Accounting Exam 1 SG

Accounting

What is the correct equation for the accounting equation?

Assets = Liabilities + Common Stock + Retained Earnings

What types of accounts are matched in the accrual accounting concept?

Expenses and revenues

Where is the balance of Accounts Receivable shown?

On the balance sheet

Earning revenue on account is classified as what type of transaction?

Asset source transaction

A particular kind of event that involves transferring something of value between two entities is called a ___________.

transaction

Companies typically report about business activity occurring over a span of time called an __________ _____________.

accounting period

An economic occurrence that changes an enterprise’s assets, liabilities, or stockholders’ equity is called an _______________ ________________.

economic event

What type of cost is considered a period cost?

Advertising expense for the current month

Which type of business is primarily a merchandising business?

Martin's Supermarket

What are the raw materials used during the year for Kenton Company?

$229,000 - beginning $18,000 + purchases - $17,500 ending inventory.

How to calculate the average tax rate?

Total tax / Total Income

How to find the effective tax rate?

Total tax / Taxable Income

What is the classification of Social Security taxes?

Regressive

What is the classification of Medicare taxes?

Proportional