income tax on the additional $6. 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 Refresh your skills...
income tax on the additional $6. 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 Refresh your skills...
, employees and customers. All of the components of net working capital should be examined in detail and managed properly. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your...
must match each employee’s Medicare tax of 1.45% (but does not match the employee’s Additional Medicare Tax). Information on the Additional Medicare Tax can be found at www.irs.gov. Join PRO to Track Progress Mark...
of the additional 20,000 units in inventory have absorbed (been assigned) $5 of fixed manufacturing overhead costs. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your...
between divisions or subsidiaries of a large company. 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...
in working capital is important information for the company, its investors, and its creditors. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping...
proof is $30,000 of sales + $2,100 of sales tax = $32,100. In general journal form the accounting entry to record this information is: debit Cash $32,100; credit Sales $30,000; credit Sales Tax Payable $2,100. Join PRO...
will also reduce the credit balance in the accumulated depreciation account. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform...
. (This is the $20 of gross wages per hour plus the $9.04 fringe benefit cost per hour.) Similarly, the employee is earning $29.04 for every hour worked. Join PRO to Track Progress Mark the Question as Read Must-Watch...
. This could result in a significant reduction in the amount of income taxes to be paid in the early years of an asset’s life, which in turn reduces the time required for the corporation to recover the amount it paid...
net cost of the borrowed money is $480,000 ($800,000 of interest minus $320,000 of income tax savings) or 4.8% ($480,000/$10,000,000). For a corporation with a combined tax rate of 30%, the net cost of the borrowed...
by the targeted rate) exceeds the amount of the cash investment, the project is accepted since it provides the required return (or more). Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How...
inventory will be reported at a cost of $32 (2 units at $11 and 1 unit at $10). Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform...
amount of depreciation over the life of the asset is $700,000 on the financial statements and on the tax return. The difference is when the $700,000 is reported as depreciation expense. Accountants refer to this as a...
of cash flows. 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 Refresh your skills to re-enter the...
sale is $340,000 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 Refresh your skills to re-enter the...
money “coming in” from customers and logically refers to it as “income”. However, it is best to use the word sales or revenue when referring to the amounts earned from customers, and to use the word income for...
person confirms that the petty cash custodian’s cash and receipts adds up to the imprest amount. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and...
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it easier to see how effective and efficient the company has been in its recent years. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career...
for a company’s cash balance. An increase in accounts payable is a positive adjustment because not paying those bills (which were included in the expenses on the income statement) is good for a company’s cash...
versus the depreciation based on replacement cost) are phantom or illusory profits. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career...
income. 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 Refresh your skills to re-enter the workforce...
%, the corporation will reduce its income tax expense and tax payments by $30,000. This means that the corporation’s net cost of the borrowed money is $70,000 ($100,000 of interest paid to lenders minus $30,000 of...
net income and the change in a company’s cash balance, the statement of cash flows is required to be issued along with the income statement and the other required financial statements. Join PRO to Track Progress Mark...
Accounting. 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 Refresh your skills to re-enter the...
are responsible for both the employee and employer portions of FICA. Social Security involves retirement and disability benefits. Medicare involves health care for people 65 years of age and older. Join PRO to Track...
) Using the FIFO cost flow assumption, the cost of the 2 units sold will be $22 ($10 + $12) Gross profit using LIFO: Sales of $32 – COGS $25 = $7 Gross profit using FIFO: Sales of $32 – COGS $22 = $10 Note that the...
, the cost of goods sold is $307,000. (The alternative is: beginning inventory of $100,000 + net purchases of $300,000 = cost of goods available of $400,000 – ending inventory of $93,000 = cost of goods sold of...
driver such as machine hours. 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 Refresh your skills to...
and every item in inventory. By reviewing the turnover ratio for each item, the slow moving items cannot be hidden by the overall turnover ratio. Join PRO to Track Progress Mark the Question as Read Must-Watch Video...
, the cost of the production facilities’ rent might be assigned to the products at the rate of $4 per machine hour, but the rent actually occurs at the rate of $10,000 per month regardless of the number of machine...
on the allowance account. 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 Refresh your skills to...
hours per week. You should be aware of the federal and state laws for your employees’ overtime compensation. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting...
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...
cost of the truck and will be part of the depreciation expense recorded during the useful life of the truck. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and...
-week fiscal quarters such as the 13 weeks ending on the last Saturday in April, etc. Calendar months such as March 1 through March 31, November 1 through November 30, etc. 4- or 5-week fiscal months such as the 4 weeks...
manufactured during an accounting year. 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 Refresh your...
by the employer. 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 Refresh your skills to re-enter the...
this asset’s account balance must be decreased. Therefore, the second part of the entry will have to be a debit. In this transaction the account Rent Expense will be debited for $600. (Recall that expenses must be...
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