process of earning that revenue may take a long time? What is the most common point chosen for recognition of revenue? Why would you choose this particular point? b. What are the two essential characteristics of a liability? What are the two recognition criteria for a liability? [Total marks
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because the picture is always changing.) The term ’balance sheet’ is derived from the simple purpose of detailing where the money came from‚ and where it is now. The balance sheet equation is fundamentally: (where the money came from) Capital + Liabilities = Assets (where the money is now). Hence the term ’double entry’ - for every change on one side of the balance sheet‚ so there must be a corresponding change on the other side - it must always balance. The Balance Sheet does not show how much
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values of Colonial’s assets and liabilities‚ which Buff is interested in acquiring. Against these assets are claims of suppliers and bank loan used to finance a portion of the inventory. Buff hired a valuation consultant for Colonial’s tangible assets and liabilities.
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3‚870 Acc / Pay 5‚000 A/R 10‚000 (Raw Mat 11‚800 + Finished Goods1‚500) Inv 13‚300 Total Current Assets $ 27‚170 Total Current Liabilities $ 5‚000 (Depreciation $90) PPE (Net) $ 5910 C/S $ 30‚000 Prepaid Rent $ 2000 R/E $ 80 Total Non-Current Assets $ 7‚910 SHE $
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when due. Suppose a company has cash of $40 million‚ accounts payable of $30 million‚ and no other current assets or liabilities. The current ratio and quick ratio would both be 1.33 to 1. Now suppose that the company used $20 million to pay a like amount of accounts payable. This transaction should have no special significance‚ as both the very liquid assets and the current liabilities would be reduced by the
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Case Study: TCO‚ E-Commerce Sara Soltanzadeh Fairleigh Dickinson University Table of Contents Introduction Page 3 Background Page 4 Application of Concepts TCO Page 4 E-commerce Page 6 E-commerce advantages and disadvantages Page 6 Treats Page 8 Solution to E-commerce treats Page 9 Conclusion Page 10 References Page 11 Appendix Page 12 Introduction Establishing
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mall for rent -expense b. Amounts to be paid in 10 days- liability c. A new fax machine purchases for office use- assets d. Land held as an investment - assets e. Amounts due from customers -assets f. Daily sales of merchandise sold - revenue g. Promotional costs to publicize a concert - expense h. A long-term loan owed to Citizens Bank -liability i. The albums‚ tapes‚ and CDs held for sale to customers –assets Normal balance for: liability = credit revenue = credit asset = debit expense = debit
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600 Total assets……………………………………………….. $69‚ 000 Liabilities and Owners’ Equity Note payable…………………………………………………. $21‚ 000 Owners’ Equity:.................................................................. Mrs. Landers…………………………………………………..$16‚ 000 Mr. Antoine……………………………………………………. 16‚ 000 Mrs. Antoine…………………………………………………… 16‚ 000 48‚ 000 Total liabilities and owners’ equity…………………….... $69‚ 000 2. Prepare a
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Additional Practice Problems for Midterm Exam Preparation of Multiple-Step Income Statement Zoomy Zombie Inc. manufactures a wide variety of children’s products including educational toys‚ safety products‚ and outdoor toys. Skellan Davis‚ the company’s controller‚ had to leave unexpectedly while preparing the 2011 financial statements. Prior to his departure‚ Skellan had calculated 2011 income from operations before taxes of $22‚850‚000 (total for all divisions). Additional events and transactions
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standard-setting body in the United States. True T False Internal users are those who manage the business. True T False False An expense paid with cash would result in an equal decrease in liabilities and owner’s equity. True False 1 Wenzhou-Kean University Fall 2013 ACCT 2200 F 9. Liabilities represent the ownership claim on total assets. True F 10. Certified Public Accountants are only permitted to prepare audit reports and tax returns. True F 11. 12. 13. 14. 15. 16. False
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