Accounting Final

Assets
Click the card to flip 👆
1 / 28
Terms in this set (28)
Assets
resources owned by a company
Owner's Equity
the owner's interest in a corporation
what is the purpose of financial accounting
measure and communicate activities of a business
a bond will issue at a premium when
the stated rate in the bond is MORE than the market interest rate
a bond will issue at a discount when
the stated rate in the bond is LESS than the market interest rate
how is invested capital in a corporation increased
by selling stock to investors
what are the characteristics of the allowance for uncollectible accounts: normal debit or credit balance?
credit
what are the characteristics of the allowance for uncollectible accounts: liability or contra asset?
contra asset
what are the characteristics of the allowance for uncollectible accounts: estimates bad debt or ensure company will not have any bad debts?
estimates bad debt
what are the characteristics of the allowance for uncollectible accounts: when is bad debt expense recorded?
in the same period as the sales on account are recorded, the idea is to potential bad debts in the same period as the sales which may give rise to bad debts
what are dividends?distributions of company profits (net income) to shareholders (stockholders)how is earned capital in a corporation increased?by retaining net income (profit) in the business rather than paying dividends to shareholderswhich amount is reported on the balance sheet for bonds? face value? carrying value? original issue amount?the carrying value, carrying value is the balance in the bond payable account PLUS premium account balance OR LESS discount account balancebonds which are supported by specific assets are pledged as collateral are called?securedbonds which do not have collateral are called?unsecuredbonds payable with one payment at maturity are called?termwhen should a company recognize revenue?when it is earned, this means when a service has been provided or a product delivered to a customerliabilities are what?creditor's claims to the company's resourcesliabilities are classified as current when?they are due within one year of the balance sheet datewhat are long term liabilities?liabilities due MORE than one year from the balance sheet datewhat is deferred (unearned) revenue?cash received in advance of providing a product or servicehow is deferred revenue recorded?we record (credit) a liability when cash is received and debit the liability when the product or service is actually providedwhat is a balance sheet?reports company assets, liabilities, and equity AT A POINT IN TIMEwhat is an income statement?reports the company's revenues, expenses, and net income for a PERIOD OF TIMEwhat is a statement of stockholder's equity?reports the change in equity accounts for a PERIOD OF TIMEwhat is the book value of a fixed asset (building, equipment, delivery vehicle, etc.)?the original cost less accumulated depreciationwhat is the purpose of internal control?improve the accuracy and reliability of financial info"capitalize" means to immediately expense an expenditure or record the expenditure as an asset?when we record an expenditure as an asset, we are said to be "capitalizing" the expenditure