Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
Because accounting measures should be verifiable, liabilities should not be estimated.
Once the products are completed, packaged, and ready for sale, their costs are
transferred
to the Finished Goods Inventory account.
A U.S. Treasury bill with an original maturity of 90 days or less is considered a cash
equivalent.
The minimum rate of return or a minimum cash flow payback period are two standards
established in capital investment analysis.
The computations for costs to be transferred out of Work in Process Inventory are the
same regardless of the number and size of the departments involved in the production
process.
Unit level, batch level, and service level are examples of cost drivers.
Companies whose securities are sold to the general public must adhere to standards
established by the Securities and Exchange Commission.
A partnership agreement need not be in writing.
Public companies must have their financial statements audited, but are not required to
have their internal control systems audited.
Trading securities appear as current assets on the balance sheet at their historical cost
regardless of subsequent increases or decreases in market value.
A business plan is a comprehensive statement of how a company will achieve its
objectives.
The financing activities section of the statement of cash flows includes certain
transactions and activities from the income statement and also takes into account
stockholders' equity.
Inventory is an example of a nonmonetary asset.
Estimated useful life and legal life are synonymous terms when dealing with intangible
assets.
Bad debts are considered as an expense of selling on credit.
