Long-term Assets
This asset is Non depreciable.
What is land?
Account that records amounts received in advance from customers for future products or services.
What is unearned revenue?
When the stated rate is less than the market rate, the bond is sold at ___________.
What is a discount?
This is the group of people that hold the most amount of power within a corporation.
Who are the stockholders?
The three sections of the statement of cash flows.
What are the operating, investing, and financing sections?
Record JE for group purchase of assets for a total price of $100,000. Equipment valued at 75,000, building valued at 100,000, and land valued at 125,000.
What is Debit Equipment for 25,000, debit building for 33,333, debit land for 41,667, & credit cash for 100,000?
On September 30th, Ace Hardware sold $8,000 of materials subject to a 5% sales tax. Record the entry for Sept. 30.
What is Debit cash 8,400, credit sales 8,000, credit sales tax payable 400?
(8,000 x 5% = 400)
Bonds or notes that have an option exercisable by the issuer to issue them at a stated dollar amount before they mature.
What is a callable bond?
On June 10, exchanged 4,000 shares of $20 par value stock for land valued at $105,000. Write the JE.
What is debit land $105,000, credit common stock $80,000, credit paid-in capital - excess of par $25,000?
This is where a decrease in accounts receivable will be listed on the cash flow statement.
What is an increase in the operating section?
Two examples of intangible assets.
What are Patents, Copyrights, Trademarks, Tradenames, Franchises, Licenses, Goodwill, Leaseholds, Research & Development?
Determine Times interest earned ratio: Net Income of 119,000, Interest expense of 44,000, and Income taxes of 35,000.
What is 0.909?
([119,000 - 44,000 - 35,00]/44,000)
Calculate the debt-to-equity ratio: total assets are 860,000, total liabilities are 360,000, and total equity is 500,000.
What is .72?
(360,000 / 500,000)
Tesla Corp. has 10,000 shares of $10 par stock outstanding. On Dec. 31, they declared a 10% stock dividend, when it was selling for $15 per share. Record the entry on Dec. 31.
What is debit retained earnings $15,000, credit common stock div distributable $10,000, credit paid-in capital - excess of par $5,000?
This is where cash received from sale of building will be listed on the cash flow statement.
What is an increase in the investing section?
Additions that extend the asset's useful life beyond its original estimate.
What is a betterment / extraordinary repair expenditure?
On Aug 23, ABC Corp. asks Schult Corp. to accept $100 cash and a 60-day, 12% $500 note to replace its existing $600 account. Record Aug 23 entry for ABC Corp.
What is debit A/P 600, credit cash 100, credit note payable 500?
Record the JE for the issuance of this bond: Par value 1,000,000, Stated interest rate 10%, Market interest rate 12%, purchased at 95.09% of par value, maturity date in 3 yrs.
What is Debit Cash 950,900, debit discount on bonds payable 49,100, credit bonds payable 1,000,000?
This contra-equity account is shares of a company's own stock that have been acquired by that same company.
What is treasury stock?
This is where cash paid for dividends will be listed on the cash flow statement.
What is a decrease in the financing section?
Find Book Value of Asset after 1st year with cost of 10,000, salvage of 1,000, and useful life of 5 years using the DDB method.
What is 6,000?
(100% / 5 = 20% x 2 = 40% x 10,000 = 4,000)
(10,000 - 4,000 = 6,000)
On Dec 1, company borrows $6,000 note from bank at 10% for 90 days. Record entry on March 2 of the following year, when all interest and principal is due.
What is debit Interest expense 100(6,000*10%*(60/360)), debit interest payable 50 (6,000*10%*(30/360)), debit note payable 6,000, credit cash 6,150?
Salisbury borrows $200,000 cash from a 5 year, 6% installment note with equal payments of $47,479 annually. Calculate the ending balance at the end of year 1.
What is $164,521?
(47,479 - (200,000 x 6%)) = 35,479
200,000 - 35,479 = 164,521
This is the total amount of net income minus any net losses and dividends declared since the company started operations.
What is retained earnings?
This is where land purchased for an installment note will be listed on the cash flow statement.
What is the noncash section of the cash flow statement?