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INTACC (QE) Flashcards

1
Q

includes money and any other negotiable instrument that is payable in money and acceptable by the bank for deposit and immediate credit, it must also be UNRESTRICTED in use, that it is readily available in the payment of current obligations and NOT be subject to any restrictions.

A

Cash

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2
Q

set aside for current operations.

A

Cash Fund

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3
Q

Period or Term
Cash and Cash Equivalents

A

Less than 3 months

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4
Q

Term or Period
Current Assets

A

3 months to 1 year

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5
Q

demand deposit & savings account, unrestricted.

A

Cash in bank

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6
Q

includes legal tender, bills, coins, checks received but not deposited, and checking and savings account.

A

Cash

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7
Q

are any short-term investment securities that have maturity periods of 90 days or less. This includes bank certificates of deposits, banker’s acceptances, treasury bills, commercial paper and other money market instruments.

A

Cash Equivalents

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8
Q

Investments in liquid securities such as ____ and ____ are not included in cash and equivalents.

A

stocks
bonds

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9
Q

is a schedule the company (depositor) prepares to reconcile, or explain, the difference between the cash balance on the bank statement and the cash balance on the company’s books.

A

Bank Reconciliation

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10
Q

The company prepares a bank reconciliation to determine its ________________and prepare any entries to ____________ in the ledger.

A

actual cash balance
correct the cash balance

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11
Q

is a record of your bank account transactions, typically for one month, prepared by the bank.

A

Bank Statement

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12
Q

is anything that doesn’t match or doesn’t exist on both places
(company and bank). A _________ will be added or subtracted to the bank or book side of the reconciliation.

A

Reconciling Item

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13
Q

typically a day’s cash receipts recorded in the depositor’s books in one period but recorded as a deposit by the bank in the succeeding period. The most common __________ is the cash receipts deposited on the last business day of the month.

A

Deposit in Transit

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14
Q

those issued by a depositor but not paid by the bank on which they are drawn. The party receiving the check may not have deposited it immediately.

A

Outstanding Checks

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15
Q

reflect deductions for such items as service charges, NSF checks, safe-deposit box rent, and notes paid by the bank for the depositor.

A

Debit Memos

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16
Q

reflect additions for such items as notes collected for the depositor by the bank and wire transfers of funds from another bank in which the company sends funds to the home office bank.

A

Credit Memos

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17
Q

refer to claims against others for money, goods or services arising from sale of merchandise or money lent or the performance of services. For accounting purposes however, the term is employed to mean claims expected to be settled by the receipts of cash.

A

Receivables

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18
Q

Receivables are recognized when title to _______________ to the buyer or when _____________ take place. The point at which title passes may vary with the terms of the sales.

A

title to the goods passes
transfer of resources

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19
Q

Measurement of Receivables

A

Face Value
Discounted Amount (Present Value)

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20
Q

Receivable are valued at their ____________ or their expected _______.

A

net realizable value
cash value

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21
Q

is the estimated amount of cash that will be collected or realized from receivables.

A

Net realizable value

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22
Q

Refers to claims arising from credit sale of merchandise or services in the ordinary course of the business.

A

Trade Receivables

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23
Q

Represent claims arising from sources other than the sale of merchandise or services in the ordinary course of the business.

A

Non-trade Receivables

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24
Q

Receivables which are expected to be realized cash within the normal operating cycle or one year, whichever is longe

