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 records. Show all posts
Showing posts with label records. Show all posts
Friday, April 15, 2016
Sunday, September 13, 2015
The following trial balance was taken from the records of Wheaton Manufacturing Company at the beginning of 2012
11-18A The following trial balance was taken from the records of Wheaton Manufacturing Company at the beginning of 2012.
Cash 9,400
Raw Material inventory $750
Work in process inventory $1,200
Finished goods inventory $2,100
Property, plant, and equip.$7,500
Accumulated depreciation $3,000
Common Stocks $7,800
Retained earnings $10,150
Total $20,950 $20,950
a. Open T-accounts with the beginning balance shown from the list above and record all transactions for the year including closing entries in the t-account
b. Prepare a schedule of cost of goods manufactured and sold, and income statement, and balance sheet.
1. Wheaton Purchased $5,700 of direct raw materials and $300 of indirect raw material on account. The indirect materials are capitalized in the Production Supplies account. Materials requisitions showed that $5,400 of direct raw materials had been used for production during the period. The use of indirect materials is determined at the end of the year by physically counting the supplies on hand.
2. By the end of the year, $5,250 of the accounts payable had been paid in cash
3. During the year. direct labor amounted to 950 hours recorded in the wages payable account at $10.50 per hour
4. By the end of the year $9,000 of wages payable had been in cash
5. At the beginning of the year, the company expected overhead cost for the period to be $6,300 and 1,000 direct labor hours to be worked. Overhead is allocated based on direct labor hours, which as indicated in event 3 amounted to 950 for the year.
6. Selling and administrative expense for the year amounted to $900 paid in cash
7. Utilities and rent for production facilities amounted to $4,650 paid in cash
8. Depreciation on the plant and equip. used in production amounted to $1,500
9. There was $12,000 of goods completed during the year
10. There was $12,750 of finished goods inventory sold for $18,000 cash
11. A count of the production supplies revealed a balance of $89 on hand at the end of the year
12. Any over or under-applied overhead is considered to be insignificant.
Click here for the solution: The following trial balance was taken from the records of Wheaton Manufacturing Company at the beginning of 2012
Cash 9,400
Raw Material inventory $750
Work in process inventory $1,200
Finished goods inventory $2,100
Property, plant, and equip.$7,500
Accumulated depreciation $3,000
Common Stocks $7,800
Retained earnings $10,150
Total $20,950 $20,950
a. Open T-accounts with the beginning balance shown from the list above and record all transactions for the year including closing entries in the t-account
b. Prepare a schedule of cost of goods manufactured and sold, and income statement, and balance sheet.
1. Wheaton Purchased $5,700 of direct raw materials and $300 of indirect raw material on account. The indirect materials are capitalized in the Production Supplies account. Materials requisitions showed that $5,400 of direct raw materials had been used for production during the period. The use of indirect materials is determined at the end of the year by physically counting the supplies on hand.
2. By the end of the year, $5,250 of the accounts payable had been paid in cash
3. During the year. direct labor amounted to 950 hours recorded in the wages payable account at $10.50 per hour
4. By the end of the year $9,000 of wages payable had been in cash
5. At the beginning of the year, the company expected overhead cost for the period to be $6,300 and 1,000 direct labor hours to be worked. Overhead is allocated based on direct labor hours, which as indicated in event 3 amounted to 950 for the year.
6. Selling and administrative expense for the year amounted to $900 paid in cash
7. Utilities and rent for production facilities amounted to $4,650 paid in cash
8. Depreciation on the plant and equip. used in production amounted to $1,500
9. There was $12,000 of goods completed during the year
10. There was $12,750 of finished goods inventory sold for $18,000 cash
11. A count of the production supplies revealed a balance of $89 on hand at the end of the year
12. Any over or under-applied overhead is considered to be insignificant.
Click here for the solution: The following trial balance was taken from the records of Wheaton Manufacturing Company at the beginning of 2012
Friday, September 11, 2015
The following data (in thousands of dollars) have been taken from the accounting records of the Maroon Corporation for the just completed year
The following data (in thousands of dollars) have been taken from the accounting records of the Maroon Corporation for the just completed year.
Sales 1,200
Raw materials inventory, beginning 25
Raw materials inventory, ending 50
Purchases of raw materials 180
Direct labor 230
Manufacturing overhead 250
Administrative expenses 400
Selling expenses 200
Work in process inventory, beginning 150
Work in process inventory, ending 120
Finished goods inventory, beginning 100
Finished goods inventory, ending 110
Use the above data to prepare (in thousands of dollars) a schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold for the year. In addition, what is the impact on the financial statements if the ending finished goods inventory is overstated or understated?
