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108 Cards in this Set
- Front
- Back
The chart of accounts includes assets liabilities and owner's equity accounts only?
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False
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After posting journal information to the ledger accounts a check mark should be entereing in the posting reference column of the hournal to indicate that the transaction item has been posted
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False
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The owner's captial account in the last two columns of the work sheet is an up to date account and includes net income and withdrawals of the current period
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False
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A contra account in sused with related accounts to bring about an increase in the net amount of the two account balances
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False
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A computer workstation cost $28.000 has an expected life of 7 yeras and an expected salvage value of $7,000. Depreciation expense using the straight line method will be $3000 per year
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True
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Purchase invoices received from suppliers provide information about
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purchases of goods
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For every transaction the accountant enters the
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day
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the simplest form of journal is one with
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two columns
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service revenue received in cash is entered by
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debiting cash and crediting service revenue
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every entry in the hournal sould include all of the following except
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the balance of the accounts affected
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In completing the worksheet what is the reason for adding the net income for the year to the Balance sheet credit column
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Owner's equity is not up to date
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Net income is shown on the worksheet as
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debit int he Income Statement column
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What does the credit balance in the accumulated depreciation account represent
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the amount of depreciation taken the in past years
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The adjusting entry for the depreciation of office equipment for the period includes
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debiting depr exp office equipment and crfediting acc dep off equip
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the first pair of columns on a 10 column worksheet would be the
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trial balance columns
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when assets are recorded at original value they are recorded under the
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historical cost principle
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an asset cost 33,000 it has an expected useful life of 5 years and an expected salvage value of 3,000 deor expense for the first year of the assets life using the straight line method is
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6,000
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The work sheet column that show the amounts that will be reported in the statement of OE and balance sheet
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Balance sheet columns
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A principle that requires the matching of revenues earned during an accounting period with the expenses incurred to produced the revenues
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matching principles
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principle requires assets to be recorded at their actual cost
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historical cost principle
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matching assets original cost against revenues produced over useful life
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depreciation
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period of time assets expected to produce revenues
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useful life
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expecteted market value of asset at end of useful life
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salvage value
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12 month period for which financial reports are prepared
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fiscal year
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form used to pull all infor to enter adjusted entries & prepare financial statements
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worksheet
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cost of an asset subject to depreciation
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depreciable cost
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amount of an item can be sold for under normal eco conditions
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market value
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account with credit balance deducted from related asset acct on balance sheet
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contra asset
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depr method which depr cost divided by est useful life
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straight line method
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journal entries at tend of acct pd to reflect changed in acct balances not direct result of exhange with outside party
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adjusting entries
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assets of durable nature used for operations over several years
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plant assets
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3rd part of amount column on work sheet
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adjusted trail balance columns
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Financial statement that should be completed first is the
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income statement
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person who reviews operationg and acfct control pordecures adopted bu management to make sure controls are adequate
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internal auditor
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person who records or enters infor in acct records may be refereed to as
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accounting clerk
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cost acct provide wide variety of service including
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analyzing cost effectiveness of products and services that are produced
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Does NOT use nonprofit acct guidelines and procedures
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proprietorships
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a credit
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is on right side
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invest of cash in business by owner
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increases cash
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coporation is usually manages by
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a professional manager
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stockholders own which type of business
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corporation
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debit
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is on left side
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purchase of an asset on accoutn and making a partial payment results in all of following EXCEPT
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increase in OE
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example of expense
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advertising
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accounting equation may be expressed as
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OE-assets=liabilities
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credit represents a decrease in
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an asset
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drawing acct should be used to show
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amoutn owner has taken out of business
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liability owner's capitial and revenue accoutns normally have
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credit balances
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Increasees OE may be from
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revenue that is derived from sales of goods or services
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Jason purchased office equipment for $4,800 on account. Transaction would
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increaset assets and decrease liabilities
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Example of expense is
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supplies consumed
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Falance received 7,000 in cash from client fro pro serviceces transaction would
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increase assets and increase OE
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reviewing operation and acct control prodcedures adopted by management to make sure controls are adequate and being followed assuring accurate and timely info
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internal auditing