A

Current Assets

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25
Receivables which are expected to be realized beyond one year or those receivables which are not currently collectible.
Non-current Assets
26
evidenced by a formal instrument which is the promissory note.
Notes Receivable
27
short term, unsecured and informal credit arrangements (open accounts).
Accounts Receivable
28
used when individual account balances are relatively large. There is a reason to believe that there may be a substantial number of accounts in dispute or with inaccuracies or irregularities
Positive Confirmation
29
internal control procedures regarding receivables are considered effective. - a large number of small balances are involved.
Negative Confirmation
30
this also known as volume discount or quantity discount. It is a means of adjusting the list price for different buyers or varying quantities. Accounts receivables should be recorded net of ________.
Trade Discounts
31
this is a reduction from the invoice price by reason or prompt payment.
Cash Discount
32
means that ownership to the merchandise is transferred to the buyer only upon reaching the point of destination or upon the buyer’s receipt of merchandise.
FOB Destination
33
means that ownership to the merchandise is transferred to the buyer upon shipment thereof.
FOB Shipping Point
34
means that the freight charges on the merchandise shipped is to be paid by the buyer.
Freight Collect
35
means that the freight charges on the merchandise shipped was already paid by the seller.
Freight Prepaid
36
this requires the recognition of bad debt loss if the accounts are doubtful of collection.
Allowance Method
37
this requires the recognition of bad debt loss only when the account proved to be worthless or uncollectible.
Direct write off method
38
Cash is measured at
Face value
39
But __________ received cannot be considered as cash yet because the __________ are unacceptable by the bank for deposit and immediate credit or outright encashment.
postdated checks
40
___________ with specified redemption date and acquired three months before redemption date can qualify as cash equivalents.
Preference Shares
41
If the term is three months or less, such instruments are classified as __________.
Cash equivalents
42
If the term is more than three months but within one year, such investments are classified as short-term or temporary investments and presented separately as _________.
current assets
43
Cash fund used for current operations or payment of current obligation are part of
cash and cash equivalents
44
Examples of Cash fund that are cash and cash equivalents
Petty cash find payroll fund travel fund interest fund dividend fund tax fund
45
The _________ is a system of control of cash which requires that all cash receipts should be deposited intact and all cash disbursements should be made by means of check.
imprest system
46
Under this system, the disbursements from the petty cash fund are immediately recorded in contradistinction with the ______ fund system where the disbursements are recorded upon the replenishment of the fund.
Fluctuating Fund System
47
Sa system na to padagdag ng padagdag yung petty cash kunwari may tira from last period
Fluctuating Fund System
48
Sa system na to back to the budget para sa petty cash kada nag rereplenish kunwari 10k ang petty cash tapos may natira na 2k dadagdagan lang ng 8k pag nag replenish
Imprest System
49
Sa system na to nirerecord lang yung expenses or disbursements pag mag rereplenish ng fund.
Imprest Fund System
50
Same lang siya sa savings deposit pero may interest
Time Deposit
51
Book Reconciling Items
Credit Memo Debit Memo Errors
52
Bank Reconciling Items
DIT Outstanding Checks Errors
53
Examples of Debit Memos
NSF Technically defective checks Bank Service Charge Reduction of Loan
54
are checks deposited but returned by the bank because of insufficiency of fund.
NSF Checks
55
are checks deposited but returned by the bank because of technical defects such as absence of signature or countersignature, erasures not countersigned, mutilated checks, conflict between amount in words and amount in figures.
Defective checks
56
pertains to amount deducted from the current account of the depositor in payment for loan which the depositor owes to the bank and which has already matured.
Reduction of Loan
57
refer to items not representing checks paid by bank which are charged or debited by the bank to the account of the depositor but not yet recorded by the depositor as cash disbursements.
Debit Memos
58
are collections already recorded by the depositor as cash receipts but not yet reflected on the bank statement.
Deposit in Transit
59
are checks already recorded by the depositor as cash disbursements but not yet reflected on the bank statement.
