acct3

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Author:
Anonymous
ID:
1454
Filename:
acct3
Updated:
2009-11-23 01:35:24
Tags:
accounting 101
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Description:
chapters 7 & 8
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  1. Petty Cash
    • *exception to the rule that all disembursments should be made check
    • * small disbursments-check not appropriate
    • *set up as imprest basis-fixed amount
    • *one person in charge
    • * locked up
    • *requires receipt
    • *replenish on regular basis
    • *journalize when replenish
  2. If you forget to replenish petty cash, what will happen?
    • expenses too low
    • net income too high
  3. Journalizing petty cash
    • Add up all like receipts
    • Travel expense $
    • postage expense $
    • supplies expense $
    • Cash $
  4. If cash is over money, what do you do?
    • Put the wrong replenish amount(credit cash) and credit cash over/short by difference
    • Cash $
    • Cash over/short $
  5. If the petty cash is short, what do you do?
    • Credit cash by the correct amount and debit cash over/short by difference
    • Cash over/short $
    • Cash $
  6. what is on the balance per bank side of the bank reconcilation?
    • Add: deposit in transit
    • Less: outstanding check

    this is what i know but the bank does not know about
  7. What goes on the balance per book side
    • Add:interest earned
    • less:nsf check
    • less: fees from bank
    • less:service charge
    • add:collection of not receivable
    • add:eft in(electronic fund transfer)
    • less:eft out
    • less: check printing
  8. what do you do with errors?
    who ever is responsible for the error, the adjustment goes on their side of the bank reconcilation.
  9. What do you do with bad debt expense and uncollected account expense
    matching principle-match the expense relating to a sale in the same time period that the sale is.
  10. what is the allowance method?
    only acceptable way to estimate the bad debt expense
  11. what is the recording entry of a bed debt expense?
    • Bad debt expense $
    • allowance for uncollectable accts $
    • this is to record an expense in the same time period as a sale
  12. What goes on the balance sheet?
    • cash
    • accts receivable
    • less:allowance for uncollectable accts
    • this gives you the net realizable
  13. what is the one way to estimate bad debt expense
    income statement apporach-% of the credit sales to the estimate the bad debt expense

    • credit sales 200,000
    • amt to go bad 4%
  14. what is the other way to estimate the amt of bad debt
    • balance sheet approach-aging of the accts receivable
    • calculate the balance that should be in the allowance acct
    • older the debt, the higher the %
    • 0-30 days, 30-60 days, 60-90 days

    you need to look at whatever is already there and make an appropriate entry
  15. What are notes receivable
    • *longer term
    • *always in writting
    • *always call for interest
  16. if the not will be collected before the end of year, how do you journalize?
    • on oct 1 lend an emplyee 10,000 for 90 days at 12%
    • oct 1 notes receivable 10,000
    • cash 10,000
    • 90 days later collect note
    • principle x rate x time
    • 10,000 x .12 x 90/360
    • you will collect 10,300
    • cash 10,300
    • notes receivable 10,000
    • interest revenue 300
  17. if the note will be collected after the end of the year, how do you journalize?
    • nov 1 note receivable 10,000
    • cash 10,000
    • dec 31 interest receivable 200
    • interest revenue 200
    • jan 31 cash 10,300
    • note receivable 10,000
    • interest revenue 100
    • interest receivable 200
  18. the book keeper recorder a check for 340 instead of correct amt of 430, what do you do?
    subtract from book
  19. the bank subtracted 1200 for a check that was 1000, what do you do?
    add to the bank side
  20. cash/over short becomes what on the balance sheet or income statement
    rename it to misc. expense

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