...AC 201 Principles of Accounting I Name Version A Exam 1A- Chapters 1-3 Multiple Choice Questions ( 2 points each) Select the ONE, BEST Answer 1.|External users of accounting information include: E.|All of the above.|| 2.|Accounting certifications include the: E.|All of the above.|| 3.|The major activities of a business include: B.|Financing.|| 4.|The accounting process begins with: A.|Analysis of business transactions and events.|| 5.|A debit is: C.|A decrease in an account.|| 6.|Of the following accounts, the one that normally has a credit balance is: C.|Sales Salaries Payable.|| 7.|A balance column ledger account is: .|B.|An account with debit and credit columns for posting entries and another column for showing the balance of the account after each entry is posted.|C.|D.|E.|| 8.|The time period principle assumes that an organization's activities can be divided into specific time periods including: E.|All of the above.|| 9.|Profit margin is defined as: A.|B.|C.|Net income divided by net sales.|| 10.|A trial balance prepared before any adjustments have been recorded is: A.||B.|Used to prepare financial statements.|||| |On November 1 of the current year, Lois Bell began Lois Bell, Interior Design with an initial investment of $50,000 cash. On November...
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...same amount. The SEC filed fraud charges against WorldCom the next day. WorldCom shares fell to less than to $1. In July 2002, WorldCom filed for Chapter 11 bankruptcy protection, the largest bankruptcy in U.S. history. Subsequently, former WorldCom chief financial officer Scott Sullivan and controller David Myers were arrested on securities fraud and conspiracy charges. Ebbers was indicted on federal charges in the accounting scandal. In March 2005, Ebbers was found guilty on all charges and was sentenced for 25 years in prison. Required: - Submit a hard copy of the case assignment in the beginning of class on the due date (Monday, September 14). Include a cover page with your section number (Track 1 or Track 2) and assigned team number. Every team member shall sign the honor pledge on the cover page. - Submit an e-copy of your assignment via Blackboard by 10:00am on the due date. The filename should include your track and group numbers: Track#_Group#_Case1.doc Refer to the WSJ article at the end of the first lecture notes (Introduction to Accounting). 1. Create a summary timeline of the WorldCom debacle....
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...Accounting Cycle Nelson L Romeu ACC/421 University of Phoenix March 5, 2012 Prof. Dawn Brauer Accounting Cycle The accounting cycle is a logical process used to help achieve the basic function of accounting, which is to identify, record, and correspond information. A business or organization may have its own unique way of performing its accounting cycle, but each must perform the task in one way or another. ADCON (Administration and Accounting) is a small-operated business with a very simplified description of the accounting cycle. The company began and has been operated for most of its 15 years with a couple of individuals and has expanded into a respected company. Gradually over time the accounting cycle has evolved much like business has evolved; the multiple steps have been reduced as technology has simplified the process, “today, most companies use accounting software that processes many of these steps simultaneously” (“What is the accounting cycle?” 2007, para. 3). The accounting cycle consists of: identifying, journalizing, posting, trail balance, adjusted entries, adjusted trial balance, preparing financial statements, closing, post-closing trial balance, reversing entries, and financial statements (Kieso, Weygandt, & Warfield, 2007, Chapter 3). Identifying a transaction or event is the first step in the cycle; businesses engage in various activities on a daily basis, as a result, determining when to record and activity is crucial...
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...having trouble understanding. If it is just the overall basic principles of accounting, we can go through them until you get the idea. Below is a brief overview: The financial position of a company is measured by the following items: 1. Assets (what it owns) 2. Liabilities (what it owes to others) 3. Owner’s Equity (the difference between assets and liabilities) The accounting equation (or basic accounting equation) offers us a simple way to understand how these three amounts relate to each other. The accounting equation for a sole proprietorship is: Assets = Liabilities + Owner’s Equity The accounting equation for a corporation is: Assets = Liabilities + Stockholders’ Equity If a company keeps accurate records, the accounting equation will always be “in balance,” meaning the left side should always equal the right side. The balance is maintained because every business transaction affects at least two of a company’s accounts. For example, when a company borrows money from a bank, the company’s assets will increase and its liabilities will increase by the same amount. For instance, if the company borrows $10,000, Cash (a normal debit balance account) would be increased (debited, left side) for $10,000, and Notes Payable (this is a normal credit balance account) would be increased for $10,000 (credited, right side). The entry in the General Journal (the record of all entries) would look like this: Debit Credit July 5, 2010 Cash ...
