E7-9 (Computing Bad Debts and Preparing Journal Entries) The trial balance before adjustment of Reba McIntyre Inc. shows the following balances.
Accounts Rec. $90,000 (DR.)
Allowance for Doubtful Accounts 1,750 (DR.)
Sales (all on credit) $680,000 (CR.)
Instructions: Given the entry for estimated bad debts assuming that the allowances is to provide for doubtful accounts on the basis of (a) 4% of gross accounts receivable and (b) 1% of net sales.
Click here for the solution: The trial balance before adjustment of Reba McIntyre Inc. shows the following balances
Showing posts with label Trial Balance. Show all posts
Showing posts with label Trial Balance. Show all posts
Monday, March 21, 2016
Monday, October 5, 2015
The trial balance for the General Fund of the City of Fairfield as of December 31, 2008, is presented here
Balance Sheet, Statement of Revenues, Expenditures, and Changes in Fund Balance
The trial balance for the General Fund of the City of Fairfield as of December 31, 2008, is presented here:
City of Fairfield
The General Fund
Adjusted Trial Balance
December 31, 2008
Debit Credit
Cash $430,000
Property Tax Receivable 45,000
Estimated Uncollectible Taxes $ 20,000
Due from Trust Fund 50,000
Vouchers Payable 60,000
Reserve for Encumbrances 30,000
Unreserved Fund Balance 415,000
$525,000 $525,000
Transactions for the year ended December 31, 2009, are summarized as follows:
1. The City Council adopted a budget for the year with estimated revenue of $735,000 and appropriations of $700,000.
2. Property taxes in the amount of $590,000 were levied for the current year. It is estimated that $24,000 of the taxes levied will prove to be uncollectible.
3. Proceeds from the sale of equipment in the amount of $35,000 were received by the General Fund. The equipment was purchased 10 years ago with resources of the General Fund at a cost of $150,000. On the date of purchase, it was estimated that the equipment had a useful life of 15 years.
4. Licenses and fees in the amount of $110,000 were collected.
5. The total amount of encumbrances against fund resources for the year was $642,500.
6. Vouchers in the amount of $455,000 were authorized for payment. This was $15,000 less than the amount originally encumbered for these purchases.
7. An invoice in the amount of $28,000 was received for goods ordered in 2008. The invoice was approved for payment.
8. Property taxes in the amount of $570,000 were collected.
9. Vouchers in the amount of $475,000 were paid.
10. Fifty thousand dollars was transferred to the General Fund from the Trust Fund.
11. The City Council authorized the write-off of $30,000 in uncollected property taxes.
Required:
A. Prepare entries in general journal form to record the transactions for the year ended December 31, 2009.
B. Prepare a preclosing trial balance for the General Fund as of December 31, 2009.
C. Prepare the necessary closing entries for the year ended December 31, 2009.
D. Prepare a balance sheet and a statement of revenues, expenditures, and changes in fund balance for the General Fund for the year ended December 31, 2009.
Click here for the solution: The trial balance for the General Fund of the City of Fairfield as of December 31, 2008, is presented here
The trial balance for the General Fund of the City of Fairfield as of December 31, 2008, is presented here:
City of Fairfield
The General Fund
Adjusted Trial Balance
December 31, 2008
Debit Credit
Cash $430,000
Property Tax Receivable 45,000
Estimated Uncollectible Taxes $ 20,000
Due from Trust Fund 50,000
Vouchers Payable 60,000
Reserve for Encumbrances 30,000
Unreserved Fund Balance 415,000
$525,000 $525,000
Transactions for the year ended December 31, 2009, are summarized as follows:
1. The City Council adopted a budget for the year with estimated revenue of $735,000 and appropriations of $700,000.
2. Property taxes in the amount of $590,000 were levied for the current year. It is estimated that $24,000 of the taxes levied will prove to be uncollectible.
3. Proceeds from the sale of equipment in the amount of $35,000 were received by the General Fund. The equipment was purchased 10 years ago with resources of the General Fund at a cost of $150,000. On the date of purchase, it was estimated that the equipment had a useful life of 15 years.
4. Licenses and fees in the amount of $110,000 were collected.
5. The total amount of encumbrances against fund resources for the year was $642,500.
6. Vouchers in the amount of $455,000 were authorized for payment. This was $15,000 less than the amount originally encumbered for these purchases.
7. An invoice in the amount of $28,000 was received for goods ordered in 2008. The invoice was approved for payment.
8. Property taxes in the amount of $570,000 were collected.
9. Vouchers in the amount of $475,000 were paid.
10. Fifty thousand dollars was transferred to the General Fund from the Trust Fund.
11. The City Council authorized the write-off of $30,000 in uncollected property taxes.
Required:
A. Prepare entries in general journal form to record the transactions for the year ended December 31, 2009.
B. Prepare a preclosing trial balance for the General Fund as of December 31, 2009.
C. Prepare the necessary closing entries for the year ended December 31, 2009.
D. Prepare a balance sheet and a statement of revenues, expenditures, and changes in fund balance for the General Fund for the year ended December 31, 2009.
Click here for the solution: The trial balance for the General Fund of the City of Fairfield as of December 31, 2008, is presented here
Thursday, September 24, 2015
The post-closing trial balance of Chen Corporation at December 31, 2011, contains the following stockholders’ equity accounts
P11-6B The post-closing trial balance of Chen Corporation at December
31, 2011, contains the following stockholders’ equity accounts.
Preferred Stock (15,000 shares issued) $750,000
Common Stock (250,000 shares issued) 2,500,000
Paid-in Capital in Excess of Par Value-Preferred 250,000
Paid-in Capital in Excess of Par Value-Common 400,000
Common Stock Dividends Distributable 250,000
Retained Earnings 902,000
A review of the accounting records reveals the following.
1. No errors have been made in recording 2011 transactions or in preparing the closing entry for net income.
2. Preferred stock is $50 par, 8%, and cumulative; 15,000 shares have been outstanding since January 1, 2010.
3. Authorized stock is 20,000 shares of preferred, 500,000 shares of common with a $10 par value.
4. The January 1 balance in Retained Earnings was $1,170,000.
5. On July 1, 20,000 shares of common stock were sold for cash at $16 per share.
6. On September 1, the company discovered an understatement error of $90,000 in computing depreciation in 2010. The net of tax effect of $63,000 was properly debited directly to Retained Earnings.
