Financial Accounting Final

credit balance – when credits > debits
36. Accountants are responsible for measuring various operating, investing and financing activities. Which of the following correctly matches the activity with its type?
A. Investing – paying utilities for the month.
B. Investing – purchasing land.
C. Operating – paying dividends to stockholders.
D. Financing – selling equipment for cash. – B. Investing – purchasing land.
process-costing system – a costing system that accumulates production
costs by process or by department for a given period of
time.
cost concept – a concept of accounting that determines the amount initially entered into the accounting records for purchases
At a particular date- often called a "snapshot" in time – dates on the Balance Sheet
limited liability – if a business fails, the owners DO NOT have to pay the business debts with their personal assets.
applies to a company
Bad debt expense methods – Percentage of sales method
Aging of receivables method
To whom does a company pay input vat? – To suppliers
Who is the composer of “The Talking Sheep”?
balance sheet (Statement of Financial Position; Statement of Financial Condition) – a formal financial statement illustrating the assets, liabilities, and owner's equity of a business as of a specific date (A=L+C-W)
Income represents what? – Represents the bottom line. This is what is left from the revenue when the cost and expenses have been deducted.
Liability – What the company owes
In a one-time special order situation, if the price offered by the potential buyer is less than the absorption cost per unit, then the producer should not accept the special offer. – False
Acid Test Ratio/Quick Ratio. – Quick assets divided by current liabilities.
The going-concern assumption – i.
Double Taxation – when stockholders are taxed once as corporate profit and again as personal income
Whо is the cоmpоser of “The Tаlking Sheep”?
Purchases return – credit allowed for the purchase price of returned merchandise, resulting in a decrease in the customer's accounts payable

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