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...train on adjusting entries. What I tell all my trainees just read understand and you may ask questions through, but you might want to wait until the end and ask all of them in the end. Adjusting entries are made so that records adhere to the revenue identification and corresponding principles. Adjusting entries may have an effect on monies or overhead in more in multiple accounting periods and not all of these dealings have not necessarily been entered during that time. An example of this as follows: a company has a $2000 debit balance in its supplies account at the end of the month, yet when they have a count of supplies they find out that they only have about $700 of supplies remaining. This account requires a $1300 adjustment so that assets are not overstated and the disbursement account requires the same adjustment so that expenses are not understated (CliffsNotes, 2012). There are five categories that adjustments fall into accrued revenues, accrued expenses, unearned revenues, prepaid expenses. Converting assets to expenses is the first category I will try to explain to you. This adjustment is a cost or cash disbursements that will affect more than one accounting period, is usually documented by subtracting an asset account, and add to a cash account. An example of converting assets into expenses are such things like prepaid expenses which include prepaid postage supplies let us say you buy $1000 worth of these and you only use $100 worth your entries would read...
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...visit here: http://www.nerdypupil.com/product/acc-250-week-9-capstone-checkpoint-printing/ Contact us at: nerdypupil@gmail.com ACC 250 WEEK 9 CAPSTONE CHECKPOINT PRINTING Capstone CheckPoint: Printing and Adjusting Entries Complete exercises 10-1 and 10-2 on pp. 380-386 of Computer Accounting with Peachtree Complete® 2009using Peachtree Complete Accounting®. Save your work as a PDF file. Under the File menu, choose Create PDF. Post the following reports, dated December 31, 2009 as a PDF file: Balance Sheet Income Statement Account Reconciliation Cash Receipts Journal (November 1, 2009 through December 31, 2009) Cash Disbursements Journal (November 1, 2009 through December 31, 2009) Home Work Hour aims to provide quality study notes and tutorials to the students of ACC 250 Week 9 Capstone CheckPoint Printing in order to ace their studies. ACC 250 WEEK 9 CAPSTONE CHECKPOINT PRINTING To purchase this visit here: http://www.nerdypupil.com/product/acc-250-week-9-capstone-checkpoint-printing/ Contact us at: nerdypupil@gmail.com ACC 250 WEEK 9 CAPSTONE CHECKPOINT PRINTING Capstone CheckPoint: Printing and Adjusting Entries Complete exercises 10-1 and 10-2 on pp. 380-386 of Computer Accounting with Peachtree Complete® 2009using Peachtree Complete Accounting®. Save your work as a PDF file. Under the File menu, choose Create PDF. Post the following reports, dated December 31, 2009 as a PDF file: Balance Sheet Income Statement Account Reconciliation Cash Receipts...
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...Systems Understanding Aid Instructions Waren Sports Assignment OBJECTIVE: To help you learn about business processes, documents, internal controls, and the accounting cycle. The assignment provides an opportunity to observe a simple accounting system in action. The knowledge and understanding of the manual system will serve as a foundation for the topics to be discussed in the remainder of the course, and in future courses, especially auditing. REQUIRED: Review entire instructions, flowcharts, and ledgers booklet before you begin the project. Complete all requirements in Part III. Requirements starting on page 10 of the instruction booklet. Use Option 2 for recording monthly transactions, and use Transaction List A, the blue one. Important: This project is very time consuming. Please plan ahead so that you have time to check the solutions manual or consult with peers or the instructor. You are encouraged to post and respond to questions using the discussion tool via D2L. HELPFUL HINTS: General 1. Make the documents and reports neat; use a pencil so that you can erase errors. 2. Make sure all general journal entries are correct. Use the reference book with your packet if you are having trouble. 3. Make sure you carefully follow the flowcharts and put proper signatures/initials on the documents. If there is no designated space for the signatures/initials, just be consistent and visible. 4. Write checks only when explicitly directed to do so. Do not write a check because...
