P2-3A Jack Shellenkamp owns and manages a computer repair service, which had the following trial balance on December 31, 2007 (the end of its fiscal year).
BYTE REPAIR SERVICE, INC.
Trial Balance
December 31, 2007
Cash $8,000
Accounts Receivable 15,000
Parts Inventory 13,000
Prepaid Rent 3,000
Shop Equipment 21,000
Accounts Payable $19,000
Common Stock 30,000
Retained Earnings 11,000
$60,000 $60,000
Summarized transactions for January 2008 were as follows:
1. Advertising costs, paid in cash, $1,000.
2. Additional repair parts inventory acquired on account $4,000.
3. Miscellaneous expenses, paid in cash, $2,000.
4. Cash collected from customers in payment of accounts receivable $14,000.
5. Cash paid to creditors for accounts payable due $15,000.
6. Repair parts used during January $4,000. (Hint: Debit this to Repair Parts Expense.)
7. Repair services performed during January: for cash $6,000; on account $9,000.
8. Wages for January, paid in cash, $3,000.
9. Dividends paid in January were $3,000.
Instructions
(a) Prepare journal entries to record each of the January transactions.
(b) Open T accounts for each of the accounts listed in the trial balance, and enter the opening balances for 2008. Post the journal entries to the accounts in the ledger.
(c) Prepare a trial balance as of January 31, 2008.
Click here for the solution: Jack Shellenkamp owns and manages a computer repair service, which had the following trial balance on December 31, 2007
Showing posts with label fiscal. Show all posts
Showing posts with label fiscal. Show all posts
Wednesday, October 14, 2015
The trial balances before and after adjustment for Garcia Company at the end of its fiscal year is presented below
E3-13 The trial balances before and after adjustment for Garcia Company at the end of its fiscal year is presented below.
GARCIA COMPANY
Trial Balance
August 31, 2008
Before Adjustment After Adjustment
Dr. Cr. Dr. Cr.
Cash $10,400 $10,400
Accounts Receivable 8,800 9,800
Office Supplies 2,300 700
Prepaid Insurance 4,000 2,500
Office Equipment 14,000 14,000
Accumulated Depreciation–Office Equipment $3,600 $4,500
Accounts Payable 5,800 5,800
Salaries Payable -0- 1,100
Unearned Rent 1,500 600
Common Stock 10,000 10,000
Retained Earnings 5,600 5,600
Service Revenue 34,000 35,000
Rent Revenue 11,000 11,900
Salaries Expense 17,000 18,100
Office Supplies Expense -0- 1,600
Rent Expense 15,000 15,000
Insurance Expense -0- 1,500
Depreciation Expense -0- 900
$71,500 $71,500 $74,500 $74,500
Instructions
Prepare the adjusting entries that were made.
Click here for the solution: The trial balances before and after adjustment for Garcia Company at the end of its fiscal year is presented below
GARCIA COMPANY
Trial Balance
August 31, 2008
Before Adjustment After Adjustment
Dr. Cr. Dr. Cr.
Cash $10,400 $10,400
Accounts Receivable 8,800 9,800
Office Supplies 2,300 700
Prepaid Insurance 4,000 2,500
Office Equipment 14,000 14,000
Accumulated Depreciation–Office Equipment $3,600 $4,500
Accounts Payable 5,800 5,800
Salaries Payable -0- 1,100
Unearned Rent 1,500 600
Common Stock 10,000 10,000
Retained Earnings 5,600 5,600
Service Revenue 34,000 35,000
Rent Revenue 11,000 11,900
Salaries Expense 17,000 18,100
Office Supplies Expense -0- 1,600
Rent Expense 15,000 15,000
Insurance Expense -0- 1,500
Depreciation Expense -0- 900
$71,500 $71,500 $74,500 $74,500
Instructions
Prepare the adjusting entries that were made.
Click here for the solution: The trial balances before and after adjustment for Garcia Company at the end of its fiscal year is presented below
Friday, October 9, 2015
Disney Amusement Park, Inc. has a fiscal year ending on September 30
P4-4A Disney Amusement Park, Inc. has a fiscal year ending on September 30. Selected data from the September 30 worksheet are presented below.
DISNEY AMUSEMENT PARK, INC.
Worksheet
For the Year Ended September 30, 2008
Adjusted
Trial Balance Trial Balance
Dr. Cr. Dr. Cr.