7. A cash dividend of $250,000 was declared and properly allocated to preferred and common stock on October 1. No dividends were paid to preferred stockholders in 2010.
8. On December 31, a 10% common stock dividend was declared out of retained earnings on common stock when the market price per share was $18.
9. Net income for the year was $495,000.
10. On December 31, 2011, the directors authorized disclosure of a $200,000 restriction of retained earnings for plant expansion. (Use Note X.)
Instructions
a. Reproduce the Retained Earnings account for the year.
b. Prepare a retained earnings statement for the year.
(b) Retained earnings $902,000
c. Prepare a stockholders’ equity section at December 31.
(c) Total stockholders’ equity $5,052,000
d. Compute the earnings per share of common stock using 240,000 as the weighted-average shares outstanding for the year.
e. Compute the allocation of the cash dividend to preferred and common stock.
Click here for the solution: The post-closing trial balance of Chen Corporation at December 31, 2011, contains the following stockholders’ equity accounts
Preferred Stock (15,000 shares issued) $750,000
Common Stock (250,000 shares issued) 2,500,000
Paid-in Capital in Excess of Par Value-Preferred 250,000
Paid-in Capital in Excess of Par Value-Common 400,000
Common Stock Dividends Distributable 250,000
Retained Earnings 902,000
A review of the accounting records reveals the following.
1. No errors have been made in recording 2011 transactions or in preparing the closing entry for net income.
2. Preferred stock is $50 par, 8%, and cumulative; 15,000 shares have been outstanding since January 1, 2010.
3. Authorized stock is 20,000 shares of preferred, 500,000 shares of common with a $10 par value.
4. The January 1 balance in Retained Earnings was $1,170,000.
5. On July 1, 20,000 shares of common stock were sold for cash at $16 per share.
6. On September 1, the company discovered an understatement error of $90,000 in computing depreciation in 2010. The net of tax effect of $63,000 was properly debited directly to Retained Earnings.
7. A cash dividend of $250,000 was declared and properly allocated to preferred and common stock on October 1. No dividends were paid to preferred stockholders in 2010.
8. On December 31, a 10% common stock dividend was declared out of retained earnings on common stock when the market price per share was $18.
9. Net income for the year was $495,000.
10. On December 31, 2011, the directors authorized disclosure of a $200,000 restriction of retained earnings for plant expansion. (Use Note X.)
Instructions
a. Reproduce the Retained Earnings account for the year.
b. Prepare a retained earnings statement for the year.
(b) Retained earnings $902,000
c. Prepare a stockholders’ equity section at December 31.
(c) Total stockholders’ equity $5,052,000
d. Compute the earnings per share of common stock using 240,000 as the weighted-average shares outstanding for the year.
e. Compute the allocation of the cash dividend to preferred and common stock.
Click here for the solution: The post-closing trial balance of Chen Corporation at December 31, 2011, contains the following stockholders’ equity accounts
Friday, September 18, 2015
Prepare a trial balance from the following information for Learn a New Language, Inc. for December 31, 2012
3. Prepare a trial balance from the following information for Learn a New Language, Inc. for December 31, 2012.
Accounts payable $5,012
Common stock $9,692
Cash $3,928
Notes payable $1,439
Wages expense $777
Marketing expense $493
Equipment $8,345
Accounts receivable $1,142
Inventory $8,074
Sales $6,616
Click here for the solution: Prepare a trial balance from the following information for Learn a New Language, Inc. for December 31, 2012
Accounts payable $5,012
Common stock $9,692
Cash $3,928
Notes payable $1,439
Wages expense $777
Marketing expense $493
Equipment $8,345
Accounts receivable $1,142
Inventory $8,074
Sales $6,616
Click here for the solution: Prepare a trial balance from the following information for Learn a New Language, Inc. for December 31, 2012
Compute the missing information from this post-closing trial balance
4. Compute the missing information from this post-closing trial balance.
Cash $34,689
Accounts Receivable 9,467
Prepaid Rent 5,000
Prepaid Insurance (A)
Supplies 944
Accounts Payable $5,389
Wages Payable (B)
Common Stock 37,049
Retained Earnings 8,234
_______ _______
Total $52,356 $52,356
Click here for the solution: Compute the missing information from this post-closing trial balance
Cash $34,689
Accounts Receivable 9,467
Prepaid Rent 5,000
Prepaid Insurance (A)
Supplies 944
Accounts Payable $5,389
Wages Payable (B)
Common Stock 37,049
Retained Earnings 8,234
_______ _______
Total $52,356 $52,356
Click here for the solution: Compute the missing information from this post-closing trial balance
Friday, August 21, 2015
The following account balances, among others, were included in the preclosing trial balance of the General Fund of the city of Madison on December 31, 2009
Problem 17-3 (Computing Unreserved Fund Balance and Closing Entries) The following account balances, among others, were included in the preclosing trial balance of the General Fund of the city of Madison on December 31, 2009.
Appropriations $3,488,000
Cash 270,000
Due to Other Fund 100,000
Due from Other Funds 250,000
Encumbrances 382,000
Estimated Revenue 3,720,000
Expenditures 3,020,000
Expenditures---2008 296,000
Reserve for Encumbrance 382,000
Reserve for Encumbrances---2008 310,000
Revenue 3,656,000
Taxes Receivable 600,000
Transfers from Other Funds 300,000
Transfers to Other Funds 520,000
Unreserved Fund Balance 422,000
Vouchers Payable 400,000
a. Prepare the necessary closing entries on December 31, 2009.
b. Calculate the amount of both the unreserved fund balance and the total fund balance in the balance sheet (1) on December 31, 2008 and (2) on December 31, 2009.
c. Prepare a schedule reconciling the December 31, 2008, total fund balance with the December 31, 2009, total fund balance by reference to actual inflows and outflow of financial resources
Click here for the solution: The following account balances, among others, were included in the preclosing trial balance of the General Fund of the city of Madison on December 31, 2009
Appropriations $3,488,000
Cash 270,000
Due to Other Fund 100,000
Due from Other Funds 250,000
Encumbrances 382,000
Estimated Revenue 3,720,000
Expenditures 3,020,000
Expenditures---2008 296,000
Reserve for Encumbrance 382,000
Reserve for Encumbrances---2008 310,000
Revenue 3,656,000
Taxes Receivable 600,000
Transfers from Other Funds 300,000
Transfers to Other Funds 520,000
Unreserved Fund Balance 422,000
Vouchers Payable 400,000
a. Prepare the necessary closing entries on December 31, 2009.
