Chapter 2 - Accounting for Business Transactions Flashcards

1
Q

what are the two types of accounts?

A

Balance sheet accounts

Nominal accounts - temporary accounts

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2
Q

what is depreciation expense formula?

A

Depreciation Expense = Depreciable asset cost - Salvage Value Number of periods of useful life

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3
Q

How do you calculate interest expense?

A

Interest = Principal x Annual Interest Rate x Portion of year covered by time of investment

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