Cash 41,400 41,400
Supplies 18,600 1,200
Prepaid Insurance 31,900 8,900
Land 80,000 80,000
Equipment 120,000 120,000
Accumulated Depreciation 36,200 42,200
Accounts Payable 14,600 14,600
Unearned Admissions Revenue 3,700 2,000
Mortgage Note Payable 50,000 50,000
Common Stock 100,000 100,000
Retained Earnings 9,700 9,700
Dividends 14,000 14,000
Admissions Revenue 277,500 279,200
Salaries Expense 105,000 105,000
Repair Expense 30,500 30,500
Advertising Expense 9,400 9,400
Utilities Expense 16,900 16,900
Property Taxes Expense 18,000 21,000
Interest Expense 6,000 10,000
Totals 491,700 491,700
Insurance Expense 23,000
Supplies Expense 17,400
Interest Payable 4,000
Depreciation Expense 6,000
Property Taxes Payable 3,000
Totals 504,700 504,700
Instructions
(a) Prepare a complete worksheet.
(b) Prepare a classified balance sheet. (Note: $10,000 of the mortgage note payable is due for payment in the next fiscal year.)
(c) Journalize the adjusting entries using the worksheet as a basis.
(d) Journalize the closing entries using the worksheet as a basis.
(e) Prepare a post-closing trial balance.
Click here for the solution: Disney Amusement Park, Inc. has a fiscal year ending on September 30
DISNEY AMUSEMENT PARK, INC.
Worksheet
For the Year Ended September 30, 2008
Adjusted
Trial Balance Trial Balance
Dr. Cr. Dr. Cr.
Cash 41,400 41,400
Supplies 18,600 1,200
Prepaid Insurance 31,900 8,900
Land 80,000 80,000
Equipment 120,000 120,000
Accumulated Depreciation 36,200 42,200
Accounts Payable 14,600 14,600
Unearned Admissions Revenue 3,700 2,000
Mortgage Note Payable 50,000 50,000
Common Stock 100,000 100,000
Retained Earnings 9,700 9,700
Dividends 14,000 14,000
Admissions Revenue 277,500 279,200
Salaries Expense 105,000 105,000
Repair Expense 30,500 30,500
Advertising Expense 9,400 9,400
Utilities Expense 16,900 16,900
Property Taxes Expense 18,000 21,000
Interest Expense 6,000 10,000
Totals 491,700 491,700
Insurance Expense 23,000
Supplies Expense 17,400
Interest Payable 4,000
Depreciation Expense 6,000
Property Taxes Payable 3,000
Totals 504,700 504,700
Instructions
(a) Prepare a complete worksheet.
(b) Prepare a classified balance sheet. (Note: $10,000 of the mortgage note payable is due for payment in the next fiscal year.)
(c) Journalize the adjusting entries using the worksheet as a basis.
(d) Journalize the closing entries using the worksheet as a basis.
(e) Prepare a post-closing trial balance.
Click here for the solution: Disney Amusement Park, Inc. has a fiscal year ending on September 30
Wednesday, October 7, 2015
The following transactions were completed by The Bronze gallery during the current fiscal year ended December 31
PR 9-1A The following transactions were completed by The Bronze gallery during the current fiscal year ended December 31:
June 6: Reinstated the account of Ian Netti, which had been written off in the preceding year as uncollectible. Journalized the receipt of $1945 cash in full payment of Ian's account.
July 19: Wrote off the $11,150 balance owed by Rancho Rigging Co., which is bankrupt.
August 13: Received 35% of the $20,000 balance owed by Santori Co., a bankrupt business, and wrote off the remainder as uncollectible.
Sept 2: Reinstated the account for Sheryl Capers, which had been written off 2 years earlier as uncollectible. Recorded the receipt of $3,170 cash in full payment.
Dec 31: Wrote off the following accounts as uncollectible (compound entry): Jacoba Co., $8390; Garcia Co., $2500; Summit Furniture, $6400; Jill DePuy, $1800.
Dec 31: Based on an analysis of the $960,750 of accounts receivable, it was estimated that $4200 will be uncollectible. Journalized the adjusting entry.
Instructions
1. Record the January 1 credit balance of $40000 in a T account for allowances for doubtful accounts.
2. Journalize the transactions. Post each entry that affects the following T accounts and determine new balances:
(allowance for doubtful accounts and bad debt expense) --
3. Determine the expected net realizable value of the accounts receivable as of Dec 31. --
4. Assuming that instead of basing the provision for uncollectible accounts on an estimated expense of 3/4 of 1% of the net sales of $6,000,000 for the year, determine the following: (a) bad debt expense for the year (b) balance in the allowance account after the adjustment of Dec 31 (c) expected net realizable value of the accounts receivable as of December 31
Click here for the solution: The following transactions were completed by The Bronze gallery during the current fiscal year ended December 31
June 6: Reinstated the account of Ian Netti, which had been written off in the preceding year as uncollectible. Journalized the receipt of $1945 cash in full payment of Ian's account.
July 19: Wrote off the $11,150 balance owed by Rancho Rigging Co., which is bankrupt.
August 13: Received 35% of the $20,000 balance owed by Santori Co., a bankrupt business, and wrote off the remainder as uncollectible.
Sept 2: Reinstated the account for Sheryl Capers, which had been written off 2 years earlier as uncollectible. Recorded the receipt of $3,170 cash in full payment.
Dec 31: Wrote off the following accounts as uncollectible (compound entry): Jacoba Co., $8390; Garcia Co., $2500; Summit Furniture, $6400; Jill DePuy, $1800.
Dec 31: Based on an analysis of the $960,750 of accounts receivable, it was estimated that $4200 will be uncollectible. Journalized the adjusting entry.
Instructions
1. Record the January 1 credit balance of $40000 in a T account for allowances for doubtful accounts.
2. Journalize the transactions. Post each entry that affects the following T accounts and determine new balances:
(allowance for doubtful accounts and bad debt expense) --
3. Determine the expected net realizable value of the accounts receivable as of Dec 31. --
4. Assuming that instead of basing the provision for uncollectible accounts on an estimated expense of 3/4 of 1% of the net sales of $6,000,000 for the year, determine the following: (a) bad debt expense for the year (b) balance in the allowance account after the adjustment of Dec 31 (c) expected net realizable value of the accounts receivable as of December 31
Click here for the solution: The following transactions were completed by The Bronze gallery during the current fiscal year ended December 31
Sunday, September 27, 2015
Selected transactions completed by Blackwell Company during its first fiscal year ending December 31 were as follow (Chapter 11 Comprehensive Problem 3)
Chapter 11 Comprehensive Problem 3 Selected transactions completed by Blackwell Company during its first fiscal year ending December 31 were as follow:
Jan. 2. Issued a check to establish a petty cash fund of $2,000.
Mar. 4. Replenished the petty cash fund, based on the following summary of petty cash receipts: office supplies, $789; miscellaneous selling expense, $256; miscellaneous administrative expense, $378.
AND SO ON
Click here for the solution: Selected transactions completed by Blackwell Company during its first fiscal year ending December 31 were as follow (Chapter 11 Comprehensive Problem 3)
Jan. 2. Issued a check to establish a petty cash fund of $2,000.
Mar. 4. Replenished the petty cash fund, based on the following summary of petty cash receipts: office supplies, $789; miscellaneous selling expense, $256; miscellaneous administrative expense, $378.
AND SO ON
Click here for the solution: Selected transactions completed by Blackwell Company during its first fiscal year ending December 31 were as follow (Chapter 11 Comprehensive Problem 3)
(Case-It Co) The following selected accounts and their current balances appear in the ledger of Case-It Co. for the fiscal year ended November 30, 2010
PR 6-1A The following selected accounts and their current balances appear in the ledger of Case-It Co. for the fiscal year ended November 30, 2010:
Cash $37,700 Sales Returns and Allowances $37,800
Accounts Receivable 111,600 Sale Discounts 19,800
Merchandise Inventory 180,000 Cost of Merchandise Sold 1,926,000
Office Supplies 5,000 Sales Salaries Expense 378,000
Prepaid Ins. 12,000 Advertising Expense 50,900
Office Equipment 115,200 Depreciation Exp - Store Equip 8,300
Accumulated Depreciation - Office Equip 49,500 Misc Selling Expense 2,000
Store Equipment 311,500 Office Salaries Expense 73,800
Accumulated Depreciation - Store Equip 87,500 Rent Expense 39,900
A/P 48,600 Insurance Expense 22,950
Salaries Payable 3,600 Depreciation Expense - Office Equip 16,200
Note Payable (final payment due 2025) 54,000 Office Supplies Expense 1,650
Gina Hennessy, Capital 454,800 Misc Admin Exp 1,900
Gina Hennessy, Drawing 45,000 Interest Expense 4,400
Sales 2,703,600
1. Prepare a multiple-step income statement.
2. Prepare a statement of owner's equity.
3. Prepare a report form of balance sheet, assuming that the current portion of the note payable is $8,000
4. Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report form and account form balance sheets differ.
Click here for the solution: The following selected accounts and their current balances appear in the ledger of Case-It Co. for the fiscal year ended November 30, 2010
Cash $37,700 Sales Returns and Allowances $37,800
Accounts Receivable 111,600 Sale Discounts 19,800
Merchandise Inventory 180,000 Cost of Merchandise Sold 1,926,000
Office Supplies 5,000 Sales Salaries Expense 378,000
Prepaid Ins. 12,000 Advertising Expense 50,900
Office Equipment 115,200 Depreciation Exp - Store Equip 8,300
Accumulated Depreciation - Office Equip 49,500 Misc Selling Expense 2,000
Store Equipment 311,500 Office Salaries Expense 73,800
Accumulated Depreciation - Store Equip 87,500 Rent Expense 39,900
A/P 48,600 Insurance Expense 22,950
Salaries Payable 3,600 Depreciation Expense - Office Equip 16,200
Note Payable (final payment due 2025) 54,000 Office Supplies Expense 1,650
Gina Hennessy, Capital 454,800 Misc Admin Exp 1,900
Gina Hennessy, Drawing 45,000 Interest Expense 4,400
Sales 2,703,600
1. Prepare a multiple-step income statement.
2. Prepare a statement of owner's equity.
3. Prepare a report form of balance sheet, assuming that the current portion of the note payable is $8,000
4. Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report form and account form balance sheets differ.
Click here for the solution: The following selected accounts and their current balances appear in the ledger of Case-It Co. for the fiscal year ended November 30, 2010
Friday, September 25, 2015
The transactions completed by Over-Nite Express Company during May 2010, the first month of the fiscal year, were as follows
PR 5-5A The transactions completed by Over-Nite Express Company during May 2010, the first month of the fiscal year, were as follows:
May1: Issued check no. 205 for May rent. $1000
2. Purchased a vehicle on account from McIntyre Sales Co. $22,300
3. Purchased office equipment on account from Office Mate $520
5. Issued Invoice No. 91 to Martin Co., $5,200
AND SO ON
Check: 2. Total Cash Receipts $73,230
Click here for the solution: The transactions completed by Over-Nite Express Company during May 2010, the first month of the fiscal year, were as follows
May1: Issued check no. 205 for May rent. $1000
2. Purchased a vehicle on account from McIntyre Sales Co. $22,300
3. Purchased office equipment on account from Office Mate $520
5. Issued Invoice No. 91 to Martin Co., $5,200
AND SO ON
Check: 2. Total Cash Receipts $73,230
Click here for the solution: The transactions completed by Over-Nite Express Company during May 2010, the first month of the fiscal year, were as follows
Sunday, September 20, 2015
For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data (ACC 560 Week 10 Assignment)
ACC 560 Week 10 Assignment
E14-12 For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data.
Income before income taxes $540,000
Income tax expense (30% $390,000) 117,000
Income before extraordinary items 423,000
Extraordinary loss from flood 150,000
Net income $273,000
The flood loss is considered an extraordinary item. The income tax rate is 30% on all items.
Instructions
a) Prepare a correct income statement, beginning with income before income taxes.
b) Explain in memo form why Molini's reported income statement data are incorrect
Click here for the solution: For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data (ACC 560 Week 10 Assignment)
E14-12 For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data.
Income before income taxes $540,000
Income tax expense (30% $390,000) 117,000
Income before extraordinary items 423,000
Extraordinary loss from flood 150,000
Net income $273,000
The flood loss is considered an extraordinary item. The income tax rate is 30% on all items.
Instructions
a) Prepare a correct income statement, beginning with income before income taxes.
b) Explain in memo form why Molini's reported income statement data are incorrect
Click here for the solution: For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data (ACC 560 Week 10 Assignment)
Friday, September 18, 2015
Rick Company’s beginning inventory and purchases during the fiscal year ended December 31, 2012, were as follows
7. Rick Company’s beginning inventory and purchases during the fiscal
year ended December 31, 2012, were as follows: (Note: The company uses a
perpetual system of inventory.)
Units Unit Price Total Cost
January 1—Beginning inventory 18 $24 $432
March 12—Sold 13
April 11—Purchase 45 $29 $1,305
June 20—Sold 33
Aug 16—Purchase 35 $27 $945
Sept 11—Sold 29
Total Cost of Inventory
Ending inventory is 23 units. $2,682
What is the cost of goods sold for Rick Company for 2012 using LIFO?
Click here for the solution: Rick Company’s beginning inventory and purchases during the fiscal year ended December 31, 2012, were as follows
Units Unit Price Total Cost
January 1—Beginning inventory 18 $24 $432
March 12—Sold 13
April 11—Purchase 45 $29 $1,305
June 20—Sold 33
Aug 16—Purchase 35 $27 $945
Sept 11—Sold 29
Total Cost of Inventory
Ending inventory is 23 units. $2,682
What is the cost of goods sold for Rick Company for 2012 using LIFO?
Click here for the solution: Rick Company’s beginning inventory and purchases during the fiscal year ended December 31, 2012, were as follows
For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data
E15-12 For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data.
Income before income taxes $540,000
Income tax expense (30% $390,000) 117,000
Income before extraordinary items 423,000
Extraordinary loss from flood 150,000
Net income $273,000
The flood loss is considered an extraordinary item. The income tax rate is 30% on all items.
Instructions
a) Prepare a correct income statement, beginning with income before income taxes.
b) Explain in memo form why Molini's reported income statement data are incorrect
Click here for the solution: For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data
Income before income taxes $540,000
Income tax expense (30% $390,000) 117,000
Income before extraordinary items 423,000
Extraordinary loss from flood 150,000
Net income $273,000
The flood loss is considered an extraordinary item. The income tax rate is 30% on all items.
Instructions
a) Prepare a correct income statement, beginning with income before income taxes.
b) Explain in memo form why Molini's reported income statement data are incorrect
Click here for the solution: For its fiscal year ending October 31, 2008, Molini Corporation reports the following partial data
Friday, September 11, 2015
Selected transactions completed by Everyday Products Inc. during the fiscal year ending December 31, 2012, were as follows
Chapter 15, Comprehensive Problem 4, 24th EDITION
Selected transactions completed by Everyday Products Inc. during the fiscal year ending December 31, 2012, were as follows:
AND SO ON
Click here for the solution: Selected transactions completed by Everyday Products Inc. during the fiscal year ending December 31, 2012, were as follows
Selected transactions completed by Everyday Products Inc. during the fiscal year ending December 31, 2012, were as follows:
AND SO ON
Click here for the solution: Selected transactions completed by Everyday Products Inc. during the fiscal year ending December 31, 2012, were as follows
Thursday, September 10, 2015
The Baker Independent School District passed an appropriations ordinance for the General Fund for a certain fiscal year in the amount of $50 million
3–5. The Baker Independent School District passed an appropriations ordinance for the General Fund for a certain fiscal year in the amount of $50 million. Revenues were anticipated from sources other than the property tax in the amount of $24 million. The total assessed value of property in the school district amounts to $600 million. Owners of property have filed for and received household, old age, and other exemptions in the amount of $80 million. It is anticipated that 2 percent of the assessed taxes will not be collected.
a. Compute the amount to be raised from property taxes.
b. Compute the gross levy required to raise revenue in the amount you computed for requirement (a). Round the computation to the nearest dollar.
c. Compute the property tax rate per $100 net assessed valuation.
d. Compute the property tax rate per $1,000 net assessed valuation (this rate is often called the millage). Round fractional cents to the next higher whole cent.
e. You own a home with an assessed valuation of $60,000. You are eligible for a homestead exemption of $2,000; deduct this amount from the gross assessed valuation to determine the net assessed valuation (NAV) of your house. Multiply the NAV in thousands of dollars by the property tax rate computed in part (d) of this problem to determine the property tax payable
on your house.
Click here for the solution: The Baker Independent School District passed an appropriations ordinance for the General Fund for a certain fiscal year in the amount of $50 million
a. Compute the amount to be raised from property taxes.
b. Compute the gross levy required to raise revenue in the amount you computed for requirement (a). Round the computation to the nearest dollar.
c. Compute the property tax rate per $100 net assessed valuation.
d. Compute the property tax rate per $1,000 net assessed valuation (this rate is often called the millage). Round fractional cents to the next higher whole cent.
e. You own a home with an assessed valuation of $60,000. You are eligible for a homestead exemption of $2,000; deduct this amount from the gross assessed valuation to determine the net assessed valuation (NAV) of your house. Multiply the NAV in thousands of dollars by the property tax rate computed in part (d) of this problem to determine the property tax payable
on your house.
Click here for the solution: The Baker Independent School District passed an appropriations ordinance for the General Fund for a certain fiscal year in the amount of $50 million
Sunday, September 6, 2015
Following are transactions and events of the General Fund of the City of Springfield for the fiscal year ended December 30, 2012
3-12 Following are transactions and events of the General Fund of the City of Springfield for the fiscal year ended December 30, 2012.
1. Estimated revenues (legally budgeted)
Property taxes $5,000,000
Sales taxes 4,000,000
Licenses and permits 1,500,000
Miscellaneous 500,000
2. Appropriations
General government 5,000,000
Culture and recreation 4,500,000
Health and welfare 1,000,000
3. Revenues received (cash)
Property taxes $4,783,541
Sales taxes 4,501,009
Licenses and permits 1,700,000
Miscellaneous 800,000
4. Encumbrances issued (includes salaries and other recurring items)
Estimated
General government 5,100,000
Culture and recreation 4,650,000
Health and welfare 905,000
5. Goods and services received (paid in cash)
Estimated Actual
General government 5,100,000 $5,035,450
Culture and recreation 4,650,000 4,610,000
Health and welfare 905,000 891,550
6. Budget revisions
Increase appropriations:
General government $100,000
Culture and recreation 150,000
7. Fund balance-Unrestricted on January 1 , 2012, was $735,000. There were no outstanding encumbrances at that date.
A. Record the transactions using the appropriate journal entries.
B. Prepare a budgetary comparison schedule for the General Fund.
Click here for the solution: Following are transactions and events of the General Fund of the City of Springfield for the fiscal year ended December 30, 2012
1. Estimated revenues (legally budgeted)
Property taxes $5,000,000
Sales taxes 4,000,000
Licenses and permits 1,500,000
Miscellaneous 500,000
2. Appropriations
General government 5,000,000
Culture and recreation 4,500,000
Health and welfare 1,000,000
3. Revenues received (cash)
Property taxes $4,783,541
Sales taxes 4,501,009
Licenses and permits 1,700,000
Miscellaneous 800,000
4. Encumbrances issued (includes salaries and other recurring items)
Estimated
General government 5,100,000
Culture and recreation 4,650,000
Health and welfare 905,000
5. Goods and services received (paid in cash)
Estimated Actual
General government 5,100,000 $5,035,450
Culture and recreation 4,650,000 4,610,000
Health and welfare 905,000 891,550
6. Budget revisions
Increase appropriations:
General government $100,000
Culture and recreation 150,000
7. Fund balance-Unrestricted on January 1 , 2012, was $735,000. There were no outstanding encumbrances at that date.
A. Record the transactions using the appropriate journal entries.
B. Prepare a budgetary comparison schedule for the General Fund.
Click here for the solution: Following are transactions and events of the General Fund of the City of Springfield for the fiscal year ended December 30, 2012
Monday, August 17, 2015
Comprehensive Problem 3 Selected transactions completed by Gampfer Company during its first fiscal year ending December 31 were as follows
Comprehensive Problem 3 Selected transactions completed by Gampfer Company during its first fiscal year ending December 31 were as follows:
Jan. 2. Issued a check to establish a petty cash fund of $3,200.
Mar. 14. Replenished the petty cash fund, based on the following summary of petty cash receipts: office supplies, $1,200; miscellaneous selling expense, $410; miscellaneous administrative expense, $620.
Apr. 21. Purchased $22,400 of merchandise on account, terms 1/10, n/30. The perpetual inventory system is used to account for inventory.
May 20. Paid the invoice of April 21 after the discount period had passed.
23. Received cash from daily cash sales for $15,120. The amount indicated by the cash register was $15,152.
June 15. Received a 60-day, 10% note for $127,500 on the Cady account.
AND SO ON
Check figures:
Current assets: 839,080
Total assets: 2,550,840
Current liabilities: 497,640
Click here for the solution: Comprehensive Problem 3 Selected transactions completed by Gampfer Company during its first fiscal year ending December 31 were as follows
Jan. 2. Issued a check to establish a petty cash fund of $3,200.
Mar. 14. Replenished the petty cash fund, based on the following summary of petty cash receipts: office supplies, $1,200; miscellaneous selling expense, $410; miscellaneous administrative expense, $620.
Apr. 21. Purchased $22,400 of merchandise on account, terms 1/10, n/30. The perpetual inventory system is used to account for inventory.
May 20. Paid the invoice of April 21 after the discount period had passed.
23. Received cash from daily cash sales for $15,120. The amount indicated by the cash register was $15,152.
June 15. Received a 60-day, 10% note for $127,500 on the Cady account.
AND SO ON
Check figures:
Current assets: 839,080
Total assets: 2,550,840
Current liabilities: 497,640
Click here for the solution: Comprehensive Problem 3 Selected transactions completed by Gampfer Company during its first fiscal year ending December 31 were as follows
Friday, August 14, 2015
The following transactions were completed by Axiom Management Company during the current fiscal year ended December 31
PR 9-1A Entries related to uncollectible accounts
The following transactions were completed by Axiom Management Company during the current fiscal year ended December 31:
Feb. 17. Received 25% of the $30,000 balance owed by Gillespie Co., a bankrupt business, and wrote off the remainder as uncollectible.
Apr. 11. Reinstated the account of Colleen Bertram, which had been written off in the preceding year as uncollectible. Journalized the receipt of $4,250 cash in full payment of Colleen’s account.
July 6. Wrote off the $9,000 balance owed by Covered Wagon Co., which has no assets.
Nov. 20. Reinstated the account of Dugan Co., which had been written off in the preceding year as uncollectible. Journalized the receipt of $5,900 cash in full payment of the account.
Dec. 31. Wrote off the following accounts as uncollectible (compound entry): Kipp Co., $3,000; Moore Co., $4,000; Butte Distributors, $8,000; Parker Towers, $6,700.
31. Based on an analysis of the $1,200,000 of accounts receivable, it was estimated that $60,000 will be uncollectible. Journalized the adjusting entry.
Instructions
1. Record the January 1 credit balance of $40,000 in a T account for Allowance for Doubtful Accounts.
2. Journalize the transactions. Post each entry that affects the following selected T accounts and determine the new balances:
Allowance for Doubtful Accounts
Bad Debt Expense
3. Determine the expected net realizable value of the accounts receivable as of December 31.
4. Assuming that instead of basing the provision for uncollectible accounts on an analysis of receivables, the adjusting entry on December 31 had been based on an estimated expense of ¾ of 1% of the net sales of $7,500,000 for the year, determine the following:
a. Bad debt expense for the year.
b. Balance in the allowance account after the adjustment of December 31.
c. Expected net realizable value of the accounts receivable as of December 31.
Click here for the solution: The following transactions were completed by Axiom Management Company during the current fiscal year ended December 31
The following transactions were completed by Axiom Management Company during the current fiscal year ended December 31:
Feb. 17. Received 25% of the $30,000 balance owed by Gillespie Co., a bankrupt business, and wrote off the remainder as uncollectible.
Apr. 11. Reinstated the account of Colleen Bertram, which had been written off in the preceding year as uncollectible. Journalized the receipt of $4,250 cash in full payment of Colleen’s account.
July 6. Wrote off the $9,000 balance owed by Covered Wagon Co., which has no assets.
Nov. 20. Reinstated the account of Dugan Co., which had been written off in the preceding year as uncollectible. Journalized the receipt of $5,900 cash in full payment of the account.
Dec. 31. Wrote off the following accounts as uncollectible (compound entry): Kipp Co., $3,000; Moore Co., $4,000; Butte Distributors, $8,000; Parker Towers, $6,700.
31. Based on an analysis of the $1,200,000 of accounts receivable, it was estimated that $60,000 will be uncollectible. Journalized the adjusting entry.
Instructions
1. Record the January 1 credit balance of $40,000 in a T account for Allowance for Doubtful Accounts.
2. Journalize the transactions. Post each entry that affects the following selected T accounts and determine the new balances:
Allowance for Doubtful Accounts
Bad Debt Expense
3. Determine the expected net realizable value of the accounts receivable as of December 31.
4. Assuming that instead of basing the provision for uncollectible accounts on an analysis of receivables, the adjusting entry on December 31 had been based on an estimated expense of ¾ of 1% of the net sales of $7,500,000 for the year, determine the following:
a. Bad debt expense for the year.
b. Balance in the allowance account after the adjustment of December 31.
c. Expected net realizable value of the accounts receivable as of December 31.
Click here for the solution: The following transactions were completed by Axiom Management Company during the current fiscal year ended December 31
Tuesday, August 4, 2015
The following information is available for Sappy’s Surgical Shears for the fiscal year ending December 31, 20XX
The following information is available for Sappy’s Surgical Shears for the fiscal year ending December 31, 20XX.
Beginning balance in Finished Goods $ 17,000
Ending balance in Finished Goods 15,200
Beginning balance in Work in Process 2,500
Ending balance in Work in Process 1,836
Selling expenses 123,000
General and administrative expenses 89,000
Direct material cost 54,500
Direct labor cost 66,000
Manufacturing overhead 21,400
Sales 385,000
Prepare a schedule of cost of goods manufactured.
Click here for the solution: The following information is available for Sappy’s Surgical Shears for the fiscal year ending December 31, 20XX
Beginning balance in Finished Goods $ 17,000
Ending balance in Finished Goods 15,200
Beginning balance in Work in Process 2,500
Ending balance in Work in Process 1,836
Selling expenses 123,000
General and administrative expenses 89,000
Direct material cost 54,500
Direct labor cost 66,000
Manufacturing overhead 21,400
Sales 385,000
Prepare a schedule of cost of goods manufactured.
Click here for the solution: The following information is available for Sappy’s Surgical Shears for the fiscal year ending December 31, 20XX
The following selected accounts and their current balances appear in the ledger of Carpet Land Co. for the fiscal year ended October 31, 2012
Problem 6-1A Multiple-Step Income Statement and Report-Form of Balance Sheet
The following selected accounts and their current balances appear in the ledger of Carpet Land Co. for the fiscal year ended October 31, 2012:
AND SO ON
Instructions
1. Prepare a multiple-step income statement.
2. Prepare a statement of owner's equity.
3. Prepare a report form of balance sheet, assuming that the current portion of the note payable is $16,000.
4. Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report form and account-form balance sheets differ.
