Exam 1 Study Guide
Types of Accounting used within an organization and for planning.
∙ Managerial Accounting
The going concerned concept says what?
∙ That the entity will continue to operate in the future.
When is revenue recorded for accrual accounting? ∙ When the services are performed
How would you find the stockholders’ equity in an equation?
∙ Subtract liabilities from the assets If you want to learn more check out How cytoplasmic male sterility is used in plant breeding?
o Assets= $1000; Liabilities= $300; SE= $700
The Matching Principle matches what to what? ∙ Expenses to revenue
What’s the accounting equation?
∙ Assets= Liabilities + Stockholders’ equity
Don't forget about the age old question of Does being a lawyer require a license or certificate?
∙ $320,000= $117,000 + $203,000
When a firm uses LIFO what happens?
∙ The cost of goods sold is greater than if FIFO was used.
∙ The products that were last in are the first out. If you want to learn more check out What are some examples of cultural pluralism?
Accounts Receivable are recorded at______ ∙ Net relizable value
“______” results from a sale of goods or services ∙ On Account (NOT CASH)
Accounts Payable are liabilities not assets!
Noncurrent intangible assets are subject to ∙ Amoritization
Straight Line depreciation
∙ There is equal depreciation each year.
The principle challenge to calculating depreciation is: ∙ Estimating the quantity of materials recovered.
Land isn’t a liability
A Chart of Accounts isn’t an example of a source document. We also discuss several other topics like What are the thermal properties of surfaces?
Perpetual inventory system is what?
∙ A continuous record of the quantity and cost of each item.
∙ Record is made of every purchase.
∙ Computers have made it more feasible to use perpetual inventory systems
How to find dividends in an equation?
When you have net income, beginning retained earnings, and ending retained earnings finding the dividends is easy. If you want to learn more check out What is the meaning of mass numbers in biology?
Add net income and Beg. Ret. Earnings; then subtract Ending Ret. Earnings. The results is your DIVIDEND
o Net Income: $100,000; Beg. Ret E: $30,000; Ending Ret. E: $90,000 o 100,000+30,000= 130,000- 90,000= 40,000 If you want to learn more check out What happens in the 1871 commune of paris?
o 40,000 is dividends