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Chapter 13 Flashcards _ (DETAILED ANSWERS) 2024 - DISTINCTION GUARANTEED.pdf
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Chapter 13 Flashcards _ (DETAILED ANSWERS) 2024 - DISTINCTION GUARANTEED.pdf
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8/9/24, 6:46 AMChapter 13
Jeremiah
Terms in this set (38)
probable future sacrifices of economic benefits that arise from present obligations to
what are liabilities?
other entities resulting from past transactions or events
what is the difference between a current and current is due in less than 12 months whereas non-current is due in more than 12 months
non-current liability?
why is the current vs non-current for liquidity and solvency purposes
classification important?
what does it mean if a liability is we know the due date and amount of the liability such as accounts payable, notes
determinable? what are examples? payable, bond payables, and accrued liabilities
what does it mean if a liability is contingent? we are uncertain about the due date and/or the amount of the liability such as lawsuits,
what are examples? environmental remediation, and pension obligations
how are accrued liabilities adjusted at year adjusted with a debit to the expense account and a credit to the liability account
end?
how do we calculate accrued interest? principal x rate x time passed
issuance of the note payable with a debit to cash and a credit to the note payable and
what are issuance and year end journal
the accrued interest at year end with a debit to interest expense and credit to interest
entries for a note payable?
payable
when a note spans beyond a calendar year, debit to the entire principal of the note, debit to the interest payable for 12/31/24, debit
for example issuing a 9 month note on July to interest expense which was accrued in 2025, and credit to cash
1st, 2024, what is the journal entry to retire
the note?
can future compensated absences result in a yes if
liability today? can annual bonuses based on 1) the obligation is attributable to work already performed
the current year's performance paid in cash 2) the paid absence can be taken in a later year and the benefit vests
in the subsequent year result in a liability 3) payment is probable
today? 4) amount can be reasonably estimated
what is the journal entry for vacations earned debit to vacation expense and credit to accrued vacation
but not taken in the current year?
Chapter 13
what is the journal entry for 2021 vacations debit to accrued vacation from the first JE, debit to vacation expense (plug), and credit
taken in 2022 when salary rates for to cash for the accrued vacation amount *(1.05)
employees rose by 5%?
what is an advance from a customer? what cash is received from customers as a deposit or "advance" such as gift cards and
types of transactions fall under this? refundable deposit
what is the journal entry for the sale of gift debit to cash and credit to gift card liability
cards?
what is the journal entry for redeemed gift debit to gift card liability, debit to cash, and credit to revenue
cards?
what is the journal entry for sales tax on gift debit to cash for the revenue x tax rate and credit to sales tax liability..... this journal entry
cards? is eventually reversed and the net change is zero
what is the journal entry for salaries earned debit to payroll expense, credit to cash
in the following year?
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