final exam FACC
capitalize correct answers record an expenditure as
an asset
capital expenditures correct answers spending to purchase long lived
tangible assets
How to compute straight line depreciation (per 1 year) correct answers
depreciation
expense = (cost - residual value) X
1/useful life
land is not
depreciated
record year 2 depreciation correct answers debit: depreciation
expense
credit: accumulated
depreciation
income statement for assets & depreciation expenses correct answers just
amortization
expense (add
depreciations)
income statements for assets and their depreciation correct answers
list assets
purchase
cost
accumulated amortization: added
depreciations
net: purchases costs -
amortizations
find estimated useful life on
equipment
purchase:
16000
residual:
4000
accumulated depreciation: 2000 correct answers 16000-
4000= 12000
12000/2000= 6
years
Record the disposal of computers and their accumulated depreciation to
the date .ofcorrect answers debit: accumulated
disposal
depreciation
credit:
equipment
Record the disposal of computers that had cost $4,800 and their
accumulated
depreciation to the date of disposal was $3,600. correct answers debit:
accumulated
depreciation + Loss on disposal of
PPE
, credit:
equipment
**loss on disposal when different
sums
fixed asset turnover ratio formula correct answers Net Sales / Average
Net Fixed
Asset
s
units of production depreciation correct answers (cost-residual value) *
actual total
production/estimated
production
Double-decling balance depreciation correct answers (cost-residual) *
2/useful life
journal entry for impairment (equipment impaired & deemed worthless)
correctaccumulated
debit: answers
depreciation
credit:
equipment
THEN
,
debit: impairment loss (+
expense)
credit:
equipment
journal entry: dispose long-lived tangible
asset
2 step correct answers
debit:
1. Accumulated
Depreciation
2. Cash
(proceeds)
Credi
t:
1.
equipment
2. Gain/loss on
disposal
book value correct answers cost - accumulated
depreciation
gain/loss on disposal formula correct answers proceeds -
book value
journal entry: amortize patent correct answers debit:
Amortization expense
credit: accumulated
Amortization
operating cycle correct answers how long it takes to buy inventory, make
products,
them, andsell
collect
payment
if a companys cycle is longer than 1 year then current liabilities are those
short term due within one operating
obligations
period
accrued liabilties correct answers expenses recorded but not yet paid (ex:
income tax)
capitalize correct answers record an expenditure as
an asset
capital expenditures correct answers spending to purchase long lived
tangible assets
How to compute straight line depreciation (per 1 year) correct answers
depreciation
expense = (cost - residual value) X
1/useful life
land is not
depreciated
record year 2 depreciation correct answers debit: depreciation
expense
credit: accumulated
depreciation
income statement for assets & depreciation expenses correct answers just
amortization
expense (add
depreciations)
income statements for assets and their depreciation correct answers
list assets
purchase
cost
accumulated amortization: added
depreciations
net: purchases costs -
amortizations
find estimated useful life on
equipment
purchase:
16000
residual:
4000
accumulated depreciation: 2000 correct answers 16000-
4000= 12000
12000/2000= 6
years
Record the disposal of computers and their accumulated depreciation to
the date .ofcorrect answers debit: accumulated
disposal
depreciation
credit:
equipment
Record the disposal of computers that had cost $4,800 and their
accumulated
depreciation to the date of disposal was $3,600. correct answers debit:
accumulated
depreciation + Loss on disposal of
PPE
, credit:
equipment
**loss on disposal when different
sums
fixed asset turnover ratio formula correct answers Net Sales / Average
Net Fixed
Asset
s
units of production depreciation correct answers (cost-residual value) *
actual total
production/estimated
production
Double-decling balance depreciation correct answers (cost-residual) *
2/useful life
journal entry for impairment (equipment impaired & deemed worthless)
correctaccumulated
debit: answers
depreciation
credit:
equipment
THEN
,
debit: impairment loss (+
expense)
credit:
equipment
journal entry: dispose long-lived tangible
asset
2 step correct answers
debit:
1. Accumulated
Depreciation
2. Cash
(proceeds)
Credi
t:
1.
equipment
2. Gain/loss on
disposal
book value correct answers cost - accumulated
depreciation
gain/loss on disposal formula correct answers proceeds -
book value
journal entry: amortize patent correct answers debit:
Amortization expense
credit: accumulated
Amortization
operating cycle correct answers how long it takes to buy inventory, make
products,
them, andsell
collect
payment
if a companys cycle is longer than 1 year then current liabilities are those
short term due within one operating
obligations
period
accrued liabilties correct answers expenses recorded but not yet paid (ex:
income tax)