Outstanding Checks
60
Under this method, the book balance and the bank balance are brought to a correct cash balance that must appear on the statement of financial position
Adjusted Balance Method
61
Under this method, the book balance is reconciled with the bank balance or the book balance is adjusted to equal the bank balance.
Book to bank Method
62
Under this method, the bank balance is reconciled with the book balance or the bank balance is adjusted to equal the book balance.
Bank to Book Method
63
refer to cash receipts or all items debited to the cash in bank account
Book Debits
64
refer to cash disbursements or all items credited to the cash in bank account.
Book Credits
65
refer to all items credited to the account of the depositor which include deposits acknowledged by bankband credit memos.
Bank Credits
66
Example of Bank Credits
Acknowledged Deposits Credit Memos
67
Example of Bank Debits
Debit Memos Checks Paid
68
refer to all items debited to the account of the depositor which include checks paid by bank and debit memos.
Bank Debits
69
If the cash balance shown in the accounting record is less than the correct cash balance and neither the entity nor the bank has made any errors, there must be a. Deposits credited by the bank but not yet recorded by the depositor b. Deposits in transit c. Outstanding checks d. Bank charges not yet recorded by the depositor
C?
70
Bank reconciliations are normally prepared on a monthly basis to identify adjustments needed in the depositor's records and to identify bank errors. Adjustments on the part of the depositor should be recorded for a. Bank errors, outstanding checks and deposits in transit. b. All items except bank errors, outstanding checks andbdeposits in transit. c. Book errors, bank errors, deposits in transit outstanding checks. and d. Outstanding checks and deposits in transit.
A
71
Bank statements provide information about all of the following, except a. Checks cleared during the period b. NSF checks c. Bank charges for the period d. Errors made by the depositor
D
72
A cash discount is known as ________ on the part of the seller and a _________ on the part of the buyer
sales discount purchase discount
73
The sales discount forfeited account is classified as other
income
74
Aging the accounts receivable is also known as
SFP Approach
75
Percent of sales is also known as
Income Statement Approach
76
refers to the period beyondbthe maximum credit term In the example, the credit term orbcredit period is 30 days.
past due
77
The allowance for doubtful accounts normally has ____ balance
credit
78
FOB shipping point is usually paid for by the _____,
Buyer
79
FOB destination is usually paid for by the _____
seller
80
value added tax account is a
cash and cash equivalents
81
adjusted cash in bank is computed by
balance per bank statement DIT Outstanding Checks Or Add CR Less DM
82
An erroneous credit to an account is ___ in cash in bank
DEDUCTED
83
How to compute for unadjusted cash in bank per ledger?
Get the adjustment bank balance then squeeze the items such as service charges, debit and credit memo
84
How to get cash balance per bank statement
cash balance per bank statement is unadjusted thus we should get first the adjusted book balance then squeeze items such as DIT OS AND ERRORS
85
FORMULA ADJUSTED BALANCE METHOD
Balance per book Add: Credit Memo (Note collected by the bank) Less: Debit Memo (NSF Service Charge) Total : Adjusted book balance Balance per bank Add: DIT Less: Outstanding Checks & Errors Total: Adjust bank balance
86
Formula Bank to Book
Bank balance Add: DIT & DM Less: OS & CM Adjusted book
87
Book to Bank
Book balance Add: CM & OS Less: DM & DIT Adjusted Bank
88
DIT FORMULA
DIT- beg Add: Cash receipts for deposits (Book Debits) Less: CM for Note Collected last month Less: Deposits acknowledge (Bank Credits) less: CM for Note collected current month) DIT- end
89
Outstanding Checks Formula
OS- beg Add: Checks drawn (Book credits) Less: DM last month Less: Checks acknowledge paid (Bank debits) Less: DM current month OS- end
90
Dagdag siya sa part ng bank (Cash receipts of deposits)
Book debits
91
Bawas siya sa part ng bank (cash disbursements or check drawns)
Book credits
92
Dagdag siya sa part ng depositor or account holder (Deposits, Note collected from customers)
Bank credits
93
Bawas siya sa part ng depositor or account holder (Checks drawn, NSF checks, service charge etc)
Bank debits
94
Pledge - Loan discounted Net Proceeds Formula
Face amount of loan Less: Interest deducted in advance
95
Pledge CM Formula
Face amount of note payable Less: Discount CM
96
more formal type of pledging
Assignment
97
Equity in asdigned accounts formula
AR- assigned Less: Note payable

1st Year - Second Sem (13 decks)

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