Financial Accounting Chapter 03

The fourth pair of columns on a 10-column work sheet prepared at the end of the period would be the

11. Investors and creditors are particularly interested in this financial statement because it tells them what is happening to the company’s most important resource?

1. For the year-end December 31, 2007, financial statements, what amount should M record as a liability?

c. The amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed.

cognizant of the fact that the choices he makes can affect the price a buyer pays

f) To evaluate the material misstatement in the accounts, I think both of the consolidated income statement and the three financial statements are useful. We need to use the information properly from all the financial statements. However the consolidated income statement is the most useful one. If there is a significant change in an account balance comparing with preceding two years, the auditor will examine whether there a material misstatement exists. For instance, the bad debt expense as a percent of net sales in 2011, 2010 and 2009 are 0.56%, 0.70% and 0.69%, respectively. There should

The statement of cash flows answers the following questions about cash: (a) Where did the cash come from during the period? (b) What

1. As of December 31, 2011, what amount, if any, of sales due should be recognized in eVade’s financial statements?

Reports revenues and expenses for a specific period of time. A firm's revenues, gains, expenses and losses are listed on the income statement. Revenue is money earned from a company’s

b. The firm is required to make a cash payment for the goods or services.

Accounting is a system of recording analysing and communicating financial information to permit informed judgement and a decision by the users of a financial statement. Accounting is important to City of Westminster College because it can help provide the college with the information they may need in the future. will help the college know what going in and out the college and ensure that they are not falling behind with their expenditure. In accounting, there are many factors that need to be considered, such as controlling and complying with the law,that will help the business build profit and expand. The following purposes will show why accounting in business is important.

d. Trace the date, check number, and amount of outstanding item – Occurrence & Completeness. (AU-C 315.A114 a.i-ii)

a) What would the receivables level be at the end of March and at the end of June?

To determine the proportion of allowable amount on a customer, the company checks the number of days the debt has been pending before payment. Equally, financial conditions of the customers, macroeconomic factors and the weighted-average risk trend trends are considered.

19. A company has a quick ratio greater than 1. All else constant, which of the following transactions will increase a firm’s quick ratio?