Financial Accounting
3rd Edition
ISBN: 9780133791129
Author: Jane L. Reimers
Publisher: Pearson Higher Ed
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Question
Chapter 3, Problem 2FSA
1.
To determine
Explain the statement given regarding prepaid expenses.
2.
To determine
Explain the statement given regarding accrued expenses.
3.
To determine
Explain the statement given regarding accounts payable.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Indicate if the following transaction from Torte Baking Company increases or decreases assets, liabilities, equity, revenue, expense, and net income. The pattern of the + and - must adhere to the balance sheet equation. Show the impact of revenue and expense on both net income and equity. If there is a + and - within one category (e.g., assets for transaction 2), then list the accounts that go up and down.
Transaction
(26)
Recognize tax expense that will be paid later.
Assets
["", "", ""]
Liabilities
["", "", ""]
Equity
["", "", ""]
Revenue
["", "", ""]
Expense
["", "", ""]
Net Income
["", "", ""]
Classify each account below using the following alternatives: Asset, Liabilities, Equity, Revenue, Expenses. Also inform where each account has its normal balance: Debit or Credit. 1. Cash 2. Account Receivable 3. Supplies 4. Prepaid Insurance 5. Truck 6. Notes Payables 7. Rent Revenue 8. Sales Revenue 9. MR Capital 10. MR Drawings 11. Truck expenses 12. Depreciation expenses 13. Wages Expenses 14. Accrual Payable 15. Accounts Payables 16. Long Term Debt 17. Inventory
Please tell me if the following are an asset, liability or equity account and if they are real or nominal
1) Accounts payable
2) Service fees revenues
3) Tax expense
4) Cash
5) Interest receivable
6) Accounts receivable
7) Smith, drawings
8) Retained earnings
9) Depreciation expense
10) Interest income (also what is interest income? Example? is a DR or CR balance?)
Chapter 3 Solutions
Financial Accounting
Ch. 3 - Prob. 1YTCh. 3 - Prob. 2YTCh. 3 - Prob. 3YTCh. 3 - Prob. 4YTCh. 3 - Prob. 5YTCh. 3 - Prob. 6YTCh. 3 - Prob. 7YTCh. 3 - How does accrual basis accounting differ from cash...Ch. 3 - Prob. 2QCh. 3 - Prob. 3Q
Ch. 3 - Prob. 4QCh. 3 - What are accrued expenses?Ch. 3 - Prob. 6QCh. 3 - Prob. 7QCh. 3 - Name two common deferred expenses.Ch. 3 - What does it mean to recognize revenue?Ch. 3 - How does matching relate to accruals and...Ch. 3 - What is depreciation?Ch. 3 - Why is depreciation necessary?Ch. 3 - Prob. 13QCh. 3 - Prob. 14QCh. 3 - Prob. 1MCQCh. 3 - Prob. 2MCQCh. 3 - Prob. 3MCQCh. 3 - Prob. 4MCQCh. 3 - Prob. 5MCQCh. 3 - Prob. 6MCQCh. 3 - Prob. 7MCQCh. 3 - Prob. 8MCQCh. 3 - When prepaid insurance has been used, the...Ch. 3 - Prob. 10MCQCh. 3 - Prob. 1SEACh. 3 - Prob. 2SEACh. 3 - Account for interest expense. (LO 1, 2). UMC...Ch. 3 - Prob. 4SEACh. 3 - Account for insurance expense. (LO 1, 3). Catrina...Ch. 3 - Prob. 6SEACh. 3 - Account for unearned revenue. (LO 1, 3). Able...Ch. 3 - Prob. 8SEACh. 3 - Prob. 9SEACh. 3 - Prob. 10SEACh. 3 - Calculate profit margin on sales ratio. (LO 5)....Ch. 3 - Prob. 12SEBCh. 3 - Prob. 13SEBCh. 3 - Prob. 14SEBCh. 3 - Prob. 15SEBCh. 3 - Prob. 16SEBCh. 3 - Prob. 17SEBCh. 3 - Prob. 18SEBCh. 3 - Prob. 19SEBCh. 3 - Calculate net income. (LO I, 4). Suppose a company...Ch. 3 - Prob. 21SEBCh. 3 - Prob. 22SEBCh. 3 - Prob. 23EACh. 3 - Prob. 24EACh. 3 - Prob. 25EACh. 3 - Prob. 26EACh. 3 - Prob. 27EACh. 3 - Prob. 28EACh. 3 - Account for insurance expense. (LO 1, 3). Yodel ...Ch. 3 - Prob. 30EACh. 3 - Prob. 31EACh. 3 - Prob. 32EACh. 3 - Prob. 33EACh. 3 - Prob. 34EACh. 3 - Southeast Pest Control, Inc., was started when its...Ch. 3 - Prob. 36EACh. 3 - Prob. 37EACh. 3 - Prob. 38EACh. 3 - Prob. 39EACh. 3 - Prob. 40EBCh. 3 - Prob. 41EBCh. 3 - Prob. 42EBCh. 3 - TJs Tavern paid 10,800 on February 1, 2010, for a...Ch. 3 - Prob. 44EBCh. 3 - Prob. 45EBCh. 3 - Account for insurance expense. (LO 1, 3). All...Ch. 3 - Prob. 47EBCh. 3 - Prob. 48EBCh. 3 - Prob. 49EBCh. 3 - Prob. 50EBCh. 3 - Prob. 51EBCh. 3 - Prob. 52EBCh. 3 - From the following list of accounts (1) identify...Ch. 3 - Prob. 54EBCh. 3 - Prob. 55EBCh. 3 - Prob. 56EBCh. 3 - Prob. 57PACh. 3 - Prob. 58PACh. 3 - Prob. 59PACh. 3 - Following is a partial list of financial statement...Ch. 3 - Prob. 61PACh. 3 - Record adjustments. (LO 1, 2, 3). The Gladiator...Ch. 3 - Prob. 63PACh. 3 - Transactions for Pops Company for 2011 were as...Ch. 3 - Record adjustments and prepare financial...Ch. 3 - Prob. 66PACh. 3 - Prob. 67PACh. 3 - Record adjustments and prepare income statement....Ch. 3 - Prob. 69PBCh. 3 - Prob. 70PBCh. 3 - Following is a partial list of financial statement...Ch. 3 - Prob. 72PBCh. 3 - Record adjustments. (LO 1, 2, 3). Summit Climbing...Ch. 3 - Prob. 74PBCh. 3 - Prob. 75PBCh. 3 - Record adjustments and prepare financial...Ch. 3 - Prob. 77PBCh. 3 - Prob. 78PBCh. 3 - Identify and explain accruals and deferrals. (LO...Ch. 3 - Prob. 2FSACh. 3 - Prob. 3FSACh. 3 - Prob. 1CTPCh. 3 - Prob. 1IECh. 3 - Prob. 3IECh. 3 - Prob. 4IE
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Identify whether each of the following accounts would be considered a permanent account (yes/no) and which financial statement it would be reported on (Balance Sheet, Income Statement, or Retained Earnings Statement). A. Accumulated Depreciation B. Buildings C. Depreciation Expense D. Equipment E. Fees Earned Revenue F. Insurance Expense G. Prepaid Insurance H. Supplies Expense I. Dividendsarrow_forwardCASH, MODIFIED CASH, AND ACCRUAL BASES OF ACCOUNTING Prepare the entry for each of the following transactions, using the (a) cash basis, (b) modified cash basis, and (c) accrual basis of accounting. 1. Purchase supplies on account. 2. Make payment on asset previously purchased. 3. Purchase supplies for cash. 4. Purchase insurance for cash. 5. Pay cash for wages. 6. Pay cash for phone expense. 7. Pay cash for new equipment. End-of-Period Adjusting Entries: 8. Wages earned but not paid. 9. Prepaid item purchased, partly used. 10. Depreciation on long-term assets.arrow_forwardBaker Company includes the following balance sheet accounts. Identify the accounts that might require adjustment. For each account that requires adjustment, indicate (1) the type of adjustment (prepaid expense, unearned revenue, accrued revenue, or accrued expense) and (2) the related account in the adjustment. (a) Prepaid Insurance.- (b) Accounts Receivable (c) Accumulated Depreciation—Equipment. (d) Notes Payable. (e) Equipment. (f) Interest Payable. (g) Unearned Service Revenue.arrow_forward
- Which of the following would you expect to find in acorrectly prepared income statement?a. Cash balance at the end of the period.b. Revenues earned during the period.c. Contributions by the owner during the period.d. Expenses incurred during the period to earn revenues.arrow_forwardListed below are nine technical accounting terms introduced in this chapter: Assets Liabilities Going Concerns Accounting Equation Cost Principles Liquidity Balance Sheet Inflation Owner's Equity Each of the following statements may (or may not) describe one of these technical terms. In the space provided below each statement, indicate the accounting term described, or answer "None" if the statement does not correctly describe any of the terms. Do not use a term more than once. (A.) Having the financial ability to pay debts as they become due. (B.) An assumption that a business will operate in the foreseeable future. (C.) Economic resources owned by businesses that are expected to benefit future operations. (D.) The debts or obligations of a business organization. (E.) Assets = Liabilities + Owners' Equity (F.) The principle which states that assets are valued in the balance sheet at their historical cost. (G.) A residual amount equal to assets minus liabilities.arrow_forwardIdentify and analyze the transaction by using the following steps:1. Determine activity – operating, investing or financing.2. Determine accounts affected and the amount of increases/decreases.3. Determine the financial statements affected – balance sheet, income statement.The accounting equation must balance for each transaction.Determine amortization using the effective interest method (see Exhibit 10-7 below for an example). Date Column 1LeasePayment Column 2InterestExpense Column 3Reduction ofObligation Column 4LeaseObligation 8% Col. 1 - Col. 2 1/1/2017 - - - $15,972 12/31/2017 $4,000 $1,278 $2,722 13,250 12/31/2018 4,000 1,060 2,940 10,310 12/31/2019 4,000 825 3,175 7,135 12/31/2020 4,000 571 3,429 3,706 12/31/2021 4,000 294 3,706 0 Column 1 is the total amount of the payment. To compute the interest expense, (column 2) multiply the lease obligation (column 4) by the interest rate. Column 3, the reduction of obligation is computed by subtracting Column 2…arrow_forward
