Author: Anonymous

Financial accounting and tax accounting require the same recordkeeping and there should be no difference in results between the two accounting systems.

Holding a copyright:

A short-term note payable is a written promise to pay a specified amount on a definite future date within one year or the operating cycle, whichever is shorter.

Bond market values are expressed as a percent of their par (face) value.

The times interest earned ratio reflects:

A loss on disposal of a plant asset occurs if the cash proceeds received from the asset sale is less than the asset’s book value.

Bering Rock acquires a granite quarry at a cost of $590,000, which is estimated to contain 200,000 tons of granite and is expected to take 6 years to remove. Compute the depletion expense for the first year assuming 38,000 tons were removed and sold.

Vacation benefits is an example of a known liability.

On December 1, Watson Enterprises signed a $24,000, 60-day, 4% note payable as replacement of an account payable with Erikson Company. What amount of interest expense is accrued at December 31 on the note? (Use 360 days a year.)

Callable bonds have an option exercisable by the issuer to retire them at a stated dollar amount prior to maturity.