Fundamentals
Principles
Journal Entries
Plant Assets
Statements
100
Net income will result during a time period when...
What is Revenues and more than Expenses?
100
Requires companies to record revenue when it has been arned and determines the amount of revenue to record.
What is the Revenue Recognition Principle?
100
An insurance policy was purchased on April 1, 2015 for $2,400.00. At the end of the year, $800 was deemed expired.
What is debit Insurance Expense for $800 and credit Prepaid Insurance for $800?
100
A plant asset with a cost of $50,000 and accumulated depreciation of $47,500 is sold for $3,500. What is the amount of the gain or loss on disposal of the fixed asset?
What is gain of $1,000?
100
Reports the assets, liabilities, and stockholders’ equity at a specific date.
What is the Balance Sheet?
200
Benny’s Repair Shop started the year with total assets of $50,000 and total liabilities of $40,000. During the year the business recorded $105,000 in revenues, $55,000 in expenses, and dividends of $10,000. Stockholders’ equity at the end of the year was...
What is $50,000?
200
The point when are expenses are recorded.
What is when they are incurred, whether or not cash is paid? (Matching Principle)
200
There was a $1,500 balance in the supplies account at the beginning of the period. During the period, the supplies account was increased by $3,000 for supplies purchased. At the end of the period before adjustment, $550 of supplies were on hand.
What is debit Supplies Expense for $3950 and credit Supplies for $3950?
200
A company discards machinery that is fully depreciated, the journal entry for this transaction.
What is debit Accumulated Depreciation and credit Machinery?
200
Summarizes the changes in retained earnings for a specific period of time.
What is the Statement of Retained Earnings?
300
If total liabilities decreased by $15,000 and stockholders’ equity decreased by $5,000 during a period of time, then total assets must change by what amount and direction during that same period?
What is Assets decrease by $20,000?
300
The Revenue Recognition principle/concept.
What is determines when revenue is credited to a revenue account?
300
On December 1, 2015, $7,500 was received for services to be performed from December 1, 2015 until May 31, 2016. Make the December 31, 2015 adjusting journal entry if the Unearned Fees at the end of December 2015 was $4,200.
What is debit Unearned Fees for $3,300 and credit Fees Revenue for $3,300
300
A machine with a cost of $65,000 has an estimated residual value of $5,000 and an estimated life of 5 years or 15,000 hours. It is to be depreciated by the units-of-production method. What is the amount of depreciation for the second full year, during which the machine was used 5,000 hours?
What is $20,000?
300
The fourth financial statement that shows how money flowed into and out of the company.
What is the Statement of Cash Flows?
400
The type of account and normal balance of Unearned Rent.
What is Current Liability with a credit balance?
400
The Matching (Expense) Principle.
What is determines that expenses related to revenue be reported at the same time the revenue is reported?
400
At the end of the current year, $8,800 fees have been earned but have not been billed to clients.
What is debit Accounts Receivable for $8,800 and credit Service Revenue for $8,800?
400
Equipment with a cost of $80,000, an estimated residual value of $5,000, and an estimated life of 15 years was depreciated by the straight-line method for 5 years. Due to obsolescence, it was determined that the useful life should be shortened by 5 years and the residual value changed to zero. The depreciation expense for the current and future years is
What is $11,000?
400
Proves that the total of the debits = total of the credits.
What is the Trial Balance?
500
The net book value of a fixed asset is determined by...
What is original cost less accumulated depreciation?
500
The ACE Company has five plants nationwide that cost $300 million. The current market value of the plants is $500 million. The plants will be reported on the Balance Sheet at this value.
What is at $300 million? (Cost Principle)
500
Salaries of $3,500 are paid for a five-day week on Friday. The month ended on Tuesday.
What is debit Wages (Salaries) Expense for $1,400 and credit Wages (Salaries) Payable to $1,400?
500
A machine with a cost of $65,000 has an estimated residual value of $5,000 and an estimated life of 5 years or 15,000 hours. It is to be depreciated by the straight-line method. The amount of depreciation for the second full year, during which the machine was used 5,000 hours.
What is $12,000?
500
Revenues (credits) > Expenses (debits)
What is Net Income?
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