A machine cost $500,000 on April 1, 2010. Its estimated salvage value is $50,000 and its expected life is eight years.
Instructions:
Calculate the depreciation expense (to the nearest dollar) by each of the following methods, showing the figures used
a) straight-line for 2010
b) Double-declining balance for 2011
c) Sum-of-the-years digits for 2011
Click here for the solution: A machine cost $500,000 on April 1, 2010
Showing posts with label April. Show all posts
Showing posts with label April. Show all posts
Sunday, September 20, 2015
Thursday, September 10, 2015
The April transactions of Wise Company are described in Problem 7-1A
ACC 225 Week 7
Problem 7-3A
The April transactions of Wise Company are described in Problem 7-1A.
Required
1. Prepare a general journal, a purchases journal like that in Exhibit 7.9, and a cash disbursements journal like that in Exhibit 7.11. Number all journal pages as page 3. Review the April transactions of Wise Company and enter those transactions that should be journalized in the general journal, the purchases journal, or the cash disbursements journal. Ignore any transactions that should be journalized in a sales journal or cash receipts journal.
2. Open the following general ledger accounts: Cash, Inventory, Office Supplies, Store Supplies, Store Equipment, Accounts Payable, Long-Term Notes Payable, Sales Salaries Expense, and Advertising Expense. Enter the March 31 balances of Cash ($85,000), Inventory ($125,000), and Long-Term Notes Payable ($210,000). Also open accounts payable subsidiary ledger accounts for Ned’s Supply, Negi Company, Price Company, and Madison, Inc.
3. Verify that amounts that should be posted as individual amounts from the journals have been
posted. (Such items are immediately posted.) Foot and crossfoot the journals and make the monthend postings.
4. Prepare a trial balance of the general ledger and a schedule of accounts payable.
Click here for the solution: The April transactions of Wise Company are described in Problem 7-1A
Problem 7-3A
The April transactions of Wise Company are described in Problem 7-1A.
Required
1. Prepare a general journal, a purchases journal like that in Exhibit 7.9, and a cash disbursements journal like that in Exhibit 7.11. Number all journal pages as page 3. Review the April transactions of Wise Company and enter those transactions that should be journalized in the general journal, the purchases journal, or the cash disbursements journal. Ignore any transactions that should be journalized in a sales journal or cash receipts journal.
2. Open the following general ledger accounts: Cash, Inventory, Office Supplies, Store Supplies, Store Equipment, Accounts Payable, Long-Term Notes Payable, Sales Salaries Expense, and Advertising Expense. Enter the March 31 balances of Cash ($85,000), Inventory ($125,000), and Long-Term Notes Payable ($210,000). Also open accounts payable subsidiary ledger accounts for Ned’s Supply, Negi Company, Price Company, and Madison, Inc.
3. Verify that amounts that should be posted as individual amounts from the journals have been
posted. (Such items are immediately posted.) Foot and crossfoot the journals and make the monthend postings.
4. Prepare a trial balance of the general ledger and a schedule of accounts payable.
Click here for the solution: The April transactions of Wise Company are described in Problem 7-1A
Sunflower Architects incorporated as licensed architects on April 1, 2010
P3-5A Sunflower Architects incorporated as licensed architects on April 1, 2010. During the first month of the operation of the business, these events and transactions occurred:
Apr: I Stockholders invested $15,000 cash in exchange for common stock of the corporation.
1 Hired a secretary-receptionist at a salary of $375 per week, payable monthly.
2 Paid office rent for the month $900.
3 Purchased architectural supplies on account from Spring Green Company $1,000.
10 Completed blueprints on a carport and billed client $1,500 for services.
11 Received $500 cash advance from J. Madison to design a new home.
20 Received $2,300 cash for services completed and delivered to M. Svetlana.
30 Paid secretary-receptionist for the month $1,500.
30 Paid $300 to Spring Green Company for accounts payable due.
The company uses these accounts: Cash, Accounts Receivable, Supplies, Accounts Payable, Unearned Revenue, Common Stock, Service Revenue, Salaries Expense, and Rent Expense.
Instructions
(a) Journalize the transactions, including explanations.
(b) Post to the ledger T accounts.
(c) Prepare a trial balance on April 30, 2010
Click here for the solution: Sunflower Architects incorporated as licensed architects on April 1, 2010
Apr: I Stockholders invested $15,000 cash in exchange for common stock of the corporation.
