Accounting Principles and Formulas Questions With Verified Answers | UPDATED
Accounting Principles and Formulas Questions With Verified Answers | UPDATED Basic Accounting Equation - ANSWER Assets = Liabilities + Owner's Equity Business Entity - ANSWER The financial statements report about a single business. Every business gets its own set of books. Accountants do not mix in the owner's personal financial information. Current - ANSWER "Current" liabilities are those debts that must be paid within one year or one operating cycle, whichever is longer. Current Ratio - ANSWER Current Assets/Current Liabilities = Current Ratio Debt Ratio - ANSWER Total Liabilities/Total Assets = Debt Ratio Alternate Debt Ratio - ANSWER 100% - Equity Ratio = Debt Ratio Double Entry Accounting - ANSWER Recording business transactions twice: once to show where the money came from, and another time to show where the money went. Equity Ratio - ANSWER Total Equity/Total Assets = Equity Ratio Alternate Equity Ratio - ANSWER 100% - Debt Ratio = Equity Ratio Liability Account - ANSWER Payable or Deferred Equity Account - ANSWER Owner's name, Withdrawal, Dividend, Stock. Income Account - ANSWER Sales, Income, or Revenue Expense Account - ANSWER Expense (every expense account should be marked with "exp." at the end) Asset Account - ANSWER Receivable, Prepaid, Investment, Inventory (many asset accounts merely have the name of the asset without any special identifying word) Book value of a long-lived asset - ANSWER Purchase Price - Accumulated Depreciation = Book Value Ending owner's equity formula - ANSWER Equity (beginning) + Net Income - Withdrawal = Equity (ending) Gross Profit (GP) - ANSWER Sales - CGS = GP
Written for
- Institution
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Minnesota School Of Business
- Course
-
Accounting Principles
Document information
- Uploaded on
- October 25, 2023
- Number of pages
- 8
- Written in
- 2023/2024
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- Exam (elaborations)
- Contains
- Questions & answers
Subjects
- accounting principles
-
accounting principles and formulas
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