Interest
Interest Formula?
Principal * Rate * Time
Debt due in 8 months is classified as?
Current Liability
Issuing bonds at face value for $100,000. What is the entry?
Debit Cash $100,000
Credit Bonds Payable $100,000
Why are payroll withholdings liabilities?
Company owes that money to the government
What is the Accounting Equation?
Assets = Liabilities + Stockholder's Equity
Lend $30,000 at 10% for 1 year. Interest Receivable?
$3,000
Debt due in 5 years is classified as?
Long-term Liability
$100,000 bond at 6%. How much is annual interest?
$6,000
What account records withheld income taxes?
Income Tax Payable
If I buy equipment with cash, what two accounts change?
Equipment increases, cash decreases
Borrow $100,000 at 6% for 1 year. How much total interest?
$600
A $40,000 note has $10,000 due within a year. How much is current?
$10,000
If bonds are issued above face value, they are issued at a?
Premium
Gross wages of $10,000. Taxes owed of $2,000. What is the net pay?
$8,000
A company previously recorded $3,000 of deferred revenue. By year end, the company has completed $1,000 of the work. Record the adjusting entry.
Debit Deferred Revenue $1,000
Credit Service Revenue $1,000
Borrow $20,000 at 5% for 6 months. What is the total interest?
$500
A company has a 100,000 note due in 5 years.
However, the company plans to pay off 30,000 within the next 12 months. How much is current?
$30,000
If a company issues a bond at a discount, what does that imply about the stated interest rate compared to the market rate?
The stated rate is lower than the market rate
Gross wages of $12,000; $2,000 taxes; $1,000 FICA. Cash paid to employee?
$9,000
A company paid 6,000 for 12 months of insurance. 3 months have expired. What is the adjusting entry?
Debit Insurance Expense $1,500
Credit Prepaid Insurance $1,500
Borrow $50,000 at 8%. After 3 months, what is the adjusting entry? (Debit, Credit, and Amount)
Debit Interest Expense $1,000
Credit Interest Payable $1,000
A note payable is due in 9 months.
The company intends to refinance it into a long-term loan, but has not yet signed any agreement by year-end. Long or current-term?
Current
If bonds are issued below face value, they are issued at a?
Discount
Gross wages of $15,000; Income tax of $2,500; FICA of $1,200. Net pay?
$11,300
By year end, a company performed 5,000 of services. It will bill the customer January 5. Nothing has been recorded yet. What is the journal entry on December 31st?
Debit Accounts Receivable $5,000
Credit Service Revenue $5,000