB SHIPPING POINT?
merchandise transfers from the seller to the buyer at the shipping point, the BUYER pays the freight
What is FOB DESTINATION?
merchandise transfers from the seller to the buyer at the destination, the SELLER pays the freight
What does LIFO mean?
Last In First Out
What does FIFO mean?
First In Last Out
What is an OUTSTANDING CHECK?
a check that has not yet cleared
Where do you start when determining OUTSTANDING CHECKS?
Should NOTES COLLECTED BY BANK be added or deducted from the book balance?
Should NSF (bounced) CHECKS be added or deducted from the book balance?
Should SERVICE FEES be added or deducted from the book balance?
The RECONCILING item in a bank reconciliation that will result in an adjusting entry by the depositor is?
bank service charges
What reconciling items should result in a JOURNAL ENTRY?
service charges or items for adjustments to book balance (NSF, Notes Collected, Service Fees)
What do you debit and credit in the JE during LIFO and FIFO?
Dr. Cost of Goods Sold
to record Cost of Goods Sold under FIFO
to record Cost of Goods Sold under LIFO
Are DEPOSITS IN TRANSITS added or deducted from the bank balance on the reconciliation?
Are OUTSTANDING CHECKS added or deducted from the bank balance on the reconciliation?
What resources are considered PLANT ASSETS?
What are examples?
- physical substance
- used in the operations of a business
-not intended for sale for customers
- expected to be of use to the company for a number of years
- pizza oven
- pizza delivery truck
How do you calculate depreciation using the STRAIGHT LINE METHOD?
cost - salvage value / useful life (years)
How do you calculate depreciation using the UNITS OF ACTIVITY METHOD?
depreciable cost / total units of activity * units of activity during the year
How do you calculate INTEREST ON A LOAN?
face value * APR / 12 * life of note in month
How do you calculate GROSS PAY?
hours worked * rate of pay