Essay about final exam study guide

Essay about final exam study guide Essay about final exam study guide ACC/291 - Final Exam Study Guide Created by ACCNerd.com How to Use this Study Guide – READ ME FIRST The following study guide will NOT have the same exact questions on your test! However, this study guide WILL help you ace the Final Exam. The guide covers the same topics and will help you gain a deeper understanding of the concepts. Best of all, you are still guaranteed a score of 90% or higher or your money back! Tip #1: Use CRTL+F to search a related keyword to quickly find the topic you need. Tip #2: If a topic is missing, please email us at support@accnerd.com. We can usually provide immediate custom support during normal business hours. 1. Ordinary repairs are expenses to keep a plant asset functioning properly: Revenue expenditures Explanation: Revenue expenditure is an ongoing cost to maintain the operational efficiency of an asset. 2. Percentage of receivables method: Estimated uncollectible accounts = $15,000. Allowance for Doubtful Accounts = $3,000 What is the amount of bad debts expense? $12,000 Explanation: This entry simply requires you to subtract 3,000 from the 15,000 in estimated uncollectable accounts. 3. What is true about intangible assets? They should be reported with a separate classification on the balance sheet Explanation: Intangible assets should be organized into its own distinct group on the balance sheet. 4. Intangible assets are the rights and privileges from assets with which characteristic? They do not have physical substance Explanation: Intangible assets are things like copyrights, patents, trademarks, trade secrets, and software code. 5. What is the book value of an asset? The asset’s cost less its accumulated depreciation Explanation: Book value is its value on paper, but does not accurately reflect the true market value. 6. Gains experienced on the sale of plant assets should: Be recognized immediately Explanation: If a company sells an asset for a capital gain, it will need to immediately report this gain on the books. 7. Percentage of sales method for recording bad debts expense. Cash sales = $300,000. Credit sales = $1,200,000. 1% = sales percentage estimated by management. Enter the correct adjusting entry: Bad Debts Expense - $12,000 Allowances for Doubtful Accounts - $12,000 Explanation: Debit bad debts expense, credit allowance for doubtful accounts. 8. Costs to improve the operating efficiency or extend the life of a plant asset are commonly called? Capital expenditures Explanation: If you add a new arm to your robot machine to increase productivity, you have made a capital expenditure. 9. What happens to the notes payable account when an interest-bearing note matures? It will be less than the total amount repaid by the borrower Explanation: The account will not take into account all of the interest that has been paid, as this is called interest income or revenue. 10. How much interest is charged on a $200,000 note payable with an annual rate of 6%, after 2 months. $2,000 Explanation: (200,000 x 0.06) / 6 = $2,000 11. A large company issues $3,000,000 in bonds that pay 10% annual interest, what is the annual net cash cost of this borrowing if the income tax rate is 30%? $210,000 Explanation: 3,000,000 x 0.1 = 300,0000 300,000 x 0.3 = 90,000 300,000 – 90,000 = $210,000 12. A company created a four-year interest-bearing note payable for $300,000 on January 1, 2012. Each January the company is required to pay $75,000 on the note. How will this note be reported on the December 31, 2013 balance sheet? Long-term debt, $150,000; Long-term debt due within one year, $75,000.Explanation: Long term debt due within one year must be reported separately on the balance sheet according to GAAP rules. 13. A company has created a $600,000, 10%, 5-year bonds on January 1, 2012 for 648,666, which reflects an effective-interest rate of 8%. Interest is paid semiannually on January 1 and July 1. If the corporation