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65 Multiple choice questions

  1. 15. The esimated amount recieved for an asset at the end of its useful life. Also called salvage value and residual value.
  2. 9. A check has ______ ___ _____ if the payee has presented the check to the bank and the bank has paid it by taking money out of the maker's account.
  3. 14. Assets that have a life longer than one year. Also capital and fixed assets.
  4. 9. An expense account for small expenses that are not important enough to have their own account.
  5. 11. A note without an interest rate written on the face, whose face amount is the future value.
  6. 12. The inventory system that averages the cost of all items in inventory and assigns that averaged cost to the items sold.
  7. 12. The inventory system that assumes the oldest items in inventory are the first ones sold.
  8. 10. A sale for which payment is to be made later.
  9. 15. An asset is said to be fully depreciated when its book value equals its salvage value.
  10. 9. A check is _________ when it has not yet cleared the bank.
  11. 9. Expenses or revenues come from transactions that are not part of normal business operations.
  12. 9. Short-term investments fro which the purpose is to resell them for a profit.
  13. 9. A gain or loss that happens when an asset is sold.
  14. 15. A list of all fixed assets in the company, their purhase dates, their depreciation methods, and their depreciation each year.
  15. 15. The esimated amount recieved for an asset at the end of its useful life. Also called salvage value and scrap value.
  16. 15. A depreciation method that results in higher depreciation expense in an asset's early years.
  17. 13. The method of accounting for operating supplies that recognizes supplies as an expense when they are consumed. When supplies are purchased, the debits are stored in supplies inventory. The supplies expese account is not touched until the inventory is adjusted.
  18. 12. A contra-purchases account used under the periodic inventory method to keep track of discounts granted by vendors for paying early.
  19. 11. The amount borrowed plus the interest up to the maturity date.
  20. 15. Assumptions about the purchase dates of fixed assets in order to simplify the depreciation process.
  21. 9. A bank deposit made too late to show up on the bank statement.
  22. 11. Assets quickly changeable into cash: cash, short-term investments, and net accounts receivable.
  23. 10. The system in which income is recognized when earned and expenses are recognized when incurred.
  24. 12. The cost paid for the merchandise sold.
  25. 15. The esimated amount recieved for an asset at the end of its useful life. Also called residual value and scrap value.
  26. 14. Assets that have a life longer than one year. Also fixed and plant assets.
  27. A note with an interest rate written on the face, whose face amount is the present value.
  28. 9. A system for maing small payments with cash.
  29. 10. Assets that are available to spend within a year.
  30. 10. Assets that are expected to last longer than one year.
  31. 12. The inventory system that keeps track of the actual historic cost of each inventory item. When that item is sold, the cost flows into cost of goods sold.
  32. 12. The inventory method that keeps track of merchandise costs in various purcahses and contra-purchases accounts and then computes cost of goods sold on the income statement. Inventory on the books is adjusted only at year-end.
  33. 10. A separate record containing the details of a control account. Example: The accounts receivable subsidiary record lists all who owe the company money, the total of which is reflected in accounts receivable.
  34. 12. The inventory method that increases the inventory account with every purchase and lowers the inventory account with every sale.
  35. 14. Assets that have a life longer than one year. Also capital and plant assets.
  36. 10. The system in which income and expenses are recognized when cash changes hands. This does not meet GAAP.
  37. 14. Recorded the cost as an asset.
  38. 9. The person who writes a check.
  39. 9. Investments that the business plans to resell within one year. Also called investments in marketable securities.
  40. 9. Securities (pieces of paper that represent ownership in investments such as stocks, bonds, etc.) that are traded on public exchanges, such as the New York Stock Exchange.
  41. 11. The amount a bank gives in exchange for a note.
  42. 12. A cost of goods sold account used in the periodic inventory method to keep track fo all merchandise bought for resale during the year.
  43. 9. A gain or los as a result of a business asset going up or down in value, but the asset has not been sold.
  44. 11. The loan amount that remains unpaid.
  45. 11. The dollar amount written on the face of a note.
  46. 14. Recorded the cost as an expense.
  47. 13. Assets that represent expenses paid in advance that provide future benefits to the business.
  48. 10. The account that shows the total of all the individual records in the subsidiary record.
  49. 12. The inventory system that assumes the latest items purchased are the first ones sold.
  50. 13. The method of accounting for operating supplies that recognizes supplies as an expense when they are purchased. When supplies are purchased, the debits are stored in supplies expense. The supplies inventory is not touched until the end of the year.
  51. 10. When a company gives up collecting an account receivable, it writes off the account by removing it from company records.
  52. 9. The person to whom a check is written.
  53. 15. Modified Accelerated Cost Recovery System, for which IRS tables tell the rate by which to multiply an asset's historical cost.
  54. 12. A contra-purchases account used under the periodic inventory method to keep track of refunds a business gets for returning merchandise to vendors, or reductions in price (allowances) the vendors offer to resolved complaints.
  55. 15. An asset is said to be fully depreciated when its book value equals its salvage value. Same as Fully Depreciated.
  56. 10. Assets that have a life longer than one year.
  57. 11. The amount borrowed, or the principal. Shows the present value as the face amount.
  58. 12. An account that is subtracted from Purchase to compute Net Purchases. Exp: Purchases Discount and Purchases Returns and Allowances
  59. 10. The method that recognizes bad-debt expenses in the period the business writes off the accounts receivable. Not GAAP.
  60. 11. The person who borrows money and writes a note promising to pay in the future.
  61. 15. The amount of the hisorical cost of an asset that gets allocated over the useful life of the asset.
  62. 12. Sales - Cost of goods sold =
  63. 11. The future value of a note.
  64. 11. The interest rate written on the face of a note.
  65. 11. To sell a note to a bank that subtracts a discount, giving the seller the proceeds.