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...General Journal * The General Journal is called the book of original entry. * A journal is a chronological record of transactions - they are in date order. * Each entry is called a journal entry, and represents a different business transaction. Each transaction is recorded once, and only once. * All journal entries follow the rules of debit and credit. Here is legal aspect of making General Journal entries timely. “A contemporaneous writing carries much more weight than a writing made at a later date. And a writing carries much more weight than a mere recollection of events, months or years after the event has taken place. The courts recognize that people's memories about events are much clearer right after the event has taken place. As to the sale of real estate, state laws require a contemporaneous writing, to establish the exact terms and conditions of the sale. In contract law, this is called a “meeting of the minds,” and must be present for a valid contract to exist. We will use verifiable, tangible evidence whenever it exists. Tangible evidence has physical existence – we can touch it, fold, staple, copy and file the document. We will look for a check, invoice, purchase order, contract or other business document that is a record of the event, a confirmation of payment received and goods delivered, etc. These documents become the back-up documentation for our journal entry. General Ledger Transactions are classified into accounts appropriate...
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...Steps in the accounting cycle (black font = manual system, yellow font = AIS) Computerized AIS (highlighted in yellow) 1. Economic event – transaction Record transaction in a journal (JOURNALIZE) Journals: a. sales – all sales on account/credit sales (SALES TRANSACTION FILE) b. purchases-all purchases on account/credit purchases (PURCHASES TRANSACTION FILE) c. cash receipts-all transaction where any cash was received even if it is only part of the transaction (CASH RECEIPTS TRANSACTION FILE) d. cash disbursement-all cash paid (checks even if it is only part of the transaction) (CASH DISBURSEMENTS TRANSACTION FILE) e. general journal – everything else (e.g., adjusting entries, closing entries, reversing entries and any transaction that doesn’t belong in the other journals. (GENERAL (JOURNAL) TRANSACTION FILE) F. payroll journal (all payroll transactions) (PAYROLL TRANSACTION FILE) 2. Record the transaction in the Ledger (general and subsidiary) i.e. POST Posting is equivalent to a (master) file update in a computerized (AIS), That is, the transaction in the transaction file are incorporated into the master file balances. General ledger (general ledger master file) Accounts receivable subsidiary ledger (accounts receivable master file) Accounts payable subsidiary ledger (accounts payable master file) Inventory subsidiary ledger (inventory master file) Payroll or employee earnings subsidiary ledger (payroll master file) (Your Waren case project also has a )...
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...ADJUSTING ENTRIES BY MELANIE.KELLY7 ACCOUNTING In accounting there is many different things that you need to know, the one that we are going to go over today is adjusting entries. Adjusting entries are to ensure that revenue and expenses are properly recorded under accrual basis. Adjusting journal entries are made in the general ledger to record revenues that have not been earned or recorded and expenses that have been made but not yet recorded. This process is fourth step in the accounting cycle, which happens at the end of the accounting period after the trial balance is done. After the adjusting entries are journalized and posted and adjusted trial balance is done, from there the financial statements are prepared. Adjusting entries can vary significantly across companies, they happen because the exchange of cash does not always match with the earnings of revenue or an expense. This could be like cash received after revenue is earned. There are four types of adjusting entries that are used as I am going to go thru all of them. Accrued revenues which are also called accrued assets these are revenues already earned but not paid for or posted to the general ledger. Another name for this could be accounts receivable. When this happens the receivable account is decreased and the cash account is increased. EXAMPLE A customer purchased a new machine but didn’t pay for it. Cash ...
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...Accounting Cycle Paper ACC421 June 3, 2013 Accounting Cycle Paper Although I work for a major corporation, Walgreens, I have nothing to do with the accounting department or the cycle. I will however use this paper to explain the accounting cycle as well as the people that would be involved within the cycle. Generally the people involved in the accounting cycle would be record-keepers, accounting clerks; financial managers as well as staff accountants all have a hand in the parts of the accounting cycles. Bookkeepers and accounting clerks are generally the ones that record the entries and prepare statements for financial managers and staff accountants to approve. The first step of the accounting cycle would be to identify and analyze the transaction and events that need to be accounted for. Even though the generally accepted accounting principles (GAAP) has guidelines there are no rules to what events or transaction a company is required to record. A company should record every sale or purchase no matter how big or small it is. Once these transactions or events have been analyzed, they are recorded in the next step which is journalizing the transactions. There are several different places these transactions are recorded. Some of these places are the general journal, cash receipts journal, cash disbursements journal, purchases journal, sales journal and other special journals depending on the company (Kieso, Weygandt, & Warfield, 2012). Then these transactions...