b. Calculate the amount of both the unreserved fund balance and the total fund balance in the balance sheet (1) on December 31, 2008 and (2) on December 31, 2009.
c. Prepare a schedule reconciling the December 31, 2008, total fund balance with the December 31, 2009, total fund balance by reference to actual inflows and outflow of financial resources
Click here for the solution: The following account balances, among others, were included in the preclosing trial balance of the General Fund of the city of Madison on December 31, 2009
Monday, August 17, 2015
Imperial Carpet has the following unadjusted trial balance as of March 31, 2012
Problem 2-6A Corrected Trial Balance
Imperial Carpet has the following unadjusted trial balance as of March 31, 2012.
AND SO ON
The debit and credit totals are not equal as a result of the following errors:
a. The balance of cash was understated by $12,000.
b. A cash receipt of $13,900 was posted as a debit to Cash of $19,300.
c. A debit of $15,000 to Accounts Receivable was not posted.
d. A return of $90 of defective supplies was erroneously posted as a $900 credit to Supplies.
e. An insurance policy acquired at a cost of $2,500 was posted as a credit to Prepaid Insurance.
f. The balance of Notes Payable was understated by $35,200.
g. A credit of $7,600 in Accounts Payable was overlooked when determining the balance of the account.
h. A debit of $10,000 for a withdrawal by the owner was posted as a credit to Leonardo Pepin, Capital.
i. The balance of $116,200 in Rent Expense was entered as $112,600 in the trial balance.
j. Gas, Electricity, and Water Expense, with a balance of $48,300 was omitted from the trial balance.
Required:
1. Prepare a corrected unadjusted trial balance as of March 31, 2012.
2. Does the fact that the unadjusted trial balance in (1) is balanced mean that there are no errors in the accounts? Explain.
Check: 1. Total of Debit Column: $1,400,000
Click here for the solution: Imperial Carpet has the following unadjusted trial balance as of March 31, 2012
Imperial Carpet has the following unadjusted trial balance as of March 31, 2012.
AND SO ON
The debit and credit totals are not equal as a result of the following errors:
a. The balance of cash was understated by $12,000.
b. A cash receipt of $13,900 was posted as a debit to Cash of $19,300.
c. A debit of $15,000 to Accounts Receivable was not posted.
d. A return of $90 of defective supplies was erroneously posted as a $900 credit to Supplies.
e. An insurance policy acquired at a cost of $2,500 was posted as a credit to Prepaid Insurance.
f. The balance of Notes Payable was understated by $35,200.
g. A credit of $7,600 in Accounts Payable was overlooked when determining the balance of the account.
h. A debit of $10,000 for a withdrawal by the owner was posted as a credit to Leonardo Pepin, Capital.
i. The balance of $116,200 in Rent Expense was entered as $112,600 in the trial balance.
j. Gas, Electricity, and Water Expense, with a balance of $48,300 was omitted from the trial balance.
Required:
1. Prepare a corrected unadjusted trial balance as of March 31, 2012.
2. Does the fact that the unadjusted trial balance in (1) is balanced mean that there are no errors in the accounts? Explain.
Check: 1. Total of Debit Column: $1,400,000
Click here for the solution: Imperial Carpet has the following unadjusted trial balance as of March 31, 2012
Thursday, August 13, 2015
At December 31, 2008, the trial balance of Worcester Company contained the following amounts before adjustment
P9-5A At December 31, 2008, the trial balance of Worcester Company contained the following amounts before adjustment.
Debits Credits
Accounts Receivable $385,000
Allowance for Doubtful Accounts $ 2,000
Sales 950,000
Instructions
(a) Based on the information given, which method of accounting for bad debts is Worcester Company using—the direct write-off method or the allowance method? How can you tell?
(b) Prepare the adjusting entry at December 31, 2008, for bad debts expense under each of the following independent assumptions.
(1) An aging schedule indicates that $11,750 of accounts receivable will be uncollectible.
(2) The company estimates that 1% of sales will be uncollectible.
(c) Repeat part (b) assuming that instead of a credit balance there is an $2,000 debit balance in Allowance for Doubtful Accounts.
(d) During the next month, January 2009, a $3,000 account receivable is written off as uncollectible. Prepare the journal entry to record the write-off.
(e) Repeat part (d) assuming that Worcester uses the direct write-off method instead of the allowance method in accounting for uncollectible accounts receivable.
(f) What type of account is Allowance for Doubtful Accounts? How does it affect how accounts receivable is reported on the balance sheet at the end of the accounting period?
Click here for the solution: At December 31, 2008, the trial balance of Worcester Company contained the following amounts before adjustment
Debits Credits
Accounts Receivable $385,000
Allowance for Doubtful Accounts $ 2,000
Sales 950,000
Instructions
(a) Based on the information given, which method of accounting for bad debts is Worcester Company using—the direct write-off method or the allowance method? How can you tell?
(b) Prepare the adjusting entry at December 31, 2008, for bad debts expense under each of the following independent assumptions.
(1) An aging schedule indicates that $11,750 of accounts receivable will be uncollectible.
(2) The company estimates that 1% of sales will be uncollectible.
(c) Repeat part (b) assuming that instead of a credit balance there is an $2,000 debit balance in Allowance for Doubtful Accounts.
(d) During the next month, January 2009, a $3,000 account receivable is written off as uncollectible. Prepare the journal entry to record the write-off.
(e) Repeat part (d) assuming that Worcester uses the direct write-off method instead of the allowance method in accounting for uncollectible accounts receivable.
(f) What type of account is Allowance for Doubtful Accounts? How does it affect how accounts receivable is reported on the balance sheet at the end of the accounting period?
Click here for the solution: At December 31, 2008, the trial balance of Worcester Company contained the following amounts before adjustment
Saturday, August 1, 2015
The accounts listed below appeared in the December 31 trial balance of the Savard Theater
P3‑5 (Adjusting Entries) The accounts listed below appeared in the December 31 trial balance of the Savard Theater.
