Recognition-formally reporting an economic item/event/transaction in the financial statement.
Realization- refers to collecting the money-sale of a product or rendering a service
Sales- No entry
Expenses- No en
Client/customer wants retain our services for next year
1-may we do the same amount of work every month
Monthly amount; 10,000
May-dec; 8 months.
2. .financial pressures
Quality of emp
3. how do we calculate net realizable value?
Accounts receivable minus allowance for doubtful accounts
4. general questions regarding: how to calculate the uncollectible accounts receivable.
Aging. Older it is less change we were going to accept it.
Balance sheet (permanent account) income state (temporary account)
Cost of goods sold
Beginning inventory- 100
*Cost of goods available for sale-350
(Dont sell) Ending inventory 120. balance sheet
Cost of goods sold is 230. income state
What is Accounting?
Communication of financial performance over a period of time.
5 Major types of companies
1. Manufacturing: creates, makes, bakes, cooks, develops a PRODUCT and then sells it; CocaCola, Started in 1886.
2. Merchandising: buys a product
is a tenant who is seeking a place to rent out space
we pay out for the ne ext
this payment represents the next 12 months of rented space
cash paid out
The most basic element of classifying costs is called a _Cost object_
A _Cost object_ is (according to the textbook) anything for which cost data
What does this mean in plain English
A budget is a detailed, quantitative plan for the future. Budgets are used for two
_planning_ developing goals and preparing budgets to achieve those goals
_control_ gathering feedback to make sure the plan is
1. The break-even point is that level of activity where:
a. Total revenue equals total cost.
b. Variable cost equals fixed cost.
c. Total contribution margin equals the sum of variable cost plus fixed
Segmented Income Statement
Segment margin is equal to segment sales revenue minus:
Variable cost of goods sold, variable selling and administrative expenses and
traceable fixed costs
Variable cost of goods
Chapter 2 Practice Problems
(1) The Collins Company uses predetermined overhead rates to apply manufacturing overhead
to jobs. The predetermined overhead rate is based on labor cost in Dept. A and machine-hours in
Full file at http:/testbankcafe.CH/Test-Bank-for-Fundamentals-of-Cost-Accounting-3rd-Edition-Lanen,Anderson,-Maher
Cost Concepts and Behavior
True / False Questions
1. The cost of an item is the sacrifice made to acquire it.
2. An ex
Kelly pitney began her consulting business, Kelly Consulting, on April 1, 2010. The accounting cylcle for Kelly Consulting for April , including financial statements was illistrated on page 157-168. During May, kelly consulting entered the following trans
CHAPTER 8 SARBANES-OXLEY, INTERNAL CONTROL, AND CASH
1. a. Congress passed the Sarbanes-Oxley Act of 2002 because of the Enron, Worldcom, Tyco, Adelphia, and other financial scandals of the early 2000s that caused stockholders, creditors, and
CHAPTER 6 ACCOUNTING FOR MERCHANDISING BUSINESSES
1. Merchandising businesses acquire merchandise for resale to customers. It is the selling of merchandise, instead of a service, that makes the activities of a merchandising business different
CHAPTER 5 ACCOUNTING SYSTEMS
1. The individual accounts receivable ledger accounts provide business managers information on the status of individual custom er accounts, which is necessary for managing collections. Managers need to know which c
CHAPTER 4 COMPLETING THE ACCOUNTING CYCLE
1. The end-of-period spreadsheet (work sheet) illustrates flow of accounting information from the unadjusted trial balance into the adjusted trial balance and into the financial statements. In doing so
CHAPTER 3 THE ADJUSTING PROCESS
1. a. Under cash-basis accounting, revenues are reported in the period in which cash is received and expenses are reported in the period in which cash is paid. b. Under accrual-basis accounting, revenues are rep
CHAPTER 2 ANALYZING TRANSACTIONS
1. An account is a form designed to record changes in a particular asset, liability, owners equity, revenue, or expense. A ledger is a group of related accounts. 2. The terms debit and credit may signify either