- When preparing the statement of financial position of LBM Ltd, which line item does not fall under current assets? Select one: a. Dividends payable b. Trade and other receivables, which can be shown separately or as one amount, includes debtors less provision for credit losses, bills receivable and income arrears c. Inventories (this includes merchandise and consumables such as stationery, packing and cleaning materials) d. Prepaymentsarrow_forwardWhich of the following statements regarding the income statement are true? Group of answer choices A. The net income from the income statement is included on the asset section of the balance sheet. B. The income statement shows the cash flows from operations during a period of time. C. Net income or loss from the income statement is included in the calculation of ending retained earnings on the Statement of Retained Earnings. D. The income statement shows how much the company owes.arrow_forwardServices are provided for customers who are sent bills for the amount they owe. For thistransaction, identify the effect on the accounting equation.a. Assets increase and liabilities increase.b. Assets increase and stockholders’ equity increases.c. Liabilities increase and stockholders’ equity decreases.d. Liabilities decrease and assets decrease.arrow_forward
- ndicate whether the following items would appear on the income statement, balance sheet, or retained earnings statement. a. Service Revenue select a financial statement b. Utilities Expense select a financial statement c. Cash select a financial statement d. Accounts Payable select a financial statement e. Supplies select a financial statement f. Salaries Expense select a financial statement g. Accounts Receivable select a financial statement h. Retained Earnings (ending) select a financial statement…arrow_forwardplease answer all parts please do not say about your guidelines in detail with explanation computation formulas thanks 2. For each transaction below, write the net effect on Current Assets (CA), Current Liabilities (CL), Gross Profit (GP), Net Income Before Taxes (NIBT), and Cash flows from operating activities (CFO). - Ignore income tax effects - Write only the effect for the current period. - Assume the companyis a merchandising firm. - Assume warranty expenses are recognized in COGS and bad debt expenses are recognized in SG\&A. - If the net effect is negative, include a negative sign. - If no effect, write 0 . - Note that this is not a balance sheet equation(A=L+E)table, so you should not expect amounts to balance.arrow_forwardListed below are the current Accounting Assumptions and Principles Economic Entity Assumption Monetary Unit Assumption Historical Cost Principle Going Concern Assumption Revenue Recognition Principle Full Disclosure Principle Time Period Assumption Matching Principle Required: For the following situations, identify whether the situation represents a violation or a correct application of GAAP, and which assumption/principle is applicable. a. In May 2021, Regent Corporation recorded as revenue $5,000 received in advance from a customer for a job that would be completed in June 2021. Violation: (Yes/No) Applicable Assumption/Principle: b. Sally Maze made sure to keep her personal expenditures separate from her marketing company books.…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
College Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
College Accounting, Chapters 1-27
Accounting
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:Cengage Learning,
The ACCOUNTING EQUATION For BEGINNERS; Author: Accounting Stuff;https://www.youtube.com/watch?v=56xscQ4viWE;License: Standard Youtube License