Click here for the solution: The following data (in thousands of dollars) have been taken from the accounting records of the Maroon Corporation for the just completed year
Sales 1,200
Raw materials inventory, beginning 25
Raw materials inventory, ending 50
Purchases of raw materials 180
Direct labor 230
Manufacturing overhead 250
Administrative expenses 400
Selling expenses 200
Work in process inventory, beginning 150
Work in process inventory, ending 120
Finished goods inventory, beginning 100
Finished goods inventory, ending 110
Use the above data to prepare (in thousands of dollars) a schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold for the year. In addition, what is the impact on the financial statements if the ending finished goods inventory is overstated or understated?
Click here for the solution: The following data (in thousands of dollars) have been taken from the accounting records of the Maroon Corporation for the just completed year
Thursday, September 10, 2015
In confirming accounts receivable on December 31, 2009, the author found 15 discrepancies between the customers' records
Auditing P 5-22 In confirming accounts receivable on December 31, 2009, the author found 15 discrepancies between the customers' records and the recorded amounts in the accounts receivable master file. A copy of all confirmations that had exceptions was turned over to the company controller investigate the reason for the difference. He, in turn, had the bookkeeper perform the analysis. The bookkeeper analyzed each exception., determined its cause, and prepared an elaborate spreadsheet explaining exceptions were caused by timing differences in the bookkeeper's report indicated that the exceptions were caused by timing differences in the clients' and customer's records. The auditor reviewed the spreadsheet and concluded that there were no material exceptions to accounts receivable.
Two years subsequent to the audit, it was determined that the bookkeeper had stolen thousands of dollars in the past 3 years by taking cash and overstating accounts receivable. In a lawsuit by the client against the CPA, an examination of the auditors December 31, 2009, accounts receivable working papers, which were subpoenaed by the court, indicated that one of the explanations in the bookkeeper's analysis of the exceptions was fictitious. The analysis stated the exception was caused by a sales allowance granted to the customer for defective merchandise the day before the end of the year. The difference was actually caused by the bookkeeper's theft.
Required:
a. What are the legal issues involved in this situation? What should the auditor use as a defense in the event that he is sued?
b. What was the CPA's deficiency in conducting the audit of accounts receivable?
Click here for the solution: In confirming accounts receivable on December 31, 2009, the author found 15 discrepancies between the customers' records
Two years subsequent to the audit, it was determined that the bookkeeper had stolen thousands of dollars in the past 3 years by taking cash and overstating accounts receivable. In a lawsuit by the client against the CPA, an examination of the auditors December 31, 2009, accounts receivable working papers, which were subpoenaed by the court, indicated that one of the explanations in the bookkeeper's analysis of the exceptions was fictitious. The analysis stated the exception was caused by a sales allowance granted to the customer for defective merchandise the day before the end of the year. The difference was actually caused by the bookkeeper's theft.
Required:
a. What are the legal issues involved in this situation? What should the auditor use as a defense in the event that he is sued?
b. What was the CPA's deficiency in conducting the audit of accounts receivable?
Click here for the solution: In confirming accounts receivable on December 31, 2009, the author found 15 discrepancies between the customers' records
A company that records credit purchases in a purchases journal and records purchases returns
ACC 225 Week 7
Exercise 7-16
A company that records credit purchases in a purchases journal and records purchases returns in a general journal made the following errors. Indicate when each error should be discovered.
1. Posted a purchases return to the Accounts Payable account and to the creditor’s subsidiary account but did not post the purchases return to the Inventory account.
2. Posted a purchases return to the Inventory account and to the Accounts Payable account but did not post to the creditor’s subsidiary account.
3. Correctly recorded a $4,000 purchase in the purchases journal but posted it to the creditor’s subsidiary account as a $400 purchase.
4. Made an addition error in determining the balance of a creditor’s subsidiary account.
5. Made an addition error in totaling the Office Supplies column of the purchases journal.
Click here for the solution: A company that records credit purchases in a purchases journal and records purchases returns
Exercise 7-16
A company that records credit purchases in a purchases journal and records purchases returns in a general journal made the following errors. Indicate when each error should be discovered.
1. Posted a purchases return to the Accounts Payable account and to the creditor’s subsidiary account but did not post the purchases return to the Inventory account.
2. Posted a purchases return to the Inventory account and to the Accounts Payable account but did not post to the creditor’s subsidiary account.
3. Correctly recorded a $4,000 purchase in the purchases journal but posted it to the creditor’s subsidiary account as a $400 purchase.
4. Made an addition error in determining the balance of a creditor’s subsidiary account.
5. Made an addition error in totaling the Office Supplies column of the purchases journal.
Click here for the solution: A company that records credit purchases in a purchases journal and records purchases returns
Saturday, August 1, 2015
The accountant of Weatherspoon Shoe Co. has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2010
E4-6 (Multiple-step and Single-step) The accountant of Weatherspoon Shoe Co. has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2010.
Rental revenue $ 29,000
Interest expense 18,000
Market appreciation on land above cost 31,000
Wages and salaries—sales 114,800
Materials and supplies—sales 17,600
Income tax 30,600
Wages and salaries—administrative 135,900
Other administrative expenses 51,700
Cost of goods sold 516,000
Net sales 980,000
Depreciation on plant assets (70% selling, 30% administrative) 65,000
Cash dividends declared 16,000
There were 20,000 shares of common stock outstanding during the year.
Instructions
(a) Prepare a multiple-step income statement.
(b) Prepare a single-step income statement.
(c) Which format do you prefer? Discuss.
Click here for the solution: The accountant of Weatherspoon Shoe Co. has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2010
Rental revenue $ 29,000
Interest expense 18,000
Market appreciation on land above cost 31,000
Wages and salaries—sales 114,800
Materials and supplies—sales 17,600
Income tax 30,600
Wages and salaries—administrative 135,900
Other administrative expenses 51,700
Cost of goods sold 516,000
Net sales 980,000
Depreciation on plant assets (70% selling, 30% administrative) 65,000
Cash dividends declared 16,000
There were 20,000 shares of common stock outstanding during the year.
Instructions
(a) Prepare a multiple-step income statement.
(b) Prepare a single-step income statement.
(c) Which format do you prefer? Discuss.
Click here for the solution: The accountant of Weatherspoon Shoe Co. has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2010
The following information was taken from the records of Gibson Inc. for the year 2010
E4-16 (Various Reporting Formats) The following information was taken from the records of Gibson Inc. for the year 2010. Income tax applicable to income from continuing operations $119,000; income tax applicable to loss on discontinued operations $25,500; income tax applicable to extraordinary gain $32,300; income tax applicable to extraordinary loss $20,400; and unrealized holding gain on available-for-sale securities $15,000.
Extraordinary gain $ 95,000 Cash dividends declared $ 150,000
Loss on discontinued operations 75,000 Retained earnings January 1, 2010 600,000
Administrative expenses 240,000 Cost of goods sold 850,000
Rent revenue 40,000 Selling expenses 300,000
Extraordinary loss 60,000 Sales 1,700,000
Shares outstanding during 2010 were 100,000.
Instructions
(a) Prepare a single-step income statement for 2010.
(b) Prepare a retained earnings statement for 2010.
(c) Show how comprehensive income is reported using the second income statement format.
Click here for the solution: The following information was taken from the records of Gibson Inc. for the year 2010
Extraordinary gain $ 95,000 Cash dividends declared $ 150,000
Loss on discontinued operations 75,000 Retained earnings January 1, 2010 600,000
Administrative expenses 240,000 Cost of goods sold 850,000
Rent revenue 40,000 Selling expenses 300,000
Extraordinary loss 60,000 Sales 1,700,000
Shares outstanding during 2010 were 100,000.
Instructions
(a) Prepare a single-step income statement for 2010.
(b) Prepare a retained earnings statement for 2010.
(c) Show how comprehensive income is reported using the second income statement format.
Click here for the solution: The following information was taken from the records of Gibson Inc. for the year 2010
Monday, June 29, 2015
(Bank reconciliation and internal control) The records of Parker Company indicate a July 31 cash balance of $10,400, which includes undeposited receipts for July 30 and 31
CP 8-5 Bank reconciliation and internal control (25th edition)
The records of Parker Company indicate a July 31 cash balance of $10,400, which includes undeposited receipts for July 30 and 31. The cash balance on the bank statement as of July 31 is $10,575. This balance includes a note of $2,250 plus $150 interest collected by the bank but not recorded in the journal. Checks outstanding on July 31 were as follows: No. 2670, $1,050; No. 3679, $675; No. 3690, $1,650; No. 5148, $225; No. 5149, $750; and No. 5151, $800. On July 25, the cashier resigned, effective at the end of the month. Before leaving on July 31, the cashier prepared the following bank reconciliation:
Cash balance per books, July 31 .................................... $10,400
Add outstanding checks:
No. 5148 ........................................................ $225
5149 ........................................................ 750
5151 ........................................................ 800 1,675
$12,075
Less undeposited receipts ......................................... 1,500
Cash balance per bank, July 31 ..................................... $10,575
Deduct unrecorded note with interest .............................. 2,400
True cash, July 31.................................................. $ 8,175
Calculator Tape of Outstanding Checks:
0*
225
750
800
1,675*
Subsequently, the owner of Parker Company discovered that the cashier had stolen an unknown amount of undeposited receipts, leaving only $1,500 to be deposited on July 31. The owner, a close family friend, has asked your help in determining the amount that the former cashier has stolen.
1. Determine the amount the cashier stole from Parker Company. Show your computations in good form.
2. How did the cashier attempt to conceal the theft?
3. a. Identify two major weaknesses in internal controls, which allowed the cashier to steal the undeposited cash receipts.
b. Recommend improvements in internal controls, so that similar types of thefts of undeposited cash receipts can be prevented.
Click here for the solution: (Bank reconciliation and internal control) The records of Parker Company indicate a July 31 cash balance of $10,400, which includes undeposited receipts for July 30 and 31
Tuesday, June 23, 2015
(Multiple-step and Single-step). The accountant of Whitney Houston Shoe Co. has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2007
Exercise 4-6 (E4-6) (Multiple-step and Single-step). The accountant of
Whitney Houston Shoe Co. has compiled the following information from the
company’s records as a basis for an income statement for the year ended
December 31, 2007.
Rental revenue $ 29,000
Interest on notes payable 18,000
Market appreciation on land above cost 31,000
Wages and salaries—sales 114,800
Materials and supplies—sales 17,600
Income tax 37,400
Wages and salaries—administrative 135,900
Other administrative expenses 51,700
Cost of goods sold 496,000
Net sales 980,000
Depreciation on plant assets (70% selling, 30% administrative) 65,000
Cash dividends declared 16,000
There were 20,000 shares of common stock outstanding during the year.
Instructions
(a) Prepare a multiple-step income statement.
(b) Prepare a single-step income statement.
(c) Which format do you prefer? Discuss.
Click here for the solution: (Multiple-step and Single-step). The accountant of Whitney Houston Shoe Co. has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2007
Rental revenue $ 29,000
Interest on notes payable 18,000
Market appreciation on land above cost 31,000
Wages and salaries—sales 114,800
Materials and supplies—sales 17,600
Income tax 37,400
Wages and salaries—administrative 135,900
Other administrative expenses 51,700
Cost of goods sold 496,000
Net sales 980,000
Depreciation on plant assets (70% selling, 30% administrative) 65,000
Cash dividends declared 16,000
There were 20,000 shares of common stock outstanding during the year.
Instructions
(a) Prepare a multiple-step income statement.
(b) Prepare a single-step income statement.
(c) Which format do you prefer? Discuss.
Click here for the solution: (Multiple-step and Single-step). The accountant of Whitney Houston Shoe Co. has compiled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2007
(Various Reporting Formats) The following information was taken from the records of Roland Carlson Inc. for the year 2007
Exercise 4-16 (E4-16) (Various Reporting Formats) The following
information was taken from the records of Roland Carlson Inc. for the
year 2007. Income tax applicable to income from continuing operations
$187,000; income tax applicable to loss on discontinued operations
$25,500; income tax applicable to extraordinary gain $32,300; income tax
applicable to extraordinary loss $20,400; and unrealized holding gain
on available-for-sale securities 15,000.
Extraordinary gain $ 95,000 Cash dividends declared $ 150,000
Loss on discontinued operations 75,000 Retained earnings January 1, 2007 600,000
Administrative expenses 240,000 Cost of goods sold 850,000
Rent revenue 40,000 Selling expenses 300,000
Extraordinary loss 60,000 Sales 1,900,000
Shares outstanding during 2007 were 100,000.
Instructions
(a) Prepare a single-step income statement for 2007.
(b) Prepare a retained earnings statement for 2007.
(c) Show how comprehensive income is reported using the second income statement format.
Click here for the solution: (Various Reporting Formats) The following information was taken from the records of Roland Carlson Inc. for the year 2007
Extraordinary gain $ 95,000 Cash dividends declared $ 150,000
Loss on discontinued operations 75,000 Retained earnings January 1, 2007 600,000
Administrative expenses 240,000 Cost of goods sold 850,000
Rent revenue 40,000 Selling expenses 300,000
Extraordinary loss 60,000 Sales 1,900,000
Shares outstanding during 2007 were 100,000.
Instructions
(a) Prepare a single-step income statement for 2007.
(b) Prepare a retained earnings statement for 2007.
(c) Show how comprehensive income is reported using the second income statement format.
Click here for the solution: (Various Reporting Formats) The following information was taken from the records of Roland Carlson Inc. for the year 2007
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