Assets
What is Professor Widdig's favorate Asset?
Cash
An Account Payable that is due in 30 days is classified as
A Current Liability
Retained Earnings is part of Equity, what other account is part of Equity?
Common Stock
Which financial statement is for a specific date in time and not a period of time?
The Balance Sheet
How is a Revenue Account Closed?
Debit
When a customer owes you money what account is this recorded in?
Accounts Receivable
What would be the AJE to record taxes owed but will not be paid the following year?
Dr Income Tax Expense
Cr Income Taxes Payable
What are Dividends?
Distribution of the company earnings to the shareholders (owners of the company)
Retained Earnings appears on which two financial statements?
Balance Sheet and Statement of Stockholders Equity
When are adjusting journal entries prepared?
At the end of the period
Inventory is considered a Current or Long Term Asset?
Current
What does it mean if Accounts Payable was debited?
The invoice or the bill was paid.
If a company has a beginning balance in retained earnings of $200, and they have net income for the year of $100, and pay a dividend of $50, what is the ending balance of retained earnings?
$250
How is Net Income calculated?
Revenues minus Exenses
At the end of the year a company owes $10,000 in wages, what accounts would be impacted by the adjusting entry?
Dr Wage Expense
Cr Wages Payable
When a company pays for one year of insurance in advance what accounts would be impacted?
Dr Prepaid Insurance (increased)
Cr Cash (decreased)
A Note Payable due in 3 years is classified as
Long Term Liability
When cash dividends are paid, what accounts are decreased?
Dr Retained Earnings (decrease)
Cr Cash (decrease)
What is the difference between Sales Revenue and Cost of Goods Sold?
Gross Profit
The final step in the accoutning cycle is
Prepare Post-Closing trial balance
Under accrual basis accounting when are supplies expensed
When they are used
If a customer pays for a service in advance, how would this be recorded?
Dr Cash
Cr Deferred Revenue (liability)
If a company ends 2025 with an ending balance in the retained earnings account of $1,050, what would be the beginning balance in the retained earnings account at 1/1/26?
$1,050
Increases to net income as a result of incidental transactions are called?
Gains
Under accrual-basis accounting, revenues are recorded when
They are earned