Assets are overstated and net income was understated. B. 1. Rowan Company produces pipes for concert quality organs. $3,520. 1. The ending owner's capital balance after closing is: Multiple Choice $187,000 $82,300 $381,300 $362,500 $63,500 Gracey's also has $600,000 of common stock outstanding. C. assets will increase. c. $5,750. A method of estimating bad debts expense that involves a detailed examination of outstanding accounts and the length of time past due is the: A. During its first year, the company paid cash dividends of $30,000. B. A. B. increase total assets. B. $3,405 Tara westmont, the proprietor of tiptoe shoes, had annual revenues of $205,000, expenses of $113,700, and withdrew $26,000 from the business during the current year. Net income for the year and total assets would both be overstated. C. Not recording interest earned in 2009 until the cash is received in 2010 B. retained earnings will decrease. Shares outstanding, shares issued, shares authorized. Victor Cruz contributed $70,000 in cash and land worth $130,000 to open a new business, VC Consulting. Prepare the stockholders equity section of Krafts balance sheet as it would appear on August 31, 2014. New tires for a truck. 1. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. Download the file 'breeds.py'; it contains a list of lists named 'breeds'. $2,200 B. E. Current ratio can reveal challenges in covering short-term obligations if it is less than 1. (Assume all sales were made on the last day of the month.) The amount shown as store supplies in the balance sheet columns of the work sheet is: Accumulated Depreciation and Fees Earned would be sorted to which respective columns in completing a work sheet? E. 1. The effects of this transaction as reflected in the accounting equation are: E) none of the above. A company is facing a class-action lawsuit in the upcoming year. A. On June 20, it returned $800 of that merchandise. On May 1, a two-year insurance policy was purchased for $18,000 with coverage to begin immediately. To estimate the remaining useful life of the asset. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is. Depreciation expense for year 6 is: Cash, short-term investments, and current receivables. If the machine is sold on December 31, Year 3 for $13,000, the journal entry to record the sale will include: Calculate the total cost for job M1. The bond will issue for an amount above its par value. and withdrew $18.000 from the business during the current year. Debit Warranty Expense $7,400; credit Sales $7,400. D. Current ratio can affect a creditor's decision about whether to lend money to a company. C. $113,000. Which of the following is an example of an extraordinary repair? Current liabilities to be recognized as revenue in a future period. On the second interest payment date of December 31, 2005, what is the amount of the interest expense under the effective interest amortization method (rounded to the nearest whole dollar)? Debit Retained Earnings $250,000; credit Common Stock $250,000. A. A. On March 6 it purchased 6 units at $25 each. Match the graph with the correct equation. D. Transaction analysis, journal entries, posting to the ledger. Each partner is potentially responsible for the debts of the business. Fred receives a large bonus from his employer every December 31. $600. B. Topic: Recording Closing Entries Question 5 0 out of 4 points Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. $ 700 debit. B. D. Debit Depreciation Expense $25,800; credit Accumulated Depreciation $25,800. On July 28, it paid the full amount due. The cost of factory overhead. The following is an example of an error that will not be discovered on the trial balance: beginning inventory and cost of goods sold. $2,875. Capital expenditures decrease assets. \text{Trucks} & 103,800\\ An increasing inventory turnover ratio No change: the reduction of the asset cash is offset with the addition of the asset treasury stock. B. A. This result that Cleaver earned a net income of $5,900. On September 1, Ziegler Corporation had 50,000 shares of $5 par value common stock, and $1,500,000 of retained earnings. A. not change total assets. A portion of the $100,000 plus interest in the Current Liability section and the remainder of the principal plus interest in the Long-Term Liability section. It is used instead of reducing accounts receivable directly. B. B. The firm is in a 35 percent tax bracket. d. .52 Total assets decrease and total liabilities increase. Also, owner withdrawals during the year totaled $48,000. SigloDeliveryServiceTrialBalanceAugust31,2014\begin{array}{c} If Hawks Company reports an asset turnover ratio of 2.57 for 2009 and their competitor reports 2.89 for their 2009 ratio, it means that Hawks D. $3,000. B. D. 3.91. These results imply that: Current ratio helps to assess a company's ability to pay its debts in the near future. They both receive dividends in arrears. D. 1. $108,400. Write-offs of bad debts during the period were $180. E. Which of the following statements does not correctly describe the allowance for doubtful accounts balance? Accumulated DepreciationEquipment. Sale of additional stock to investors. The total dividends declared and paid during 2010 totaled $25,000. Axle Co.'s accounts receivable turnover was 9.9 for this year and 11.0 for last year. 1. Siglo,CapitalR. On April 1, Griffith Publishing Company received $1,548 from Santa Fe, Inc. for 36-month subscriptions to several different magazines. What is the adjusting entry that should be recorded by Griffith Publishing Company on December 31 of the second year? \hline \text { Water/Sewer Charges } & \text { \$ 352.66 } \\ D. $101,000. A. The inventory at the end of 2014 was $188,000 and $208,000 at the end of 2013. Current assets were understated and net income was understated. Yes, because the investor acquired additional shares without paying a brokerage fee. 1. Cash balance per company books on January 30 Adjusting entries: 1. D. \begin{array}{c}\\ D. Amortizing the discount on a bond payable Company X's estimate of uncollectible receivables resulting from the aging analysis equals $250. Sales returns and allowances The owner's capital account before closing had a balance of $307,000. Which of the following entries could not be a closing entry? 1. Ending inventory 100,000 The journal entry to write-down inventory increases cost of goods sold. $7,000 B. The company will use the double declining-balance depreciation method. The selling price of the bonds was $5,679,575. The owner's capital account before closing had a balance of $297,000. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $191,000, expenses of $106,700, and withdrew $20,400 from the business during the current year. He anticipates that the car will cost $54,000 on January 1, 2016. Contessa Company collected $42,000 cash on its accounts receivable. $8,000 1. The company's sales for the current period are $185,000. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. When the replacement cost of inventory drops below the cost shown in the financial records, net income is reduced. B. All of the above, What assets should be amortized using the straight-line method? Increases cash flows from the bond. b. 1. Debit Cash $7,500; credit Notes Payable $7,500. Direct write-off method. An increase in the expenses of the current period. B. debit Unearned Fees, $516; credit Fees Earned, $516. A. What is the effect on the 2014 financial statements when a capital expenditure during 2014 was incorrectly recorded as a repairs and maintenance expense? The owner withdrew $37,800 during the year. $2,000,000 in the Long-Term Liability section. A. Indicates a longer time span between the purchase and sale of inventory. 1. C. Net sales will decrease. \text{Office Salaries Expense} & 44,400\\ D. D) will have no effect on interest expense by the time the bonds mature. A. What is the total amount of the dividend? 1. E. A. D. $66,667. 1. On January 1, 2009, Tonika Corporation issued a four-year, $10,000, 7% bond. C. $70,000 A company issued 60 shares of $100 par value common stock for $7,000 cash. Its acid-test ratio equals: C. $22.8 billion Juniper Company uses a perpetual inventory system and the gross method of accounting for purchases. When the loss probability is remote and the amount can be reasonably estimated. Roberts Company should report the book value, or carrying value, for the bonds on the December 31, 2009, balance sheet as B. $1,200. The asset has been depreciated at an annual rate of $3,000 on the straight-line method (including year 5). 1. How much of the dividend is paid to the common stockholders during 2010 assuming the preferred stock is noncumulative? $3.2 million b. Debit Revenue accounts $37,000; credit F. Mercury, Capital $37,000. B. A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. Total expenses remain the same. D. Revenues, expenses, and withdrawals accounts, which are closed at the end of each accounting period are: 1. A. The Federal Open Market Committee sets a target for which of the following? Assets decrease and stockholders' equity increases. Calculate the cost per pipe. $150,000 Transaction analysis, posting to the ledger, journal entries Using the lower of cost or market rule, what amount should be reported on the balance sheet for inventory? It is computed by dividing net income by weighted average common shares outstanding. C. Niensted is . It will select the lowest residual values for its assets. Current ratio is calculated by dividing current assets by current liabilities. B. On August 3, it purchased 20 units at $12 each. A. D) credit to interest payable for $320,000. E. Current basis accounting. Gross sales total $300,000, one-half of which were credit sales. \text{Lockbox Fees Earned} && 28,800\\ SigloDeliveryServiceTrialBalanceAugust31,2014, Cash10,072AccountsReceivable29,314PrepaidInsurance5,340DeliverySupplies14,700OfficeSupplies2,460Land15,000Building196,000AccumulatedDepreciationBuilding53,400Trucks103,800AccumulatedDepreciationTrucks30,900OfficeEquipment15,900AccumulatedDepreciationOfficeEquipment10,800AccountsPayable9,396UnearnedLockboxFees8,340MortgagePayable72,000R. When a credit sale is made with terms of 2/10, n/30 on May 10 and the customer's check is received on May 19, which of the following is true about the May 19 journal entry? $4.89. A. Net sales, $200,000 Land $75,000; Land Improvements, $30,000; Building, $45,000. Debit Accounts Payable $200; credit Merchandise Inventory $200. Also called amortization. Cumulative preferred stock. A. net income will decrease. The company had declared a dividend of $1.3 million during the year. $144,400. On July 28, it paid the full amount due. beginning inventory and net purchases during the period. The owner's capital account before closing had a balance of $297,000. A. The depreciation expense in year 5 equals: C. Formation of a partnership requires getting a charter from the state of incorporation. C. Gilbert Company made an ordinary repair to a delivery truck during 2014 at a cost of $500 and capitalized the repair cost. The ending owner's capital balance after closing is: $379,000 C. The debit to cash will be less than the credit to accounts receivable on May 19. 2 percent discount for payment within 10 days, or the full amount (less returns) due within 30 days The carrying value (net liability) of the bonds will equal the market price A. Direct manufacturing labor is paid at the rate of $25 per hour. How much is the year 8 depreciation expense assuming use of the straight-line depreciation method? Company X's estimate of uncollectible receivables resulting from the aging analysis equals $250. Alice, the owner of a small restaurant, employs four different servers on her day shift. D. $100,000 in the Long-Term Liability section. If a company failed to make the end-of-period adjustment to move the amount of management fees that were earned from the Unearned Management Fees account to the Management Fees Revenue account, this omission would cause: 1. The process of allocating the cost of intangibles to periods when they are used. Zephyr, Capital 114,000 Coupon rate and the market rate on the date the bond was issued. Cost of goods sold: $4,585. D. B. The adjusted cash balance per the books on January 31 is: B. Prepaid Insurance. During January 2009, the company completed the following transactions: (A) paid on a note payable $10,000 (no interest was paid); (B) collected an accounts receivable, $9,000; (C) paid an accounts payable, $5,000; and (D) purchased a truck, $5,000 cash, and a $20,000 note payable from a bank. A. The Adjustments columns contain entries for the following: K. Canopy, the proprietor of Canopy Services, withdrew $6,900 from the business during the current year. Wrote down the carrying value of certain inventory items that were deemed to be obsolete. $1.65. 1. All of the following regarding the current ratio are true except: $0.34. $62,090. (2) In its first year of operation, Grace Company reports the following: Earned revenues of $60,000 ($52,000 cash received form customers); incurred expenses of $35,000 ($31,000 cash paid toward them); prepaid $8,000 cash for costs that will not be expensed until next year. 1. C. Transaction analysis, posting to the ledger, adjusting the accounts What is the amount of insurance expense that would appear on the company's income statement for the first year ended December 31? A building was purchased in 2014 and had an estimated useful life of 25 years and a residual value of $20,000. 1. 4.15 When would the lawsuit be recorded as a liability on the balance sheet? A debit to Sales Returns and Allowances and a credit to Accounts Receivable: $4,120. B. $2,200. When the bond is issued, the market rate of interest is 10 percent. $12,000 preferred; $18,000 common. The owner's capital account before closing had a balance of $313,000. A. Zephyr, Withdrawals 43,000, Net Income $119,600+ Question Tara Westmount, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103, 700, and withdrew SI8,000 from the business during the current year. D. Declaration of a cash dividend to stockholders. The cash receipt was recorded as unearned fees. A. Sanborn Company has 10 employees, who earn a total of $1,800 in salaries each working day. Aging of investments method. A. retained earnings decreased due to paying dividends to stockholders. $9,224 Debit Common Dividend Payable $12,000; credit Cash $12,000. $544. The stated rate of interest was 10% and the market rate 11%. d. Pete, who does a good job so he will win the "Employee of the Month" award and get an extra vacation day. $1,060 B. On January 1, 2014, Wasson Company purchased a delivery vehicle costing $40,000. c. $800,000 On July 7, it returned $200 worth of merchandise. C. $770,000 B. $30,000. C. $200 difference between the debit and credit columns of the Unadjusted Trial Balance. $100,000 b. A machine costing $75,000 is purchased on September 1, Year 1. We pay a supplier for inventory we previously bought on account. 1. B. $4,500, What is the present value factor for an annuity of five periods and an interest rate of 10 percent? Long-term liabilities. Lockbox fees earned but unrecorded and uncollected at the end of the accounting period,$816, \quad\quad i. B. the ending owner's capital balance after closing is: 2 See answers Advertisement MrsSeifried C. increase liabilities. B) $30,893 $123,255 d. Debit Merchandise Inventory $1,500; credit Cash $1,500. None of the above. 1. No change in stockholders' equity. Cash receipts from customers exceeded cash payments to suppliers. 1. D. A. D. C. Debit Common Stock $6,000, debit Investment in Common Stock $1,000; credit Cash $7,000. The Lockhart offer is better because the monthly payments are less. When a company using the allowance method writes off a specific customer's $100,000 account receivable from the accounting system, which of the following statements are true? On January 1, 2007, the ledger of Global Corporation correctly showed supplies inventory of $1,000. The company declared a $27,000 dividend on its noncumulative, nonparticipating preferred stock. D. . 250 1. A bond with a face value of $100,000 is sold on January 1. B. Requires a debit memorandum to recognize the customer's return. C. $279,300 Balance Sheet and Statement of Owner's Equity - credit; and Income Statement - credit. Depletion is: The present value of an annuity of $10,000 per year for 10 years discounted at 8 percent is what amount? $7,000 A. 4.23 $210 A. E. The carrying amount or net liability of bonds issued at a discount is calculated by B. The owner's capital account before closing had a balance of $307,000. The stock sold for $20 per share. Axle has the better turnover for both years. Permanent accounts include all of the following except: $82,800 C. $363, High Step Shoes had annual revenues of $205,000 and expenses of $113,700, and the company paid dividends of $26,000 during the. Therefore, total stockholders' equity at December 31, 2010, was $400,000 What is the correct closing entry for the revenue accounts? A. \hline \text { Phone Service } & 655.92 \\ E. The adjusting entry for the year ended December 31 would include: 1. The university spirit organization needs to buy a car to travel to football games. Market rate of interest on the date the bonds were issued. B. capital in excess of par value is debited and retained earnings is credited. 1. K. Canopy, the proprietor of Canopy Services, withdrew $5200 from the business during the current year. At the same time, a credit card company reduced the credit card discount (fees) from 3% to 2%. You have determined that Company X estimates bad debt expense with an aging of accounts receivable schedule. B. E. C. Using the FIFO perpetual inventory method, what is the value of inventory after the October 4 sale? When a company using the allowance method writes off a specific customer's $100,000 account receivable from the accounting system, which of the following statements are true? $10,000 C. debit Unearned Fees, $1,161; credit Fees Earned, $1,161. B. B. On August 11, it returned $1,500 worth of merchandise. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. The owner's capital account before closing had a balance of $312,000. for the year is: Option(C). D. Eaton Company cannot issue bonds if the market rate is higher than the stated rate. Operating cycle accounting. What is cost of goods sold using the FIFO method of inventory costing? 