29. Which of the following best describes a revenue?
A. Resources owned.
B. Cash received from a customer.
C. Amounts earned from providing goods and services to a customer.
D. Dividends paid to stockholders. – C. Amounts earned from providing goods and services to a customer.
insurance expense – operating expense, IS, debit
Aspects of a Statement of Retained Earnings – Beginning Retained Earnings
Ending Retained Earnings
verifiable – info that is proven to be free from error
2 basic methods of measuring income!!!!!! – Accruals concept: expenses and revenues are recorded in the period they occur, weather cash is involved or not, ex. Depreciation
Cash basis: recognizes impact only when the company receives or pays cash (common for gov accounting)
Price-earnings ratio – Stock price/Earnings per share
What is in a statement of owners equity – capital beginning of month, plus investments, net income, less withdrawals ,capital at end of month
Temporary Accounts – revenue, expense, and divided accounts used to capture accounting information for a single accounting cycle
FIll in the blank with the present progressive form of the verb. Sandra __________ (leer) una revista en la playa.
Budgeted Sales – =Sales Forecast (in units) x unit selling price
Accounts Receivable – …Is a Debit balance account.
declaration date – the day on which the board of directors declares the cash dividend to be paid
Kaiser's Kraft Korner sells a single product. 7,000 units were sold resulting in $70,000 of sales revenue, $28,000 of variable costs, and $12,000 of fixed costs.
Breakeven point in units is:
a. 2,000 units
b. 3,000 units
c. 5,000 units
d. None of these answers are correct. – a. 2,000 units
$10X – $4X – $12,000 = 0; X = 2,000 units
Acquisition/Payment Process – acquiring Capital, Property/Plant/Equipment, Raw materials, Labor, Inventory, Goods & Services
FIll in the blаnk with the present prоgressive fоrm оf the verb. Sаndrа __________ (leer) una revista en la playa.
inventory turnover – measures liquidity of inventory
Income earned by not received is called: – Accounts Receivable
PERIODIC INVENTORY SYSTEM – A SYSTEM IN WHICH THE BUSINESS DOES NOT KEEP A CONTINUOUS RECORD OF INVENTORY ON HAND. AT THE END OF THE PERIOD THE BUSINESS TAKES A PHYSICAL COUNT OF ON-HAND INVENTORY AND USES THIS INFORMATION TO PREPARE THE FINANCIAL STATEMENTS.
Creditor – is a person or business to whom the business owes money.
Current Liabilities – Liabilities which we expect to be paid within the coming accounting period. It will be necessary for us to have cash to meet these liabilities.
E.g. short term bank loan and accounts payable.