If a company incorrectly classified an item of capital expenditure as revenue expenditure, what effect would this have on the company's accounts in the year of the expenditure and in subsequent years?

Q: How are restrictions of retained earnings reported?

A:

Q: A loss due to a discontinued operation should be reported on the income statement   a. as an…

A: Introduction: An income statement is a summary of your company's profits and losses over a given…

Q: For what reasons might a company restrict a portion of its retained earnings?

A:

Q: When determining the amount of cash paid for income taxes, what would be indicated by an increase in…

A: Defferred income tax liability indicates that the because of temporary difference between accounting…

Q: A company fails to capitalize avoidable interest incurred while constructing an asset. What is the…

A: The interest expense incurred for construction of an asset should be capitalized because a new fixed…

Q: evaluate the impact of tax rate changes on a company’s fi nancial statements and ratios;

A: Changes to the income tax rate can significantly impact a company’s financial statements and the…

Q: different depreciation methods are used in different financial year

A: According to the concept of consistency in Accounting, accounting method used in one financial year…

Q: Which one of the following statement about encumbrance is correct? a. Encumbrances are equivalent to…

A: Encumbrances denote the estimated expenditures before the actual expenditure is occurred. It…

Q: Which of the following would NOT be reflected in the income statement?

A: Income statement- it is a part of financial statements prepared by the company that shows the…

Q: ch of the following is not correct relative to an appropriation of Retained Earnings? a. Retaine

A: The amount of profit after paying all the costs incomes taxes and dividends to shareholders is known…

Q: It is legal and ethical to use one method of deprecia method on the company's financial statements.

A: True, it is legal and ethical to use one method of depreciation for taxes and another method on the…

Q: The accounting net income of a company are not necessarily the same amount as the net income for tax…

A: The accounting net income of a company are not necessarily the same amount aa the net income for tax…

Q: how would you recognize your company’s assets that were acquired with the intention of generating…

A: Balance sheet shows the financial position of the company. It shows the assets, liabilities, and…

Q: Which of the following is NOT a component of Accumulated Other Comprehensive Income? A. Gains or…

A: Other comprehensive income (OCI) includes any unrealized gains or losses from sources of funds from…

Q: which of the following is true of the effect of net loss on financial statements?

A: The objective of this question is to understand the impact of a net loss on a company's financial…

Q: mount of dividends that a corporation may declare? a. Cash flow test b. Book value test c.…

A: The right answer is d. Income to expense ratio test

Q: Which of the following may not affect retained earnings or earned capital? Correction of prior…

A: The question is related to retained earnings. The retained earnings will be affected by Profit or…

Q: Why should executory contracts be disclosed in the financial statements? Group of answer choices…

A: Executory contracts are contracts under which neither party has performed any of its obligations or…

Q: (Based on Appendix 7B) Do U.S. GAAP and IFRS differ in the ability of a company to recognize in net…

A: Generally Accepted Accounting Principles (GAAP): Generally Accepted Accounting Principles are the…

Q: Which of the following is not deductible from business income? Group of answer choices Casual…

A: Business income is earned revenue that includes all money generated by an entity's operations.…

Q: Why are liability accounts included in the capital acquisitionand repayment cycle audited…

A: Liability accounts in the capital acquisition and repayment cycle are audited differently from…

Q: When do the corporations also report their retained earnings?

A: When do the corporations also report their retained earnings?

Q: 7 How should deferred taxes be presented on the balance sheet? As current components of…

A: Deferred tax arises whenever there is a difference between the carrying amount of the…

Q: When are companies required to file consolidated financials? How is it recorded?

A: Consolidated financial statements are required when one entity has effective control over another…

Q: On a company's balance statement, why are fixed assets depreciated?

A: Fixed asset:  It can be defined as a tangible asset that is used by the business in its production…

Q: hy do companies choose to accelerate depreciation on their tax return and not on their income…

A: Depreciation is the decrease in value of assets and in accerlated method there is more depreciation…

Q: What are the short-term effect and the long-term effect of improperly capitalizing expenditures on…

A: Financial statements are prepared by the company to present its financial position at a given point…

Q: If depreciation expense is not recorded how would that affect financial statements and…

A: Depreciation records the usage of a fixed asset over a period of time and allocates its cost to the…

Q: When analyzing a company's financial report, what are the most likely indicators that a company is…

A: A tax is a financial charge imposed by government. It is a source of income for the governments to…

Q: Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All…

A: a.Work in process inventory, beginning - Cutting$113,500Direct materials used - Cutting23,500Direct…

Q: is the temporary differrence of depreciation between financial accounting and taxation puposes…

A: In accounting, a temporary difference is a difference between an asset or liability's carrying…

Q: Select all that are true with respect to depreciation. Depreciation is a cash flow outflow at the…

A: Form 1040 Schedule 1 is used to report certain types of income that are not listed on the main 1040…

Q: The recorded amount for uncollectible taxes was overstated. To revise the estimate during the same…

A: GASB: The GASB is the board that provides the guideline to the governmental units about proper…

Q: Which of the following items isreported net of related income taxes?a. Gain or loss from…

A:

Q: When we look at GAAP are corporations required by GAAP to have an accrual or cash basis of…

A: According to Generally Accepted Accounting Principles (GAAP), corporations are required to use the…