Accounting

Front 1

the relevant factor(s) in computing depreciation incude?

Back 1

-cost
-salvage value
-useful life
-depreciation method

Front 2

natural resources

Back 2

-include standing timber, mineral deposits, and oil and gas fields
-are also called wasting assets
-are long-term assets
-are depleted

Front 3

units-of-production depreciation

Back 3

a method that allocates an equal portion of the total depreciable cost for a plant asset to each unit

Front 4

most companies use accelerated depreciation in computing taxable income because?

Back 4

it postpones tax payments until later years, and the company can use the resources now to earn additional income before payment is due

Front 5

plant assets are?

Back 5

tangible assets used in the operation of a business that have a useful life of more than one accounting period

Front 6

ordinary repairs

Back 6

-are expenditure to keep an asset in normal operating condition
-are necessary if an asset is to perform to expectations over its useful life
-are treated as expenses
-include cleaning, lubricating, and normal adjusting

Front 7

a leasehold

Back 7

are the rights granted to the lessee by the lessor of a lease

Front 8

revenue expenditures

Back 8

are additional cost of plant assets that do not materially increase the assets life or its productive capabilities

Front 9

pledging receivables

Back 9

-allows firms to raise cash
-allows a firm to retain ownership of its receivables
-does not transfer risk of bad debts to the lender
-should be disclosed in the financial statements

Front 10

a promissory note received from a customer in exchange for an account receivable?

Back 10

is a note receivable for the recipient

Front 11

the relevant factor(s) in computing depreciation incude?

Back 11

-cost
-salvage value
-useful life
-depreciation method

Front 12

natural resources

Back 12

-include standing timber, mineral deposits, and oil and gas fields
-are also called wasting assets
-are long-term assets
-are depleted

Front 13

units-of-production depreciation

Back 13

a method that allocates an equal portion of the total depreciable cost for a plant asset to each unit

Front 14

most companies use accelerated depreciation in computing taxable income because?

Back 14

it postpones tax payments until later years, and the company can use the resources now to earn additional income before payment is due

Front 15

plant assets are?

Back 15

tangible assets used in the operation of a business that have a useful life of more than one accounting period

Front 16

ordinary repairs

Back 16

-are expenditure to keep an asset in normal operating condition
-are necessary if an asset is to perform to expectations over its useful life
-are treated as expenses
-include cleaning, lubricating, and normal adjusting

Front 17

a leasehold

Back 17

are the rights granted to the lessee by the lessor of a lease

Front 18

revenue expenditures

Back 18

are additional cost of plant assets that do not materially increase the assets life or its productive capabilities

Front 19

pledging receivables

Back 19

-allows firms to raise cash
-allows a firm to retain ownership of its receivables
-does not transfer risk of bad debts to the lender
-should be disclosed in the financial statements

Front 20

a promissory note received from a customer in exchange for an account receivable?

Back 20

is a note receivable for the recipient

Front 21

factor

Back 21

the buyer who pays cash for an account receivable

Front 22

the quality of receivables refers to?

Back 22

the likelihood of collection without loss

Front 23

the amount of federal income taxes withheld from an employee's paycheck is determined by?

Back 23

the employee's annual earnings rate and number or withholding allowances

Front 24

if a company uses a special payroll bank account

Back 24

the company draws one check for the entire payroll on the regular bank account and deposits it in the payroll bank account.

Front 25

sales tax payable

Back 25

is a current liability for retailers

Front 26

current liabilities

Back 26

obligations due to be paid within one year or the company's operating cycle, whichever is longer.

Front 27

employer payroll taxes

Back 27

are an added expense beyond the wages and salaries earned by employees

Front 28

fixed costs

Back 28

-create risk
-can be advantage when a company is growing
-include interest expense
-do not fluctuate with changes in sales

Front 29

a payroll register includes

Back 29

-pay period dates
-hours worked
-gross pay and net pay
-deductions

Front 30

payroll expenses for employers may involve

Back 30

-liabilities to individual employees
-liabilities to federal and state governments
-liabilities to insurance companies
-liabilities to labor unions

Front 31

factor

Back 31

the buyer who pays cash for an account receivable

Front 32

the quality of receivables refers to?

