CH19 - Problem 1 -- Statement of Activities—Hospital
The following events were recorded on the books of Mercy Hospital for the year ended December 31, 2008.
1. Revenue from patient services totaled $16,000,000. The allowance for uncollectibles was established at $3,400,000. Of the $16,000,000 revenue, $6,000,000 was recognized under cost reimbursement agreements. This revenue is subject to audit and retroactive adjustment by third-party payers (estimated adjustments are included in the allowance account).
2. Patient service revenue is accounted for at established rates on the accrual basis.
3. Other operating revenue totaled $346,000, of which $160,000 was from specific purpose funds.
4. Mercy received $410,000 in unrestricted gifts and bequests. They are recorded at fair market value when received.
5. Endowment funds earned $160,000 in unrestricted income.
6. Board designated funds earned $82,000 in income.
7. Mercy’s operating expenses for the year amounted to $13,370,000. This included $500,000 in straight-line depreciation.
Prepare a statement of activities for Mercy Hospital for the year ended December 31, 2008.
Click here for the solution: The following events were recorded on the books of Mercy Hospital for the year ended December 31, 2008
Showing posts with label books. Show all posts
Showing posts with label books. Show all posts
Wednesday, October 14, 2015
Sunday, September 27, 2015
Accounts are listed below for a foreign subsidiary that maintains its books in its local currency
Exercise 13-1 Identifying the Exchange Rate
Accounts are listed below for a foreign subsidiary that maintains its books in its local currency. The equity interest in the subsidiary was acquired in a purchase transaction. In the space provided, indicate the exchange rate that would be used to translate the accounts into dollars assuming that the functional currency was identified (a) as the U.S. dollar and (b) as the foreign entity’s local currency. Use the following letters to identify the exchange rate:
H—historical exchange rate
C—current exchange rate
A—average exchange rate for the current period
Exchange Rate if the
Functional Currency Is:
Account U.S. Dollar Local Currency
Cash _____ __________
Accounts receivable _____ __________
Inventory carried at cost _____ __________
Inventory carried at market _____ __________
Prepaid rent _____ __________
Property, plant, and equipment _____ __________
Goodwill _____ __________
Accounts payable _____ __________
Bonds payable _____ __________
Unamortized premium on bonds payable _____ __________
Preferred stock carried at issuance price _____ __________
Common stock _____ __________
Sales _____ __________
Cost of goods sold _____ __________
Depreciation expense
Click here for the solution: Accounts are listed below for a foreign subsidiary that maintains its books in its local currency
Accounts are listed below for a foreign subsidiary that maintains its books in its local currency. The equity interest in the subsidiary was acquired in a purchase transaction. In the space provided, indicate the exchange rate that would be used to translate the accounts into dollars assuming that the functional currency was identified (a) as the U.S. dollar and (b) as the foreign entity’s local currency. Use the following letters to identify the exchange rate:
H—historical exchange rate
C—current exchange rate
A—average exchange rate for the current period
Exchange Rate if the
Functional Currency Is:
Account U.S. Dollar Local Currency
Cash _____ __________
Accounts receivable _____ __________
Inventory carried at cost _____ __________
Inventory carried at market _____ __________
Prepaid rent _____ __________
Property, plant, and equipment _____ __________
Goodwill _____ __________
Accounts payable _____ __________
Bonds payable _____ __________
Unamortized premium on bonds payable _____ __________
Preferred stock carried at issuance price _____ __________
Common stock _____ __________
Sales _____ __________
Cost of goods sold _____ __________
Depreciation expense
Click here for the solution: Accounts are listed below for a foreign subsidiary that maintains its books in its local currency
In each of the following independent cases the company closes its books on December 31
Problem: P14-5 -- Reporting Liabilities (Comprehensive Bond Problem)
In each of the following independent cases the company closes its books on December 31.
1. Sanford Co. sells $500,000 of 10% bonds on March 1, 2010. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2013. The bonds yield 12%. Give entries through December 31, 2011.
2. Titania Co. sells $400,000 of 12% bonds on June 1, 2010. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2014. The bonds yield 10%. On October 1, 2011. Titania buys back $120,000 worth of bonds for $126,000 (includes accrued interest). Give entries through December 1, 2012.
