Exam 2: Concepts and Elements Underlying Accounting

Tyler Tours provides transportation services and requires clients to book trips at least one month in advance. Tyler Tours bills its customers on the first day of the month and requires payments to be made on the last day of the month. When should Tyler Tours recognize revenue from its services?

Match each term listed below with the appropriate term. Terms may be used once, more than once, or not at all. -_____ Allows a user to forecast occurrences from current information.

Match each term listed below with the appropriate term. Terms may be used once, more than once, or not at all. -_____ Most assets are shown at their original cost.

Manley Corporation's trial balance at December 31, 2010 consisted of the following account balances: Required: a. Prepare Manley's December 31, 2010 balance sheet. (Hint: You must compute a missing amount.) b. Prepare Manley's income statement for the year ended December 31, 2010.

On Jan. 2, 2010, Doric Company purchased a new machine for $75,000. Doric expects the machine to have a useful life of 10 years and $5,000 salvage value. What is the accumulated depreciation on the machine at the end of 2012?

Businesses may recognize money received in advance of selling a profit or performing a service in current period operating income.

The primary purpose of financial reports is to

A debt or obligation that will be eliminated by giving up current assets or incurring a current liability is a

A manufacturing company that charges employees a nominal amount to park in a close-in parking garage would report those parking fees as operating revenues.

Match each term listed below with the appropriate term. Terms may be used once, more than once, or not at all. -_____ Is timely and has predictive value and/or feedback value.

In a business organization, transaction information is posted from the general journal to the chart of accounts.

Which of the following are examples of intangible assets?

Which of the following are assets?

The basis that reflects a transaction's economic impact, regardless of whether cash is involved, is the

O'Connor Inc. provides apartments to local university students under different revenue packages. One popular package allows students to pay the annual rent in advance and take a 25% discount over the monthly rate. O'Connor should recognize the related revenue for students who choose this package

Inflows of new assets into a business that have been generated by business operating activities are included in

Match each term listed below with the appropriate term. Terms may be used once, more than once, or not at all. -_____ Divides reporting intervals into equal lengths.

The specific dollar amount printed on each stock certificate is the

The par value of a corporation's stock often has little relationship to its market value.

If an asset's value has permanently declined below its historical cost, that asset should be written down to its current value.