1 Hired a secretary-receptionist at a salary of $375 per week, payable monthly.
2 Paid office rent for the month $900.
3 Purchased architectural supplies on account from Spring Green Company $1,000.
10 Completed blueprints on a carport and billed client $1,500 for services.
11 Received $500 cash advance from J. Madison to design a new home.
20 Received $2,300 cash for services completed and delivered to M. Svetlana.
30 Paid secretary-receptionist for the month $1,500.
30 Paid $300 to Spring Green Company for accounts payable due.
The company uses these accounts: Cash, Accounts Receivable, Supplies, Accounts Payable, Unearned Revenue, Common Stock, Service Revenue, Salaries Expense, and Rent Expense.
Instructions
(a) Journalize the transactions, including explanations.
(b) Post to the ledger T accounts.
(c) Prepare a trial balance on April 30, 2010
Click here for the solution: Sunflower Architects incorporated as licensed architects on April 1, 2010
Wednesday, September 9, 2015
You are provided with the following information for Kiley Enterprises, effective as of its April 30, 2010, year-end
P2-3A You are provided with the following information for Kiley Enterprises, effective as of its April 30, 2010, year-end.
Accounts payable $834
Accounts receivable 810
Building, net of accumulated depreciation 1,537
Cash 1,270
Common stock 900
Cost of goods sold 990
Current portion of long-term debt 450
Depreciation expense 335
Dividends paid during the year 325
Equipment, net of accumulated depreciation 1,220
Income tax expense 165
Income taxes payable 135
Interest expense 400
Inventories 967
Land 2,100
Long-term debt 3,500
Prepaid expenses 12
Retained earnings, beginning 1,600
Revenues 4,600
Selling expenses 210
Short-term investments 1,200
Wages expense 700
Wages payable 222
(a) Complete income statement and a retained earnings statement for Kiley Enterprises for the year ended April 30, 2010.
(b) Complete the classified balance sheet for Kiley Enterprises as of April 30, 2010.
Click here for the solution: You are provided with the following information for Kiley Enterprises, effective as of its April 30, 2010, year-end
Accounts payable $834
Accounts receivable 810
Building, net of accumulated depreciation 1,537
Cash 1,270
Common stock 900
Cost of goods sold 990
Current portion of long-term debt 450
Depreciation expense 335
Dividends paid during the year 325
Equipment, net of accumulated depreciation 1,220
Income tax expense 165
Income taxes payable 135
Interest expense 400
Inventories 967
Land 2,100
Long-term debt 3,500
Prepaid expenses 12
Retained earnings, beginning 1,600
Revenues 4,600
Selling expenses 210
Short-term investments 1,200
Wages expense 700
Wages payable 222
(a) Complete income statement and a retained earnings statement for Kiley Enterprises for the year ended April 30, 2010.
(b) Complete the classified balance sheet for Kiley Enterprises as of April 30, 2010.
Click here for the solution: You are provided with the following information for Kiley Enterprises, effective as of its April 30, 2010, year-end
Tuesday, September 8, 2015
At the beginning of the current season on April 1, the ledger of Wichita Pro Shop showed Cash $2,500
P5-9A At the beginning of the current season on April 1, the ledger of Wichita Pro Shop showed Cash $2,500; Merchandise Inventory $3,500; and Common Stock $6,000. These transactions occurred during April, 2010.
Apr. 5 Purchased golf bags, clubs and balls on account from Roland Co. $1,500, terms 3/10, n/60.
7 Paid freight on Roland Co. purchases $80.
9 Received credit from Roland Co. for merchandise returned $200.
10 Sold merchandise on account to members $910, terms n/30.
12 Purchased golf shoes, sweaters, and other accessories on account from Eagle Sportswear $830, terms 1/10, n/30.
14 Paid Roland Co. in full.
17 Received credit from Eagle Sportswear for merchandise returned $30.
20 Made sales on account to members $810, terms n/30.
21 Paid Eagle Sportswear in full.
27 Granted credit to members for clothing that did not fit $60.
30 Received payments on account from members $1,100.
Instructions
(a) Journalize the April transactions using a periodic inventory system.
(b) Using T-accounts, enter the beginning balances in the ledger accounts and post the April transactions
(c) Prepare a trial balance on April 30, 2010.
(d) Prepare an income statement through gross profit.
Click here for the solution: At the beginning of the current season on April 1, the ledger of Wichita Pro Shop showed Cash $2,500
Apr. 5 Purchased golf bags, clubs and balls on account from Roland Co. $1,500, terms 3/10, n/60.
7 Paid freight on Roland Co. purchases $80.
9 Received credit from Roland Co. for merchandise returned $200.
10 Sold merchandise on account to members $910, terms n/30.
12 Purchased golf shoes, sweaters, and other accessories on account from Eagle Sportswear $830, terms 1/10, n/30.
14 Paid Roland Co. in full.
17 Received credit from Eagle Sportswear for merchandise returned $30.
20 Made sales on account to members $810, terms n/30.
21 Paid Eagle Sportswear in full.
27 Granted credit to members for clothing that did not fit $60.
30 Received payments on account from members $1,100.
Instructions
(a) Journalize the April transactions using a periodic inventory system.
(b) Using T-accounts, enter the beginning balances in the ledger accounts and post the April transactions
(c) Prepare a trial balance on April 30, 2010.
(d) Prepare an income statement through gross profit.
Click here for the solution: At the beginning of the current season on April 1, the ledger of Wichita Pro Shop showed Cash $2,500
Monday, August 31, 2015
Mike purchases a heavy-duty truck (5-year class recovery property) for his delivery service on April 30, 2010
Mike purchases a heavy-duty truck (5-year class recovery property) for his delivery service on April 30, 2010. The truck is not considered a passenger automobile for purposes of the listed property and luxury automobile limitations. The truck has a depreciable basis of $39,080 and an estimated useful life of 5 years. Its estimated salvage value is $1,080. Assume no election to expense is made and no bonus depreciation is taken.
a. Calculate the amount of depreciation for 2010 using financial accounting straight-line depreciation (not the straight-line MACRS election) over the truck's estimated useful life.
b. Calculate the amount of depreciation for 2010 using the straight-line depreciation election under MACRS over the minimum number of years.
c. Calculate the amount of accelerated depreciation for 2010 that Mike could deduct using MACRS.
Click here for the solution: Mike purchases a heavy-duty truck (5-year class recovery property) for his delivery service on April 30, 2010
a. Calculate the amount of depreciation for 2010 using financial accounting straight-line depreciation (not the straight-line MACRS election) over the truck's estimated useful life.
b. Calculate the amount of depreciation for 2010 using the straight-line depreciation election under MACRS over the minimum number of years.
c. Calculate the amount of accelerated depreciation for 2010 that Mike could deduct using MACRS.
Click here for the solution: Mike purchases a heavy-duty truck (5-year class recovery property) for his delivery service on April 30, 2010
Saturday, August 22, 2015
On April 1 Flint Hills Travel Agency Inc. was established
P3-1A On April 1 Flint Hills Travel Agency Inc. was established. These transactions were completed during the month
• 1. Stockholders invested $25,000 cash in the company in exchange for common stock.
• 2. Paid $900 cash for April office rent.
• 3. Purchased office equipment for $2,800 cash.
• 4. Purchased $200 of advertising in the Chicago Tribune, on account.
• 5. Paid $500 cash for office supplies.
• 6. Earned $10,000 for services provided: Cash of $1,000 is received from customers, and the balance of $9,000 is billed to customers on account.
• 7. Paid $400 cash dividends.
• 8. Paid Chicago Tribune amount due in transaction (4).
• 9. Paid employees’ salaries $1,200.
• 10. Received $9,000 in cash from customers billed previously in transaction (6).
Check: (a) Cash $29,000; Ret. Earnings $ 7,300
• (a) Prepare a tabular analysis of the transactions using these column headings: Cash, Accounts Receivable, Supplies, Office Equipment, Accounts Payable, Common Stock, and Retained Earnings (with separate columns for Revenues, Expenses, and Dividends). Include margin explanations for any changes in Retained Earnings.
• (b) From an analysis of the Retained Earnings columns, compute the net income or net loss for April.
Click here for the solution: On April 1 Flint Hills Travel Agency Inc. was established
• 1. Stockholders invested $25,000 cash in the company in exchange for common stock.
• 2. Paid $900 cash for April office rent.
• 3. Purchased office equipment for $2,800 cash.
• 4. Purchased $200 of advertising in the Chicago Tribune, on account.
• 5. Paid $500 cash for office supplies.
• 6. Earned $10,000 for services provided: Cash of $1,000 is received from customers, and the balance of $9,000 is billed to customers on account.
