recording liabilities other terms review potpourri $100100$100100$100100 $200200$200200$200200...

Recording Liabilities

Other Terms

Review Potpourri

$100 $100 $100

$200 $200 $200

$300 $300 $300

$400 $400 $400

$500

Bond Trans-x

$400

$100

$200

$300

$500

Bond Terms

$100

$200

$300

$400

$500 $500 $500

Recording Liabilities - $100

The category of liabilities used to report expenses that have been incurred but not paid (or recorded) at the end of the accounting period.

What are Accrued Liabilities?

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Recording Liabilities - $200

Short-term obligations that will be paid with current assets within the current operating cycle or one year, whichever is longer.

What are Current Liabilities?

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Recording Liabilities - $300

Accounts affected when a retail company, using a perpetual inventory system, sells a microwave to a customer for cash.

What are Cash, Sales Revenue, Inventory, and Cost of Goods Sold? (Also, if sold in a jurisdiction that charges sales tax, what is Sales Taxes Payable)?

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Recording Liabilities - $400

Accounts affected when an employee earns and is paid her net wages in cash.

What are Wages Expense, Cash, Withheld Income Taxes Payable, CPP Payable, EI Payable, and any miscellaneous payables such as United Way or pension plans?

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Recording Liabilities - $500

The point at which a liability is recorded.

What is “at the point when the company is obligated to give up assets or services”? (See p. 429)

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Bond Terms - $100

The payment made when a bond matures.

What is Face Value?

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Bond Terms - $200

The interest rate stated on the face of the bond, which is used to compute interest payments.

What is the Stated Interest Rate?

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Bond Terms - $300

The amount of money the company receives when the bond is issued.

What is the Issue Price?

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Bond Terms - $400

The rate of interest that lenders demand from a bond.

What is the Market Interest Rate?

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Bond Terms - $500

When the issue price is greater than the face value the bond is issued at a ______. When the issue price is below the face value the bond is issued at a ______.

What are Premium and Discount?

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Bond Trans-x - $100

Accounts affected when a $1,000 bond is issued at face value.

What are Cash (debited for $1,000) and Bonds Payable (credited for $1,000)?

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Bond Trans-x - $200

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The classification of the Discount on Bonds Payable account.

What is a Contra-Liability?

Bond Trans-x - $300

DAILY DOUBLE!!!

Bond Trans-x - $400

The accounts affected when a $1,000 bond is issued at 104.

What are Cash (debited for $1,040), Bonds Payable (credited for $1,000), and Premium on Bonds Payable (credited for $40)?

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Bond Trans-x - $500

The accounts affected when a $1,000 bond, which was issued at face value, is retired at 109.

What are Bonds Payable (debited for $1,000), Loss on Bond Retirement (debited for $90), and Cash (credited for $1,090)?

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Other Terms - $100

The term that describes a company’s ability to pay current obligations.

What is Liquidity?

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Other Terms - $200

A prearranged agreement that allows a company to borrow money at any time up to a certain limit.

What is a Line of Credit?

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Other Terms - $300

(Cash + Short Term Investments + Accounts Receivable, Net) divided by Current Liabilities.

What is the Quick Ratio?

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Other Terms - $400

(Net Income + Interest Expense + Income Tax Expense)/Interest Expense.

What is the Times Interest Earned Ratio?

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Other Terms - $500

How a contingent liability—that will probably become an actual liability, but whose probable amount cannot be estimated—is accounted for.

What is “described in a footnote”?

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Review Potpourri - $100

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Method of amortization that allocates the cost of an asset in equal periodic amounts over its useful life.

What is Straight-line Amortization?

Review Potpourri - $200

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A term used to describe the acquisition cost of an asset less its accumulated amortization.

What is book (or carrying) value?

Review Potpourri - $300

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Buy items at $1, $2, and $3 in that order; __&__ are the costs assigned to the first two items sold under FIFO.

What are $1 and $2?

Review Potpourri - $400

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The requirement to use the least optimistic measures when the value of an asset or liability is uncertain.

What is the Conservatism?

Review Potpourri - $500

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Accounts affected when $200 of prepaid rent is used up during the period.

What are Rent Expense (increase, debited) and Prepaid Rent (decrease, credited)?

Daily Double Specify Your Wager!

Bond Trans-x ---

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The accounts affected when a $1,000 bond is issued at 95.

What are Cash (debited for $950), Discount on Bonds Payable (debited for $50), and Bonds Payable (credited for $1,000)?