MGMT 200 FINAL EXAM (PURDUE UNIVERSITY)
NEWEST 2024 FINAL EXAM, PRACTICE EXAM
AND STUDY GUIDE 300 QUESTIONS AND
CORRECT DETAILED ANSWERS (VERIFIED
ANSWERS) |ALREADY GRADED A+.
When does deferred revenue arise? - ANSWER >>>when companies
receive payment in advance
What is a current liability? - ANSWER >>>A liability expected to be
paid within 1 year of balance sheet date
What is a long-term liability? - ANSWER >>>payable in more than
one year from balance sheet date
What is the operating cycle? - ANSWER >>>the length in time from
spending cash to provide goods/services to a customer until collection
of cash from that customer
What does a company with a 3 month operating cycle do with their
liabilities? - ANSWER >>>classifies current liabilities as those due in
1 year
What does a company with a 15 month operating cycle do with their
liabilities? - ANSWER >>>classifies current liabilities as those due
within 15 months
What is notes payable? - ANSWER >>>A written promise made by
the business to pay a debt, usually involving interest, in the future.
How to calculate Interest on notes payable? - ANSWER >>>Face
Value x Annual Interest Rate x Fraction of the year
,How do you record Notes Payable? - ANSWER >>>debit cash, credit
notes payable
Southwest Airlines borrows $100,000 from Bank of America on
September 1,2024, signing a 6%, six-month note for the amount
borrowed plus accrued interest due six months later on March 1,
2025.
On September 1, 2024, Southwest will receive $100,000 in cash and
record the following: - ANSWER >>>debit cash 100,000
credit notes payable 100,000
Southwest Airlines borrows $100,000 from Bank of America on
September 1,2024, signing a 6%, six-month note for the amount
borrowed plus accrued interest due six months later on March 1,
2025.
How do you calculate the Interest for the 6 month period? - ANSWER
>>>100,000 X.06 X 6/12 = 3000
Southwest Airlines borrows $100,000 from Bank of America on
September 1,2024, signing a 6%, six-month note for the amount
borrowed plus accrued interest due six months later on March 1,
2025.
How do you calculate the Interest for the 4 month period? What would
be the Adjusted journal Entry? - ANSWER >>>100,000 x .06 x 4/12 =
2000, Debit to Interest Expense 2000 and Credit to interest Payable
2000
How do you record the repayment of Notes Payable? - ANSWER
>>>Debit to Notes Payable, Interest Expense, Interest Payable
Credit to Cash
What are the payroll costs for employees? - ANSWER >>>Federal
and state income taxes
FICA taxes
,Health, Dental, Disability, Life insurance
Investments in retirement/savings plan
What are the payroll employer costs? - ANSWER >>>federal and
state unemployment taxes
employer matching portion of Social Security and Medicare
Health, Dental, Disability, Life insurance
Contributions to retirements or savings plan
What is the journal entry for employee salary expense, withholdings,
and salaries payable? - ANSWER >>>debit to salaries expense
credit to employee income tax payable, FICA Tax payable, Salaries
Payable
What is the journal entry for posting fringe benefits? - ANSWER
>>>Debit to salaries expense
Credit to Fringe Benefits Payable(depending on company)
How do you record employer payroll taxes? - ANSWER >>>Debit to
Payroll Tax Expense
Credit to FICA Tax Payable
Credit to Unemployment Tax Payable
What are some other current liabilities? - ANSWER >>>- Deferred
Revenues
- Sales Tax Payable
- Current portion of long-term debt
how to record deferred revenue - ANSWER >>>debit to cash, credit
to sales revenue
Apple sells gift card to customer for $100
What is the journal entry? - ANSWER >>>Debit to cash for 100
Credit o deferred revenue for 100
Apple sells gift card to customer for $100
, Customer spends $15 of it
what is the journal entry apple makes? - ANSWER >>>debit to
deferred revenue for 15
credit to sales revenue for 15
What account classification is deferred revenue? - ANSWER
>>>liability
What is the journal entry for sales tax payable? - ANSWER >>>Debit
to cash
Credit to sales revenue
Credit to sales tax payable
A customer bought lunch in an airport for $15 plus 10% sales tax
What is the journal entry? - ANSWER >>>Debit to cash for 16.5
Credit to sales revenue for sales revenue
Credit to sales tax payable for 1.5
Suppose a company has a long-term note payable of $1,000,000. At
the balance sheet date, the company determines that $200,000 of the
note is due within the next 12 months (2025), while the remaining
$800,000 is due in later periods (2026 and beyond). The company
needs to reclassify $200,000 of the long-term note to current notes
payable - ANSWER >>>Debit to Notes payable (long term)
Credit to Notes Payable (short term)
What is contingency? - ANSWER >>>uncertain situations that can
result in a win or loss for a company
What is a contingent liability? - ANSWER >>>existing uncertain
situation that might result in a loss
When do you report contingent liabilities? - ANSWER >>>when a loss
is probable and the amount is reasonably estimable
NEWEST 2024 FINAL EXAM, PRACTICE EXAM
AND STUDY GUIDE 300 QUESTIONS AND
CORRECT DETAILED ANSWERS (VERIFIED
ANSWERS) |ALREADY GRADED A+.
