Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

Acct 3110 > Final Exam > Flashcards

Final Exam Flashcards

(77 cards)

Start Studying
1
Q

FASB Conceptual Framework Qualitative

A

Relevance- More useful for decisions being made
Predictive Value- helps predict future performance
Confirmatory Value- Information helps confirm prior expectations
Materiality- Information large enough to influence decision makin

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Quantitative Materiality

A

Dollar Amount.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Quality Materiality

A

Importance of information regardless of dollar amount.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Faithful Representation

A

Information should be complete, neutral, and free from error

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Conservatism

A

Report bad news more often then good news. Managers have too much incentive to report good news.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Enhancing Characteristics

A

Comparability, Consistency, Verifiable, Timely, and understandable

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Constraint on FASB CF

A

Cost effectiveness: The cost to implement ta standard should not exceed its benefits.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Owner’s Equity

A

Paid-in-Capital (C/S and P/S)+ RE

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

3 Adjusting Entries

A

Prepayments, Accruals, and Estimates

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Balance Sheet

A

Current Asset + PPE - Depreciation

Current Liabilities + Long term Liabilities + Share holder’s Equity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Temporary Accounts to Close out

A

Cause changes in RE. Income Statement + Dividends

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Title of Balance Sheet

A

As of …..

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Current Ratio

A

CA/CL

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Working Capital

A

Current Assets- Current Liabilities

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Quick Assets

A

Excludes Inventory, prepaid expense, deferred taxes, and restricted Cash. Higher Liquidity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Quick Ratio

A

Quick Asset/ Current Liability

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Debt to Equity Ratio

A

Total Liabilities/ Total Owner’s Equity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Interest Coverage

A

EBIT/Interest Expense

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

EBIT

A

Earnings before interest and taxes.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Market Capitalization

A

Stock Prices x Shares Outstanding

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Gross Profit

A

Step 1 IS = Sales Revenue- COGS

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Operating Income

A

Step 2 IS = GP-Operating Expenses

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Operating Expenses

A

Bad Debt, Rent, Ads, Losses on impairment, depreciation.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q 
Other Income (Income from 
continuing Operation before taxes)
A

Step 3 IS: Operating income + Other income (interest expense and revenue/Gain or loss on sale of asset)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Income From continuing Operations`
Step 4: Deduct income taxes
26
Net Income
Step 5: Income from discontinued Operation
27
Income Statement Title
For a period of time
28
Balance Sheet Method
Use A/R to estimate ending allowance for bad debts
29
Income Statement Method
Use credit sales revenue to estimate bad debt expense.
30
COGS
=Beg inv. +Net Purchases - Ending Inventory
31
Net Purchases
Purchases + Freight-in - Purchase Discounts - Purchase Returns
32
Freight - In
Pay to have inventory that are being shipped to us Perp: Costs are added to inv Period= Freight-in temp account
33
Purchase Returns
Company purchases inventory and returns Perp: Credit Inv Period: Temporary Account
34
Net Method
Buyer does not take discount then it is booked to Purchase Discounts lost
35
Good in Transit
Should wait to recognize inventory and revenue when the goods arrive at buyer
36
Goods on Consignment
Consignor does not recognize rev until sale to a third party occurs
37
LIFO
US GAAP is ok with LIFO but IFRS does not
38
Cost index in layer year
Costin layer year/ cost in base year
39
Gross Profit Method
Beg inv + Net Purchases = Goods Available for sale | GAFS-COGS= Ending Inv
40
GP%
GP/Net sales or 1-GP% = COGS/ Net Sales
41
Retail Inventory Method
High Volume, low unit price 1. Estimate Cost to retail percentage 2. Estimate Ending inventory @ retail 3. Multiply ending inventory at cost by multiplying by ratio
42
Cost to retail Percentage
GAFS @ cost/ GAFS @ Retail
43
Ending Inv @ Retail
= GAFS@ retail - Net Sales
44
Conventional Retail Method
Ignores Net Markdowns | Net markdowns will be subtracted after ratio calculated
45
LIFO Retail method
Excludes Beg Inv
46
Gross Profit Retail Method
Not allowed in annual financial reports due to it's assumptions
47
Inventory Write Down
Sell inventory for less than its costs | Costs in relation to Benchmark
48
Benchmarks for write down
``` Fifo/Average= Net Realizable Value LIFO/Retail = Market ```
49
NRV Net Realizable Value
estimated selling price - costs of completion, disposal, and transportation Ceiling
50
"Floor" for inv WD
NRV- Normal profit margin
51
What effects a company when choosing costing methods
Flow of inventory., net income, income taxes.
52
Changing to LIFO
Prospective implementation
53
Inventory Errors
Overstatement of Ending Inv = COGS is understated | Prior year adj to RE if not self corrected
54
Costs to be Capitalized
Purchase Price + All expenditures necessary for asset to be used
55
Capitalized costs
Contribute to future benefits`
56
Developing NR Costs
Acquisition, Exploration, Development, and restoration
57
ARO
Restore a Natural resources to original conditions. Asset Retirement Obligation Accretion Expense
58
Patents
20Ys Right to manufacture
59
Copy Rights
70+ Ys life of creator
60
Trademarks
10Ys
61
R&D
Too difficult to tie to future benefits as GAPP says to not include. Expense as used.
62
Software
Can capitalize software after technological Feasibility
63
Good Will
Acquisition - FV of all Net assets
64
Lump sum Purchases
If assets are identical, spread cost evenly | If assets different, Based on FV
65
NonCash Aqcuisitions
Record the acquired asset at a measure of Fair Value
66
Discount of Note payable
plugs between Fair value and Face Value. Contra Asset
67
Exchanges of Nonmonetary Assets
FV New Equip= cash paid and FV Plug to Gain = FV-BV Debit New FV Equp and Accum Dep
68
Interest Capitalization
Costs incurred due to construction should be capitalized
69
3 step interest cap
1. Determine Avg Accum Expenditures 2. Calc amount of interest 3. Amount capitalized <= interest incurred
70
Depreciation Base
= Original Cost- Residual Value
71
Cost Allocation
PPE-> Depreciation Natural Resources -> Depletion Intangibles -> Amortization
72
Recoverability Test
If Undiscounted expected future cash flows are < Book Value, then it is impaired
73
Measurement of impairment loss
=BV-FV
74
IFRS Impairment
Test Annually, no recoverability test, no assessment, and allows reversal
75
Subsequent Expenditures
Cost incurred after an assets initial acquisition Cap if it is improved Expense if it maintains benefits
76
Disposition
Gain or loss recognized for the difference between the consideration received and book value of asset sold
77
Retirements
Remove Asset from books and plug to a loss.

Acct 3110 (8 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions