Chp 5-8 Flashcards
If you have year 1 EI, it’s the same as…
year 2 BI
If error in Y1 Ei over
Y2 Ei under
If error in Y1 GP OVER
GP UNDER
If error in Y1 NI OVER
NI UNDER
If error in Y1 R/E OVER
NO ERROR (SELF CORRECTS)
If there’s an error in inventory…
- doensn’t affect sales
- affects everything under gross profit on income statement
By Increasing COGS you do what to the balance sheet equation
reduces retained earnings
reduces assets
By Increasing COGS you do what to income statement equation
increases expenses
reduces net income
Goodwill, land, and trademarks are not ____ or _____
depreciated or amortized
Accumulated depreciation should never cause book value to
fall below residual value
When calculating cost, do not include
interest
property tax
We record long term assets at: _______
the cost of the asset plus all the cost necessary to get the asset ready to use
Are employee withholdings an expense of the companee?
no, current liability
what are company expenses?
- ER share soc security
- ER share medicare
- Fed employee tax
- St unemply tax
- pension exp
- health inspection exp
Is sales tax payable revenue a company expense?
no liability
