Numerade

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Example Company pays an invoice Cancelation of already received orders Depreciation of company's office building Payment of bonus for the last fiscal year Purchase of new computers (bank payment) The customer pays an outstanding receivables Sale of old computers (price= book value and cash payment) Prepayment of the car leasing rate for the next year Billing of goods sold with profit Company donates 5.000 Euro to TH Nürnberg Hiring of new Chief Accountant

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James Kiss

Numerade educator

On 01.08.2023 a new machine will be implemented at Smith Corp. The pre-tax purchase price in the invoice was 95,200 € and was deducted with 3% discount. The following after-tax expenses were incurred in connection with the purchase and implementation of the machine: • Transportation insurance: 1,000 € • Assembly costs: 3,000 € • Freight costs: 2,500 € • Operating costs of the machine in April: 3,500 € Please calculate the acquisition costs of the machine!

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Donna Densmore

Numerade educator

Match each term with its definition by writing the appropriate letter in the space provided. Terms | Definitions --- | --- 1. Depreciation | a. Expenses paid in cash and recorded in an asset account before they are used or consumed. 2. Prepaid expenses | b. An individual accounting record of increases and decreases in a specific asset, liability or shareholders' equity item. 3. Fiscal year | c. The form of an account with a title and a left or debit side and a right or credit side. 4. Account | d. The process of allocating the cost of an asset to expense over is useful life. 5. Deferred income | e. Accounting periods that are one year in length. 6. T-Account | f. The average time that is required to go from cash to cash in producing revenues 7. Operating cycle | g. Tangible resources of a relatively permanent nature that are being used in the business and are not intended for sale. 8. PPE | h. Revenues received and recorded as liabilities before they are earned.

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Donna Densmore

Numerade educator

Written exam preparation (8) 3 Minutes Please mention three examples each for external and internal users of financial statements.

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Breanna Ollech

Numerade educator

Multiple choice: Circle the letter that best answers each of the following statements. 2.Smith Corp. made a purchase of inventory on credit on August 3, for 6,000 •. Due to the long-standing business relationships, the supplier grants Smith Corp. a special discount of 3% discount if the invoice will be settled within 10 days. On August 17, Smith Corp. makes the appropriate payment. The correct record on August 17 for Smith Corp. is: a) DR Accounts Payable 6,000 CR Cash 6,000 b) DR Accounts Payable 5,820 CR Cash 5,820 c) DR Accounts Payable 6,000 CR Purchase Returns 180 / Cash 5,820 d) DR Accounts Payable 6,000 CR Inventory 180 / Cash 5,820

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Jonathon Brumley

Numerade educator

3.Smith Corp. has the following amounts in the determination of cost of goods sold: Costs of goods purchased 76,000 €, ending inventory 34,000 €, costs of goods sold 82,000 €. The EURO amount of beginning inventory is: a) 28,000 € b) 40,000 € c) 42,000 € d) 48,000 €

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Breanna Ollech

Numerade educator

4. Smith Corp. had 300 units of inventory on hand at January 1 costing 32 ?€ each. Purchase during the month of January were as follows: • January 15: 400 units (33 €/unit) • January 23: 550 units (34 €/unit) • January 29: 100 units (35 €/unit) A physical count on January 31 shows 450 units on hand. The cost of the inventory at January 31 under the LIFO method is a) 15,400 € b) 14,900 € c) 14,550 € d) 14,400 €

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Anand Jangid

Numerade educator

Multiple choice: Circle the letter that best answers each of the following statements. 5. Smith Corp. had 10,000 units of inventory on hand at January 1 costing 9 € each. Purchase during the month of January were as follows: • June 18: 9,000 units (8 €/unit) • November 8: 6,000 units (7 €/unit) A physical count on December 31 shows 8,000 units on hand. Under the FIFO method, the December 31 inventory is a) 56,000 € b) 58,000 € c) 64,000 € d) 72,000 €

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Anand Jangid

Numerade educator

Multiple choice: Circle the letter that best answers each of the following statements. 6. At the beginning of the year 01, a new machine is purchased for production. The net price is 50,000 †. As direct incidental costs fall (net): Transport costs 4,000 †, packing 1,500 †, transportation insurance 500 †. The company uses the straight-line depreciation method. The depreciation p.a. amounts to 8,000 †, the residual amount is 0. The useful life of the new machine is a) 6 years b) 10 years c) 7 years d) 5 years

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Jonathon Brumley

Numerade educator

7. Smith Corp. purchased a truck for 27,000 € on January 1, 2021. The truck will have an estimated residual value of 2,000 € at the end of five years. Using the units of activity method, the accumulated depreciation at December 31, 2022 can be computed by the following formula: a) (27,000 € : total estimated activity) x units of activity for 2022 b) (25,000 € : total estimated activity) x units of activity for 2022 c) (27,000 € : total estimated activity) x units of activity for 2021 and 2022 d) (25,000 € : total estimated activity) x units of activity for 2021 and 2022

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merve b.