Debit Credit
Equipment $192,000
Accumulated Depreciation—Equipment $ 60,000
Notes Payable 90,000
Admissions Revenue 380,000
Advertising Expense 13,680
Salaries Expense 57,600
Interest Expense 1,400
(a) From the account balances listed above and the information given below, prepare the annual adjusting entries necessary on December 31. (Omit explanations.)
1. The equipment has an estimated life of 16 years and a salvage value of $24,000 at the end of that time. (Use straight-line method.)
2. The note payable is a 90-day note given to the bank October 20 and bearing interest at 8%. (Use 360 days for denominator.)
3. In December 2,000 coupon admission books were sold at $30 each. They could be used for admission any time after January 1.
4. Advertising expense paid in advance and included in Advertising Expense $1,100.
5. Salaries accrued but unpaid $4,700.
(b) What amounts should be shown for each of the following on the income statement for the year?
Interest expense
Admissions revenue
Advertising expense
Salaries expense
Click here for the solution: The accounts listed below appeared in the December 31 trial balance of the Savard Theater
Debit Credit
Equipment $192,000
Accumulated Depreciation—Equipment $ 60,000
Notes Payable 90,000
Admissions Revenue 380,000
Advertising Expense 13,680
Salaries Expense 57,600
Interest Expense 1,400
(a) From the account balances listed above and the information given below, prepare the annual adjusting entries necessary on December 31. (Omit explanations.)
1. The equipment has an estimated life of 16 years and a salvage value of $24,000 at the end of that time. (Use straight-line method.)
2. The note payable is a 90-day note given to the bank October 20 and bearing interest at 8%. (Use 360 days for denominator.)
3. In December 2,000 coupon admission books were sold at $30 each. They could be used for admission any time after January 1.
4. Advertising expense paid in advance and included in Advertising Expense $1,100.
5. Salaries accrued but unpaid $4,700.
(b) What amounts should be shown for each of the following on the income statement for the year?
Interest expense
Admissions revenue
Advertising expense
Salaries expense
Click here for the solution: The accounts listed below appeared in the December 31 trial balance of the Savard Theater
Presented below is the trial balance of Vivaldi Corporation at December 31, 2010
E5-12 (Preparation of a Balance Sheet) Presented below is the trial balance of Vivaldi Corporation at December 31, 2010.
Debits Credits
Cash $ 197,000
Sales $ 7,900,000
Trading Securities (at cost, $145,000) 153,000
Cost of Goods Sold 4,800,000
Long-term Investments in Bonds 299,000
Long-term Investments in Stocks 277,000
Short-term Notes Payable 90,000
Accounts Payable 455,000
Selling Expenses 2,000,000
Investment Revenue 63,000
Land 260,000
Buildings 1,040,000
Dividends Payable 136,000
Accrued Liabilities 96,000
Accounts Receivable 435,000
Accumulated Depreciation—Buildings 352,000
Allowance for Doubtful Accounts 25,000
Administrative Expenses 900,000
Interest Expense 211,000
Inventories 597,000
Extraordinary Gain 80,000
Long-term Notes Payable 900,000
Equipment 600,000
Bonds Payable 1,000,000
Accumulated Depreciation—Equipment 60,000
Franchise 160,000
Common Stock ($5 par) 1,000,000
Treasury Stock 191,000
Patent 195,000
Retained Earnings 78,000
Paid-in Capital in Excess of Par 80,000
Totals $12,315,000 $12,315,000
Instructions
Prepare a balance sheet at December 31, 2010, for Vivaldi Corporation. Ignore income taxes.
Click here for the solution: Presented below is the trial balance of Vivaldi Corporation at December 31, 2010
Debits Credits
Cash $ 197,000
Sales $ 7,900,000
Trading Securities (at cost, $145,000) 153,000
Cost of Goods Sold 4,800,000
Long-term Investments in Bonds 299,000
Long-term Investments in Stocks 277,000
Short-term Notes Payable 90,000
Accounts Payable 455,000
Selling Expenses 2,000,000
Investment Revenue 63,000
Land 260,000
Buildings 1,040,000
Dividends Payable 136,000
Accrued Liabilities 96,000
Accounts Receivable 435,000
Accumulated Depreciation—Buildings 352,000
Allowance for Doubtful Accounts 25,000
Administrative Expenses 900,000
Interest Expense 211,000
Inventories 597,000
Extraordinary Gain 80,000
Long-term Notes Payable 900,000
Equipment 600,000
Bonds Payable 1,000,000
Accumulated Depreciation—Equipment 60,000
Franchise 160,000
Common Stock ($5 par) 1,000,000
Treasury Stock 191,000
Patent 195,000
Retained Earnings 78,000
Paid-in Capital in Excess of Par 80,000
Totals $12,315,000 $12,315,000
Instructions
Prepare a balance sheet at December 31, 2010, for Vivaldi Corporation. Ignore income taxes.
Click here for the solution: Presented below is the trial balance of Vivaldi Corporation at December 31, 2010
Wednesday, July 15, 2015
The adjusted trial balance of Eastwood Company and other related information for the year 2010 are presented on the next page
P5-3 (Balance Sheet Adjustment and Preparation) The adjusted trial balance of Eastwood Company and other related information for the year 2010 are presented on the next page.
EASTWOOD COMPANY
ADJUSTED TRIAL BALANCE
DECEMBER 31, 2010
Debits Credits
Cash $ 41,000
Accounts Receivable 163,500
Allowance for Doubtful Accounts $ 8,700
Prepaid Insurance 5,900
Inventory 208,500
Long-term Investments 339,000
Land 85,000
Construction Work in Progress 124,000
Patents 36,000
Equipment 400,000
Accumulated Depreciation of Equipment 240,000
Unamortized Discount on Bonds Payable 20,000
Accounts Payable 148,000
Accrued Expenses 49,200
Notes Payable 94,000
Bonds Payable 200,000
Common Stock 500,000
Paid-in Capital in Excess of Par—Common Stock 45,000
Retained Earnings 138,000
$1,422,900$1,422,900
Additional information:
1. The LIFO method of inventory value is used.
2. The cost and fair value of the long-term investments that consist of stocks and bonds is the same.
3. The amount of the Construction Work in Progress account represents the costs expended to date on a building in the process of construction. (The company rents factory space at the present time.) The land on which the building is being constructed cost $85,000, as shown in the trial balance.
