The times interest earned ratio is calculated by dividing interest expense by income before interest expense and income taxes.

Obligations not due within one year or the company’s operating cycle, whichever is longer, are reported as current liabilities.

An asset’s book value is $36,000 on January 1, Year 6. The asset is being depreciated $500 per month using the straight-line method. Assuming the asset is sold on July 1, Year 7 for $25,000, the company should record:

The phrase capital-intensive refers to companies with large amounts invested in plant assets.

The times interest earned ratio is calculated by dividing interest expense by income before interest expense and income taxes.

The phrase capital-intensive refers to companies with large amounts invested in plant assets.

An asset’s book value is $36,000 on January 1, Year 6. The asset is being depreciated $500 per month using the straight-line method. Assuming the asset is sold on July 1, Year 7 for $25,000, the company should record:

Mohr Company purchases a machine at the beginning of the year at a cost of $24,000. The machine is depreciated using the double-declining-balance method. The machine’s useful life is estimated to be 5 years with a $4,000 salvage value. The machine’s book value at the end of year 2 is:

On July 1, Shady Creek Resort borrowed $250,000 cash by signing a 10-year, 8% installment note requiring equal payments each June 30 of $37,258. What is the journal entry to record the first annual payment?

An accelerated depreciation method yields larger depreciation expense in the early years of an asset’s life and less depreciation expense in later years.