FINAL Flashcards Preview

Accounting 1010 > FINAL > Flashcards

Flashcards in FINAL Deck (53):
1

What is ACCOUNTS RECEIVABLE classified as?

Asset

2

What is ACCOUNTS PAYABLE classified as?

Liability

3

What is MISC. EXPENSE classified as?

Expense

4

What is FEES EARNED classified as?

Revenue

5

What is UNEARNED RENT classified as?

Liability

6

What is CAPITAL classified as?

Owner's Equity

7

What is CASH classified as?

Asset

8

What is WAGES EXPENSE classified as?

Expense

9

What is DRAWING classified as?

Owner's Equity

10

What is PREPAID INSURANCE classified as?

Asset

11

What is EQUIPMENT classified as?

Asset

12

What is SUPPLIES EXPENSE classified as?

Expense

13

What is LAND classified as?

Asset

14

What is RENT EXPENSE classified as?

Expense

15

What is SUPPLIES classified as?

Asset

16

What is the normal balance for ASSETS?

Debit

17

What is the normal balance for LIABILITIES?

Credit

18

What is the normal balance for OWNSER'S EQUITY (DRAWING)?

Debit

19

What is the normal balance for OWNER'S EQUITY (CAPITAL)?

Credit

20

What is the normal balance for REVENUES?

Credit

21

What is the normal balance for EXPENSES?

Debit

22

What are the PERMANENT accounts?

Capital
Assets
Liabilities

23

What are the TEMPORARY accounts?

Drawing
Revenues
Expenses

24

What is the BASIC ACCOUNTING EQUATION?

assets = liabilities + owner's equity

25

What is the order in which FINANCIAL STATEMENTS are prepared?

1. Income Statement
2. Statement of Owner's Equity
3. Balance Sheet

26

What appears on the INCOME STATEMENT?

revenues
expenses

27

What appears on the STATEMENT OF OWNER'S EQUITY?

capital
drawing

28

What appears on the BALANCE SHEET?

assets
liabilities

29

What is used to PREPARE the FINANCIAL STATEMENT?

Adjusted Trial Balance

30

What is the order of CLOSING ENTRIES?

1. revenues
2. expenses
3. income summary
4. owner's equity

31

What is the PURPOSE of CLOSING ENTRIES?

to 0 out temporary accounts

32

What accounts appear on the POST-CLOSING TRIAL BALANCE?

ONLY permanent accounts
(capital, assets, liabilities)

33

What does FOB stand for?

Free On Board

34

What is FOB SHIPPING POINT?

merchandise transfers from the seller to the buyer at the shipping point, the BUYER pays the freight

35

What is FOB DESTINATION?

merchandise transfers from the seller to the buyer at the destination, the SELLER pays the freight

36

What does LIFO mean?

Last In First Out

37

What does FIFO mean?

First In Last Out

38

What is an OUTSTANDING CHECK?

a check that has not yet cleared

39

Where do you start when determining OUTSTANDING CHECKS?

Bank Statement

40

Should NOTES COLLECTED BY BANK be added or deducted from the book balance?

added

41

Should NSF (bounced) CHECKS be added or deducted from the book balance?

deducted

42

Should SERVICE FEES be added or deducted from the book balance?

deducted

43

The RECONCILING item in a bank reconciliation that will result in an adjusting entry by the depositor is?

bank service charges

44

What reconciling items should result in a JOURNAL ENTRY?

service charges or items for adjustments to book balance (NSF, Notes Collected, Service Fees)

45

What do you debit and credit in the JE during LIFO and FIFO?

Dr. Cost of Goods Sold
Cr. Inventory
to record Cost of Goods Sold under FIFO
OR
to record Cost of Goods Sold under LIFO

46

Are DEPOSITS IN TRANSITS added or deducted from the bank balance on the reconciliation?

added

47

Are OUTSTANDING CHECKS added or deducted from the bank balance on the reconciliation?

deducted

48

What resources are considered PLANT ASSETS?
What are examples?

Plant Assets:
- 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

Example:
- pizza oven
- pizza delivery truck

49

How do you calculate depreciation using the STRAIGHT LINE METHOD?

cost - salvage value / useful life (years)

50

How do you calculate depreciation using the UNITS OF ACTIVITY METHOD?

depreciable cost / total units of activity * units of activity during the year

51

How do you calculate INTEREST ON A LOAN?

face value * APR / 12 * life of note in month

52

How do you calculate GROSS PAY?

hours worked * rate of pay

53

How do you calculate net pay?

gross pay - FICA (7.65%) - income taxes withheld