Instructions
(Round to the nearest dollar.)
For the two cases prepare all of the relevant journal entries from the time of sale until the date indicated. Use the effective-interest method for discount and premium amortization (construct amortization tables where applicable). Amortize premium or discount on interest dates and at year-end. (Assume that no reversing entries were made.)
Click here for the solution: In each of the following independent cases the company closes its books on December 31
In each of the following independent cases the company closes its books on December 31.
1. Sanford Co. sells $500,000 of 10% bonds on March 1, 2010. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2013. The bonds yield 12%. Give entries through December 31, 2011.
2. Titania Co. sells $400,000 of 12% bonds on June 1, 2010. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2014. The bonds yield 10%. On October 1, 2011. Titania buys back $120,000 worth of bonds for $126,000 (includes accrued interest). Give entries through December 1, 2012.
Instructions
(Round to the nearest dollar.)
For the two cases prepare all of the relevant journal entries from the time of sale until the date indicated. Use the effective-interest method for discount and premium amortization (construct amortization tables where applicable). Amortize premium or discount on interest dates and at year-end. (Assume that no reversing entries were made.)
Click here for the solution: In each of the following independent cases the company closes its books on December 31
Friday, September 25, 2015
Mendosa Company closes its books monthly
Problem 9-6A (P9-6A) Mendosa Company closes its books monthly. On September 30, selected ledger account balances are:
Notes Receivable $33,000
Interest Receivable $ 170
Notes Receivable include the following.
Date Maker Face Term Interest
Aug. 16th Chang. Inc $8,000 60 days 8%
Aug. 25th Hughey Co. $9,000 60 days 10%
Sept. 30th Skinner Corp $16,000 6 months 9%
Interest is computed using a 360-day year. During October, the following transactions were completed.
Oct 7 Made sales of $6,900 on Mendosa credit cards
12 Made sales of $900 on MasterCard Credit cards. The credit card service charge is 3%.
15 Added $460 to Mendosa customer balance for finance charges on unpaid balances
15 Received payment in full from Chang Inc. on the amount due
24 Received notice that the Hughey note has been dishonored. (assume that Hughey is expected to pay in the future)
Instructions
(a) Journalize the October transactions and the October 31 adjusting entry for accrued interest receivable
(b) Enter the balances at October 1 in the receivable accounts. Post the entries to all of the receivable accounts.
(c) Show the balance sheet presentation of the receivable accounts at October 31
Click here for the solution: Mendosa Company closes its books monthly
Notes Receivable $33,000
Interest Receivable $ 170
Notes Receivable include the following.
Date Maker Face Term Interest
Aug. 16th Chang. Inc $8,000 60 days 8%
Aug. 25th Hughey Co. $9,000 60 days 10%
Sept. 30th Skinner Corp $16,000 6 months 9%
Interest is computed using a 360-day year. During October, the following transactions were completed.
Oct 7 Made sales of $6,900 on Mendosa credit cards
12 Made sales of $900 on MasterCard Credit cards. The credit card service charge is 3%.
15 Added $460 to Mendosa customer balance for finance charges on unpaid balances
15 Received payment in full from Chang Inc. on the amount due
24 Received notice that the Hughey note has been dishonored. (assume that Hughey is expected to pay in the future)
Instructions
(a) Journalize the October transactions and the October 31 adjusting entry for accrued interest receivable
(b) Enter the balances at October 1 in the receivable accounts. Post the entries to all of the receivable accounts.
(c) Show the balance sheet presentation of the receivable accounts at October 31
Click here for the solution: Mendosa Company closes its books monthly
Tuesday, September 8, 2015
Goldenrod Warehouse distributes hardback books to retail stores and extends credit terms of 2/10, n/30 to all of its customers
P5-2A Goldenrod Warehouse distributes hardback books to retail stores and extends credit terms of 2/10, n/30 to all of its customers. During the month of June the following merchandising transactions occurred.
June 1 Purchased books on account for $960 (including freight) from Barnum Publishers, terms 2/10, n/30.
