Homework 2

Homework 2 - PPE l Long-term debt LTL m Materials and...

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Jackie Gragnola Bus 214, Bissonnette Homework 2 19.) Market value is not used as the basis for accounting because it is subjective, whereas the cost value is verifiable from transaction to transaction. Therefore, cost value is used instead of market value. BE 2-1 a) Accounts payable CL b) Accounts receivable CA c) Accumulated depreciation PPE d) Building PPE e) Cash CA f) Goodwill IA g) Income tax payable CL h) Invest. in long-term bonds LTI i) Land PPE j) Merchandise inventory CA k) Patent IA l) Supplies CA BE 2-4 a) Issued new shares of common stock- Increase Common Stock b) Paid a cash dividend- Decrease Retained Earnings c) Reported net income of $75,000- Increase Retained Earinings d) Reported a net loss of $20,000- Decrease Retained Earnings EX 2-1 a) Accounts payable and accrued liabilities CL b) Accounts receivable CA c) Accumulated depreciation PPE d) Buildings PPE e) Cash and short-term invest. CA f) Dividends payable CL g) Goodwill IA h) Income taxes payable CL i) Inventories CA j) Investments LTI k) Land
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Unformatted text preview: PPE l) Long-term debt LTL m) Materials and suppliesCA n) Office equipment and furniture PPE o) Prepaid Expenses CA EX 2-11 a) Is the rationale for why plant assets are not reporter at liquidation value: Going Concern Assumption (2) b) Indicates that personal and business record-keeping should be separately maintained: Economic Entity Assumption (6) c) Assumes that the dollar is the “measuring stick” used to report on financial performance: Monetary Unit Assumption (3) d) Separates financial information into time periods for reporting purpose: Time period Assumption (4) e) Indicates that companies should not record in the accounts market value changes: Cost Principle (5) f) Dictates that companies should disclose all circumstances and events that make a difference to financial statement users: Full Disclosure Principle (1) P 2-3A See attached sheet...
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This note was uploaded on 11/21/2011 for the course BUS 214 taught by Professor Waker during the Winter '08 term at Cal Poly.

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Homework 2 - PPE l Long-term debt LTL m Materials and...

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