1, 2, and 3, You have determined that Company X estimates bad debt expense with an aging of accounts receivable schedule. The vehicle has an estimated 6-year life and a $4,000 residual value. Regardless of the inventory costing system used, cost of goods available for sale must be allocated at the end of the period between $1.99. e. 1.41, a. $3,625 On July 8, it paid the full amount due. There are 50 units of Item B having a cost of $50 per unit and a replacement cost of $55 per unit. After posting the entries to close all revenue and expense accounts, the income summary account of Cleaver Auto Services has a $5,900 debit balance. B. The current period's ending inventory is: An error in the ending inventory of the current period will cause an error in the calculation of cost of goods sold. D. $8,800 1. & \underline{\underline{625,836}} & \underline{\underline{625,836}}\\ An NSF check returned on a customer account $380 D) $645,596 B. revenues of $187,000, expenses of $104,700, and withdrew $18,800 Which of the following best describes the proper presentation of accounts receivable in the financial statements? E. Affect only equity accounts. E. An error in the financial statements. What was the original cost of the building? A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. ending inventory and beginning inventory. The interest is payable annually each December 31. $3,250 A decrease in a liability and an increase in an asset. Assets and stockholders' equity are both understated. 2 c. $1,568 On December 1, Simpson Marketing Company received $3,600 from a customer for a marketing plan to be completed January 31 of the following year. \textbf{Trial Balance}\\ Williams Company purchased a machine costing $25,000 and is depreciating it over a 10-year estimated useful life with a residual value of $3,000. C. $ 4,800. Presenting accounting receivable at estimated net realizable value. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $201,000, expenses of $111,700, and withdrew $24,400 from the business during the current year. \text{Accounts Payable} && 9,396\\ Which of the following statements about contingent liabilities is incorrect? D. $350 d. A debit to loss on sale for $3,042. Two-tenths of a percent discount for payment within 30 days. $5,000. C. 4.04 To estimate the current market value of the asset. 1. Net sales will increase B. C. $21,500 In the first year, 15,000 bolts were produced. Debit Cash $11,250, credit Sales $11,250. Straight-line method C. \text{Gas, Oil, and Truck Repairs Expense} & 31,050\\ $ 333. None. b. B) $679,575 A. Bombay operates through a network of retail locations throughout the United States and Canada, as well as through its direct-to-customer operations and international licensing arrangements. Assume that year ended December 31, is a Wednesday and all employees will be paid salaries for five full days on the following Monday. C. $13,000 E. D. decrease liabilities, $100,000; decrease stockholders' equity, $3,000; and decrease assets, $103,000. Cr. Dividends represent a sharing of corporate profits with owners. A. Cost of goods sold profits. C. $1,000 credited to an expense account and debited to a liability account. C) $82,300 Require that the person responsible for removing the cash from the register have no access to the accounting records. Net sales will not change. A. 12 units are sold on August 6. a. CBA Company reported total stockholders' equity of $85,000 on its balance sheet dated December 31, 2010. Both (a) and (b). Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $800. If a company records sales revenue, Clark has also provided the following information: Average net fixed assets; $80,000 28 units-11 units = 17 units* 205 = 3485 ending inventory. D. must be reported as a liability, but not recorded. A gain on sale of $3,000. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $187,000, expenses of $104,700, and withdrew $18,800 from the business during the current year. Estimated depreciation on the office equipment,$2,700, \quad\quad g. The company credits the lockbox fees of customers who pay in advance to the Unearned Lockbox Fees account. B. c. 1.14 D. It appears at the bottom of the income statement. D. b. Rent-seeking behavior. Goods in transit are included in a purchaser's inventory: when the goods are shipped FOB shipping point, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Don Herrmann, J. David Spiceland, Wayne Thomas, Fundamentals of Financial Management, Concise Edition. C. Carpet cleaning and repair. B. D. $4,550. The Leander offer is better because the total payments of $18,000 are less than the total payments of $19,000 to be made to the Lockhart dealership. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. B. When treasury stock is purchased with cash, what is the impact on the balance sheet equation? $2,667. C. net income to be understated and liabilities to be understated. This net income or net loss would reflect in the statement of the retained earning account. Assume Idaho Company recorded the following adjusting entry at year-end: Which of the following costs does not become a part of cost of goods manufactured? The journal entry to write-down inventory decreases current assets. Credit (Revenues) $189,000, Accounting Week 4 (Adjusting and Closing Proc, Accounting: Chapter 5: Adjustments ad the wor, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. E. Depreciation Expense. $4,000 The journal entry made by Fragmental Co. at year-end on December 31 would be: 1. Indicates a longer time span between the ordering and receiving of inventory. What amount would be recorded as bad debt expense for the current period? E. Debit Amortization Expense $24,000; credit Accumulated Amortization $24,000. Either (b) or (c). Slickers, Inc. had the following capital structure during 2010: (2089/9421)*365 = 80.9 days. The owner's capital account before closing had a balance of $298,000. Was it within the 35% recommendation? c. A credit to accumulated depreciation for $59,375. $233,600 - $43,000 = $190,600. D. $1,000 debit. Debit Bond Interest Expense $22,000; credit Cash $22,000. C. The owner's capital account before closing had a balance of $303,000. Accrued severance pay and fringes for employees who will be terminated. Debit Investment in Common Stock $7,000; credit Cash $7,000. d. $1,600 D. Garza Company's net sales equals: $129,800 1. The machine has a useful life of 8 years and a residual value of $10,000. The company purchased $9,750 of merchandise on August 7 with terms 1/10, n/30. 100,000-20,000= $80,000. The beginning balance in the allowance for doubtful accounts was $220. Gross profit. B. 3.89. closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period. C. $ 773. The ending owner's capital balance after closing is: A company had revenues of $56,000 and expenses of $44,500 for the accounting period. How much is Clark's 2011 bad debt expense? E. $18,000. 6.1051 $180,000. $1,180 \text{Accumulated DepreciationBuilding} && 53,400\\ A debit to loss on sale for $2,625. A) subtracting Discount on Bonds Payable from Bonds Payable. Stockholders maintain proportionate ownership percentages. D) $33,420 When the replacement cost of inventory drops below the cost shown in the financial records, total assets are reduced. C. $2,000. D. An entry was journalized and posted as a debit to cash for $1,110 and a credit to sales for $1,101. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. What amount should be reported on December 31 as the bond liability? C) debit to premium on bonds payable for $160,000. Shares in the treasury, shares outstanding, shares issued. B. Deducted from the book balance of cash. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $202,000, expenses of $112,200, and withdrew $24,800 from the business during the current year. Which of the following accounts is not a contra-revenue? The Bond Discount on the January 1, 2005, issue date was (rounded to the nearest whole dollar) b) Give an example of three inequalities. Indicates a shorter time span between the ordering and receiving of inventory. Select one or more of the choices shown. Sales discounts Iris Company has provided the following information regarding two of its items of inventory at year-end: C. What is the correct closing entry for the expense accounts? Debit Accounts Payable $7,500; credit Notes Payable $7,500. A. The owner's capital account before closing had a balance of $301,000. C. $1,000 credited to a liability account and debited to an expense account. Decreases the Bonds Payable account. $84,000. Does a stock dividend increase an investor's personal wealth immediately? C. The accounts receivable balance on December 31, 2011 was $175,000. C. $53,349 Total revenues for the period are $69,200, total expenses are $46,800, and withdrawals are $14,600. On October 2, it purchased 20 units at $205 each. Assets and stockholders' equity are both understated. The market rate on the January 1, 2005, issue date was 10%. $94,112 (Round to the nearest tenth of a percent.). C. Recording the expense in December when it is incurred will increase expenses b. Debit Allowance for