3 Sold books on account to the Flint Hills bookstore for $1,200 each. The cost of the merchandise sold was $720.
6 Received $60 credit for books returned to Barnum Publishers.
9 Paid Barnum Publishers in full.
15 Received payment in full from the Flint Hills bookstore.
17 Sold books on account to Town Crier Bookstore for $1,400. The cost of the merchandise sold was $840.
20 Purchased books on account for $720 from Good Book Publishers, terms 1/15, n/30.
24 Received payment in full from Town Crier Bookstore.
26 Paid Good Book Publishers in full.
28 Sold books on account to HomeTown Bookstore for $1,300. The cost of the merchandise sold was $780.
30 Granted HomeTown Bookstore $150 credit for books returned costing $90.
Instructions
Journalize the transactions for the month of June for Goldenrod Warehouse, using a perpetual inventory system.
Click here for the solution: Goldenrod Warehouse distributes hardback books to retail stores and extends credit terms of 2/10, n/30 to all of its customers
June 1 Purchased books on account for $960 (including freight) from Barnum Publishers, terms 2/10, n/30.
3 Sold books on account to the Flint Hills bookstore for $1,200 each. The cost of the merchandise sold was $720.
6 Received $60 credit for books returned to Barnum Publishers.
9 Paid Barnum Publishers in full.
15 Received payment in full from the Flint Hills bookstore.
17 Sold books on account to Town Crier Bookstore for $1,400. The cost of the merchandise sold was $840.
20 Purchased books on account for $720 from Good Book Publishers, terms 1/15, n/30.
24 Received payment in full from Town Crier Bookstore.
26 Paid Good Book Publishers in full.
28 Sold books on account to HomeTown Bookstore for $1,300. The cost of the merchandise sold was $780.
30 Granted HomeTown Bookstore $150 credit for books returned costing $90.
Instructions
Journalize the transactions for the month of June for Goldenrod Warehouse, using a perpetual inventory system.
Click here for the solution: Goldenrod Warehouse distributes hardback books to retail stores and extends credit terms of 2/10, n/30 to all of its customers
Saturday, August 22, 2015
On July 31, 2010, Fenton Company had a cash balance per books of $6,140
P4-3A On July 31, 2010, Fenton Company had a cash balance per books of $6,140. The statement from Jackson State Bank on that date showed a balance of $7,695.80. A comparison of the bank statement with the cash account revealed the following facts.
1. The bank service charge for July was $25.
2. The bank collected a note receivable of $1,500 for Fenton Company on July 15, plus $30 of interest. The bank made a $10 charge for the collection. Fenton has not accrued any interest on the note.
3. The July 31 receipts of $1,193.30 were not included in the bank deposits for July. These receipts were deposited by the company in a night deposit vault on July 31.
4. Company check No. 2480 issued to H. Coby, a creditor, for $384 that cleared the bank in July was incorrectly entered in the cash payments journal on July 10 for $348.
5. Checks outstanding on July 31 totaled $1,980.10.
6. On July 31 the bank statement showed an NSF charge of $690 for a check received by the company from P. Figura, a customer, on account.
Instructions
(a) Prepare the bank reconciliation as of July 31.
(b) Prepare the necessary adjusting entries at July 31
Check: (a) Cash bal. $6,909.00
Click here for the solution: On July 31, 2010, Fenton Company had a cash balance per books of $6,140
1. The bank service charge for July was $25.
2. The bank collected a note receivable of $1,500 for Fenton Company on July 15, plus $30 of interest. The bank made a $10 charge for the collection. Fenton has not accrued any interest on the note.
3. The July 31 receipts of $1,193.30 were not included in the bank deposits for July. These receipts were deposited by the company in a night deposit vault on July 31.
4. Company check No. 2480 issued to H. Coby, a creditor, for $384 that cleared the bank in July was incorrectly entered in the cash payments journal on July 10 for $348.
5. Checks outstanding on July 31 totaled $1,980.10.
6. On July 31 the bank statement showed an NSF charge of $690 for a check received by the company from P. Figura, a customer, on account.
Instructions
(a) Prepare the bank reconciliation as of July 31.
