Contra Accounts
Cost of Goods Sold (COGS): Am I a contra account?
No
When companies grant credit directly to their customers, they expect that a portion will go unpaid.
True or False
True
What does LIFO stand for?
Last-in-first-out
What does 2/10, net 30 mean?
2% discount if paid in 10 days, otherwise full amount due in 30 days.
What percent of your grade is this exam worth?
20%
Sales Discounts: what account type is it AND what is its normal balance?
Equity AND Debit
Name the two methods used to account for bad debt?
Direct writeoff method
Allowance method
What are the 4 methods we covered?
SI, FIFO, LIFO, WAC
Net Sales - COGS = ...
Gross Profit
What grade do you need to get in this class to not have to take it again?
C-
Sales Returns & Allowances: what account type is it AND what is its normal balance?
Equity AND Debit
Name all three methods that can be used to estimate bad debt under the allowance method?
Percent of Sales
Percent of Receivables
Aging Schedule
If damaged, obsolete (out-of-date), or deteriorated goods can be sold, they will be included in inventory at their original cost. True or False
False.
What is the formula for straight line depreciation?
(Cost - SV) / UL
Part of the renovation will include a peacock enclosure and 7 live birds. One for every dean of the college of business. True or False
False
Accumulated Depreciation: what account type is it AND what is its normal balance?
Asset AND Credit
Rando Corp uses the direct writeoff method. At the end of the current year Rando discovers it will not collect $15,000 of it receivables. What is the journal entry?
Dr Bad Debt Expense $15,000
Cr A/R $15,000
Which two methods are the same under the periodic and perpetual inventory cost system
FIFO and SI
On November 15th, Rando Corp sells an ATM for $1,500 and accepted the buyer’s VISA credit card. VISA charges a 5% fee. What journal entry should Rando make to record the sale?
Dr Cash $1,425
Credit Card Expense 75
Cr Sales Revenue $1,500
Where in the US did I grow up?
San Diego
Allowance for Doubtful Accounts (ADA): what account type is it AND what is its normal balance?
Asset AND Credit
Rando Corp uses the direct writeoff method. At the end of the current year Rando discovers it will not collect $11,000 of it receivables and records the appropriate journal entry. A week later, Rando miraculously collects the $15,000. What is the journal entry?
Dr A/R $11,000
cr Bad Debt Expense $11,000
Dr Cash 11,000
cr A/R 11,000
When purchase costs regularly rise, the inventory costing method that yields the highest reported net income is:
FIFO
Rando Corp sold a piece of equipment at the end of the year for $4,000 cash. The equipment originally cost $16,000 and had accumulated depreciation of $13,000. What journal should GNB prepare to record the sale of the equipment?
Dr Cash $4,000
Accumulated Depreciation 13,000
Cr Gain on Sale $1,000
PPE 16,000
What are my office hours?
T TH
1230-145
330-430