4. The patents were purchased by the company at a cost of $40,000 and are being amortized on a straight-line basis.
5. Of the unamortized discount on bonds payable, $2,000 will be amortized in 2011.
6. The notes payable represent bank loans that are secured by long-term investments carried at $120,000. These bank loans are due in 2011.
7. The bonds payable bear interest at 8% payable every December 31, and are due January 1, 2021.
8. 600,000 shares of common stock of a par value of $1 were authorized, of which 500,000 shares were issued and outstanding.
Instructions
Prepare a balance sheet as of December 31, 2010, so that all important information is fully disclosed.
Click here for the solution: The adjusted trial balance of Eastwood Company and other related information for the year 2010 are presented on the next page
EASTWOOD COMPANY
ADJUSTED TRIAL BALANCE
DECEMBER 31, 2010
Debits Credits
Cash $ 41,000
Accounts Receivable 163,500
Allowance for Doubtful Accounts $ 8,700
Prepaid Insurance 5,900
Inventory 208,500
Long-term Investments 339,000
Land 85,000
Construction Work in Progress 124,000
Patents 36,000
Equipment 400,000
Accumulated Depreciation of Equipment 240,000
Unamortized Discount on Bonds Payable 20,000
Accounts Payable 148,000
Accrued Expenses 49,200
Notes Payable 94,000
Bonds Payable 200,000
Common Stock 500,000
Paid-in Capital in Excess of Par—Common Stock 45,000
Retained Earnings 138,000
$1,422,900$1,422,900
Additional information:
1. The LIFO method of inventory value is used.
2. The cost and fair value of the long-term investments that consist of stocks and bonds is the same.
3. The amount of the Construction Work in Progress account represents the costs expended to date on a building in the process of construction. (The company rents factory space at the present time.) The land on which the building is being constructed cost $85,000, as shown in the trial balance.
4. The patents were purchased by the company at a cost of $40,000 and are being amortized on a straight-line basis.
5. Of the unamortized discount on bonds payable, $2,000 will be amortized in 2011.
6. The notes payable represent bank loans that are secured by long-term investments carried at $120,000. These bank loans are due in 2011.
7. The bonds payable bear interest at 8% payable every December 31, and are due January 1, 2021.
8. 600,000 shares of common stock of a par value of $1 were authorized, of which 500,000 shares were issued and outstanding.
Instructions
Prepare a balance sheet as of December 31, 2010, so that all important information is fully disclosed.
Click here for the solution: The adjusted trial balance of Eastwood Company and other related information for the year 2010 are presented on the next page
Sunday, July 12, 2015
A partial trial balance of Dickinson Corporation is as follows on December 31, 2010
A partial trial balance of Dickinson Corporation is as follows on December 31, 2010.
____________________________________Dr.__________Cr.
Supplies on hand___________________$ 2,500
Accrued salaries and wages_______________________ $ 1,500
Interest Receivable__________________ 5,100
Prepaid insurance___________________ 90,000
Unearned rent ___________________________________ -0-
Accrued interest payable __________________________ 15,000
Additional adjusting data:
1. A physical count of supplies on hand on December 31, 2010, totaled $1,100.
2. Through oversight, the Accrued Salaries and Wages account was not changed during 2010. Accrued salaries and wages on December 31, 2010, amounted to $4,400.
3. The Interest Receivable account was also left unchanged during 2010. Accrued interest on investments amounts to $4,350 on December 31, 2010.
4. The unexpired portions of the insurance policies totaled $65,000 as of December 31, 2010.
5. $24,000 was received on January 1, 2010 for the rent of a building for both 2010 and 2011. The entire amount was credited to rental income.
6. Depreciation for the year was erroneously recorded as $5,000 rather than the correct figure of $50,000.
7. A further review of depreciation calculations of prior years revealed that depreciation of $7,200 was not recorded. It was decided that this oversight should be corrected by a prior period adjustment.
(a) Assuming that the books have not been closed, what are the adjusting entries necessary at December 31, 2010? (Ignore income tax considerations.)
(b) Assuming that the books have been closed, what are the adjusting entries necessary at December 31, 2010? (Ignore income tax considerations.)
Click here for the solution: A partial trial balance of Dickinson Corporation is as follows on December 31, 2010
____________________________________Dr.__________Cr.
Supplies on hand___________________$ 2,500
Accrued salaries and wages_______________________ $ 1,500
Interest Receivable__________________ 5,100
Prepaid insurance___________________ 90,000
Unearned rent ___________________________________ -0-
Accrued interest payable __________________________ 15,000
Additional adjusting data:
1. A physical count of supplies on hand on December 31, 2010, totaled $1,100.
2. Through oversight, the Accrued Salaries and Wages account was not changed during 2010. Accrued salaries and wages on December 31, 2010, amounted to $4,400.
3. The Interest Receivable account was also left unchanged during 2010. Accrued interest on investments amounts to $4,350 on December 31, 2010.
4. The unexpired portions of the insurance policies totaled $65,000 as of December 31, 2010.
5. $24,000 was received on January 1, 2010 for the rent of a building for both 2010 and 2011. The entire amount was credited to rental income.
6. Depreciation for the year was erroneously recorded as $5,000 rather than the correct figure of $50,000.
7. A further review of depreciation calculations of prior years revealed that depreciation of $7,200 was not recorded. It was decided that this oversight should be corrected by a prior period adjustment.
(a) Assuming that the books have not been closed, what are the adjusting entries necessary at December 31, 2010? (Ignore income tax considerations.)
(b) Assuming that the books have been closed, what are the adjusting entries necessary at December 31, 2010? (Ignore income tax considerations.)
Click here for the solution: A partial trial balance of Dickinson Corporation is as follows on December 31, 2010
Tuesday, June 23, 2015
(Adjusting Entries) The accounts listed on the next page appeared in the December 31 trial balance of the Jane Alexander Theater
Exercise P3-5 (P3-5) (Adjusting Entries) The accounts listed on the next
page appeared in the December 31 trial balance of the Jane Alexander
Theater.
Debit Credit
Equipment $192,000
Accumulated Depreciation—Equipment $ 60,000
Notes Payable 90,000
Admissions Revenue 380,000
Advertising Expense 13,680
Salaries Expense 57,600
Interest Expense 1,400
Instructions
(a) From the account balances listed above and the information given below, prepare the annual adjusting entries necessary on December 31. (Omit explanations.)
(1) The equipment has an estimated life of 16 years and a salvage value of $40,000 at the end of that time. (Use straight-line method.)
(2) The note payable is a 90-day note given to the bank October 20 and bearing interest at 10%. (Use 360 days for denominator.)
(3) In December 2,000 coupon admission books were sold at $25 each. They could be used for admission any time after January 1.
(4) Advertising expense paid in advance and included in Advertising Expense $1,100.
(5) Salaries accrued but unpaid $4,700.
(b) What amounts should be shown for each of the following on the income statement for the year?
(1) Interest expense. (3) Advertising expense.
(2) Admissions revenue. (4) Salaries expense.
Click here for the solution: (Adjusting Entries) The accounts listed on the next page appeared in the December 31 trial balance of the Jane Alexander Theater
Debit Credit
Equipment $192,000
Accumulated Depreciation—Equipment $ 60,000
Notes Payable 90,000
Admissions Revenue 380,000
Advertising Expense 13,680
Salaries Expense 57,600
Interest Expense 1,400
Instructions
(a) From the account balances listed above and the information given below, prepare the annual adjusting entries necessary on December 31. (Omit explanations.)
(1) The equipment has an estimated life of 16 years and a salvage value of $40,000 at the end of that time. (Use straight-line method.)
(2) The note payable is a 90-day note given to the bank October 20 and bearing interest at 10%. (Use 360 days for denominator.)
(3) In December 2,000 coupon admission books were sold at $25 each. They could be used for admission any time after January 1.
(4) Advertising expense paid in advance and included in Advertising Expense $1,100.
(5) Salaries accrued but unpaid $4,700.
(b) What amounts should be shown for each of the following on the income statement for the year?
(1) Interest expense. (3) Advertising expense.
(2) Admissions revenue. (4) Salaries expense.
Click here for the solution: (Adjusting Entries) The accounts listed on the next page appeared in the December 31 trial balance of the Jane Alexander Theater
(Adjusting and Closing). Presented below is the December 31 trial balance of Nancy Drew Boutique
Problem 3-9 (P3-9) (Adjusting and Closing). Presented below is the December 31 trial balance of Nancy Drew Boutique.
AND SO ON
Instructions
(a) Construct T-accounts and enter the balances shown.
(b) Prepare adjusting journal entries for the following and post to the T-accounts. (Omit explanations.)
Open additional T-accounts as necessary. (The books are closed yearly on December 31.)
(1) Bad debts are estimated to be $1,400.
(2) Furniture and equipment is depreciated based on a 6-year life (no salvage value).
(3) Insurance expired during the year $2,550.
(4) Interest accrued on notes payable $3,360.
(5) Sales salaries earned but not paid $2,400.
(6) Advertising paid in advance $700.
(7) Office supplies on hand $1,500, charged to Office Expense when purchased.
(c) Prepare closing entries and post to the accounts.
Click here for the solution: (Adjusting and Closing). Presented below is the December 31 trial balance of Nancy Drew Boutique.
AND SO ON
Instructions
(a) Construct T-accounts and enter the balances shown.
(b) Prepare adjusting journal entries for the following and post to the T-accounts. (Omit explanations.)
Open additional T-accounts as necessary. (The books are closed yearly on December 31.)
(1) Bad debts are estimated to be $1,400.
(2) Furniture and equipment is depreciated based on a 6-year life (no salvage value).
(3) Insurance expired during the year $2,550.
(4) Interest accrued on notes payable $3,360.
(5) Sales salaries earned but not paid $2,400.
(6) Advertising paid in advance $700.
(7) Office supplies on hand $1,500, charged to Office Expense when purchased.
(c) Prepare closing entries and post to the accounts.
Click here for the solution: (Adjusting and Closing). Presented below is the December 31 trial balance of Nancy Drew Boutique.
(Preparation of a Balance Sheet) Presented below is the trial balance of John Nalezny Corporation at December 31, 2007
Exercise 5-12 (E5-12) (Preparation of a Balance Sheet) Presented below
is the trial balance of John Nalezny Corporation at December 31, 2007.
AND SO ON
Instructions
Prepare a balance sheet at December 31, 2007, for John Nalezny Corporation. Ignore income taxes.
Click here for the solution: (Preparation of a Balance Sheet) Presented below is the trial balance of John Nalezny Corporation at December 31, 2007
AND SO ON
Instructions
Prepare a balance sheet at December 31, 2007, for John Nalezny Corporation. Ignore income taxes.
Click here for the solution: (Preparation of a Balance Sheet) Presented below is the trial balance of John Nalezny Corporation at December 31, 2007
Wednesday, June 17, 2015
(Comprehensive Accounting Cycle Problem) The following trial balance was prepared for Gifts, Etc., Inc., on December 31, 2010, after the closing entries were posted
Problem 5-26 Comprehensive Accounting Cycle Problem (Uses Percent of Revenue Allowance Method)
The following trial balance was prepared for Gifts, Etc., Inc., on December 31, 2010, after the closing entries were posted.
AND SO ON
Required
a. Organize the transaction data in accounts under an accounting equation.
b. Prepare an income statement, a statement of changes in stockholders' equity, a balance sheet, and a statement of cash flows for 2011.
Check:
Net Income: $236,710
Total Assets: 1,142,950
Click here for the solution: (Comprehensive Accounting Cycle Problem) The following trial balance was prepared for Gifts, Etc., Inc., on December 31, 2010, after the closing entries were posted
The following trial balance was prepared for Gifts, Etc., Inc., on December 31, 2010, after the closing entries were posted.
AND SO ON
Required
a. Organize the transaction data in accounts under an accounting equation.
b. Prepare an income statement, a statement of changes in stockholders' equity, a balance sheet, and a statement of cash flows for 2011.
Check:
Net Income: $236,710
Total Assets: 1,142,950
Click here for the solution: (Comprehensive Accounting Cycle Problem) The following trial balance was prepared for Gifts, Etc., Inc., on December 31, 2010, after the closing entries were posted
Saturday, May 9, 2015
P3-6 Presented below are the trial balance and the other information related to Carlos Beltran, a consulting engineer
Problem 3-6 (P3-6) Presented below are the trial balance and the other information related to Carlos Beltran, a consulting engineer.