• 7. Paid $400 cash dividends.
• 8. Paid Chicago Tribune amount due in transaction (4).
• 9. Paid employees’ salaries $1,200.
• 10. Received $9,000 in cash from customers billed previously in transaction (6).
Check: (a) Cash $29,000; Ret. Earnings $ 7,300
• (a) Prepare a tabular analysis of the transactions using these column headings: Cash, Accounts Receivable, Supplies, Office Equipment, Accounts Payable, Common Stock, and Retained Earnings (with separate columns for Revenues, Expenses, and Dividends). Include margin explanations for any changes in Retained Earnings.
• (b) From an analysis of the Retained Earnings columns, compute the net income or net loss for April.
Click here for the solution: On April 1 Flint Hills Travel Agency Inc. was established
Tuesday, August 18, 2015
LoBianco Company's record of transactions for the month of April was as follows
LoBianco Company's record of transactions for the month of April was as follows.
Purchases Sales
(Balance on hand)
April 1 600 @ $7.43 April 3 500 @ $12.39
4 1,500 @ $7.53 9 1,300 @ $12.39
8 800 @ $7.93 11 600 @ $13.63
13 1,200 @ $8.05 23 1,200 @ $13.63
21 700 @ $8.18 27 900 @ $14.87
29 500 @ $8.41 ______
______ 4,500
5,300
(a) Assuming that periodic inventory records are kept in units only, compute the inventory at April 30 using (1) LIFO and (2) average cost.
(b) Assuming that perpetual inventory records are kept in dollars, determine the inventory using (1) FIFO and (2) LIFO.
(c) Compute cost of goods sold assuming periodic inventory procedures and inventory priced at FIFO.
(d) In an inflationary period, which inventory method–FIFO, LIFO, average cost–will show the highest net income?
Click here for the solution: LoBianco Company's record of transactions for the month of April was as follows
Purchases Sales
(Balance on hand)
April 1 600 @ $7.43 April 3 500 @ $12.39
4 1,500 @ $7.53 9 1,300 @ $12.39
8 800 @ $7.93 11 600 @ $13.63
13 1,200 @ $8.05 23 1,200 @ $13.63
21 700 @ $8.18 27 900 @ $14.87
29 500 @ $8.41 ______
______ 4,500
5,300
(a) Assuming that periodic inventory records are kept in units only, compute the inventory at April 30 using (1) LIFO and (2) average cost.
(b) Assuming that perpetual inventory records are kept in dollars, determine the inventory using (1) FIFO and (2) LIFO.
(c) Compute cost of goods sold assuming periodic inventory procedures and inventory priced at FIFO.
(d) In an inflationary period, which inventory method–FIFO, LIFO, average cost–will show the highest net income?
Click here for the solution: LoBianco Company's record of transactions for the month of April was as follows
Monday, August 17, 2015
On April 1, 2012, Kathleen Alvarez established an interior decorating business, Intrex Designs
Problem 2-3A Journal Entries and Trial Balance
On April 1, 2012, Kathleen Alvarez established an interior decorating business, Intrex Designs. During the month, Kathleen completed the following transactions related to the business:
Apr. 1. Kathleen transferred cash from a personal bank account to an account to be used for the business, $17,000.
2. Paid rent for period of April 2 to end of month, $3,400.
6. Purchased office equipment on account, $10,000.
8. Purchased a used truck for $21,000, paying $2,000 cash and giving a note payable for the remainder.
10. Purchased supplies for cash, $1,800.
12. Received cash for job completed, $13,000.
Apr. 15. Paid annual premiums on property and casualty insurance, $1,800.
23. Recorded jobs completed on account and sent invoices to customers, $9,000.
24. Received an invoice for truck expenses, to be paid in April, $1,000.
Enter the following transactions on Page 2 of the two-column journal.
29. Paid utilities expense, $1,500.
29. Paid miscellaneous expenses, $750.
30. Received cash from customers on account, $7,800.
30. Paid wages of employees, $4,000.
30. Paid creditor a portion of the amount owed for equipment purchased on April 6, $2,500.
30. Withdrew cash for personal use, $2,000.
AND SO ON
Check: 3. Total of Credit Column: $66,500
Click here for the solution: On April 1, 2012, Kathleen Alvarez established an interior decorating business, Intrex Designs
On April 1, 2012, Kathleen Alvarez established an interior decorating business, Intrex Designs. During the month, Kathleen completed the following transactions related to the business:
Apr. 1. Kathleen transferred cash from a personal bank account to an account to be used for the business, $17,000.