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bring various items of infor to determine result
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summarizing
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looking at events that have taken place and thinking how they affect the business
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analyzing
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focusing on tax planning, preparing tax returns, dealing with IRS and other gov agencies
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tax acct
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business that buys products to sell
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merchandising business
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business that makes products to sell
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manufacturing business
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accountants help managers develop a financial plan
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budgeting
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procedures and guidelines develiped by FASB followed in acct and reporting process
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gaap
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deciding meaning of importance of infor in various reports
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interpreting
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type of ownership strcture in which one person owns business
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sole proprietorship
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entering financial infor about events affeting company into acct sustem
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recording
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generally supervises work of acctr clerks helps with daily acct work and summarized acct info
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bookeeper
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more than one person owns business
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partnership
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ownership stockholders owns business
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corporation
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business that provides service
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service business
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reviewing and testing to be certain proper acct policies and practices have been followed
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auditing
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sorting and grouping similar items together
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classifying
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includes preparing various reports and financial statements and analyzing operating, investing and financing decision
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financial accct
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sustem of gathering financial info about a business and reporting infor to users
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accounting
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Self employment tax is double SS and med rates
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True
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med tax is applied to all employee earnings
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true
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payments from petty cash fund should not be made with out obtaining some sort of receipt in return
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true
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journal entry to record payroll transaction for acct period to debit wages and salaries expense for gross pay and credit appropriate liability and cash acct
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true
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fair labor standards act provides 1.5 ot
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true
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outstanding checks are chekcs issued that have no yet been presented to bank for payment
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true
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unless employer has only a few employees manual systems can be inefficent
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true
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amoutn of employers med taxes is computed by multiplying by 1.45%
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true
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workers comp provides insurance for employees who suffer job related illness or injury
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true
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business commply use cash register tape that accumulate a record of the days cash receipts
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true
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from 941 emplyrs quarterly tax return
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true
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balance in cash acct on depositors books will be same as bank balance
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true
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business cash includes currency coins check money in chekcing acct money orders and bank cashiers checks
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true
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payroll expenditures rep small part of total expenditures
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false
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ind contrator performs service for fee and doesnt work under control of company
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true
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emploery pays total cost of
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workers comp
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employers usually prepare which of the following types of payroll records
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payroll register, employee earings record, and payroll chekc
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rules by which employers must deposit ss and med taxes cna be found in
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circular e
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journalize employers payroll taxes, need to credit all following acct except
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payroll tax expense
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when all taxes have been paid payroll tax liablilty accoutn will have
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zero balance
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key source of infor for computing employer payroll tax is
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payroll register
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process op bring book and bank balance in to agree ment is called
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reconciling the bank statement
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output from manual or electronic payroll acct system inc all of the following except
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time cards
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any person who agrees to perform a service for a fee and is not subject to control of those for whom the service is performed is called a
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independent contractor
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atm machine depositor must have a
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pin number
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self employment tax is required of an individual who owns his or her own business and makes
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$400 or more
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check written to establish the petty cash fund is entered in journal by
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debiting petty cash and crediting cash
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multi column form used to assemble computer and summarize data for all employees at end of payroll period is an
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payroll register
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when all taxes have been paid payroll tax liablilty accoutn will have
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zero balance
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key source of infor for computing employer payroll tax is
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payroll register
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process op bring book and bank balance in to agree ment is called
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reconciling the bank statement
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output from manual or electronic payroll acct system inc all of the following except
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time cards
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any person who agrees to perform a service for a fee and is not subject to control of those for whom the service is performed is called a
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independent contractor
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atm machine depositor must have a
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pin number
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self employment tax is required of an individual who owns his or her own business and makes
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$400 or more
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check written to establish the petty cash fund is entered in journal by
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debiting petty cash and crediting cash
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multi column form used to assemble computer and summarize data for all employees at end of payroll period is an
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payroll register
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