Match the items below by entering the appropriate code letter in the space provided.
1> A general ledger account that summarizes detailed information in a subsidiary
ledger.
2> A subsidiary ledger that contains accounts with individual creditors.
3> A special journal with more than one column.
4> Detailed information about a group of accounts with a common characteristic.
5> Used to record high volume, similar type transactions.
Answer:
At the time an asset is acquired, cost and fair value should be the same.
Answer:
You are the accountant for a small manufacturing firm. Your company is
privately held, so there is no current requirement to issue financial
statements using GAAP. You were hired four years ago, and at that time
you instituted a cash budgeting system. Presently, you present a schedule
of predicted cash sources and cash needs at the end of each week for the
following week.
Jim Bangon, the company’s president, has asked whether a statement of
cash flows would also be useful.
Prepare a short memorandum to the president indicating whether you
believe such an addition to the financial statements to be useful. Include in
your memo the benefits that might be expected from a statement of cash
flows and whether those are different from the benefits of a cash sources
and cash needs listing.
Answer:
The income statement is sometimes referred to as the statement of operations.
Answer:
Determine the impact on the balance sheet accounts if the following information is not
used to adjust the accounts of Mood Food Company for the month of January, 2015.
Round answers to the nearest dollar.
1> The company rents extra office space to Beulah, CPAs. Beulah pays the $6,000 rent
annually on January 1.
2> The company has an outstanding loan to its President in the amount of $150,000.
The loan accrues interest at the annual rate of 6%. Principal and interest are due January
1, 2017.
3> The company completed work on a project during January that was not yet billed to
the client. The client will be charged $3,100.
Answer: