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17 Cards in this Set
- Front
- Back
A current liability is a debt that can reasonably be expected to be paid (or settled) a. within one year, or the operating cycle, whichever is longer. b. between 6 months and 18 months. d. out of cash currently on hand. |
within one year, or the operating cycle, whichever is longer. |
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Failure to record a liability will probably result in an overstated net income. result in overstated total liabilities and stockholder’s equity. have no effect on net income. result in understated total assets. |
result in an overstated net income. |
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The interest charged on a $200,000 note payable, at the rate of 6%, on a 90-day note would be a. $12,000. b. $6,000. c. $3,000. d. $1,000. |
c. $3,000. |
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A retail store credited the Sales account for the sales price and the amount of sales tax on sales. If the sales tax rate is 5% and the balance in the Sales account amounted to $189,000, what is the amount of the sales taxes owed to the taxing agency? a. $180,000. b. $189,000. c. $9,450. |
$9,450. |
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Sales taxes collected by a retailer are reported as contingent liabilities. revenues. expenses. current liabilities. |
current liabilities. |
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Gomez Corporation issues 800, 10-year, 8%, $1,000 bonds dated January 1, 2012, at 96. The journal entry to record the issuance will show a debit to Cash of $800,000. credit to Discount on Bonds Payable for $32,000. credit to Bonds Payable for $768,000. debit to Cash for $768,000. |
a debit tot cash for $768,00 |
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Which one of the following would not be considered an advantage of the corporate form of organization? Limited liability of stockholders. Separate legal existence. Continuous life. Government regulation. |
government regulation |
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Par value represents what a share of stock is worth. represents the original selling price for a share of stock. is established for a share of stock after it is issued. is the value assigned per share in the corporate charter. |
is the value assigned per share in the corporate charter |
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Alt Corp. issues 2,000 shares of $10 par value common stock at $14 per share. When the transaction is recorded, credits are made to: Common Stock $20,000 and Paid-in Capital in Excess of Stated Value $8,000. Common Stock $28,000. Common Stock $20,000 and Paid-in Capital in Excess of Par Value $8,000. Common Stock $20,000 and Retained Earnings $8,000. |
Common Stock $20,000 and Paid-in Capital in Excess of Par Value $8,000 |
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Tomlinson Packaging Corporation began business in 2010 by issuing 20,000 shares of $5 par common stock for $8 per share and 5,000 shares of 6%, $10 par preferred stock for par. At year end, the common stock had a market value of $10. On its December 31, 2010 balance sheet, Tomlinson Packaging would report Common Stock of $200,000. Common Stock of $100,000. Common Stock of $160,000. Paid-in Capital of $150,000. |
common stock of $100,000 |
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The following data is available for BOX Corporation at December 31, 2012: Common stock, par $10 (authorized 30,000 shares) $200,000 Treasury stock (at cost $15 per share) $ 1,200 Based on the data, how many shares of common stock are outstanding? a. 30,000. d. 19,920. |
$19,920 |
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Treasury stock is stock issued by the U.S. Treasury Department. stock purchased by a corporation and held as an investment in its treasury. corporate stock issued by the treasurer of a company. a corporation’s own stock, which has been reacquired and held for future use. |
a corporation’s own stock, which has been reacquired and held for future use. |
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Which of the following is not a right or preference associated with preferred stock? The right to vote. First claim to dividends. Preference to corporate assets in case of liquidation. T o receive dividends in arrears before common dividends. |
the right to vote |
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The date on which a cash dividend becomes a binding legal obligation is on the declaration date. date of record. payment date. last day of the fiscal year end. |
declaration date |
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The effect of the declaration of a cash dividend by the board of directors is to increase decrease stockholders equity assets assets liabilities liabilities stockholders equity
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liabilities stockholders equity |
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Contingent liabilities are obligations from past transactions and dependent on future events. estimated, based on past history. recorded to properly match expenses with revenues. all of the above. |
all of the above |
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Which payroll tax is only paid by the employee? Federal income tax Federal unemployment tax Social Security tax Medicare tax |
federal income tax |