(b) Prepare the necessary adjusting entries at July 31
Check: (a) Cash bal. $6,909.00
Click here for the solution: On July 31, 2010, Fenton Company had a cash balance per books of $6,140
Thursday, August 13, 2015
Francis Equipment Co. closes its books regularly on December 31, but at the end of 2010 it held its cash book open
P7-1 (Determine Proper Cash Balance) Francis Equipment Co. closes its books regularly on December 31, but at the end of 2010 it held its cash book open so that a more favorable balance sheet could be prepared for credit purposes. Cash receipts and disbursements for the first 10 days of January were recorded as December transactions. The information is given on the next page.
1. January cash receipts recorded in the December cash book totaled $45,640, of which $28,000 represents cash sales, and $17,640 represents collections on account for which cash discounts of $360 were given.
2. January cash disbursements recorded in the December check register liquidated accounts payable of $22,450 on which discounts of $250 were taken.
3. The ledger has not been closed for 2010.
4. The amount shown as inventory was determined by physical count on December 31, 2010.
The company uses the periodic method of inventory.
Instructions
(a) Prepare any entries you consider necessary to correct Francis's accounts at December 31.
(b) To what extent was Francis Equipment Co. able to show a more favorable balance sheet at December 31 by holding its cash book open? (Compute working capital and the current ratio.) Assume that the balance sheet that was prepared by the company showed the following amounts:
Dr. Cr.
Cash $39,000
Receivables 42,000
Inventories 67,000
Accounts payable $45,000
Other current liabilities 14,200
Click here for the solution: Francis Equipment Co. closes its books regularly on December 31, but at the end of 2010 it held its cash book open
1. January cash receipts recorded in the December cash book totaled $45,640, of which $28,000 represents cash sales, and $17,640 represents collections on account for which cash discounts of $360 were given.
2. January cash disbursements recorded in the December check register liquidated accounts payable of $22,450 on which discounts of $250 were taken.
3. The ledger has not been closed for 2010.
4. The amount shown as inventory was determined by physical count on December 31, 2010.
The company uses the periodic method of inventory.
Instructions
(a) Prepare any entries you consider necessary to correct Francis's accounts at December 31.
(b) To what extent was Francis Equipment Co. able to show a more favorable balance sheet at December 31 by holding its cash book open? (Compute working capital and the current ratio.) Assume that the balance sheet that was prepared by the company showed the following amounts:
Dr. Cr.
Cash $39,000
Receivables 42,000
Inventories 67,000
Accounts payable $45,000
Other current liabilities 14,200
Click here for the solution: Francis Equipment Co. closes its books regularly on December 31, but at the end of 2010 it held its cash book open
Wednesday, July 15, 2015
Werth Company asks you to review its December 31, 2010, inventory values and prepare the necessary adjustments to the books
E8-5 (Inventoriable Costs—Error Adjustments) Werth Company asks you to review its December 31, 2010, inventory values and prepare the necessary adjustments to the books. The following information is given to you.
1. Werth uses the periodic method of recording inventory. A physical count reveals $234,890 of inventory on hand at December 31, 2010.
2. Not included in the physical count of inventory is $10,420 of merchandise purchased on December 15 from Browser. This merchandise was shipped f.o.b. shipping point on December 29 and arrived in January. The invoice arrived and was recorded on December 31.
3. Included in inventory is merchandise sold to Bubbey on December 30, f.o.b. destination. This merchandise was shipped after it was counted. The invoice was prepared and recorded as a sale on account for $12,800 on December 31. The merchandise cost $7,350, and Bubbey received it on January 3.
4. Included in inventory was merchandise received from Dudley on December 31 with an invoice price of $15,630. The merchandise was shipped f.o.b. destination. The invoice, which has not yet arrived, has not been recorded.
5. Not included in inventory is $8,540 of merchandise purchased from Minsky Industries. This merchandise was received on December 31 after the inventory had been counted. The invoice was received and recorded on December 30.
6. Included in inventory was $10,438 of inventory held by Werth on consignment from Jackel Industries.
7. Included in inventory is merchandise sold to Sims f.o.b. shipping point. This merchandise was shipped after it was counted. The invoice was prepared and recorded as a sale for $18,900 on December 31. The cost of this merchandise was $11,520, and Sims received the merchandise on January 5.
8. Excluded from inventory was a carton labeled “Please accept for credit.” This carton contains merchandise costing $1,500 which had been sold to a customer for $2,600. No entry had been made to the books to reflect the return, but none of the returned merchandise seemed damaged.