Back 32

the likelihood of collection without loss

Front 33

the amount of federal income taxes withheld from an employee's paycheck is determined by?

Back 33

the employee's annual earnings rate and number or withholding allowances

Front 34

if a company uses a special payroll bank account

Back 34

the company draws one check for the entire payroll on the regular bank account and deposits it in the payroll bank account.

Front 35

sales tax payable

Back 35

is a current liability for retailers

Front 36

current liabilities

Back 36

obligations due to be paid within one year or the company's operating cycle, whichever is longer.

Front 37

employer payroll taxes

Back 37

are an added expense beyond the wages and salaries earned by employees

Front 38

fixed costs

Back 38

-create risk
-can be advantage when a company is growing
-include interest expense
-do not fluctuate with changes in sales

Front 39

a payroll register includes

Back 39

-pay period dates
-hours worked
-gross pay and net pay
-deductions

Front 40

payroll expenses for employers may involve

Back 40

-liabilities to individual employees
-liabilities to federal and state governments
-liabilities to insurance companies
-liabilities to labor unions

Front 41

contingent liabilities must be recorded if

Back 41

the future event is probable and the amount owed can be reasonably estimated

Front 42

gross pay is

Back 42

total compensation earned by an employee before any deductions

Front 43

the formula for computing annual straight-line depreciation

Back 43

cost less salvage value divided by the useful life in years

Front 44

the useful life of a plant asset is

Back 44

the length of time it is productively used in company's operations

Front 45

the wage bracket withholding table is used

Back 45

compute federal income tax withholding

Front 46

unearned revenues are

Back 46

-also called deferred revenues
-amounts received in advance from customers for future delivery of products or services
- also called collections in advance
-also called prepayments

Front 47

an employee earnings report

Back 47

is the cumulative record of an employee's hours worked gross earnings, deductions and net pay

Front 48

known liabilities

Back 48

-include accounts payable, notes payable, and payroll
-are obligations set by agreements, contracts, or laws
-are measurable
-are definitely determinable

Front 49

long-term liabilities

Back 49

obligations not expected to be paid within the longer of one year or the company's operating cycle

Front 50

uncertainties such as natural disasters

Back 50

are not contingent liabilities because they are future events not arising out of past transactions or events

Front 51

FUTA taxes are

Back 51

unemployment taxes

Front 52

obsolescence

Back 52

refers to a plant asset that is no longer useful in producing goods and services

Front 53

plant assets

Back 53

used in operations

Front 54

plant assets include

Back 54

-land
-land improvements
-buildings
-machinery and equipment

Front 55

a change in an accounting estimate is?

Back 55

a change in a calculated amount that is part of financial statements that results from new information or subsequent developments and from better insight or improved judgement

Front 56

salvage value is

Back 56

-also called residual value
-also called scrap value
-an estimate of the assets value at the end of its benefit period
-a factor relevant to determining depreciation

Front 57

the account receivable turnover measure

Back 57

how often, on average receivables are received and collected during the period

Front 58

the matching principle requires

Back 58

the use of the allowance method of accounting for bad debts

Front 59

aging of accounts receivable method

Back 59

a method of estimating bad debts expense that involves a detailed examination of outstanding accounts and their length of time past due

Front 60

the materiality principle

Back 60

states that an amount can be ignored if its effect on financial statements is unimportant to the users business decisions

Front 61

the accounts receivable turnover is calculated by?

Back 61

dividing net sales by the average accounts receivable

Front 62

allowance method of accounting for bad debits

Back 62

an accounting procedure that
(1) estimates and reports bad debts expense from credit sales during the period of the sales, and
(2) reports accounts receivable at the amount of crash to be collected

Front 63

a promissory note

Back 63

is a written promise to pay a specified amount of money at a certain date

Front 64

the amount of bad debt expense can be estimated by

Back 64

-the percent of sales method
-the percent of accounts receivable method
-the aging of accounts receivable

Front 65

the maturity date of a note receivable

Back 65

is the day the note is due to be paid

Front 66

the times interest earned computation is

Back 66

(net income + interest expense + income taxes) / interest expense

Front 67

book value

Back 67

the total cost of an asset less its accumulated depreciation