accounting 1120
Download
Skip this Video
Download Presentation
Accounting 1120

Loading in 2 Seconds...

play fullscreen
1 / 28

Accounting 1120 - PowerPoint PPT Presentation


  • 85 Views
  • Uploaded on

Accounting 1120. Final Study Guide. 1. What is depreciation? Which plant asset is not depreciated?. Depreciation is the allocation of a plant asset’s cost to expense over its useful life. It is NOT a process of valuation

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Accounting 1120' - mae


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
accounting 1120

Accounting 1120

Final Study Guide

1 what is depreciation which plant asset is not depreciated
1. What is depreciation? Which plant asset is not depreciated?
  • Depreciation is the allocation of a plant asset’s cost to expense over its useful life.
    • It is NOT a process of valuation
    • It does NOT mean that the business sets aside cash to replace an asset when it is used up
  • LAND is not depreciated.
2 amount of accumulated depreciation
2. Amount of accumulated Depreciation

32,000-4,000=28,000

28,000 / 4 (years of useful life) = 7,000

3 long term short term liabilities
3. Long-Term/Short-Term Liabilities
  • Long Term Liabilities
    • Obligations not expected to be paid within the longer of one year or the company's operating cycle
  • Short Term Liabilities
    • Obligations that will be paid within one year or less
4 accrued interest expense
4. Accrued Interest Expense

4,000*.06*2/12 = $40

6 balance of retained earnings
6. Balance of Retained Earnings
  • Beginning Retained Earnings + Net Income = New Balance Retained Earnings
    • 72,000+8,000 = $80,000
  • Retained Earnings – Dividend Payment
    • 80,000-7,450 = 72,550
9 statement of cash flow sections
9. Statement of Cash Flow Sections
  • Cash flows from operating activities
    • Depreciation, increases and decreases in inventory, accounts receivable, accounts payable, accrued liabilities
  • Cash flows from investing activities
    • Acquisition or sale of plant assets
  • Cash flows from financing activities
    • Notes payable, stocks (including dividends, treasury stock), bonds – borrowing money and repaying creditors
11 amounts received in advance
11. Amounts Received in Advance

Amounts received in advance from customers for future products or services are __liabilities___.

12 partnership equity balance
12. Partnership Equity Balance

$72,000 (agreed upon market value of the asset) – 15,000 (note payable secured by the asset) = 57,000

13 cumulative preferred stock dividends
13. Cumulative Preferred Stock Dividends

1,500 (shares) * 25 (par value) * .04 = 1,500 dividends owed to preferred stockholders

First year – paid 1,100 dividends – still owe 400

Second year – paid 400 from last year + 1,500 from this year = 1,900

14 stock split
14. Stock Split

The par value = $4 ($12 / 3)

Number of shares outstanding = 45,000 (15,000 * 3)

Market Value = $8 ($24 /3)

16 depreciation
16. Depreciation

32,000-2,000=30,000

30,000/10 = 3,000

Three years of straight line depreciation = 9,000

30,000-9,000 = 21,000

21,000/5 = 4,200

17 treasury stock
17. Treasury Stock

100*3 (profit made on stock 33-30=3) $300

100*-2 (loss from selling stock 28-30 =-2) = -200

Balance = $100

18 gain loss
18. Gain/Loss

$7,500 – 6,800 = $700 loss

20 issuing bonds
20. Issuing Bonds

Discount

Premium

Discount

Premium

21 depreciation
21. Depreciation

Use the depreciation worksheet in Excel

23 payroll
23. Payroll

INCOME

6,100 (monthly salary) * 12 = 73,200

73,200 * .05 = 3,660 Bonus

Total Salary and Bonus – 73,200+3,660 = 76,860

DEDUCTIONS

Federal Income Tax 810*12 = 9,720+932 = 10,652.00

State Income Tax 80*12 = 960+70 = 1,030.00

FICA Tax 76,860*.08 = 6,148.80

United Fund 76,860*.01 = 768.60

Insurance $20*12 = 240.00

TOTAL DEDUCTIONS 18,840.00

23 payroll1
23. Payroll

Gross Pay = $76,860

Total Deductions = -18,840

Net Pay = $58,020

24 issuing stock
24. Issuing Stock

Cash Received 2,000*35 = 70,000

Common Stock 2,000*2 = 4,000

Paid-in-Capital in Excess of Par = 66,000 (70,000-4,000)

24 issuing stock1
24. Issuing Stock

Equipment Received 80,000

Inventory Received 18,000

Preferred Stock – 3,000*30 90,000

Paid-in-Capital in Excess of Par = 8,000 (98,000-90,000)

ad