Presented below is selected information from the Greenville Company's current period accounting records (in $000s):
Sales $10,000
Raw Materials Used 2,500
Direct Labor Costs 1,000
Period Costs (Selling and Administrative) 2,500
Beginning Raw Material Inventory 300
Ending Raw Material Inventory 1,000
Net Income 200
Beginning Work-in-Process Inventory 0
Ending Work-in-Process Inventory 300
Beginning Finished Goods Inventory 700
Ending Finished Goods Inventory 400
* NOTE: All raw materials used were direct materials.
Question:
Determine the following (in dollars):
a. Raw Material Purchases
b. Gross Profit
c. Cost of Goods Manufactured
d. Manufacturing Overhead
Click here for the solution: Presented below is selected information from the Greenville Company's current period accounting records (in $000s)
Showing posts with label information. Show all posts
Showing posts with label information. Show all posts
Friday, April 15, 2016
Tuesday, April 12, 2016
International Reporting Case: Sepracor, Inc., a U.S. drug company, reported the following information
International Reporting Case
Sepracor, Inc., a U.S. drug company, reported the following information. The company prepares its financial statements in accordance with U.S. GAAP.
2007 (,000)
Current Liabilities $ 554,114
Convertible Subordinated Debt 648,020
Total Liabilities 1,228,313
Stockholders’ Equity 176,413
Net Income 58,333
Analysts attempting to compare Sepracor to international drug companies may face a challenge due to differences in accounting for convertible debt under iGAAP. Under IAS 32, Financial Instruments, convertible bonds, at issuance, must be classified separately into their debt and equity components based on estimated fair value.
INSTRUCTIONS:
(a) Compute the following rations for Sepracor, Inc. (assume that year-end balances approximate annual averages.)
(1) Return on assets.
(2) Return on stockholders’ equity
(3) Debt to asset ratio
(b) Briefly discuss the operating performance and financial position of Sepracor. Industry averages for these ratios in 2007were: ROA 3.5%; return on equity 16%; and debt to assets 75%. Based on this analysis would you make an investment in the company's 5% convertible bonds? Explain.
(c) Assume you want to compare Sepracor to an international company, like Bayer (which prepares its financial statements in accordance with iGAAP). Assuming that the fair value of the equity components of Sepracor's convertible bonds is $150,000, how would you adjust the analysis above to make valid comparisons between Sepracor and Bayer
Click here for the solution: International Reporting Case: Sepracor, Inc., a U.S. drug company, reported the following information
Sepracor, Inc., a U.S. drug company, reported the following information. The company prepares its financial statements in accordance with U.S. GAAP.
2007 (,000)
Current Liabilities $ 554,114
Convertible Subordinated Debt 648,020
Total Liabilities 1,228,313
Stockholders’ Equity 176,413
Net Income 58,333
Analysts attempting to compare Sepracor to international drug companies may face a challenge due to differences in accounting for convertible debt under iGAAP. Under IAS 32, Financial Instruments, convertible bonds, at issuance, must be classified separately into their debt and equity components based on estimated fair value.
INSTRUCTIONS:
(a) Compute the following rations for Sepracor, Inc. (assume that year-end balances approximate annual averages.)
(1) Return on assets.
(2) Return on stockholders’ equity
(3) Debt to asset ratio
(b) Briefly discuss the operating performance and financial position of Sepracor. Industry averages for these ratios in 2007were: ROA 3.5%; return on equity 16%; and debt to assets 75%. Based on this analysis would you make an investment in the company's 5% convertible bonds? Explain.
(c) Assume you want to compare Sepracor to an international company, like Bayer (which prepares its financial statements in accordance with iGAAP). Assuming that the fair value of the equity components of Sepracor's convertible bonds is $150,000, how would you adjust the analysis above to make valid comparisons between Sepracor and Bayer
Click here for the solution: International Reporting Case: Sepracor, Inc., a U.S. drug company, reported the following information
The following information is available for a non-cancelable lease of equipment that is classified as a sales-type lease by the lessor and as a capital lease by the lessee
E21-9 Lessee and Lessor Accounting Issues
The following information is available for a non-cancelable lease of equipment that is classified as a sales-type lease by the lessor and as a capital lease by the lessee. Assume that the lease payments are made at the ginning of each month, interest and straight-line depreciation are recognized at the end of each month, and the residual value of the leased asset is zero at the end of a three-year life.
REQUIRED:
1. Record the lease (including the initial receipt of $2,000) and the receipt of the second and third installments of $2,000 in the accounts of the Anson Company. Carry computations to the nearest dollar.
Click here for the solution: The following information is available for a non-cancelable lease of equipment that is classified as a sales-type lease by the lessor and as a capital lease by the lessee
The following information is available for a non-cancelable lease of equipment that is classified as a sales-type lease by the lessor and as a capital lease by the lessee. Assume that the lease payments are made at the ginning of each month, interest and straight-line depreciation are recognized at the end of each month, and the residual value of the leased asset is zero at the end of a three-year life.
REQUIRED:
1. Record the lease (including the initial receipt of $2,000) and the receipt of the second and third installments of $2,000 in the accounts of the Anson Company. Carry computations to the nearest dollar.
Click here for the solution: The following information is available for a non-cancelable lease of equipment that is classified as a sales-type lease by the lessor and as a capital lease by the lessee
Monday, March 21, 2016
Presented below is information related to Blowfish radios for Hootie Company for the month of July
E8-16 (Compute FIFO, LIFO, Average-Cost-Periodic) Presented below is information related to Blowfish radios for Hootie Company for the month of July.
Date Transaction Units In Unit Cost Total Units Sold Sell Price Total
July 1 Balance 100 $4.10 $410
July 6 Purchase 800 $4.20 $3360
July 7 Sale 300 $7.00 $2100
July 10 Sale 300 $7.30 $2190
July 12 Purchase 400 $4.50 $1800
July 15 Sale 200 $7.40 $1480
July 18 Purchase 300 $4.60 $1380
July 22 Sale 400 $7.40 $2960
July 25 Purchase 500 $4.58 $2290
July 30 Sale 200 $7.50 $1500
2100 $9240 1400 $10,230
Instructions
a.) Assuming that the periodic inventory method is used, compute the inventory cost at July 31 under each of the following cost flow assumptions:
1.) FIFO
2.) LIFO
3.) Weighted-average round the average unit cost to the nearest one tenth of one cent
b.) Answer the following questions
1.) Which of the following methods used above all will yield the lowest figure for ending figure for gross profit for the income statement? Why?
2.) Which of the methods used above will yield the lowest figure for ending inventory for the balance sheet? Why?
Click here for the solution: Presented below is information related to Blowfish radios for Hootie Company for the month of July
Date Transaction Units In Unit Cost Total Units Sold Sell Price Total
July 1 Balance 100 $4.10 $410
July 6 Purchase 800 $4.20 $3360
July 7 Sale 300 $7.00 $2100
July 10 Sale 300 $7.30 $2190
July 12 Purchase 400 $4.50 $1800
July 15 Sale 200 $7.40 $1480
July 18 Purchase 300 $4.60 $1380
July 22 Sale 400 $7.40 $2960
July 25 Purchase 500 $4.58 $2290
July 30 Sale 200 $7.50 $1500
2100 $9240 1400 $10,230
Instructions
a.) Assuming that the periodic inventory method is used, compute the inventory cost at July 31 under each of the following cost flow assumptions:
1.) FIFO
2.) LIFO
3.) Weighted-average round the average unit cost to the nearest one tenth of one cent
b.) Answer the following questions
1.) Which of the following methods used above all will yield the lowest figure for ending figure for gross profit for the income statement? Why?
2.) Which of the methods used above will yield the lowest figure for ending inventory for the balance sheet? Why?
Click here for the solution: Presented below is information related to Blowfish radios for Hootie Company for the month of July
Thursday, January 14, 2016
Presented below is information related to Bruce Van Company
Presented below is information related to Bruce Van Company.
Retained earnings, December 31, 2010 $ 650,000
Sales 1,400,000
Selling and administrative expenses 240,000
Hurricane loss (pre-tax) on plant (extraordinary item) 290,000
Cash dividends declared on common stock 33,600
Cost of goods sold 780,000
Gain resulting from computation error 520,000
on depreciation charge in 2009(pre-tax)
Other revenue 120,000
Other expenses 100,000
Instructions
Prepare in good form a multiple-step income statement for the year 2011. Assume a 30% tax rate and that 80,000 shares of common stock were outstanding during the year. Show EPS computations as well.
Click here for the solution: Presented below is information related to Bruce Van Company
Retained earnings, December 31, 2010 $ 650,000
Sales 1,400,000
Selling and administrative expenses 240,000
Hurricane loss (pre-tax) on plant (extraordinary item) 290,000
Cash dividends declared on common stock 33,600
Cost of goods sold 780,000
Gain resulting from computation error 520,000
on depreciation charge in 2009(pre-tax)
Other revenue 120,000
Other expenses 100,000
Instructions
Prepare in good form a multiple-step income statement for the year 2011. Assume a 30% tax rate and that 80,000 shares of common stock were outstanding during the year. Show EPS computations as well.
Click here for the solution: Presented below is information related to Bruce Van Company
Thursday, November 26, 2015
Listed below are several information characteristics and accounting principles and assumptions
1. (TCO A) Listed below are several information characteristics and accounting principles and assumptions. Match the letter of each with the appropriate phrase that states its application. (Points: 30)
1: Stable dollar assumption
2: Notes as part of necessary information to a fair presentation.
3: Earnings process completed and realized or realizable.
4: Valuing assets at amounts originally paid for them.
5: the impact of an item on the overall financial operations of a company.
6: Accruals and deferrals in adjusting and closing process (Do not use going concern).
7: Affairs of the business distinguished from those of its owners.
8: Presentation of error-free information with representational faithfulness
9: Business enterprise assumed to have a long life.
10: Cost of providing financial information versus the benefits derived from its use.
: Historical cost principle
: Going concern principle
: Matching principle
: Monetary unit
: Revenue recognition principle
: Full disclosure principle
: Reliability characteristic
: Cost-benefit relationship
: Materiality constraint
: Economic entity assumption
Click here for the solution: Listed below are several information characteristics and accounting principles and assumptions
1: Stable dollar assumption
2: Notes as part of necessary information to a fair presentation.
3: Earnings process completed and realized or realizable.
4: Valuing assets at amounts originally paid for them.
5: the impact of an item on the overall financial operations of a company.
6: Accruals and deferrals in adjusting and closing process (Do not use going concern).
7: Affairs of the business distinguished from those of its owners.
8: Presentation of error-free information with representational faithfulness
9: Business enterprise assumed to have a long life.
10: Cost of providing financial information versus the benefits derived from its use.
: Historical cost principle
: Going concern principle
: Matching principle
: Monetary unit
: Revenue recognition principle
: Full disclosure principle
: Reliability characteristic
: Cost-benefit relationship
: Materiality constraint
: Economic entity assumption
Click here for the solution: Listed below are several information characteristics and accounting principles and assumptions
Wednesday, November 25, 2015
Sepracor, Inc., a U.S. drug company, reported the following information
International Reporting Case
Sepracor, Inc., a U.S. drug company, reported the following information. The company prepares its financial statements in accordance with U.S. GAAP.
2007 (,000)
Current Liabilities $ 554,114
Convertible Subordinated Debt 648,020
Total Liabilities 1,228,313
Stockholders’ Equity 176,413
Net Income 58,333
Analysts attempting to compare Sepracor to international drug companies may face a challenge due to differences in accounting for convertible debt under iGAAP. Under IAS 32, Financial Instruments, convertible bonds, at issuance, must be classified separately into their debt and equity components based on estimated fair value.
INSTRUCTIONS:
(a) Compute the following rations for Sepracor, Inc. (assume that year-end balances approximate annual averages.)
(1) Return on assets.
(2) Return on stockholders’ equity
(3) Debt to asset ratio
(b) Briefly discuss the operating performance and financial position of Sepracor. Industry averages for these ratios in 2007were: ROA 3.5%; return on equity 16%; and debt to assets 75%. Based on this analysis would you make an investment in the company's 5% convertible bonds? Explain.
(c) Assume you want to compare Sepracor to an international company, like Bayer (which prepares its financial statements in accordance with iGAAP). Assuming that the fair value of the equity components of Sepracor's convertible bonds is $150,000, how would you adjust the analysis above to make valid comparisons between Sepracor and Bayer.
Click here for the solution: Sepracor, Inc., a U.S. drug company, reported the following information
Sepracor, Inc., a U.S. drug company, reported the following information. The company prepares its financial statements in accordance with U.S. GAAP.
2007 (,000)
Current Liabilities $ 554,114
Convertible Subordinated Debt 648,020
Total Liabilities 1,228,313
Stockholders’ Equity 176,413
Net Income 58,333
Analysts attempting to compare Sepracor to international drug companies may face a challenge due to differences in accounting for convertible debt under iGAAP. Under IAS 32, Financial Instruments, convertible bonds, at issuance, must be classified separately into their debt and equity components based on estimated fair value.
INSTRUCTIONS:
(a) Compute the following rations for Sepracor, Inc. (assume that year-end balances approximate annual averages.)
(1) Return on assets.
(2) Return on stockholders’ equity
(3) Debt to asset ratio
(b) Briefly discuss the operating performance and financial position of Sepracor. Industry averages for these ratios in 2007were: ROA 3.5%; return on equity 16%; and debt to assets 75%. Based on this analysis would you make an investment in the company's 5% convertible bonds? Explain.
(c) Assume you want to compare Sepracor to an international company, like Bayer (which prepares its financial statements in accordance with iGAAP). Assuming that the fair value of the equity components of Sepracor's convertible bonds is $150,000, how would you adjust the analysis above to make valid comparisons between Sepracor and Bayer.
Click here for the solution: Sepracor, Inc., a U.S. drug company, reported the following information
Tuesday, November 10, 2015
Using the information from Rebekah Company prepare a pension worksheet inserting January 1, 2008
E20-3 (Preparation of Pension Worksheet with Reconciliation) Using the information from Rebekah Company prepare a pension worksheet inserting January 1, 2008, balances, showing December 31, 2008, balances, the reconciliation schedule, and the journal entry recording pension expense.
Rebekah Company provides the following information about its defined benefit pension plan for the year 2008.
Service cost $ 90,000
Contribution to the plan $ 105,000
Prior service cost amortization $ 10,000
Actual and expected return on plan assets $64,000
Benefits paid $40,000
Accrued pension cost liability at January 1, 2008 $10,000
Plan assets at January 1, 2008 $ 640,000
Projected benefit obligation at January 1, 2008 $800,000
Unrecognized prior service cost balance at January 1, 2008 $150,000
Interest/discount (settlement) rate 10%
Click here for the solution: Using the information from Rebekah Company prepare a pension worksheet inserting January 1, 2008
Rebekah Company provides the following information about its defined benefit pension plan for the year 2008.
Service cost $ 90,000
Contribution to the plan $ 105,000
Prior service cost amortization $ 10,000
Actual and expected return on plan assets $64,000
Benefits paid $40,000
Accrued pension cost liability at January 1, 2008 $10,000
Plan assets at January 1, 2008 $ 640,000
Projected benefit obligation at January 1, 2008 $800,000
Unrecognized prior service cost balance at January 1, 2008 $150,000
Interest/discount (settlement) rate 10%
Click here for the solution: Using the information from Rebekah Company prepare a pension worksheet inserting January 1, 2008
Monday, October 26, 2015
Podsednik Company has gathered the following information
ACC 560 Week 2 Assignment
E3-9 Podsednik Company has gathered the following information.
Units in beginning work in process -0-
Units started into production 36,000
Units in ending work in process 6,000
Percent complete in ending work in process:
Conversion costs 40%
Materials 100%
Costs incurred:
Direct materials $72,000
Direct labor $81,000
Overhead $97,200
Required:
1. Compute equivalent units of production for materials and for conversion costs.
2. Determine the unit costs of production.
Click here for the solution: Podsednik Company has gathered the following information
E3-9 Podsednik Company has gathered the following information.
Units in beginning work in process -0-
Units started into production 36,000
Units in ending work in process 6,000
Percent complete in ending work in process:
Conversion costs 40%
Materials 100%
Costs incurred:
Direct materials $72,000
Direct labor $81,000
Overhead $97,200
Required:
1. Compute equivalent units of production for materials and for conversion costs.
2. Determine the unit costs of production.
Click here for the solution: Podsednik Company has gathered the following information
Deer Park, a public camping ground near the Lake Mead National Recreation Area, has compiled the following financial information as of December 31, 2008
ACC 557 Week 1 Assignment
E1-14 Deer Park, a public camping ground near the Lake Mead National Recreation Area, has compiled the following financial information as of December 31, 2008.
Revenues during 2008—camping fees $140,000 Notes payable $ 60,000
Revenues during 2008—general store 50,000 Expenses during 2008 150,000
Accounts payable 11,000 Supplies on hand 2,500
Cash on hand 23,000 Common stock 20,000
Original cost of equipment 105,500 Retained earnings ?
Market value of equipment 140,000
Instructions
(a) Determine Deer Park’s net income for 2008.
(b) Prepare a balance sheet for Deer Park as of December 31, 2008.
Click here for the solution: Deer Park, a public camping ground near the Lake Mead National Recreation Area, has compiled the following financial information as of December 31, 2008
E1-14 Deer Park, a public camping ground near the Lake Mead National Recreation Area, has compiled the following financial information as of December 31, 2008.
Revenues during 2008—camping fees $140,000 Notes payable $ 60,000
Revenues during 2008—general store 50,000 Expenses during 2008 150,000
Accounts payable 11,000 Supplies on hand 2,500
Cash on hand 23,000 Common stock 20,000
Original cost of equipment 105,500 Retained earnings ?
Market value of equipment 140,000
Instructions
(a) Determine Deer Park’s net income for 2008.
(b) Prepare a balance sheet for Deer Park as of December 31, 2008.
Click here for the solution: Deer Park, a public camping ground near the Lake Mead National Recreation Area, has compiled the following financial information as of December 31, 2008
Financial statement information about four different companies is as follows
ACC 557 Week 1 Assignment
P1–5A Financial statement information about four different companies is as follows.
Instructions
(a) Determine the missing amounts. (Hint: For example, to solve for (a), Assets _ Liabilities _ Stockholders’ Equity _ $45,000.)
(b) Prepare the retained earnings statement for Yates Company. Assume beginning retained earnings was $20,000.
(c) Write a memorandum explaining the sequence for preparing financial statements and the interrelationship of the retained earnings statement to the income statement and balance sheet.
Karma Yates McCain Dench
Company Company Company Company
January 1, 2008
Assets $ 95,000 $110,000 (g) $170,000
Liabilities 50,000 (d) 75,000 ( j)
Stockholders’ equity (a) 60,000 45,000 90,000
December 31, 2008
Assets (b) 137,000 200,000 (k)
Liabilities 55,000 75,000 (h) 80,000
Stockholders’ equity 60,000 (e) 130,000 170,000
Stockholders’ equity changes in year
Additional investment (c) 15,000 10,000 15,000
Dividends 25,000 (f) 14,000 20,000
Total revenues 350,000 420,000 (i) 520,000
Total expenses 320,000 385,000 342,000 (l)
Click here for the solution: Financial statement information about four different companies is as follows
P1–5A Financial statement information about four different companies is as follows.
Instructions
(a) Determine the missing amounts. (Hint: For example, to solve for (a), Assets _ Liabilities _ Stockholders’ Equity _ $45,000.)
(b) Prepare the retained earnings statement for Yates Company. Assume beginning retained earnings was $20,000.
(c) Write a memorandum explaining the sequence for preparing financial statements and the interrelationship of the retained earnings statement to the income statement and balance sheet.
Karma Yates McCain Dench
Company Company Company Company
January 1, 2008
Assets $ 95,000 $110,000 (g) $170,000
Liabilities 50,000 (d) 75,000 ( j)
Stockholders’ equity (a) 60,000 45,000 90,000
December 31, 2008
Assets (b) 137,000 200,000 (k)
Liabilities 55,000 75,000 (h) 80,000
Stockholders’ equity 60,000 (e) 130,000 170,000
Stockholders’ equity changes in year
Additional investment (c) 15,000 10,000 15,000
Dividends 25,000 (f) 14,000 20,000
Total revenues 350,000 420,000 (i) 520,000
Total expenses 320,000 385,000 342,000 (l)
Click here for the solution: Financial statement information about four different companies is as follows
Saturday, October 17, 2015
Big Slick Oil Co., Inc., has the following account balances and other information in alphabetical order at Dec. 31, 2007
Big Slick Oil Co., Inc., has the following account balances and other information in alphabetical order at Dec. 31, 2007. All balances are as of the end of the year except Retained Earnings.
Accounts Payable.............................................$22,000
Accounts Receivable........................................$34,000
Cash................................................................ $12,000
Common Stock................................................ $50,000
Cost of Goods Sold.......................................... $120,000
Equipment, net of Accumulated Depreciation..... $60,000
Dividends......................................................... $14,000
Income Tax Expense......................................... $10,000
Interest Expense............................................... $7,000
Inventory.......................................................... $23,000
Operating Expenses.......................................... $45,000
Retained Earnings, Jan. 1, 2007........................ $19,000
Sales Revenue.................................................. $220,000
Unearned Revenue............................................ $14,000
Number of shares of stock outstanding at the end of 2007 is 10,000 shares.
Required:
Prepare an accrual basis income statement and a classified balance sheet in proper form.
Click here for the solution: Big Slick Oil Co., Inc., has the following account balances and other information in alphabetical order at Dec. 31, 2007
Accounts Payable.............................................$22,000
Accounts Receivable........................................$34,000
Cash................................................................ $12,000
Common Stock................................................ $50,000
Cost of Goods Sold.......................................... $120,000
Equipment, net of Accumulated Depreciation..... $60,000
Dividends......................................................... $14,000
Income Tax Expense......................................... $10,000
Interest Expense............................................... $7,000
Inventory.......................................................... $23,000
Operating Expenses.......................................... $45,000
Retained Earnings, Jan. 1, 2007........................ $19,000
Sales Revenue.................................................. $220,000
Unearned Revenue............................................ $14,000
Number of shares of stock outstanding at the end of 2007 is 10,000 shares.
Required:
Prepare an accrual basis income statement and a classified balance sheet in proper form.
Click here for the solution: Big Slick Oil Co., Inc., has the following account balances and other information in alphabetical order at Dec. 31, 2007
Wednesday, October 14, 2015
Prepare a bank reconciliation for Jax-Mart based on the following information
INSTRUCTIONS: Prepare a bank reconciliation for Jax-Mart based on the following information:
• Balance per bank at 8/30/07, $3,465.50
• Balance per books at 8/30/07, $2,012.87
• Outstanding checks total $2,003.84
• A $1,148.21 deposit was made too late to appear on the bank statement
• The bank collected a $1500 note plus $120 in interest charges
• A check for $110 was returned with the bank statement, but was charged by the bank as $1,100
• A check for $86 was returned with the bank statement but was recorded in the books at $68
• Bank service charges were $15 for August.
Click here for the solution: Prepare a bank reconciliation for Jax-Mart based on the following information
• Balance per bank at 8/30/07, $3,465.50
• Balance per books at 8/30/07, $2,012.87
• Outstanding checks total $2,003.84
• A $1,148.21 deposit was made too late to appear on the bank statement
• The bank collected a $1500 note plus $120 in interest charges
• A check for $110 was returned with the bank statement, but was charged by the bank as $1,100
• A check for $86 was returned with the bank statement but was recorded in the books at $68
• Bank service charges were $15 for August.
Click here for the solution: Prepare a bank reconciliation for Jax-Mart based on the following information
Given the following information, prepare a statement of cash flows
Given the following information, prepare a statement of cash flows
Increase in accounts receivable $25
Increase in inventories 30
Operating income 75
Interest expense 25
Increase in accounts payable 25
Dividends 15
Increase in common stock 20
Increase in net fixed assets 23
Depreciation expense 12
Income taxes 17
Beginning cash 20
Click here for the solution: Given the following information, prepare a statement of cash flows
Increase in accounts receivable $25
Increase in inventories 30
Operating income 75
Interest expense 25
Increase in accounts payable 25
Dividends 15
Increase in common stock 20
Increase in net fixed assets 23
Depreciation expense 12
Income taxes 17
Beginning cash 20
Click here for the solution: Given the following information, prepare a statement of cash flows
Friday, October 9, 2015
While examining cash receipts information, the accounting department determined the following information
ACC 290 Week 5 Assignment
BE7-5 While examining cash receipts information, the accounting department determined the following information: opening cash balance $150, cash on hand $1,125.74, and cash sales per register tape $988.62. Prepare the required journal entry based upon the cash count sheet.
Click here for the solution: While examining cash receipts information, the accounting department determined the following information
BE7-5 While examining cash receipts information, the accounting department determined the following information: opening cash balance $150, cash on hand $1,125.74, and cash sales per register tape $988.62. Prepare the required journal entry based upon the cash count sheet.
Click here for the solution: While examining cash receipts information, the accounting department determined the following information
Sunday, September 27, 2015
Presented is information related to Rogers Co. for the month of January 2008
E5-8 Presented is information related to Rogers Co. for the month of January 2008.
Ending inventory per perpetual records $21,600
Ending inventory actually on hand 21,000
Cost of goods sold 218,000
Freight-out 7,000
Insurance expense 12,000
Rent expense 20,000
Salary Expense 61,000
Sales Discounts 10,000
Sales Returns and Allowances 13,000
Sales 350,000
Instructions
(a) Prepare the necessary adjusting entry for inventory.
(b) Prepare the necessary closing entries.
Click here for the solution: Presented is information related to Rogers Co. for the month of January 2008
Ending inventory per perpetual records $21,600
Ending inventory actually on hand 21,000
Cost of goods sold 218,000
Freight-out 7,000
Insurance expense 12,000
Rent expense 20,000
Salary Expense 61,000
Sales Discounts 10,000
Sales Returns and Allowances 13,000
Sales 350,000
Instructions
(a) Prepare the necessary adjusting entry for inventory.
(b) Prepare the necessary closing entries.
Click here for the solution: Presented is information related to Rogers Co. for the month of January 2008
You are provided with the following information for Pavey Inc. for the month ended October 31, 2008
P6-5A You are provided with the following information for Pavey Inc. for the month ended October 31, 2008. Pavey uses a periodic method for inventory.
Date Description Units Unit Cost or Selling Price
October 1 Beginning inventory 60 $25
October 9 Purchase 120 26
October 11 Sale 100 35
October 17 Purchase 70 27
October 22 Sale 60 40
October 25 Purchase 80 28
October 29 Sale 110 40
Instructions
(a) Calculate (i) ending inventory, (ii) cost of goods sold, (iii) gross profit, and (iv) gross profit rate under each of the following methods.
(b) Compare results for the three cost flow assumptions. What cost flow results in the lowest inventory value. What cost flow results in the lowest cost of goods sold. What cost flow results in the lowest gross profit. What cost flow results in the lowest gross profit rate.
Click here for the solution: You are provided with the following information for Pavey Inc. for the month ended October 31, 2008
Date Description Units Unit Cost or Selling Price
October 1 Beginning inventory 60 $25
October 9 Purchase 120 26
October 11 Sale 100 35
October 17 Purchase 70 27
October 22 Sale 60 40
October 25 Purchase 80 28
October 29 Sale 110 40
Instructions
(a) Calculate (i) ending inventory, (ii) cost of goods sold, (iii) gross profit, and (iv) gross profit rate under each of the following methods.
(b) Compare results for the three cost flow assumptions. What cost flow results in the lowest inventory value. What cost flow results in the lowest cost of goods sold. What cost flow results in the lowest gross profit. What cost flow results in the lowest gross profit rate.
Click here for the solution: You are provided with the following information for Pavey Inc. for the month ended October 31, 2008
Research 15-2 FASB codification; locate and extract relevant information and authoritative support for a financial reporting issue;
Research 15-2 FASB codification; locate and extract relevant information and authoritative support for a financial reporting issue; capital lease; sublease of a leased asset
“I don't see that in my intermediate accounting text I saved from college,” you explain to another member of the accounting division of Dowell Chemical Corporation. “This will take some research.” Your comments pertain to the appropriate accounting treatment of a proposed sublease of warehouses Dowell has used for product storage.
Required:
1. After the first full year under the warehouse lease, what is the balance in Dowell's lease liability? An amortization schedule will be helpful in determining this amount.
2. After the first full year under the warehouse lease, what is the carrying amount (after accumulated depreciation) of Dowell's leased warehouses?
3. Obtain the relevant authoritative literature on accounting for derecognition of capital leases by lessees using the FASB's Codification Research System. You might gain access from the FASB website (www.fasb.org), from your school library, or some other source. Determine the appropriate accounting treatment for the proposed sublease. What is the specific Codification citation that Dowell would rely on to determine:
a. if the proposal to sublease will qualify as a termination of a capital lease, and
b. the appropriate accounting treatment for the sublease?
4. What, if any, journal entry would Dowell record in connection with the sublease?
Click here for the solution: Research 15-2 FASB codification; locate and extract relevant information and authoritative support for a financial reporting issue;
“I don't see that in my intermediate accounting text I saved from college,” you explain to another member of the accounting division of Dowell Chemical Corporation. “This will take some research.” Your comments pertain to the appropriate accounting treatment of a proposed sublease of warehouses Dowell has used for product storage.
Required:
1. After the first full year under the warehouse lease, what is the balance in Dowell's lease liability? An amortization schedule will be helpful in determining this amount.
2. After the first full year under the warehouse lease, what is the carrying amount (after accumulated depreciation) of Dowell's leased warehouses?
3. Obtain the relevant authoritative literature on accounting for derecognition of capital leases by lessees using the FASB's Codification Research System. You might gain access from the FASB website (www.fasb.org), from your school library, or some other source. Determine the appropriate accounting treatment for the proposed sublease. What is the specific Codification citation that Dowell would rely on to determine:
a. if the proposal to sublease will qualify as a termination of a capital lease, and
b. the appropriate accounting treatment for the sublease?
4. What, if any, journal entry would Dowell record in connection with the sublease?
Click here for the solution: Research 15-2 FASB codification; locate and extract relevant information and authoritative support for a financial reporting issue;
Friday, September 25, 2015
Selected financial statement information and additional data for Johnston Enterprises is presented below
Selected financial statement information and additional data for
Johnston Enterprises is presented below. Prepare a statement of cash
flows for the year ending December 31, 2010
Johnston Enterprises
Balance Sheet and Income Statement Data
December 31, December 31,
2010 2009___
Current Assets:
Cash $153,000 $119,000
Accounts Receivable 238,000 306,000
Inventory 391,000 340,000
Total Current Assets 782,000 765,000
Property, Plant, and Equipment 1,241,000 1,122,000
Less: Accumulated Depreciation (476,000) (442,000)
Total Assets $1,547,000 $1,445,000
Current Liabilities:
Accounts Payable $187,000 $102,000
Notes Payable 51,000 68,000
Income Tax Payable 85,000 76,500
Total Current Liabilities 323,000 246,500
Bonds Payable 340,000 391,000
Total Liabilities 663,000 637,500
Stockholders' Equity:
Common Stock 510,000 467,500
Retained Earnings 374,000 340,000
Total Stockholders' Equity 884,000 807,500
Total Liabilities & Stockholders' Equity $1,547,000 $1,445,000
Sales 1,615,000 $1,513,000
Less Cost of Goods Sold 731,000 731,000
Gross Profit 884,000 782,000
Expenses:
Depreciation Expense 153,000 136,000
Salary Expense 391,000 357,000
Interest Expense 34,000 34,000
Loss on Sale of Equipment 17,000 0
Income Before Taxes 289,000 255,000
Less Income Tax Expense 119,000 102,000
Net Income $170,000 $153,000
Additional Information:
During the year, Johnston sold equipment with an original cost of $153,000 and accumulated depreciation of $119,000 and purchased new equipment for $272,000.
Click here for the solution: Selected financial statement information and additional data for Johnston Enterprises is presented below
Johnston Enterprises
Balance Sheet and Income Statement Data
December 31, December 31,
2010 2009___
Current Assets:
Cash $153,000 $119,000
Accounts Receivable 238,000 306,000
Inventory 391,000 340,000
Total Current Assets 782,000 765,000
Property, Plant, and Equipment 1,241,000 1,122,000
Less: Accumulated Depreciation (476,000) (442,000)
Total Assets $1,547,000 $1,445,000
Current Liabilities:
Accounts Payable $187,000 $102,000
Notes Payable 51,000 68,000
Income Tax Payable 85,000 76,500
Total Current Liabilities 323,000 246,500
Bonds Payable 340,000 391,000
Total Liabilities 663,000 637,500
Stockholders' Equity:
Common Stock 510,000 467,500
Retained Earnings 374,000 340,000
Total Stockholders' Equity 884,000 807,500
Total Liabilities & Stockholders' Equity $1,547,000 $1,445,000
Sales 1,615,000 $1,513,000
Less Cost of Goods Sold 731,000 731,000
Gross Profit 884,000 782,000
Expenses:
Depreciation Expense 153,000 136,000
Salary Expense 391,000 357,000
Interest Expense 34,000 34,000
Loss on Sale of Equipment 17,000 0
Income Before Taxes 289,000 255,000
Less Income Tax Expense 119,000 102,000
Net Income $170,000 $153,000
Additional Information:
During the year, Johnston sold equipment with an original cost of $153,000 and accumulated depreciation of $119,000 and purchased new equipment for $272,000.
Click here for the solution: Selected financial statement information and additional data for Johnston Enterprises is presented below
Thursday, September 24, 2015
The following information was obtained from the accounts of Lukes, Inc., as of December 31, 2008
P 3-2 The following information was obtained from the accounts of Lukes,
Inc., as of December 31, 2008. It is presented in scrambled order.
Common stock, no par value, 10,000 shares
authorized, 5,724 shares issued $ 3,180
Retained earnings 129,950
Deferred income tax liability (long term) 24,000
Long-term debt 99,870
Accounts payable 35,000
Buildings 75,000
Machinery and equipment 300,000
Land 11,000
Accumulated depreciation 200,000
Cash 3,000
Receivables, less allowance of $3,000 58,000
Accrued income taxes 3,000
Inventory 54,000
Other accrued expenses 8,000
Current portion of long-term debt 7,000
Prepaid expenses 2,000
Other assets (long term) 7,000
Required
Prepare a classified balance sheet in report form. For assets, use the classifications of current assets, plant and equipment, and other assets. For liabilities, use the classifications of current liabilities and long-term liabilities.
Click here for the solution: The following information was obtained from the accounts of Lukes, Inc., as of December 31, 2008
Common stock, no par value, 10,000 shares
authorized, 5,724 shares issued $ 3,180
Retained earnings 129,950
Deferred income tax liability (long term) 24,000
Long-term debt 99,870
Accounts payable 35,000
Buildings 75,000
Machinery and equipment 300,000
Land 11,000
Accumulated depreciation 200,000
Cash 3,000
Receivables, less allowance of $3,000 58,000
Accrued income taxes 3,000
Inventory 54,000
Other accrued expenses 8,000
Current portion of long-term debt 7,000
Prepaid expenses 2,000
Other assets (long term) 7,000
Required
Prepare a classified balance sheet in report form. For assets, use the classifications of current assets, plant and equipment, and other assets. For liabilities, use the classifications of current liabilities and long-term liabilities.
Click here for the solution: The following information was obtained from the accounts of Lukes, Inc., as of December 31, 2008
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