Are bonds payable reported as a current liability if they mature in six months? Definition of Bonds Payable Bonds payable are formal, long-term obligations that promise to pay interest every six months and the principal...
Are bonds payable reported as a current liability if they mature in six months? Definition of Bonds Payable Bonds payable are formal, long-term obligations that promise to pay interest every six months and the principal...
off. The accountant will prepare adjusting entries to record expenses that occurred but are not yet entered by the bookkeeper. (Examples include interest on bank loans since the last loan payment, wages earned by...
What is common stock? Definition of Common Stock Common stock refers to the shares of ownership interest in a U.S. corporation. The owners of the common stock are referred to as common stockholders, common shareholders,...
stockholders want their investments to grow in value instead of receiving taxable dividends. A large, established public utility with stable earnings and the ability to issue bonds payable (with low, tax-deductible...
Journal Entries (Word Scramble) Download PDF To see each answer, press or click on the blue "Unscramble" button. 1. The accrual of interest expense is recorded in the _________ journal. GENERAL NERLEAG...
for interest expense, and payments for income taxes. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your current job...
is $16. It may be in the best interest of Giant Corporation to arrange for both Sub1 and Sub2 to agree to a transfer price of $16. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to...
of the goods that were sold during the current period, and the following which also occurred during the current period: salaries earned by the company’s employees, interest expense incurred, commissions earned by...
by reading our Nonmanufacturing Overhead (Explanation). 1. Selling expenses should be allocated to the cost of goods sold for external financial reporting. True Wrong. False Right! 2. According to U.S. accounting...
to as a contra-liability account. Examples of Contra-Liability Accounts Some contra-liability accounts include: Discount on Bonds Payable Bond Issue Costs Discount on Notes Payable The debit balances in the above...
expensive components of the cost of capital. One reason is that the interest is deductible for income taxes. For example, a corporation paying 6% on its loans may have an after-tax cost of 4% when its combined federal...
and asked that his billing period be changed to cover the calendar month. They were pleased to make the change. Next, the owner called his bank and asked if the bank would be able to deduct the current month’s loan...
within our free Accounting Career Center. If you need to take additional college credits, then you should give thought as to whether it should be for the minimum credits in the discipline of your interest, an MBA...
to the owner’s capital account at the end of each accounting year. Select... True False 3. The closing entries will include a __________ to the Sales account. Select... debit credit 4. Prepaid Insurance is a temporary...
a vendor’s invoice within the vendor’s early payment discount period. Purchase Discounts Lost is considered to be an interest expense or a financing charge resulting from the buyer not being able to pay the cash...
the amount of money currently on hand.) Expense accounts and loss accounts including Cost of Goods Sold, Wages Expense, Rent Expense, Interest Expense, Loss on Disposal of Equipment, Loss from Lawsuit, etc. (The debit...
, the written note specifies the principal amount, the date due, and the interest to be paid. For most companies, if the note will be due within one year, the borrower will classify the note payable as a current...
or simply the gross margin.) Companies should be continuously monitoring its gross margin ratio to be certain it is sufficient to cover its selling, general and administrative expenses, interest expense, and to earn a...
of Cost Principle The cost principle means that a long-term asset purchased for the cash amount of $50,000 will be recorded at $50,000. If the same asset was purchased for a down payment of $20,000 and a formal promise...
and paid by the corporation. Here are a few of the more common descriptions that will be seen under the direct method: Cash from customers Cash paid to employees Cash paid to suppliers Cash paid for interest The direct...
prices based on their costs. In the long run, the products’ selling prices must be large enough to cover all of a company’s manufacturing costs (including the variable and fixed indirect manufacturing costs) plus...
Cost of goods sold $400,000 Selling, general and admin expenses $150,000 Interest expense $8,000 Corporate income tax expense $6,000 The retailer’s profit margin ratio (after tax) for its most recent year was 6%....
in the factory. In addition to the manufacturing costs, there are selling, general and administrative (SG&A) expenses and perhaps interest expense. Generally, accountants do not consider these expenses to be product...
activities, and disclosing the amounts paid for income taxes and interest. The notes to the financial statements are an integral part of all financial statements including SCF. 10. Digital Marketing Consultants, Inc....
Our Explanation of Evaluating Business Investments compares four of the techniques for reviewing potential capital expenditures. You will be introduced to accounting rate of return, payback, net present value, and...
. The actual senior executive compensation amount (regardless of amount) will be the same amount whether the company stays in three states or expands to the fourth state. What matters are the ADDITIONAL expenses and the...
or Practice Quiz for this topic. For more insight regarding a specific question, use the search box at the top of the page. 1. This non-government organization currently establishes accounting standards in the United...
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...
Our Explanation of Bookkeeping provides you with a rich understanding of the recording of transactions. It then discusses the additional steps necessary for preparing accurate financial statements. This is great for...
Our Explanation of Bookkeeping provides you with a rich understanding of the recording of transactions. It then discusses the additional steps necessary for preparing accurate financial statements. This is great for...
. Select... increase decrease 7. The account Sales Discounts is likely to have a __________ balance. Select... debit credit 8. If a bank credits a company’s checking account for interest that the company has earned,...
, __________ activities, and __________ activities. 2. The exchange of bonds for stock shall be reported as __________ information. 3. A corporation is required to disclose the amount of interest and income taxes that it...
.” Discounting can be thought of as removing the interest or necessary earnings that is included in the future cash amounts. After the interest has been removed the resulting amount is the present value or the...
this topic by reading our Inventory and Cost of Goods Sold (Explanation). 1. Under which inventory cost flow assumption is the cost of the most recent purchase matched first with sales revenues? FIFO Wrong. Under FIFO...
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.
Discounts Lost is an income statement account similar to Interest Expense, since it implies that JAYCO did not have the money to pay the vendor the cash price by February 15. Any amount in the Purchases Discount Lost...
. In essence, the cost of goods sold is being matched with the revenues from the goods sold, thereby achieving the matching principle of accounting. When the cost of goods sold is subtracted from net sales, the result is...
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