When does deferred revenue arise? - ANSWER >>>when companies
receive payment in advance
What is a current liability? - ANSWER >>>A liability expected to be
paid within 1 year of balance sheet date
What is a long-term liability? - ANSWER >>>payable in more than
one year from balance sheet date
What is the operating cycle? - ANSWER >>>the length in time from
spending cash to provide goods/services to a customer until collection
of cash from that customer
What does a company with a 3 month operating cycle do with their
liabilities? - ANSWER >>>classifies current liabilities as those due in
1 year
What does a company with a 15 month operating cycle do with their
liabilities? - ANSWER >>>classifies current liabilities as those due
within 15 months
What is notes payable? - ANSWER >>>A written promise made by
the business to pay a debt, usually involving interest, in the future.
How to calculate Interest on notes payable? - ANSWER >>>Face
Value x Annual Interest Rate x Fraction of the year
,How do you record Notes Payable? - ANSWER >>>debit cash, credit
notes payable
Southwest Airlines borrows $100,000 from Bank of America on
September 1,2024, signing a 6%, six-month note for the amount
borrowed plus accrued interest due six months later on March 1,
2025.
On September 1, 2024, Southwest will receive $100,000 in cash and
record the following: - ANSWER >>>debit cash 100,000
credit notes payable 100,000
Southwest Airlines borrows $100,000 from Bank of America on
September 1,2024, signing a 6%, six-month note for the amount
borrowed plus accrued interest due six months later on March 1,
2025.
How do you calculate the Interest for the 6 month period? - ANSWER
>>>100,000 X.06 X 6/12 = 3000
Southwest Airlines borrows $100,000 from Bank of America on
September 1,2024, signing a 6%, six-month note for the amount
borrowed plus accrued interest due six months later on March 1,
2025.
How do you calculate the Interest for the 4 month period? What would
be the Adjusted journal Entry? - ANSWER >>>100,000 x .06 x 4/12 =
2000, Debit to Interest Expense 2000 and Credit to interest Payable
2000
How do you record the repayment of Notes Payable? - ANSWER
>>>Debit to Notes Payable, Interest Expense, Interest Payable
Credit to Cash
What are the payroll costs for employees? - ANSWER >>>Federal
and state income taxes
FICA taxes
,Health, Dental, Disability, Life insurance
Investments in retirement/savings plan
What are the payroll employer costs? - ANSWER >>>federal and
state unemployment taxes
employer matching portion of Social Security and Medicare
Health, Dental, Disability, Life insurance
Contributions to retirements or savings plan
What is the journal entry for employee salary expense, withholdings,
and salaries payable? - ANSWER >>>debit to salaries expense
credit to employee income tax payable, FICA Tax payable, Salaries
Payable
What is the journal entry for posting fringe benefits? - ANSWER
>>>Debit to salaries expense
Credit to Fringe Benefits Payable(depending on company)
How do you record employer payroll taxes? - ANSWER >>>Debit to
Payroll Tax Expense
Credit to FICA Tax Payable
Credit to Unemployment Tax Payable
What are some other current liabilities? - ANSWER >>>- Deferred
Revenues
- Sales Tax Payable
- Current portion of long-term debt
how to record deferred revenue - ANSWER >>>debit to cash, credit
to sales revenue
Apple sells gift card to customer for $100
What is the journal entry? - ANSWER >>>Debit to cash for 100
Credit o deferred revenue for 100
Apple sells gift card to customer for $100
, Customer spends $15 of it
what is the journal entry apple makes? - ANSWER >>>debit to
deferred revenue for 15
credit to sales revenue for 15
What account classification is deferred revenue? - ANSWER
>>>liability
What is the journal entry for sales tax payable? - ANSWER >>>Debit
to cash
Credit to sales revenue
Credit to sales tax payable
A customer bought lunch in an airport for $15 plus 10% sales tax
What is the journal entry? - ANSWER >>>Debit to cash for 16.5
Credit to sales revenue for sales revenue
Credit to sales tax payable for 1.5
Suppose a company has a long-term note payable of $1,000,000. At
the balance sheet date, the company determines that $200,000 of the
note is due within the next 12 months (2025), while the remaining
$800,000 is due in later periods (2026 and beyond). The company
needs to reclassify $200,000 of the long-term note to current notes
payable - ANSWER >>>Debit to Notes payable (long term)
Credit to Notes Payable (short term)
What is contingency? - ANSWER >>>uncertain situations that can
result in a win or loss for a company
What is a contingent liability? - ANSWER >>>existing uncertain
situation that might result in a loss
When do you report contingent liabilities? - ANSWER >>>when a loss
is probable and the amount is reasonably estimable
