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current liability
within one year
TERM 2
10K Sales, $600 sales tax, what's recorded.
DEFINITION 2
Cash 10, 600 (credit) sales 10 K (crdit) sales tax payable 600
TERM 3
Is sales tax an expense?
DEFINITION 3
No, liability.
TERM 4
Formula: Wages Payable
DEFINITION 4
Wages Exp minus: FICA - Federal Income Taxes Payable -
State Income Taxes Payable
TERM 5
Formula: Payroll Tax Expense
DEFINITION 5
Add up: FICA tax+federal unemployment+State
Unemployment
a)Bonds Interest Payable b) Bonds Interest
Expense
a) principal value X principal rate b) current value X current
rate
TERM 7
a) face value b) maturity date
DEFINITION 7
a) principal due at the maturity b) date final payment is due
TERM 8
a) Premium b) Discount c) Bonds sell at face
value
DEFINITION 8
a) Sold above face value b) Sold below face value c) Sold at
face value
TERM 9
"Bonds sold for 90" means
DEFINITION 9
Bonds sold for 90% at face value
TERM 10
What type of account is "Discount on Bond
Payable"
DEFINITION 10
Contra-Liability (debit)
authorized
stock
amount of stock corporation is authorized legally to sell
TERM 17
T/F: the authorization of capital stock needs
an accounting entry.
DEFINITION 17
False!
TERM 18
SE=
DEFINITION 18
Total Paid In Capital + Retained Earnings
TERM 19
1,000 shares. $1 par value. Sold for $5 a
share. What happens?
DEFINITION 19
Cash (debit) 5K Common Stock (credit) 1K Excess Paid In
Capital- Common Stock (credit) 4K
TERM 20
formula: Paid In Capital Excess
DEFINITION 20
Difference between Selling Price and Par value
formula: Total Paid In Capital
Common Stock + Preferred Stock + Paid In Capital Excess-
Common Stock + Paid In Capital Excess-Preferred Stock
TERM 22
Treasury
stock
DEFINITION 22
stock that has been reaquired or bought back by corporation.
Debit Treasury Stock and Credit Cash. It's a Contra-
Stockholder's Equity account (Debit)
TERM 23
When preferred stock issued, just like
common stock,
DEFINITION 23
Debit Cash and Credit a) Preferred Stock b) Paid In Capital-
Preferred Stock
TERM 24
T/F: Purchase of treasury stock reduces
stockholder's equity
DEFINITION 24
True!
TERM 25
Who has first right to share in distribution of
corporate
DEFINITION 25
preferred stockholders
formula: outstanding common
stock
Issued shares - treasury stock
TERM 32
balance per book
DEFINITION 32
beg balance + Note receivable - NSF - bank fee +/- Error
TERM 33
balance per bank
DEFINITION 33
beg balance + deposit in transit - outstanding check +/- bank
errors
TERM 34
residual means
DEFINITION 34
salvage
TERM 35
book value=
DEFINITION 35
Cost - AD
T/F: Market value has nothing to do with book
value
True
TERM 37
Double Declining Balance
DEFINITION 37
Cost X 2/useful life
TERM 38
Straight Line
DEFINITION 38
(Cost - Salvage)/ Useful Life
TERM 39
Units of Activity
DEFINITION 39
(Cost - Salvage)/ Useful life
TERM 40
Formula: gross profit
DEFINITION 40
Net sales rev - cost of goods sold
Formula: Net
A/R
A/R - Allowance
TERM 47
formula: average cost
method
DEFINITION 47
cost of goods available for sale/total units available for sale.
Example: 12K/1K= $12.
TERM 48
How do you find out whether you made a gain
or a loss?
DEFINITION 48
Book value - Sale
TERM 49
formula: cash net realizable value
DEFINITION 49
A/R - ADA
TERM 50
If we buy goods and receive a discount, does
that affect A/P?
DEFINITION 50
No! Discount makes Inventory decrease! Debit: A/P. Credit:
Cash and Inventory.
If we sell goods, does a discount affect A/R
when we collect the money?
No! Debit: Cash and Sales Discount. Credit: A/R
TERM 52
They return one of our calculators that we
sold to them for $45. We bought the
calculator for $34.
DEFINITION 52
1) Debit: Sales Returns and Allowances $45. Credit: A/R $
2) Debit: Inventory $35. Credit: CGS $
TERM 53
formula: goods available for sale
DEFINITION 53
CGS + Ending Inventory
TERM 54
Formula: CGS
DEFINITION 54
Beg Inv + Purchases - Ending Inventory.
TERM 55
formula: net purchases
DEFINITION 55
Purchases - Purchase Returns and Allowances - Purchase
Discounts
formula: gross profit
rate
gross profit/net sales
TERM 62
formula: profit margin ratio
DEFINITION 62
net income/ net sales
TERM 63
formula: cost capitalized of inventory bought
DEFINITION 63
List price + freight costs + installation - discount
TERM 64
find discount price. List price 20K, amount
returned 400, discount %.
DEFINITION 64
List price (20K) - amount returned (400) = what we paid for it
(19,600) X discount % (.02)= discount price (392)
TERM 65
Shows financial situation of a company at a
given time
DEFINITION 65
the balance sheet
Income statement has revenure earned even
though cash not yet received refers to
accrual accounting
TERM 67
Formula: ending supplies
DEFINITION 67
Beg supplies + purchased - used
TERM 68
Market value
DEFINITION 68
cannot be determined
TERM 69
post closing trial balance
DEFINITION 69
accounts you DON'T close out
TERM 70
when closing accounts
DEFINITION 70
RED are closed to Retained Earnings. (Rev and Exp are closed
to income summary first)
formula: interest expense
carrying value X market rate
TERM 77
formula: carrying value b) what is it
DEFINITION 77
face value +/- unamortized premium/discount b) book value
TERM 78
what type of cash flow are bonds
DEFINITION 78
financing
TERM 79
formula: to find sales when only given total
cash made and sales tax percentage
DEFINITION 79
Divide total cash made/ 1.(percentage)
TERM 80
***to find carrying value a) on discount b) on
premium
DEFINITION 80
a) you add your discount amortization b) you subtract your
discount amortization
how much of wages and payroll tax to send to
the government
FICA + FICA + all other taxes
TERM 82
stock splits
DEFINITION 82
Reduces the market value of shares. Decreases par value
and increases the number of shares outstanding.
