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Terms in this set (27)
Calculate Net Income
What is revenue
sales, the money made off of the product or service sold.
T Account- Revenue
T Account-Salary Expenses
T Account- Pre-paid Rent
T Account- Unearned revenue
T Account- Notes payable
T Account- Salaries Payable
Paid cash for $4,000 of salaries expenses.
Credit cash, debit salaries expenses
Received $20,000 cash by issuing common stock.
Debit cash, credit common stock
Purchased supplies for $900 cash.
Debit supplies, credit cash
Performed services on account for $7,000.
Debit accounts receivable, credit service revenue
FOB shipping point
Buyer pays the shipping charge
Supplier pays the shipping cost
cost of goods sold
the total cost of merchandise sold during the period
the amount paid to suppliers for products that are purchased.
Calculate retained earnings
previous year RE+ net income of current year-dividends of current year= RE
T Accounts- dividends
T Accounts- Settle accounts payable
Return on equity
net income/stockholders equity
(the higher the number the more profitable the company)
calculate debt ratio
total debt/total assets
(the higher the number the higher the risk)
calculate gross margin
sales revenue- cost of goods sold
T Accounts- Cash
T Accounts- Supplies
T Accounts- Accounts payable
T Accounts- Land
T Accounts- ASSETS
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