AND SO ON
Instructions
(a) From the trial balance and other information given, prepare annual adjusting entries as of December 31, 2007. (Omit explanations.)
(b) Prepare an income statement for 2007, a classified balance sheet, and a statement of owner’s equity. Carlos Beltran withdrew $17,000 cash for personal use during the year.
Click here for the solution: P3-6 Presented below are the trial balance and the other information related to Carlos Beltran, a consulting engineer
AND SO ON
Instructions
(a) From the trial balance and other information given, prepare annual adjusting entries as of December 31, 2007. (Omit explanations.)
(b) Prepare an income statement for 2007, a classified balance sheet, and a statement of owner’s equity. Carlos Beltran withdrew $17,000 cash for personal use during the year.
Click here for the solution: P3-6 Presented below are the trial balance and the other information related to Carlos Beltran, a consulting engineer
ACC 225 Week Nine (Week 9) Solution
ACC 225
Week Nine (Week 9) Solution
Final Project: Comprehensive Problem-Perpetual
• Resources: Appendix A, Fundamental Accounting Principles, p. 301, and Appendix C
• Due Date: Day 7 [Individual] forum
• Complete the Comprehensive Problem-Perpetual. In this project, follow the steps of the accounting cycle to process given transactions in a business environment. Then, synthesize special journals, a trial balance, financial statements, and a post-closing trial balance.
• Use the spreadsheet in Appendix C available on aXcess to complete the problems. Be sure to use the tabs labeled P07C and Given P07C.
• Post your answers as an attachment.
Colo Company
Click here for the solution: ACC 225 Week Nine (Week 9) Solution
Final Project: Comprehensive Problem-Perpetual
• Resources: Appendix A, Fundamental Accounting Principles, p. 301, and Appendix C
• Due Date: Day 7 [Individual] forum
• Complete the Comprehensive Problem-Perpetual. In this project, follow the steps of the accounting cycle to process given transactions in a business environment. Then, synthesize special journals, a trial balance, financial statements, and a post-closing trial balance.
• Use the spreadsheet in Appendix C available on aXcess to complete the problems. Be sure to use the tabs labeled P07C and Given P07C.
• Post your answers as an attachment.
Colo Company
Click here for the solution: ACC 225 Week Nine (Week 9) Solution
Friday, May 1, 2015
The General's Favorite Fishing Hole - Period 1
Comprehensive Problem. Heintz and Parry. College Accounting 19th Edition and 20th Edition
PERIOD 1
The Account Cycle
Bob Night opened "The General's Favorite Fishing Hole". The fishing camp is open from April through September and attracts many famous college basketball coaches during the off-season. Guests typically register for one week, arriving on Sunday afternoon and returning home the following Saturday afternoon. The registration fee includes room and board, the use of fishing boats, and professional instruction in fishing techniques. The chart of accounts for the camping operations is provided below.
The General's Favorite Fishing Hole Chart of Account.
Assets Revenues
101 cash 401 Registration fees
142 Office Supplies
144 Food Supplies Expenses
145 Prepaid Insurance 511 Wages Expense
181 Fishing Boat 521 Rent Expense
181.1 Accum. Depr-Fishing Boats 523 Office Supplice Expense
524 Food Supplice Expense
Liabilities 525 Telephone Expense
202 Account Payable 533 utilities Expense
219 Wages Payable 535 Insurance Expense
536 pastage Expense
Owner's Equuity 542 Depr. Exp-Fishing Boats
311 Bob Night Payable
312 Bob Night Drawing
313 Income Summary
The following transactions took place during April 20--
April
1 Night invested cash in the business $90,000.
1 Paid insurance premium for camping season, 9,000.
2 Paid rent for lodge and campgrounds for the month of April, $40,000.
2 Deposited registration fee, $35,000
2 Purchase ten fishing boats on account for $60,000. The boats have estimated useful
lives of five years, at which time they will be donated to a local day camp. Arrangement
were made to pay for the boats in July.
3 Purchase food supplies from Acme Super Market on account, $7,000.
5 Purchase office supplies from Gordon Office Supplies on account, $500.
7 Deposited registration fee, $38,600.
10 Purchased food supplies from Acme Super Market on account, $8,200
10 Paid wages to fishing guides, $10,000
14 Deposited registration fees, $30,500
16 Purchased food supplies from Acme Super Market on account, $9,000
17 Paid wages to fishing guides, $10,000
18 Paid postage , $150.
21 Deposited registration fees, $35,600
24 Purchased food supplies from Acme Super Market on account, $8,500
24 Paid wages to fishing guides, $10,000
28 Deposited registration fees, $32,000.
29 Paid wages to fishing guides, $10,000
30 Purchased food supplies from Acme Super Market on account, $6,000.
30 Paid Acme Super market on account ,$32,700.
30 Paid utilities bill, $2,000.
30 Paid telephone bill, $1,200.
30 Bob Night withdrew cash for personal use, $6,000
Adjustment information for the end of April is provided below.
a Office supplies remaining on hand, $100.
b Food supplies remaining on hand, $8,000.
c Insurance expired during the month of April, $1,500.
d Depreciation on the fishing boatsfor the month of April, $1,000.
e Wages earned , but not yet paid, at the end of April, $500.
Required:
1 Enter the above transactions in a general journal. Enter transactions from April 1-5 on pages 1, April 7-8 on page 2, April 21-29 and the first two entries for April 30 on page 3, and the remain entries for April 30 on page 4.
2 Post the entries to the general ledger.(if you are not using the working papers that accompany this text, you will need to enter the account titles and account numbers in the general leger accounts).
3 Prepare a trial balance on a work sheet.
4 Complete the work sheet.
5 Prepare the income statement.
6 Prepare the statement of owner's equity
7 Prepare the balance sheet.
8 Journalise the adjusting entries (page 5)
9 Post the adjusting entries to the general ledger.
10 Journalise the closing entries (page 5 and 6)
11 Post the closing entries to the general ledger.
12 Prepare a post-closing trial balance.
PERIOD 1
The Account Cycle
Bob Night opened "The General's Favorite Fishing Hole". The fishing camp is open from April through September and attracts many famous college basketball coaches during the off-season. Guests typically register for one week, arriving on Sunday afternoon and returning home the following Saturday afternoon. The registration fee includes room and board, the use of fishing boats, and professional instruction in fishing techniques. The chart of accounts for the camping operations is provided below.
