Accounting I Midterm 2015

merchandise purchases are: – expenses (debited) and have a negative effect on Owner's equity
activity sharing – increasing the efficiency of necessary activities
by using economies of scale.
Prepaid expenses – expenses that have been paid in the current fiscal period but will not be subtracted from revenue until a subsequent fiscal period
financial activities – borrowing money, issuing shares of stock for cash
recording returns/allowances on credit – debit: sales returns & allowances sales
Credit: account receivables
In preparing closing entries, which of the following columns of the worksheet are the most helpful? – C. The income statement columns
Qualitative Characteristics – -Understandability
-Faithful Representation
Capital structure – Mixture of liabilities a d stockholders equity a business uses
The cost flow method that often parallels the actual physical flow of merchandise is the
A. FIFO method.
B. LIFO method.
C. average-cost method.
D. gross profit method. – A
The central cavity of the diaphysis of an adult long bone is called the __________ and filled with __________.
in terms of net debt
cash is = – cash
short term deposits
marketable securities
highly liquid short term investments
What is a Conservatism Principle? – Gains will not be recognised and earned and losses will be recognised as soon they are likely to occur.
activity-based costing – system a cost assignment approach
that first uses direct and driver tracing to assign costs to activities
and then uses drivers to assign costs to cost objects.
Quick Ratio – Quick assets/ current liabilities
The centrаl┬ácаvity оf the diаphysis оf an adult lоng bone is called the __________ and filled with __________.
Expense – A decrease in owners equity resulting from a business transaction is a/an
Prepaid Insurance – 1. Asset
2. Balance Sheet
3. Debit
4. Permanent
Place the four business functions in the order they appear along the value chain:
A = Customer service
B = Design
C = Distribution
D = Production
a. A B D C
b. A C D B
c. B D C A
d. B A D C – c. B D C A
Depreciation Expense – Part of operating expenses income statement
Accounting – Information and measurement system that identifies, records, and communicates relevant information about a company's business activities.

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