Distinguish between input-oriented principles and output-oriented principles and list at least three principles in each category.
What will be an ideal response?
ANSWER:
Input-oriented principles are concerned with general approaches or rules for preparing financial statements and their content, including any necessary supplementary disclosures. Output-oriented principles are concerned with the comparability of financial statements of different firms. Input-oriented principles include recognition, matching, conservatism, disclosure, materiality, and objectivity. Out-oriented principles include comparability, consistency, and uniformity.
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On January 1, Year 1, Mayberry Company borrowed cash from Central Bank by issuing a $75,000 face value 3-year installment note payable that carried a 9% interest rate. The note is to be repaid by making annual cash payments of $29,629.11, which includes both principal and interest. The payments are to be made on December 31 of each year.Required:a) Prepare an amortization schedule for the term of the loan, showing the amounts to be paid on principal and interest for Year 1, Year 2, and Year 3 and the loan balance at the end of each year. (Round your answers to two decimal points.)b) What amount of interest expense will be shown on the Year 2 income statement?c) What amount of liability for the note will be shown on the balance sheet as of December 31, Year 2?d) Prepare the journal entry
to record the payment made on December 31, Year 2. What will be an ideal response?
Jasper makes a $50,000, 90-day, 9.0% cash loan to Clayborn Co. Jasper's entry to record the collection of the note and interest at maturity should be: (Use 360 days a year.)
A. Debit Cash $51,125.00; credit Interest Revenue $1125.00; credit Notes Receivable $50,000. B. Debit Cash for $50,000; credit Notes Receivable $50,000. C. Debit Notes Payable $50,000; Debit Interest Expense $4500; credit Cash $54,500. D. Debit Cash $54,500; credit Interest Revenue $4500, credit Notes Receivable $50,000. E. Debit Cash $51,125.00; credit Notes Receivable for $51,125.00.
The planning stage involves
A. determining appropriate automation methods. B. ensuring the availability of the right number and types of people. C. determining the pay scales of employees. D. training of hired individuals. E. evaluating the results of implemented programs.
The initial interest rate is the part of a purchase price that is paid up front in cash.
Answer the following statement true (T) or false (F)