financial accounting exam

How are liabilities classified on the balance sheet?

Current liabilities or non-current liabilities

What is the journal entry to record a notes payable?

Debit cash, credit notes payable

What type of account is unearned rent revenue?

Liability account

How to calculate the sales tax if give total receipts and the sale tax rate.

Total receipts/ 1 + the sales tax rate

What is the journal entry to record salaries and wages for a period?

Debit wages expense, credit salaries and wages payable

How to calculate debt to assets ratio?

Total debt / total assets

How are sales taxes collected by a retailer recorded?

Credit to sales taxes payable under the current liabilities section on the balance sheet.

What is the chief accounting officer called?

The controller

What are the characteristics of a privately held corporation?

Limited shareholders, no public trading of shares, greater owner control, and flexibility in management and decision-making.

What is par value?

The face value of a bond or the value of a stock certificate stated in the corporate charter

What is the amount of stock that a corporation may issue according to its charter called?

Authorized stock

What is credited for the excess of selling price over par value?

Additional paid – in capital

What is the journal entry for stock that is issued that has A stated value?

Debit cash, credit, stock, credit paid – in capital

What is the journal entry for treasury stock?

Debit treasury stock, credit cash

What is treasury stock?

The shares a company owns of its own stock

What are dividends in arrears?

Unpaid cumulative preferred stock dividends that have been missed by a company

What is the record date?

A specific date set by a company to determine which shareholders are eligible to receive a dividend payment or corporative action

What is the order of activities on the statement of cash flows?

Operating activities, investing, activities, financial activities

Given a series of transactions, which one does not impact cash

Stop for assets, exchanges, leasing arrangements, and converting bonds into stock

How is the insurance of debt to purchase assets classified on the statement of cash flows

Financing activity

Where is an increase in inventory recorded on a statement of cash flows?

As a deduction in the cash flow from operating activity section

Where is land purchased for cash recorded on a statement of cash flows

Investing activities

If equipment is sold at a game, where is the gain recorded on a statement of cash flows?

A deduction from net income in the operating activity section

How to calculate net cash provided by operating activities, giving a set of numbers

Net income + Non-cash Expenses – increased in working capital

Where are cash dividends classified on the statement of cash flows?

Financing activities

Comparison of data with an company is called what

Intracompany comparisons

How to calculate the average collection period of an account receivable in terms of days

Net credit sales/average accounts receivable times 365

How to calculate the current ratio

Current assets/total current liabilities

How to calculate inventory turnover

Cast of good sold/average inventory value