Reference no: EM132019658

Part A -

Why might partners agree on other than an equal split when it comes to profits I losses? Shouldn't everyone be treated equally?

What's the first two (general) things a partnership would do in "liquidation" (a winding dawn)? That is, before it's in a position to return assets back to the partners.

When we make "adjusting" journal entries, does this just affect revenue and expense accounts (subset of OE)? Or can asset and liability values be affected as well? Can we make ANY normal entries to revenue or expense and NOT impact either of the other two categories?

If I said the "RED" type accounts have a short life, what might I be referring to? What permanent account inherits all the "RED" activity? (Informally at interim periods, formally at fiscal yearend) The 'year-end' entry affecting these RED accounts is called the _____ entries.

Once these year-end entries are completed/posted, what are the only "type" of accounts that remain in the 'post' closing trial balance?

Inventory is a big thing--this DR account, after sold & reduced, is shifted to a DR expense account. No longer have this asset after it's sold. Which "method" calculates a "cost of goods sold" expense continuously? Which "method" calculates that expense only once per month? Which method do you believe a Walmart or Target uses?

Merchandising accounting can be confusing- Need to buy inventory before selling it. Keep these action separate. Where are some new accounts such as "sales returns/allowances & sales discounts" used? Buying side or selling side? What are these debit accounts subtracted from? What's the resulting subtotal called and what statement is it on?

Which cost flow "assumption" commonly parallels the actual flow of merchandise? Under rising prices (inflation), which "assumption" gives the lowest gross profit? Why for this 2nd question?

lf a company had SALES of $400,000 and Cost of Goods "available" for sale of $300,000 (this is not cost or goods sold), and had an historical gross profit rate of 35%, what is your "estimate" of ending inventory for this company?

Part B -

Wouldn't accounting be greatly simplified if we just waited for cash to come in and cash to go out before "recording transactions? Would this give satisfactory results when pulling financial statements? Why or why not?

How can a transaction such as a sale of a plant asset create a gain or loss in the income Statement? How would you describe a generic formula for the calculation of such an event? The difference between what two elements gives rise to this effect?

Employees "earn" gross pay, but get paid "net pay". Why do employers EXPENSE the gross pay calculation even though employees do not receive the gross pay in their paychecks? What is this expense called?

Also, what's the name of the other Expense that employers book related to payroll?

Do accountants record all "contingent" liabilities? Why or why not? (keep it short).

What is the only method concerning recognizing "bad debt expense" that's accepted by the IRS? (on tax returns). This method WAITS unit a bad customer account is abandonded. Which might be months after the credit sale, or maybe even a year. Why is this method theoretically "deficient" as concerns proper accounting principles?

lf a petty cash fund is well controlled, the amount of currency and the amount of 'receipts' contained in it at any time will equal what amount? When the petty cash custodian actually disburses cash in exchange for a receipt form an employee, is there a journal entry made at that time?

Typically, why isn't the "bank statement" amount of cash for a depositor exactly equal to the amount of cash on the "depositor's books" at month-end? What are the two broad categories that account for virtually ALL differences (from the bank perspective)?

Why is there not an income Statement effect (expense) under the "allowance" method when a specific customer receivable is actually written-off the ledger?

How would you describe where a revenue expenditure versus a capital expenditure is charged to? Am referring to types of accounts for these different types of expenditures? Which one affects the balance sheet and which one directly affects the income statement?