D102 Financial Accounting WGU

D102 Financial Accounting WGU 22 studiers today 5.0 (2 reviews) Students also studied Terms in this set (52) Western Governors UniversityD 196 Save D102 Financial Accounting Teacher 120 terms pjames638Preview Financial Accounting - D102 WGU 165 terms Hails_111Preview wgu d102 pre assesment 64 terms Keto_BobPreview Taxatio 66 terms ada What information is contained in a balance sheet? Report of a company's financial position as of a point in time.What is an owners' equity item?Accounts receivable Loans payable Capital stock Cash Capital Stock A company ended July with assets of $150,000 and owner's equity of $60,000.What is the amount of liabilities at the end of July?

$90,000

What is reported in a multiple-step income statement that is not reported in a single-step income statement?Gross Profit How is gross profit computed?Sales minus cost of goods sold.The following are some accounts from a company's

financial statements:

(accounts receivable, cost of goods sold, cash, retained earnings, sales, inventory, income tax expense, accounts payable) Which set is a list of all of the items that are used in computing this company's net income?Sales, cost of goods sold, and income tax expense.What cash flow category contains activities whereby cash is obtained from or repaid to owners or creditors?Financing

Here are some financial statement items for the year for a company.Cash received from customers Cash received from the sale of land Cash paid for dividends Cash paid to employees for wages Cash paid to purchase a new building Cash paid for rent Cash received as new investment from owners Which set of items is a list of items that are used in computing the company's financing cash flow for the year?Cash paid for dividends and cash received as new investment from owners.Here are some financial statement items for a company.Net income Cash flow from financing activities Cash balance at the beginning of the year Sales Cash flow from investing activities Accounts receivable Retained earnings at the beginning of the year Cash flow from operating activities What items are used in computing the company's ending cash balance for the year?Cash balance at the beginning of the year, cash flow from operating activities, cash flow from investing activities, and cash flow from financing activities.How is revenue typically recorded with debits and credits?As a credit, representing an increase in equity.What is the proper way to record an increase in an asset account and an increase in an equity account?Asset, debit; equity, credit How are expenses typically recorded with debits and credits?As a debit, representing an increase in assets.A company purchased inventory for $5,000. The company paid $1,000 cash and the remainder of the purchase was made on account.What is included in the journal entry necessary to record this inventory purchase?Credit to accounts payable for $4,000.A company sold inventory that cost $1,300 for $2,000. It received $500 cash and the remainder was on account.What is included in the journal entry or entries necessary to record this sale of inventory?Debit to accounts receivable for $1,500.On August 1 of Year 1, a company paid $7,200 for two years' rent. The rental period starts on August 1 of Year 1.Which debit or credit is correctly included in the adjusting journal entry necessary on December 31 of Year 1?Debit to rent expense for $1,500.

The revenue recognition principle states that revenues are recorded when two main criteria have been met. One of those criteria is that cash has been collected or collectability is reasonably assured.What is the other criterion?The earnings process is substantially complete.What is the matching principle?Expenses are recorded in the same period in which the corresponding revenue is recorded.For large, publicly traded companies, why is accrual basis accounting preferred over cash basis accounting?Accrual basis accounting provides a more accurate picture of a company's economic profitability.At the end of the year, before any closing entries are made, which account has a debit balance?Cost of Goods Sold What is a nominal account?Capital stock Long-term debt Salaries Equipment Salaries In preparing a bank reconciliation, what is the proper treatment of a deposit in transit?Add it to the reported cash balance in the bank statement.A company rents a building that it uses in its operations.The accountant for the company mistakenly input a $1,000 rental payment on the building as $10,000 in the accounting records.What is the impact of this error on the financial statements?Expenses are too high, so reported net income is too low.The accountant for a company mistakenly posted an expense amount as an asset in the general ledger.What is the financial statement impact of this error?Assets are too high, and retained earnings are too high.The accountant for a company mistakenly posted a liability amount as a revenue in the general ledger.What is the financial statement impact of this error?Liabilities are too low, and retained earnings are too high.Proper segregation of duties requires that one person not perform three specific separate functions with respect to a single transaction. Two of those functions are authorization and record keeping.What is the third function that should be performed by a different person if proper segregation of duties is to be maintained?Custody of assets Why are daily cash deposits important?They prevent the accumulation of a large amount of cash.

On July 10, goods were sold for $10,000. Cash of $4,000 was received, and the $6,000 remainder was on account.The customer returned the goods before paying any of the remaining $6,000 on account.Which debit or credit should be included in the journal entry on the seller's books to record the return of the goods?Credit accounts receivable for $6,000 What is the direct write-off method with respect to bad debts?Recognizing bad debt expense after confirming that a specific customer is not going to pay.On January 6, a credit sale was made for $1,000. Terms for the sale were 4/10, n/30. Cash for the sale was collected on January 25.Which debit or credit should be included in the journal entry to record the cash collection on January 25?Debit cash for $1,000 A company's controller estimated bad debt expense using the percentage of accounts receivable method.Total sales for the year were $1,500,000. The ending balance in accounts receivable was $300,000. An examination of the outstanding accounts at the end of the year indicates that approximately 7% of these accounts will ultimately prove to be uncollectible. Before any adjustment, the balance in the allowance for bad debts is $4,000 (credit). Total accounts written off as uncollectible during the year were $15,000.Which debit or credit is included in the adjusting entry to record bad debt expense for the year?Credit allowance for bad debts for $17,000 Which costs are included in work-in-process inventory? Materials, labor, and overhead Who owns goods in transit?If the shipping terms are FOB destination, the goods belong to the seller while in transit.On November 1, a company purchased inventory costing $1,000 on account. The payment terms are 2/10, n30. The company paid on November 6 to receive the 2% discount.What is the impact on the company's financial statements of the cash payment of this account within the discount period?Decrease inventory by $20 With a LIFO inventory cost flow assumption, what is assumed about the units that are sold and the units that remain in ending inventory?New units sold, old units in ending inventory When a machine is purchased, what is the proper accounting for the amount paid for sales tax on the purchase price?As part of the cost of the machine