. These costs are partially fixed and partially variable. Understanding how costs behave is important for management’s planning and controlling of its organization’s costs, and for cost-volume-profit analyses...
. These costs are partially fixed and partially variable. Understanding how costs behave is important for management’s planning and controlling of its organization’s costs, and for cost-volume-profit analyses...
owed by the borrower. On any given date, the borrower is liable for the unpaid principal balance plus any accrued interest expense up to that point. The borrower’s balance sheets will report: A current liability for...
, Plant and Equipment. At that point, the depreciation of the addition will begin. (If a company is constructing an assembly line or a huge machine that will take time to build, the amounts would also be accumulated in...
that a state has authorized a corporation to issue 100,000 shares of common stock. The corporation has issued 20,000 of those shares to investors and received $2,000,000. At this point, the corporation has 20,000 shares...
at maturity. Let’s also assume that after the bonds are issued the market interest rates increase by one percentage point. As a result the 5% bond will lose some of its value because the contractual payment of $50 per...
too noisy for residents, there’s little point to calculate the net present value. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career...
Why would the cost behavior change outside of the relevant range of activity? Cost behavior often changes outside of the relevant range of activity due to a change in the fixed costs. When volume increases to a certain...
Adding the increase in accrued expenses payable Example of the Direct Method of SCF When the direct method of presenting a corporation’s cash flows from operating activities is used, the amount of net income is not...
a vibrant campus placement or career services office with a track record of placing accounting students in the professional positions that you seek. Here’s my point. What if many of the top performers on the CPA Exam...
What GPA is needed to be hired by a CPA firm? There is no single GPA (grade point average) that assures you of being hired by a CPA firm. I have seen firms pass over a student with a near-perfect GPA (3.97 out of 4.0)...
the budget for January 2024 and adds the budget for January 2025. This rolling budget now covers the 12 months from February 1, 2024 through January 31, 2025. At the end of February 2024, the rolling budget will drop...
was also 60% (contribution margin of $6 divided by the selling price of $10). The contribution margin is a key component in computing a company’s break-even point. Join PRO to Track Progress Mark the Question as Read...
of production method, let’s assume that a company has a machine with a cost of $500,000 and a useful life that is expected to end after producing 240,000 units of a component part. Further, the machine’s salvage...
ledger accounts. At any point you can go to an account such as Salaries Expense for Sales Staff and see the year to date amount of such an expense. With the use of accounting software, an enormous quantity of...
receivable that will be collected. Example of Allowance for Doubtful Accounts Assume a company has $230,000 of accounts receivable at the end of its accounting year. Its Allowance for Doubtful Accounts (before any...
? Balance Sheet Wrong. Income Statement Right! Statement Of Cash Flows Wrong. Statement Of Comprehensive Income Wrong. Statement Of Stockholders’ Equity Wrong. 5. Does the heading of a balance sheet indicate a period...
. Select... period of point in 17. The amounts reported on the income statement represent a __________ __________ time. Select... period of point in 18. The amounts reported on the statement of cash flows represent a...
Our Explanation of Financial Statements provides you with the highlights of each of the five external financial statements issued by U.S. corporations. Our insights will give you a good understanding of what the...
Our Explanation of Accounting Equation (or bookkeeping equation) illustrates how the double-entry system keeps the accounting equation in balance. You will see how the revenues and expenses on the income statement are...
and store the transaction amounts involving revenues and expenses. At any point, the balances in the revenue and expense accounts can be moved to the owner’s equity account. Since revenues cause owner’s equity to...
income is significant. Here are some hypothetical amounts to illustrate the point: Revenue from sales of products $300,000 Cost of the products that were sold $200,000 Expenses (wages, rent, ads, etc.) $88,000 Net...
of a company’s fixed expenses assists in understanding how the retailer’s net income will change as volume changes. The total amount of fixed expenses can also be used to quickly estimate a company’s break-even...
or Practice Quiz for this topic. For more insight regarding a specific question, use the search box at the top of the page. 1. The time between the placing of an order and the receipt of the goods that were ordered is...
service, etc. When deciding which of the non-necessary projects should be undertaken, companies likely use various techniques for ranking the projects from a financial point of view. The following are four common...
. Knowing how costs behave when sales or other activities change will allow you to better understand how a company’s gross profit and net income will change. It also allows you to quickly calculate a product’s...
the financial statements accurate under accrual accounting. You raised an important point. You should discuss this further with your accountant. Join PRO to Track Progress Mark the Question as Read Must-Watch Video...
Our Explanation of Improving Profits will assist you in focusing on the costs and revenues that are relevant (and ignoring those which are not relevant) for improving profits and eliminating losses. Examples of the...
__________cost to the point of transfer plus the company’s opportunity cost. Select... fixed incremental total 10. Residual income is expressed as a __________. Select... dollar amount percentage 11. A potential...
months of use, the accumulated depreciation reported on the balance sheet will be $24,000. After 120 months, the accumulated depreciation reported on the balance sheet will be $120,000. At that point, the depreciation...
with a lien on real estate. mortgage bond This bond is secured with a lien on real estate. Mark as wrong Mark as right basis point This metric is one hundredth (1/100) of a percentage point of an interest rate such...
will be too small). The owner’s (or stockholders’) equity will also be too low because of the effect on net income (see next bullet point) The income statement for the current period will overstate (report too much)...
variable 15. In the cost equation y = a + bx, “a” is the __________. Select... dependent variable fixed cost independent variable 16. When graphing a cost that is linear, the amount of the fixed cost is the point...
Our Explanation of the Balance Sheet provides you with a basic understanding of a corporation's balance sheet (or statement of financial position). You will gain insights regarding the assets, liabilities, and...
when the amount of cash is low and at the __________ of the accounting period. Select... end mid-point 12. An imprest petty cash account is __________ to be debited or credited each time that the petty cash fund is...
Since our Explanation of Cash Flow Statement illustrates how the amounts are determined, you will get a better understanding of this very important financial statement. No longer will you look at only the income...
statement. It is associated with the balance sheet. Statement Of Operations Wrong. This name is used instead of income statement. 2. The income statement heading will specify which of the following? A POINT In Time...
Our Explanation of Accounting Basics uses a simple story to introduce important accounting concepts and terminology. It illustrates how transactions will be included in a company's financial statements.
or the statement of financial condition. 2. The balance sheet heading will specify a Period Of Time Wrong. The balance sheet reflects an instant or a POINT in time. Point In Time Right! The balance sheet is at an...
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