an accounting adjusting entry in which the account Depreciation Expense is debited and the contra asset account Accumulated Depreciation is credited. Effects of Depreciation The following are some of the effects for a...
an accounting adjusting entry in which the account Depreciation Expense is debited and the contra asset account Accumulated Depreciation is credited. Effects of Depreciation The following are some of the effects for a...
What is a defined contribution pension plan? A defined contribution pension plan is one in which the employer contributes an amount into each eligible employee’s account within an established plan. The employee decides...
or the corporation’s retained earnings account. Accounts that are Debited in the Closing Entries The following temporary accounts normally have credit balances that require a debit as part of the closing entries:...
of the income statement accounts (revenues, expenses, gains, losses) by transferring their balances to the owner’s capital account or the corporation’s retained earnings account. This is done after the company’s...
by the corporation, the stockholders’ equity account Retained Earnings would be credited. If a corporation reduces its assets by purchasing its stock from its stockholders, the contra-stockholders’ equity account...
(or to a corporation’s retained earnings account within stockholders’ equity). To recap the above, the monthly rent payment keeps the sole proprietor’s accounting equation, Assets = Liabilities + Owner’s Equity,...
accounts to a balance sheet account such as a corporation’s Retained Earnings account When recording a reversing entry for a previous accrual adjusting entry involving an expense When recording a deferral adjusting...
Revenues will eventually be moved to the sole proprietor’s capital account or to a corporation’s Retained Earnings account (thereby increasing the credit balance in one of those owner’s or stockholders’ equity...
consolidated statements of operations. The other six corporations used one of the following titles: consolidated statements of income, consolidated statements of earnings, or consolidated results of operations. In the...
reported as other comprehensive income on each period’s statement of comprehensive income. It is similar to the amount of retained earnings which is the net cumulative amount of the items reported on each period’s...
of comprehensive income along with the amount of net income from the income statement. Since the OCI items do not affect the net income, they do not cause a change in a corporation’s retained earnings. Instead, the...
accounts such as Accounts Payable, Notes Payable, Accrued Liabilities, Deferred Income Taxes, etc. Owner’s (Stockholders’) equity accounts including Owner’s Capital, Common Stock, Retained Earnings, and others...
statement, statement of comprehensive income, balance sheet, statement of cash flows, and statement of stockholders’ equity) The notes to the financial statements Press releases and conference calls regarding...
in a corporation’s retained earnings, which is part of the stockholders’ equity section of the balance sheet. Balance Sheet: Retail/Wholesale – Corporation Join PRO to Track Progress Mark the Question as Read...
for income tax and before investment income, interest expense, or other non-operating income or expense items. Operating income is also reported as income from operations, operating earnings, or operating profit. Major...
accumulated depreciation. It is also the face value of bonds minus its unamortized discount (or plus its unamortized premium). It is also the amount of a corporation’s stockholders’ equity. Mark as wrong Mark as...
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...
22. The account Retained Earnings will be included in which side of the accounting equation? Select... Left Right 23. When a company uses the accrual method and it records interest expense that it incurred but has not...
as Prepaid Insurance or as part of Prepaid Expenses. Each month an adjusting entry will move $500 from Prepaid Insurance to Insurance Expense to recognize that the insurance coverage has a monthly cost of $500. 13. A...
-term assets. Similarly, current liabilities are reported in a section that is separate from long-term liabilities. This allows bankers, owners, and others to easily compute the amount of an organization’s working...
of $0 on an income statement prepared using the accrual method of accounting. The break-even point expressed in dollars of revenues is calculated by dividing the company’s total fixed expenses for the accounting...
_________________ ratio. TURNOVER ETOVNRUR Unscramble TURNOVER EORRVUNT Unscramble Mark the Word Scramble as Complete Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your...
Why is inventory turnover important? Definition of Inventory Turnover A company’s inventory turnover is often expressed as the company’s cost of goods sold for a year divided by the average cost of inventory during...
What is sales mix? Definition of Sales Mix Sales mix is the relative proportion or ratio of a business’s products that are sold. Sales mix is important because a company’s products usually have different degrees of...
account for a certain transaction. Example of a Credit Memo Assume that SellerCorp had issued a sales invoice for $800 for 100 units of product that it shipped to BuyerCo at a price of $8 each. BuyerCo informs...
a larger portion of selling and administrative costs while other products require a small portion. Only when a product’s selling and administrative costs are combined with the product’s manufacturing costs will they...
, such as Sales Discounts or Discounts for xxx. Let me give you an example from the meat industry. We had 40,000 pounds of beef without a local customer, so we sold it to a company 1,000 miles away for the local price of...
for a small fee that was immediately expensed. Since then Company X has been very effective in promoting this trademarked brand. Consumers now pay a premium price for this recognized and superior product. A competitor...
already successful business. You are confident that it will increase your company’s contribution margin by $1,500 a week. A highly-trusted and successful firm will complete the website within 4 weeks at a set price of...
is currently experiencing. For example, if a retailer buys its merchandise for $0.70 and sells the merchandise for $1.00, it has a gross profit of $0.30. The gross profit of $0.30 divided by the selling price of $1.00...
or the average methods will vary slightly depending on whether the inventory system is periodic or perpetual and whether a dollar-value method based on price indexes was used. Join PRO to Track Progress Mark the...
of its customers. Ace requires that the customer pay $50,000 before Ace begins to design and construct the machine. The $50,000 payment is made in December 2023 and the machine must be finished by March 31, 2024. The...
of the years 2021 through 2023. In addition the accountant might add a price index for each line which expresses each line’s amounts as a percentage of the 2021 amount. In this example the base year is 2021. Assuming...
or stockholders? equity Benefits of Disposing of Obsolete Inventory Since the value of the obsolete items may continue to decrease, it is wise to dispose of the items at any price as soon as possible. The benefits of...
that was prepared by the organization The receiving report that was prepared by the organization The “match” part of the three-way match refers to comparing the quantities, price per unit, terms, and other...
What are the journal entries for a stock split? Definition of a Stock Split A stock split usually increases the number of shares of a corporation’s common stock with the intention of reducing the market price of each...
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