The General's Favorite Fishing Hole Chart of Account.
Assets Revenues
101 cash 401 Registration fees
142 Office Supplies
144 Food Supplies Expenses
145 Prepaid Insurance 511 Wages Expense
181 Fishing Boat 521 Rent Expense
181.1 Accum. Depr-Fishing Boats 523 Office Supplice Expense
524 Food Supplice Expense
Liabilities 525 Telephone Expense
202 Account Payable 533 utilities Expense
219 Wages Payable 535 Insurance Expense
536 pastage Expense
Owner's Equuity 542 Depr. Exp-Fishing Boats
311 Bob Night Payable
312 Bob Night Drawing
313 Income Summary
The following transactions took place during April 20--
April
1 Night invested cash in the business $90,000.
1 Paid insurance premium for camping season, 9,000.
2 Paid rent for lodge and campgrounds for the month of April, $40,000.
2 Deposited registration fee, $35,000
2 Purchase ten fishing boats on account for $60,000. The boats have estimated useful
lives of five years, at which time they will be donated to a local day camp. Arrangement
were made to pay for the boats in July.
3 Purchase food supplies from Acme Super Market on account, $7,000.
5 Purchase office supplies from Gordon Office Supplies on account, $500.
7 Deposited registration fee, $38,600.
10 Purchased food supplies from Acme Super Market on account, $8,200
10 Paid wages to fishing guides, $10,000
14 Deposited registration fees, $30,500
16 Purchased food supplies from Acme Super Market on account, $9,000
17 Paid wages to fishing guides, $10,000
18 Paid postage , $150.
21 Deposited registration fees, $35,600
24 Purchased food supplies from Acme Super Market on account, $8,500
24 Paid wages to fishing guides, $10,000
28 Deposited registration fees, $32,000.
29 Paid wages to fishing guides, $10,000
30 Purchased food supplies from Acme Super Market on account, $6,000.
30 Paid Acme Super market on account ,$32,700.
30 Paid utilities bill, $2,000.
30 Paid telephone bill, $1,200.
30 Bob Night withdrew cash for personal use, $6,000
Adjustment information for the end of April is provided below.
a Office supplies remaining on hand, $100.
b Food supplies remaining on hand, $8,000.
c Insurance expired during the month of April, $1,500.
d Depreciation on the fishing boatsfor the month of April, $1,000.
e Wages earned , but not yet paid, at the end of April, $500.
Required:
1 Enter the above transactions in a general journal. Enter transactions from April 1-5 on pages 1, April 7-8 on page 2, April 21-29 and the first two entries for April 30 on page 3, and the remain entries for April 30 on page 4.
2 Post the entries to the general ledger.(if you are not using the working papers that accompany this text, you will need to enter the account titles and account numbers in the general leger accounts).
3 Prepare a trial balance on a work sheet.
4 Complete the work sheet.
5 Prepare the income statement.
6 Prepare the statement of owner's equity
7 Prepare the balance sheet.
8 Journalise the adjusting entries (page 5)
9 Post the adjusting entries to the general ledger.
10 Journalise the closing entries (page 5 and 6)
11 Post the closing entries to the general ledger.
12 Prepare a post-closing trial balance.
Click here for the solution: The General's Favorite Fishing Hole - Period 1
Tuesday, April 28, 2015
Benjamin O'Henry has owned and operated O'Henry's Data Services since its beginning ten years ago
Benjamin O'Henry has owned and operated O'Henry's Data Services since
its beginning ten years ago. From all appearances, the business has
prospered. In the past few years, you have become friends with O'Henry
and his wife. Recently, O'Henry mentioned that he has lost his zest for
the business and would consider selling it for the right price. You are
interested in buying this business, and you obtain its most recent
monthly unadjusted trial balance which follows:
O'Henry's Data Services
O'Henry's Data Services
Unadjusted Trial Balance
November 30, 20XX
Cash……………………………… $9,700
Accounts receivable……………………… 7,900
Prepaid expenses………… 2,600
Furniture, fixtures, & equipment 151,300
Accumulated depreciation $15,600
Accounts payable………… 3,800
Salary payable………………
Unearned service revenue 6,700
Benjamin O'Henry, capital 137,400
Benjamin O'Henry, withdrawals 2,000
Service revenue………… 14,300
Rent expense……………
Salary expense………… 3,400
Utilities expense……… 900
Depreciation expense
Supplies expense……
Total…………………………………………. $177,800 $177,800
Revenues and expenses vary little from month to month, and November is a typical month. Your investigation reveals that the unadjusted trial balance does not include the effects of monthly revenues of $2,100 and monthly expenses totaling $2,750. If you were to buy O'Henry's Data Services, you would hire a manager who would require a monthly salary of $3,000.
The most you would pay for the business is 20 times the monthly net income you could expect to earn from it. Compute this possible price. The least O'Henry will take for the business is his ending capital. Compute this amount. Under these conditions, how much should you offer O'Henry? Give your reason.
Click here for the solution: Benjamin O'Henry has owned and operated O'Henry's Data Services since its beginning ten years ago
Cash……………………………… $9,700
Accounts receivable……………………… 7,900
Prepaid expenses………… 2,600
Furniture, fixtures, & equipment 151,300
Accumulated depreciation $15,600
Accounts payable………… 3,800
Salary payable………………
Unearned service revenue 6,700
Benjamin O'Henry, capital 137,400
Benjamin O'Henry, withdrawals 2,000
Service revenue………… 14,300
Rent expense……………
Salary expense………… 3,400
Utilities expense……… 900
Depreciation expense
Supplies expense……
Total…………………………………………. $177,800 $177,800
Revenues and expenses vary little from month to month, and November is a typical month. Your investigation reveals that the unadjusted trial balance does not include the effects of monthly revenues of $2,100 and monthly expenses totaling $2,750. If you were to buy O'Henry's Data Services, you would hire a manager who would require a monthly salary of $3,000.
The most you would pay for the business is 20 times the monthly net income you could expect to earn from it. Compute this possible price. The least O'Henry will take for the business is his ending capital. Compute this amount. Under these conditions, how much should you offer O'Henry? Give your reason.
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