MC
What is the tax rate associated with an income tax bracket?
marginal tax rate
$5,400 CR
Allowance for Uncollectible Accounts = normal CR account
Have = $400 DR
Want = $5,000 CR
What is it called when revenue is earned in one period, but not received until a later fiscal period?
Accrued Revenue
What is the annual depreciation expense for an asset costing $7,000, Salvage Value is $1,000, and useful life is 6 years?
$1,000/year
= (7,000 - 1,000) / 6
a business can use any 12-month period for reporting its financial performance
True
The journal entry to adjust Merchandise Inventory when beginning merchandise inventory is $135,000.00 and ending merchandise inventory is $125,000.00 would be
DR Income Summary $10,000
CR Merchandise Inventory $10,000
what is the adjusting entry for the following?
$10,000 Note Receivable, 120-days, 10% note, dated October 24th.
DR Interest Receivable $186.11
CR Interest Income $186.11
= (10,000 x 10% x 67/360)
What is the basic formula to calculate depreciation?
(Cost-Salvage value) / estimated useful life
What does the DR to insurance expense represent?
Value of insurance used throuhout a year
The marginal tax rate increases as the net income before federal income tax increases.
true
at the end of every fiscal year, a __________ ________of inventory is done
Physical Count
What is the DR account and CR account used when recording the adjusting entry for depreciation of an asset?
DR Depreciation Expense
CR Accumulated Depreciation
If a corporation is expected to owe more than $500 in taxes for a year, how often do they need to pay in estimated payments throughout that year?
Quarterly
BV = Cost of asset - Accumulated depreciation
The total amount of depreciation expense that has been recorded since the purchase of a plant asset is called depreciation expense
false
accumulated depreciation
For Accrued Interest Income, is the term of note or date of the note needed for the adjusting entry at the end of the year?
date of the note!
(we want to know how many days from the date of the note until Dec. 31 we have used to make the adjusting entry)
What is the DR account and CR account used when recording the adjusting entry for federal income tax?
DR Federal Income Tax Expense
CR Federal Income Tax Payable
On an unadjusted trial balance, if an account has a $0 balance, do you still list the account on the statement?
Yes, list ALL accounts for a business on the trial balance
Calculate the total Accumulated Depreciation at the end of year 4 based off the info below:
Year 1 Depreciation Expense = $200
Year 2 Depreciation Expense = $200
Year 3 Depreciation Expense = $200
Year 4 Depreciation Expense = ?
$800
= 200 (yr 1) + 200 (yr 2) + 200 (yr 3) + 200 (yr 4)
Functional depreciation is used in estimating the useful life of computer equipment
True
What is the book value of an asset at the end of year 3 that has the following information?
Cost = $10,000
Salvage Value = $2,000
Est. useful life = $4 years
BV @ end of year 3 = $4,000
= 10,000 - 6,000
A/D = 2,000 (yr 1) + 2,000 (yr 2) + 2,000 (yr 3) = $6,000 at the end of year 3
A corporation has income before taxes of $80,000. The corporation has already paid in quarterly estimates of $3,000 per quarter to the IRS. Using the tax bracket info below, what is the adjusting entry that needs to be made?
Tax is: $13,750 + 34% of the amount over $75,000
DR Federal Income Tax Payable $3,450
CR Federal Income Tax Expense $3,450
1) $80,000 - 75,000 = $5,000
2) $5,000 x 34% = $1,700
3) $1,700 + $13,750 = $15,450
4) ($2,000/quarter x 4 quarters) - $15,450 = $3,450
Merchandise inventory does not have a related expense account, instead what account do you use for the journal entry?
Income Summary
Current assets are assets that are expected to be exchanged for cash or consumed in what time frame?
within a year or less
Annual straight-line depreciation expense of a plant asset is calculated as the original cost of the plant asset divided by the years of estimated useful life.
False
1) cost
2) salvage value
3) est. useful life