Accounting Quiz 3 Laurie Wood

Accrued expenses – Expenses incurred in one fiscal period but not paid until a later date.
Stockholders' equity for Commerce-GA Corporation on 01/01/2008 and 12/31/2008 were $60,000 and $75,000, respectively. Assets on 01/01/2008 and 12/31/2008 were $115,000 and $105,000, respectively. Liabilities on 01/01/2008 were $55,000. What is the amount of liabilities on 12/31/2008? – $30,000
Entity – An organization or a section of an organization that, for accounting purposes, stands apart from other organizations and individuals as a separate economic unit.
Continuity Assumption – Unless there is evidence to the contrary, the accountant assumes that the business will continue to operate indefinitely.
Ramos, Inc. has monthly revenues of $30,000 and monthly expenses of $18,000, and the company paid $4,000 in dividends; therefore, net income for the month is $12,000. – True
cost constraint – constraint that weights the cost that companies will incur to provide the information against the benefit that financial statement users will gain from having the information available
The multiple-step income statement for a merchandising company shows each of the following items except
A. Gross profit.
B. Cost of goods sold.
C. Sales revenue section.
D. Investing activities section. – D
Current Liquidity Ratio – current assets/ current liabilities
Originally codified by ISO, what does the “intermediate system” in IS-IS (Intermediate System to Intermediate System) stand for?
physical flow schedule – a schedule that reconciles units to account
for with units accounted for. The physical units are not adjusted
for percent of completion.
Decreases in stockholders equity that are due to the cost of operating the business are:
A) assets
B) revenues
C) expenses
D) liabilities – C)Expenses
nominal accounts – income statement, balances represent activity over a certain period of time, revenue and expenses, transferred to retained earnings
Certified Management Accountant (CMA) – test for budgeting, performance management cost management financial statement analysis
Memorandum – a brief written message that describes a transaction that takes place within a business.
Originаlly cоdified by ISO, whаt dоes the “intermediаte system” in IS-IS (Intermediate System tо Intermediate System) stand for?
liquidity – measure of how easily an asset can be converted into cash
confectioner – one who makes and sells cakes, pastries, and other sweet things.
Under the percentage-of-receivables basis, the amount of bad debt expense is the difference between the required balance and the existing balance in the allowance account.
A. True
B. False – TRUE
current liabilities – zobowiązania bierzące

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