Terms
Obligations to be paid within one year or the company's operating cycle, whichever is longer
What are current liabilities
Amounts owed to suppliers for products and/or services purchased on credit.
What are accounts payable
The statement of cash flows helps users evaluate
What is the management of a company
On December 1, Watson Enterprises signed a $24,000, 60-day, 4% note payable as replacement of an account payable with Erikson Company. What amount of interest expense is accrued at December 31 on the note? (Use 360 days a year.)
What is $80
On November 1, Casey's Snowboards signed a $12,000, 90-day, 5% note payable to cover a past due account payable. What is the maturity value?
What is $12,150
Obligations not expected to be paid within the longer of one year or the company's operating cycle are reported as:
What are long-term liabilities
Total compensation earned by an employee before any deductions
What is gross pay
Included in the operating activities section
What are activities that create revenue or expenses and/or current assets and current liabilities
On May 22, Jarrett Company borrows $7,500 from Fairmont Financing, signing a 90-day, 8%, $7,500 note. The interest paid for this note is:
What is $150
On September 1, Knack Company signed a $50,000, 90-day, 5% note payable with Central Savings Bank. What is the maturity value of the note? (Use 360 days a year.)
What is $50,625
The difference between the amount received from issuing a note payable and the amount repaid at maturity is referred to as:
What is interest
Amounts received in advance from customers for future products or services
What are unearned revenues
The three major categories included on the statement of cash flows
What are investing, operating, and financing activities
On November 1, X Company signed a 120-day, 8% note payable, with a face value of $9,000. What is the accrued interest at December 31 on the note? (Use 360 days a year.)
What is $120
On November 1, X Company signed a 120-day, 8% note payable, with a face value of $9,000. What is the maturity value of the note on March 1? (Use 360 days a year.)
What is $9,240
A potential obligation that depends on a future event arising from a past transaction or event.
What is a contingent liability
FICA taxes include
What are social security and medicare taxes
When preparing a statement of cash flows using the indirect method, what do you do with depreciation expense?
What is add it back to net income in the operating activities section
On December 1, Victoria Company signed a 90-day, 6% note payable, with a face value of $15,000. What amount of interest expense is accrued at December 31 on the note? (Use 360 days a year.)
What is $75
On April 12, Hong Company agrees to accept a 60-day, 10%, $4,500 note from Indigo Company to extend the due date on an overdue account. The maturity value is: (Use 360 days a year.)
What is $4,575
A written promise to pay a specified amount on a definite future date within one year or the company's operating cycle, whichever is longer
What is a short-term note payable
A company has advance subscription sales totaling $45,000 for the upcoming year when four quarterly journals will mailed to customers. The amount you debit unearned revenue and credit sales revenue at the end of each quarter is:
What is $11,250
Two different methods of preparing a statement of cash flows and the difference between them.
What are direct and indirect and the operating activities section
On December 1, A company borrowed $60,000 by signing a 60-day, 5% note payable from its bank. What is the interest expense on Dec. 31?
What is $250
On December 1, Williams Company borrowed $45,000 cash from Second National Bank by signing a 90-day, 9% note payable. What is the maturity value?
What is $46,012.50