1. -land purchased for $510,000 4 yrs ago-owner has long term debtthat relates to purchase ofthis land-owner plans to sell landfor 850,000-avg selling price=790,000for past year-what is fair value of theland?

790,000

2. Accounts payable (123) balance sheet, currentliabilities, credit

3. accounts receivable (123) balance sheet, asset, debit4. average income tax rate

(equation)income tax expense/incomebefore income taxes

5. capital stock (A, L, or OE) owners equity6. cash (123) balance sheet, asset, debit7. cash (A, L, or OE) asset8. characteristics of a retailer

on a balance sheet (2)-no receivables-high inventory

9. characteristics of debtfinancing (3)

-right to receive capital atfuture date-right to share any remainingresources if business isterminated-right to force the business into bankruptcy if interest is notpaid

10. characteristics of equityfinancing

-right to share in profits ofbusiness-right to share any remainingresources when business isterminated-right to have a say in affairsof the business

11. characteristics of thebalance sheet for a bank

-largest category =receivables-largest source of financing isNOT equity

12. company profit if they sellfor $1

net income/sales

13. company sells for $1-howmuch did they pay for it?

COGS/sales

14. company sells product for$1, how much profit?

net income/sales

15. compute retained earningsat the beginning of the year

(use chart)

16. computeretainedearnings at theend of the year

retained earnings (beginning)+netincome-dividends=retained earningsending

17. compute thechange inretainedearnings

net loss (total revenue-total expenses)-dividends=change in retained earnings

18. corporations -separate legal entire apart from owners-one or more owners-separation of business and personaltaxation (double taxation)

19. cost of goodssold (123)

income statement, expense, debit

20. define revenue measure of economic value created21. describe

accountspayable

obligation arising from the purchase of aninventory on account

22. describeberkshirehathaway

large company that owns a controllinginterest in many operating subsidiariesand also owns smaller investments in anumber of large corporations

23. describeinventory

goods purchased and held for resale

24. describe theentity concept asit applies to asmall soleproprietorship

balance sheet should have assets andliabilities of the business operationsthemselves and should not include anypersonal assets or obligations

25. dividends (123) income statement, owners equity, debit26. the entity

conceptpersonal expenditures of company owners(purchase of personal use items: food,cars, etc) should not be reflected as assetsor expenses in the companies financialstatements

27. equation forassets

assets=liabilities+owners equity

28. equation forearnings pershare

net income/# of shares outstanding

29. equipment(document, type,deb/credit)

-balance sheet-asset-credit

30. expenses (123) -income statement-expense-debit

31. financialaccounting

-seeks to provide info. for current or futureproviders of capital--accomplished through financialstatements (historical info.)

Accounting FinalStudy online at quizlet.com/_12bk6d

32. Given total cost of sales andtotal sales, how do you findthe wholesale purchase for$1?

total cost of sales/total sales

33. gross income (123) -income statement-revenue-credit

34. How are prepaid expensesreported on financialstatements?

asset

35. how do you find incomebefore income taxes?

gross profit (sales -COGS)-operating income(expenses)-interestexpense=income before taxexpense

36. How do you find netincome?

revenue-expenses

37. how do you find net income? revenues (sales)-expenses38. How do you find the ending

balance in retained earningsfrom a trial balance?

retained earnings+netincome-dividends

39. how do you find totalliabilities?

Assets-ownersequity=liability (assets=liabilities+ownersequity)

40. how do you find wholesale? cost of sale (COGS)/net sale(sales)=wholesale

41. how does walmart financemost of its inventorpurchases?

accounts payable

42. how does Walmart financemost of its inventorypurchases?

accounts payable

43. how to compute net incomewhen given a list of data

revenues-expenses=netincome

44. how to find income tax rate income tax expense/income before income taxes(answer= a %)

45. how to find tax onshareholders dividend -ex: income beforetaxes=$5,000,000 tax= 40%What is the total income taxpaid by shareholders?

$5,000,000*.4=2,000,000remaining profit:5,000,000-2,000,000=3,000,000 (toshareholders)3,000,000*.4=1,200,000

46. interest payable (123) -balance sheet-liability-credit

47. inventory (123) -balance-asset-debit

48. inventory (A, L, or OE) asset49. Land (A, L, or OE) asset50. long-term debt (notes payable)

(123)-balance sheet-liability-credit

51. Managerial accounting seeks to provideinformation to assistmanagers in effectiveoperation of the businessthrough customizedmanagement reports-more detailed and mayinclude future budgets andforecasts--not available for public

52. name a company likely to havea large amount of bad debtexpense

zions bank

53. Name a company who hasrecorded a large lability in itsbalance sheet for whichcustomers have paid but thecompany has not yet delivered

United airlines

54. name a company with a largeamount of depreciation

exxon mobil

55. Name that company:receivables=$734

Wells Fargo or Zionsbank

56. name two companies with ahigh cost of goods sold

-home depot-walmart

57. net income (123) -balance-owners equity-credit

58. net income (e) revenue-expenses59. paid in capital (123) -balance sheet

-owners equity-credit

60. partnership -more than one owner-no separation betweenbusiness and personalliability-same as proprietorshipbut more owners

61. Prepaid expense (123) balance sheet, asset, debit62. proprietorship -one owner

- no separation ofbusiness and personalliability-no separate incometaxation

63. purpose of financial statements (what are theyand what do they show?)

-statement of cash flows-income statement-balance sheet

64. research and development expense (123) -income statement-expense-debit

65. retained earnings cumulative amount of net income kept in the business expansion66. retained earnings (123) -balance sheet

-owners equity-credit

67. retained earnings (A, L, or OE) owners equity68. retained earnings (e) net income-dividends69. return on sales (profit) (e) net income/sales70. sales revenue (123) -income statement

-revenue-credit

71. taxes payable (123) balance sheet, liability, credit72. unearned revenue (123) balance sheet, liability, credit73. utilities payable (123) -balance sheet

-liability-credit

74. wages payable (123) -balance sheet-liability-credit

75. what is retained earnings? the cumulative amount of income taxes paid on behalf of shareholders76. what is the reason for GAAP? to create comparable informaiton77. what is walmarts largest source of financing? retained earnings78. who hires who in corporate management shareholders-(elect)-board of directors-hires-top management personnel-hires-

other employees--produce profits for owners79. who selects a corporations board of directors? shareholders

Accounting Final