Assignment
1. According to the Week 5 lecture, why do most businesses fail within the first few years?
2. If an Accounts Receivable account is not eventually converted into cash, what happens to the amount of money in the account after a pre-determined period of time?
3. It's possible to make a lot of sales, pay minimal expense, and still go bankrupt. True or False?
4. Most businesses practice Accrual Base or Cash Base Accounting?
5. What is the first step when reconciling your cash account/bank statement?
6. What is the second step when reconciling your cash account/bank statement?
7. What is the third step when reconciling your cash account/bank statement?
8. What is the fourth step when reconciling your cash account/bank statement?
9. How often should a reconciliation of the cash account occur?
10. If a client writes the company a bad check to pay for services/products, and you charge them an administrative fee to make sure the amount eventually gets paid. What type of account is credited?
11. According to the Week 6 lecture, how can a business increase sales of the company?
12. What kind of a fee do you have to pay if you accept credit cards?
13. What term is used to describe the value of a company has through its reputation?
14. Would goodwill be considered a tangible or an intangible asset?
15. What is the equivalent of depreciation for an intangible asset?
16. What is the equivalent of depreciation for a natural resource?
17. What are the three items needed to calculate depreciation?
18. A piece of equipment is purchased for $10,000, has a salvage value of $2,000, and an estimated useful life of 4 years. Using the straight-line depreciation method, how much is depreciated per year for the next 4 years?
19. A piece of equipment is purchased for $10,000, has a salvage value of $2,000, and an estimated useful life of 4 years. Using the double-declining balance method, how much is depreciated per year for the next 2 years?
20. How does an "Accumulated Deprecation" account get increased; debit or credit?
21. What are the three levels of the Cash Flow Statement?
22. What type of income statement separates out the "Gross Margin", "Operating Income" and "Net Income"?
23. What does FUTA stand for?
24. What does FICA stand for?
25. What amount is income capped at to pay FICA - Social Security Tax on?
26. What is the term given to the borrower of a bond?
27. What is the term given to the lender of a bond?
28. What is the interest rate called which is multiplied by the bond's face value when issuing pre-determined payments to the bondholder?
29. What is the amount to pay off the bond (debt) when it is more than the face value?
30. What is the amount to pay off the bond (debt) when it is less than the face value?
31. What step takes place after the accountant analyzes the transaction (Step 1).
32. What is the step before the final step (Step 8: Close the Books).
33. Which financial statement displays how the accounting equation balances?
34. Are revenue, expense, and withdrawal accounts temporary or permanent accounts?
35. Are cash, equipment, accounts payable, and capital accounts temporary or permanent accounts?
36. The General ___________ is a diary of each specific account from under each component of the accounting equation.
37. What are the three reports within the Accounting Worksheet?
38. What is the report called which is the preliminary to the Income Statement and Balance Sheet (it's contained in the Accounting Worksheet).
39. What account are the temporary accounts closed out to before everything is taken to Retained Earnings?
40. What is the most fundamental lesson in which the accounting profession is built off of?