Explain the phrase Generally Accepted Accounting Principle.

Question

The comparative balance sheets and an income statement for Raceway Corporation follow. Balance Sheets As of December 31 Year 2 Year 1 Assets Cash $ 6,300 $ 48,400 Accounts receivable 10,200 7,260 Inventory 45,200 56,000 Prepaid rent 700 2,140 Equipment 140,000 144,000 Accumulated depreciation (73,400) (118,000) Land 116,000 50,000 Total assets $ 245,000 $ 189,800 Liabilities Accounts payable (inventory) $ 37,200 $ 40,000 Salaries payable 12,200 10,600 Stockholders’ equity Common stock, $50 par value 150,000 120,000 Retained earnings 45,600 19,200 Total liabilities and stockholders’ equity $ 245,000 $ 189,800 Income Statement For the Year Ended December 31, Year 2 Sales $ 480,000 Cost of goods sold (264,000) Gross profit 216,000 Operating expenses Depreciation expense (11,400) Rent expense (7,000) Salaries expense (95,200) Other operating expenses (76,000) Net income $ 26,400 Other Information Purchased…

Answer 1

Question

Chapter 1, Problem 4E

a.

To determine

Explain the phrase Generally Accepted Accounting Principle.

b.

To determine

Explain the major sources of GAAP.

c.

To determine

Explain whether .there is a single comprehensive list of generally accepted accounting principles

d.

To determine

List the types of accounting reports that are prepared in conformity with generally accepted accounting principles.

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The comparative balance sheets and an income statement for Raceway Corporation follow. Balance Sheets As of December 31 Year 2 Year 1 Assets Cash $ 6,300 $ 48,400 Accounts receivable 10,200 7,260 Inventory 45,200 56,000 Prepaid rent 700 2,140 Equipment 140,000 144,000 Accumulated depreciation (73,400) (118,000) Land 116,000 50,000 Total assets $ 245,000 $ 189,800 Liabilities Accounts payable (inventory) $ 37,200 $ 40,000 Salaries payable 12,200 10,600 Stockholders’ equity Common stock, $50 par value 150,000 120,000 Retained earnings 45,600 19,200 Total liabilities and stockholders’ equity $ 245,000 $ 189,800 Income Statement For the Year Ended December 31, Year 2 Sales $ 480,000 Cost of goods sold (264,000) Gross profit 216,000 Operating expenses Depreciation expense (11,400) Rent expense (7,000) Salaries expense (95,200) Other operating expenses (76,000) Net income $ 26,400 Other Information Purchased…

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Answer 2

Question

Chapter 1, Problem 4E

a.

To determine

Explain the phrase Generally Accepted Accounting Principle.

b.

To determine

Explain the major sources of GAAP.

c.

To determine

Explain whether .there is a single comprehensive list of generally accepted accounting principles

d.

To determine

List the types of accounting reports that are prepared in conformity with generally accepted accounting principles.

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Answer 3

Question

Chapter 1, Problem 4E

a.

To determine

Explain the phrase Generally Accepted Accounting Principle.

b.

To determine

Explain the major sources of GAAP.

c.

To determine

Explain whether .there is a single comprehensive list of generally accepted accounting principles

d.

To determine

List the types of accounting reports that are prepared in conformity with generally accepted accounting principles.

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Answer 4

Question

Chapter 1, Problem 4E

a.

To determine

Explain the phrase Generally Accepted Accounting Principle.

b.

To determine

Explain the major sources of GAAP.

c.

To determine

Explain whether .there is a single comprehensive list of generally accepted accounting principles

d.

To determine

List the types of accounting reports that are prepared in conformity with generally accepted accounting principles.

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Answer 5

Chapter 1, Problem 4E

a.

To determine

Explain the phrase Generally Accepted Accounting Principle.

b.

To determine

Explain the major sources of GAAP.

c.

To determine

Explain whether .there is a single comprehensive list of generally accepted accounting principles

d.

To determine

List the types of accounting reports that are prepared in conformity with generally accepted accounting principles.

Answer 6

Chapter 1, Problem 4E

a.

To determine

Explain the phrase Generally Accepted Accounting Principle.

Answer 7

Chapter 1, Problem 4E

a.

To determine

Explain the phrase Generally Accepted Accounting Principle.

Answer 8

b.

To determine

Explain the major sources of GAAP.

Answer 9

b.

To determine

Explain the major sources of GAAP.

Answer 10

c.

To determine

Explain whether .there is a single comprehensive list of generally accepted accounting principles

Answer 11

c.

To determine

Explain whether .there is a single comprehensive list of generally accepted accounting principles

Answer 12

d.

To determine

List the types of accounting reports that are prepared in conformity with generally accepted accounting principles.

Answer 13

d.

To determine

List the types of accounting reports that are prepared in conformity with generally accepted accounting principles.

Answer 14

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Ch. 1 - Prob. 1STQ Ch. 1 - 2. To understand and use accounting information in...Ch. 1 - 3. Purposes of an accounting system include all of...Ch. 1 - Prob. 4STQ Ch. 1 - Prob. 5STQ Ch. 1 - 6. Financial accounting information is...Ch. 1 - Prob. 7STQ Ch. 1 - Prob. 8STQ Ch. 1 - Prob. 9STQ Ch. 1 - Prob. 10STQ

Explain the phrase Generally Accepted Accounting Principle.

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Explain the phrase Generally Accepted Accounting Principle.

Explain the major sources of GAAP.

Explain whether .there is a single comprehensive list of generally accepted accounting principles

List the types of accounting reports that are prepared in conformity with generally accepted accounting principles.

Chapter 1 Solutions