All of the following are characteristics of current liabilities except:
a. They may be replaced with a new short-term liability rather than being paid in cash.
b. They may involve estimated amounts.
c. They are due within one year or within the operating cycle, whichever is longer.
d. All three of the above are characteristic of current liabilities.
d
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Chapin Company purchased investments in 2017 at a cost of $200,000and recorded them as trading securities. Their market values totaled $250,000 and $230,000 on December 31, 2017, and December 31, 2018, respectively. The entry required on December 31, 2018, would include a
A) debit to Unrealized Holding Gain/Loss-Trading Securities of $20,000 B) credit to Unrealized Holding Gain/Loss-Trading Securities of $20,000 C) credit to Unrealized Holding Gain/Loss-Trading Securities of $30,000 D) debit to Unrealized Holding Gain/Loss-Trading Securities of $30,000
The accounting for the allocation of overhead costs is a three-step process and occurs at three different points in the accounting cycle.
List each of the three steps. For each step indicate when the step occurs and why the step is needed.
If accrued salaries were recorded on December 31 with a debit to Salaries Expense and a credit to Salaries Payable, and no reversing entries were made on January 1, the entry to record payment of these wages on the following January 5 would include:
A. A debit to Salaries Payable and a credit to Cash. B. No entry would be necessary on January 5. C. A debit to Cash and a credit to Salaries Payable. D. A debit to Cash and a credit to Prepaid Salaries. E. A debit to Salaries Payable and a credit to Salaries Expense.
One approach to the development of a transfer price is to use the market value if the item has an existing market at the time of transfer
Indicate whether the statement is true or false