Instructions
(a) Determine the proper inventory balance for Werth Company at December 31, 2010.
(b) Prepare any correcting entries to adjust inventory to its proper amount at December 31, 2010. Assume the books have not been closed.
Click here for the solution: Werth Company asks you to review its December 31, 2010, inventory values and prepare the necessary adjustments to the books
1. Werth uses the periodic method of recording inventory. A physical count reveals $234,890 of inventory on hand at December 31, 2010.
2. Not included in the physical count of inventory is $10,420 of merchandise purchased on December 15 from Browser. This merchandise was shipped f.o.b. shipping point on December 29 and arrived in January. The invoice arrived and was recorded on December 31.
3. Included in inventory is merchandise sold to Bubbey on December 30, f.o.b. destination. This merchandise was shipped after it was counted. The invoice was prepared and recorded as a sale on account for $12,800 on December 31. The merchandise cost $7,350, and Bubbey received it on January 3.
4. Included in inventory was merchandise received from Dudley on December 31 with an invoice price of $15,630. The merchandise was shipped f.o.b. destination. The invoice, which has not yet arrived, has not been recorded.
5. Not included in inventory is $8,540 of merchandise purchased from Minsky Industries. This merchandise was received on December 31 after the inventory had been counted. The invoice was received and recorded on December 30.
6. Included in inventory was $10,438 of inventory held by Werth on consignment from Jackel Industries.
7. Included in inventory is merchandise sold to Sims f.o.b. shipping point. This merchandise was shipped after it was counted. The invoice was prepared and recorded as a sale for $18,900 on December 31. The cost of this merchandise was $11,520, and Sims received the merchandise on January 5.
8. Excluded from inventory was a carton labeled “Please accept for credit.” This carton contains merchandise costing $1,500 which had been sold to a customer for $2,600. No entry had been made to the books to reflect the return, but none of the returned merchandise seemed damaged.
Instructions
(a) Determine the proper inventory balance for Werth Company at December 31, 2010.
(b) Prepare any correcting entries to adjust inventory to its proper amount at December 31, 2010. Assume the books have not been closed.
Click here for the solution: Werth Company asks you to review its December 31, 2010, inventory values and prepare the necessary adjustments to the books
Monday, July 6, 2015
Speedy Printing manufactures soft cover books
Speedy Printing manufactures soft cover books. For January, the following information is available:
Budgeted market size (units) 125,000
Budgeted market share 18%
Budgeted average contribution margin per unit $1.20
Actual market size (units) 100,000
Actual market share 19%
Actual average contribution margin per unit $1.22
Required:
Compute the market-share variance, the market-size variance, and the sales-quantity variance in terms of the contribution margin.
Click here for the solution: Speedy Printing manufactures soft cover books
Budgeted market size (units) 125,000
Budgeted market share 18%
Budgeted average contribution margin per unit $1.20
Actual market size (units) 100,000
Actual market share 19%
Actual average contribution margin per unit $1.22
Required:
Compute the market-share variance, the market-size variance, and the sales-quantity variance in terms of the contribution margin.
Wednesday, June 17, 2015
(Determining and Interpreting Flexible Budget Variances) Use the standard price and cost data supplied in Problem 15-18. Assume that Holligan actually produce and sold 31,000 books
Problem 15-19 Determining and Interpreting Flexible Budget Variances
Use the standard price and cost data supplied in Problem 15-18. Assume that Holligan actually produce and sold 31,000 books. The actual sales price and costs incurred follow.
AND SO ON
Check:
Flexible Budget Variance of NI: $25,900 U
Click here for the solution: (Determining and Interpreting Flexible Budget Variances) Use the standard price and cost data supplied in Problem 15-18. Assume that Holligan actually produce and sold 31,000 books
Use the standard price and cost data supplied in Problem 15-18. Assume that Holligan actually produce and sold 31,000 books. The actual sales price and costs incurred follow.
AND SO ON
Check:
Flexible Budget Variance of NI: $25,900 U
Click here for the solution: (Determining and Interpreting Flexible Budget Variances) Use the standard price and cost data supplied in Problem 15-18. Assume that Holligan actually produce and sold 31,000 books
Subscribe to:
Posts (Atom)