Peregrine Exam/ 71 Questions with Certified Solutions
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Peregrine
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Peregrine
Peregrine Exam/ 71 Questions with Certified Solutions. Terms like:
What is meant by reconciling an account? - Answer: Reconciling an account is likely to mean proving or documenting that an account balance is correct.
What is included in cash and cash equivalents? - Answer: In accounting, a ...
Peregrine Exam/ 71 Questions with Certified
Solutions
What is meant by reconciling an account? - Answer: Reconciling an account is likely to mean
proving or documenting that an account balance is correct.
What is included in cash and cash equivalents? - Answer: In accounting, a company's cash
includes the following:
currency and coins
checks received from customers but not yet deposited
checking accounts
petty cash
Cash equivalents are short-term, highly liquid investments with a maturity date that was 3
months or less at the time of purchase.
money market accounts
U.S. Treasury Bills
commercial paper
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, What is the difference between an implicit cost and an explicit cost? - Answer: An implicit cost is
present but it is not initially shown or reported as a separate cost.
An explicit cost is a cost that is present and it is clearly shown or reported as a separate cost.
What is the difference between stocks and bonds? - Answer: Stocks, or shares of capital stock,
represent an ownership interest in a corporation. Every corporation has common stock.
Bonds are a form of long-term debt in which the issuing corporation promises to pay the
principal amount at a specified maturity date.
AN INCREASE TO WHICH OF THE FOLLOWING ACCOUNTS WILL INCREASE OWNERS' EQUITY? -
Answer: Client Fees
IN TIMES OF RISING PRICES, THE INVENTORY COST METHOD THAT WILL YIELD THE LOWEST NET
INCOME IS: - Answer: LIFO (LIFO is the acronym for last-in, first-out, which is a cost flow
assumption often used by U.S. corporations in moving costs from inventory to the cost of goods
sold.
Example: Assume that a corporation uses LIFO and has three units of a product in its inventory.
Due to its supplier raising its prices, the corporation purchased the items at different costs and
in the following sequence: $40, $44, and $46. The corporation ships the oldest item (the one
purchased for $40) to a customer at a selling price of $60. However, under the LIFO cost flow
assumption the company reports its cost of goods sold at $46 (the latest cost) and reports a
gross profit of $14. (The costs of $40 and $44 remain in inventory.)
When a business erroneously records expenses as assets, it has violated the measurement issue
of - Answer: classification
A dividend will reduce which of the following accounts? - Answer: Retained Earnings
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