2. Paid rent for period of April 2 to end of month, $3,400.
6. Purchased office equipment on account, $10,000.
8. Purchased a used truck for $21,000, paying $2,000 cash and giving a note payable for the remainder.
10. Purchased supplies for cash, $1,800.
12. Received cash for job completed, $13,000.
Apr. 15. Paid annual premiums on property and casualty insurance, $1,800.
23. Recorded jobs completed on account and sent invoices to customers, $9,000.
24. Received an invoice for truck expenses, to be paid in April, $1,000.
Enter the following transactions on Page 2 of the two-column journal.
29. Paid utilities expense, $1,500.
29. Paid miscellaneous expenses, $750.
30. Received cash from customers on account, $7,800.
30. Paid wages of employees, $4,000.
30. Paid creditor a portion of the amount owed for equipment purchased on April 6, $2,500.
30. Withdrew cash for personal use, $2,000.
AND SO ON
Check: 3. Total of Credit Column: $66,500
Click here for the solution: On April 1, 2012, Kathleen Alvarez established an interior decorating business, Intrex Designs
On April 1, 2012, Pavlova Company received a condemnation award of $410,000 cash as compensation for the forced sale of the company’s land and building
E10-25 (Disposition of Assets) On April 1, 2012, Pavlova Company received a condemnation award of $410,000 cash as compensation for the forced sale of the company’s land and building, which stood in the path of a new state highway. The land and building cost $60,000 and $280,000, respectively, when they were acquired. At April 1, 2012, the accumulated depreciation relating to the building amounted to $160,000. On August 1, 2012, Pavlova purchased a piece of replacement property for cash. The new land cost $90,000, and the new building cost $380,000.
Instructions
Prepare the journal entries to record the transactions on April 1 and August 1, 2012.
Click here for the solution: On April 1, 2012, Pavlova Company received a condemnation award of $410,000 cash as compensation for the forced sale of the company’s land and building
Instructions
Prepare the journal entries to record the transactions on April 1 and August 1, 2012.
Click here for the solution: On April 1, 2012, Pavlova Company received a condemnation award of $410,000 cash as compensation for the forced sale of the company’s land and building
Wednesday, July 15, 2015
LoBianco Company’s record of transactions for the month of April was as follows
E8-14 (FIFO, LIFO, and Average Cost Determination) LoBianco Company’s record of transactions for the month of April was as follows.
Purchases Sales
April 1 (balance on hand) 600 @ $6.00 April 3 500 @ $10.00
4 1,500 @ 6.08 9 1,300 @ 10.00
8 800 @ 6.40 11 600 @ 11.00
13 1,200 @ 6.50 23 1,200 @ 11.00
21 700 @ 6.60 27 900@ 12.00
29 500 @ 6.79 4,500
5,300
Instructions
(a) Assuming that periodic inventory records are kept, compute the inventory at April 30 using (1) LIFO and (2) average cost.
(b) Assuming that perpetual inventory records are kept in both units and dollars, determine the inventory at April 30 using (1) FIFO and (2) LIFO.
(c) Compute cost of goods sold assuming periodic inventory procedures and inventory priced at FIFO.
(d) In an inflationary period, which inventory method—FIFO, LIFO, average cost—will show the highest net income?
Click here for the solution: LoBianco Company’s record of transactions for the month of April was as follows
Purchases Sales
April 1 (balance on hand) 600 @ $6.00 April 3 500 @ $10.00
4 1,500 @ 6.08 9 1,300 @ 10.00
8 800 @ 6.40 11 600 @ 11.00
13 1,200 @ 6.50 23 1,200 @ 11.00
21 700 @ 6.60 27 900@ 12.00
29 500 @ 6.79 4,500
5,300
Instructions
(a) Assuming that periodic inventory records are kept, compute the inventory at April 30 using (1) LIFO and (2) average cost.
(b) Assuming that perpetual inventory records are kept in both units and dollars, determine the inventory at April 30 using (1) FIFO and (2) LIFO.
(c) Compute cost of goods sold assuming periodic inventory procedures and inventory priced at FIFO.
(d) In an inflationary period, which inventory method—FIFO, LIFO, average cost—will show the highest net income?
Click here for the solution: LoBianco Company’s record of transactions for the month of April was as follows
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