Check: 1. Net Income: $775,000
Click here for the solution: The following selected accounts and their current balances appear in the ledger of Carpet Land Co. for the fiscal year ended October 31, 2012
The following selected accounts and their current balances appear in the ledger of Carpet Land Co. for the fiscal year ended October 31, 2012:
AND SO ON
Instructions
1. Prepare a multiple-step income statement.
2. Prepare a statement of owner's equity.
3. Prepare a report form of balance sheet, assuming that the current portion of the note payable is $16,000.
4. Briefly explain (a) how multiple-step and single-step income statements differ and (b) how report form and account-form balance sheets differ.
Check: 1. Net Income: $775,000
Click here for the solution: The following selected accounts and their current balances appear in the ledger of Carpet Land Co. for the fiscal year ended October 31, 2012
Tuesday, July 14, 2015
After reviewing the month-to-month variances, Panarude senior management became concerned about the increased spending occurring in the last three months of each fiscal year
Panarude Airfreight is an international air freight hauler with more
than 45 jet aircraft operating in the United States and the Pacific Rim.
The firm is headquartered in Melbourne, Australia, and is organized
into five geographic areas: Australia, Japan, Taiwan, Korea, and the
United States. Sup-porting these areas are several centralized corporate
function services (cost centers): human resources, data processing,
fleet acquisition and maintenance, and telecommunications. Each
responsibility center has a budget, negotiated at the beginning of the
year with the vice president of finance. Funds unspent at the end of the
year do not carry over to the next fiscal year. The firm is on a
January-to-December fiscal year.
After reviewing the month-to-month variances, Panarude senior management became concerned about the increased spending occurring in the last three months of each fiscal year. In particular, in the first nine months of the year, expenditure accounts typically show favorable variances (actual spending is less than budget), but in the last three months, unfavorable variances are the norm. In an attempt to smooth out these spending patterns, each responsibility center is reviewed at the end of each calendar quarter and any unspent funds can be deleted from the budget for the remainder of the year. The accompanying table shows the budget and actual spending in the telecommunications department for the first quarter of this year.
At the end of the first quarter, telecommunications’ total annual budget for this year can be reduced by $7,000, the total budget underrun in the first quarter. In addition, the remaining nine monthly budgets for telecommunications are reduced by $778 (or $7,000 / 9). If, at the end of the second quarter, telecommunications’ budget shows an unfavorable variance of, say, $8,000 (after the original budget is reduced for the first-quarter underrun), management of telecommunications is held responsible for the entire $8,000 unfavorable variance. The first-quarter underrun is not restored. If the second quarter budget variance is also favorable, the remaining six monthly budgets are each reduced further by one-sixth of the second-quarter favorable budget variance.
Required:
a. What behavior would this budgeting scheme engender in the responsibility center managers?
b. Compare the advantages and disadvantages of the previous budget regime, where any end-of-year budget surpluses do not carry over to the next fiscal year, with the system of quarterly budget adjustments just described.
Click here for the solution: After reviewing the month-to-month variances, Panarude senior management became concerned about the increased spending occurring in the last three months of each fiscal year
After reviewing the month-to-month variances, Panarude senior management became concerned about the increased spending occurring in the last three months of each fiscal year. In particular, in the first nine months of the year, expenditure accounts typically show favorable variances (actual spending is less than budget), but in the last three months, unfavorable variances are the norm. In an attempt to smooth out these spending patterns, each responsibility center is reviewed at the end of each calendar quarter and any unspent funds can be deleted from the budget for the remainder of the year. The accompanying table shows the budget and actual spending in the telecommunications department for the first quarter of this year.
At the end of the first quarter, telecommunications’ total annual budget for this year can be reduced by $7,000, the total budget underrun in the first quarter. In addition, the remaining nine monthly budgets for telecommunications are reduced by $778 (or $7,000 / 9). If, at the end of the second quarter, telecommunications’ budget shows an unfavorable variance of, say, $8,000 (after the original budget is reduced for the first-quarter underrun), management of telecommunications is held responsible for the entire $8,000 unfavorable variance. The first-quarter underrun is not restored. If the second quarter budget variance is also favorable, the remaining six monthly budgets are each reduced further by one-sixth of the second-quarter favorable budget variance.
Required:
a. What behavior would this budgeting scheme engender in the responsibility center managers?
b. Compare the advantages and disadvantages of the previous budget regime, where any end-of-year budget surpluses do not carry over to the next fiscal year, with the system of quarterly budget adjustments just described.
Click here for the solution: After reviewing the month-to-month variances, Panarude senior management became concerned about the increased spending occurring in the last three months of each fiscal year
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