ACIS 2004 Exam 2 Study Guide: Doubtful Accounts, Assets, and Liabilities, Study notes of Accounting

Download ACIS 2004 Exam 2 Study Guide: Doubtful Accounts, Assets, and Liabilities and more Study notes Accounting in PDF only on Docsity! ACIS 2004 Exam 2 – Study Guide This exam is a 125 point exam it consists of: 10 True / False worth 3 points each (30 points total) 16 Multiple Choice worth 4 points each (64 points total) 2 problems worth 15 and 16 points, respectively (31 points total) Chapter 5 1. Explain how the allowance method of accounting for doubtful accounts affects financial statements a. Define the allowance for doubtful accounts b. Define contra asset c. Define and calculate the net realizable value of accounts receivable d. Calculate and record allowance for doubtful accounts using the percent of revenue (sales) method e. Record an account write-off using the allowance method 2. Record credit card sales 3. Explain how accounting for notes receivable and accrued interest affects financial statements a. Record the issuance of a notes receivable, accrue the related interest, and the receipt of payment of the notes receivable Chapter 6 1. Identify different types of long-term operational assets and the terms used to allocate their costs a. Tangible assets i. Property, Plant and Equipment (depreciation) ii. Land (no allocation) iii. Natural resources (depletion) b. Intangible assets (amortization) 2. Calculate the goodwill recognized from the purchase of a business. 3. Determine the cost of long-term operational assets (one asset purchase or a basket purchase) 4. Calculate Depreciation methods a. Straight-line b. Double-declining balance c. Units of production 5. Explain how the different methods affect the financial statements at various points in the life of the asset. 6. Calculate gains and losses on the sale of long-term assets and determine how the sale affects the financial statements 7. Know what types of costs related to long-term assets should be capitalized (put on the balance sheet) vs. expensed (immediately placed on the income statement) 8. Know how the revision of an estimate (change in expected salvage value or useful life) affects current and past financial statements