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...Accounting Cycle Justin McKibben ACC/421 July 1, 2013 Ric Hedges Accounting Cycle Houston Federal Credit Union is a financial institution in Sugar Land, TX and is responsible for providing financial services for its members. The accounting cycle at the organization is a typical cycle of any standard financial institution. The procedures of the accounting cycle must be in the guidelines set forth by GAAP. The employees of the organizations accounting department confirm with the rules and standards within GAAP, and each employee is responsible for certain areas of accounting. The organization currently uses accounting software called Symitar Episys, which is controlled by Jack Henry & Associates. They are responsible for serving more than 500 credit unions in servicing every area of the organization as well as accounting programs specified for completing the daily and monthly accounting processes. The accounting cycle for each period begins with the collection and analysis of transactions from the organizations day-to-day activities. Transactions are collected and recorded and are prepared to be posted to the appropriate general journal ledger accounts for proper documentation. Once the transactions are prepared, the appropriate journal entries are made to the correct ledger accounts. Each entry must consist of two or more entries, which the debits and credits must match other the entry is not balanced and cannot be posted. These entries can describe the...
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...article “Don’t Leave Your Hand in the Cookie Jar,” the author states that John Davies and Karl Schumaker have totally opposite opinions about how to make the year-end adjusting entries for 2009. John is an assistant controller. He has a master’s degree in accounting, is a CPA, and has three years of solid experience with a major accounting firm. Karl, John’s immediate boss, a controller, is 20 years older than John, and he has a B.S. in management and a general M.B.A. from a top graduate school. Moreover, he has over 25 years of corporate accounting and finance experience even though he has no public accounting experience. The adjusting entries in question consist of accounts receivable bad debt, product returns, and product warranties. The accounts receivable bad debt is the first accounting adjustment they have different opinion. Karl would to prefer to bring the bad debt up to 3% of sale this year from 2.75% last year because he thinks an economic slowdown is coming. Besides, Karl believes in conservative accounting, so he thinks that the accountants should use the least favorable amount. However, John thinks the bad debt should be keep as same as 2.5%. John said that he does not see the need to bump up the bad debt percentages, and he mentioned they can adjust it in future as needed. The second adjusting entry they hold the opinion differ from each other is product returns. Karl wants to keep the 1% on product returns, but John thinks the product returns should be decrease...
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...depends on a future event occurring or not occurring. For example, if a parent guarantees a daughter’s first car loan, the parent has a contingent liability. If the daughter makes her car payments and pays off the loan, the parent will have no liability. If the daughter fails to make the payments, the parent will have a liability. If a company is sued by a former employee for $500,000 for age discrimination, the company has a contingent liability. If the company is found guilty, it will have a liability. However, if the company is not found guilty, the company will not have an actual liability. In accounting, a contingent liability and the related contingent loss are recorded with a journal entry only if the contingency is both probable and the amount can be estimated. If a contingent liability is only possible (not probable), or if the amount cannot be estimated, a journal entry is not required. However, a disclosure is required. When a contingent liability is remote (such as a nuisance suit), then neither a journal nor a disclosure is required. A product warranty is often cited as a contingent liability that is both probable and can be estimated. What is the difference between a contingent liability and an estimated liability? A contingent liability is a potential liability (and a potential loss). It is dependent upon a future event occurring or not occurring. For instance, if someone files a lawsuit against Jay Corp, Jay Corp will have a contingent liability....
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...a bit, the transition would be easier. This is the reasoning behind Gurchick’s insistence of waiting for the 4th quarter. On the down side, if sales do not increase as expected, the company would be in substantial trouble. They will have a great deal of over stated income, which will be caught by auditors. They will make adjusting journal entries for this, which will decrease net income. If this decrease is too substantial then the books will be in the negative. Browne understands that the Chatter Chick was over produced, and is prepared to deal with the consequence. Gurchick prefers to take a gamble and hope for the best. 2. The corporate culture at Creative Toys is probably quite tense at this point. With Browne and Gurchick disagreeing over the course of action, the employees at this point are most likely wondering what the outcome of the decrease in demand will be and whether the company will be able to make it through this. I think that everyone is probably quite worried and tense at this point, and things are likely going to continue to be this way until the Chatter Chick fiasco is over and done with. 3. As the controller and chief accounting officer, Browne could request control over the books, without interference from the board. However, there is also an issue of conflicts of interest. If I was Browne I would be evaluating my values and beliefs. There are a lot of...
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