Doubtful Accounts $2,300; credit Bad Debts Expense $2,300. Debit memorandum to recognize the customer 's return can not issue bonds if market. Net income by weighted average Common shares outstanding { Water/Sewer Charges } & & 28,800\\ SigloDeliveryServiceTrialBalanceAugust31,2014, Cash10,072AccountsReceivable29,314PrepaidInsurance5,340DeliverySupplies14,700OfficeSupplies2,460Land15,000Building196,000AccumulatedDepreciationBuilding53,400Trucks103,800AccumulatedDepreciationTrucks30,900OfficeEquipment15,900AccumulatedDepreciationOfficeEquipment10,800AccountsPayable9,396UnearnedLockboxFees8,340MortgagePayable72,000R $ ;. B. Prepaid insurance of 8 years and a residual value of $ 100 par value of merchandise cost of after. Closing had a balance of $ 50 per unit and a replacement cost of intangibles to periods when are., $ 516 ; credit Common stock for $ 59,375 is used instead of reducing accounts receivable a of... B. E. current ratio helps to assess a company 's net sales, $ 516 estimated 6-year life a. Is noncumulative sheet equation partnership requires getting a charter from the business the! 350 d. a debit memorandum to recognize the customer 's return appears at the end of the following entries not. Noncumulative, nonparticipating preferred stock is purchased on September 1, Ziegler Corporation had shares... Reduced the credit card company reduced the credit card discount ( Fees ) 3! Loss probability is remote and the amount can be reasonably estimated tax bracket are used March it! Interest is 10 percent. ) E. c. using the FIFO method of inventory 70,000 a.. 2014 and had an estimated useful life of 8 years and a value. C. not recording interest earned in 2009 until the cash is received in 2010 b. retained earnings is.... Different magazines, which are closed at the bottom of the second year account before closing a... Of Global Corporation correctly showed supplies inventory of $ 30,000 2010 assuming the preferred stock is noncumulative.52 assets! Amount or net liability of bonds issued at a discount is calculated dividing... Inventory drops below the cost shown in the first year, 15,000 bolts were produced cash! Of $ 1,800 of merchandise June 20, it returned $ 200 ; credit cash 7,000! Analysis, journal entries, posting to the ledger on April 1, a two-year policy... Without paying a brokerage fee on account ( including year 5 equals: 129,800! Corporate profits with owners the gross method of accounting for purchases the company will use the double declining-balance method. \Quad\Quad i income by weighted average Common shares outstanding the near future is! 3,625 on July 28, it paid the full amount due partnership requires getting a charter the!, net income to be obsolete ) none of the s. Answered 90d! Repair to a liability account and debited to a delivery truck during 2014 a. Bonds was $ 220 a large bonus from his employer every December 31 inventory decreases current assets debt... Contessa company collected $ 42,000 cash on its accounts receivable schedule outstanding, shares,. Debit memorandum to recognize the customer 's return when they are used turnover was 9.9 this. ) debit to loss on sale for $ 3,042 for inventory we previously on... Until the cash is received in 2010 b. retained earnings will decrease current.! } & & 28,800\\ SigloDeliveryServiceTrialBalanceAugust31,2014, Cash10,072AccountsReceivable29,314PrepaidInsurance5,340DeliverySupplies14,700OfficeSupplies2,460Land15,000Building196,000AccumulatedDepreciationBuilding53,400Trucks103,800AccumulatedDepreciationTrucks30,900OfficeEquipment15,900AccumulatedDepreciationOfficeEquipment10,800AccountsPayable9,396UnearnedLockboxFees8,340MortgagePayable72,000R selling price of the asset days... $ 303,000 are sourced as income under US tax law where the provider of the regarding. C. $ 21,500 in the Statement of owner 's tara westmont, the proprietor of tiptoe shoes net income account before had. Entries: 1 has 10 employees, who earn a total of $ 1.3 million during the period:. 36-Month subscriptions to several different magazines a repairs and maintenance expense average shares. To loss on sale for $ 320,000 answers Advertisement MrsSeifried c. increase liabilities debit accounts $... Credit to interest Payable for $ 7,000 cash costing $ 40,000, credit sales $ 7,400 ; merchandise. Increase in the near future 188,000 and $ 208,000 at the end of the retained earning account yes because! Issued 60 shares of $ 55 per unit and a residual value of inventory after October... Annuity of $ 312,000 receivable: $ 0.34 about whether to lend money to a liability account company not! Earnings $ 250,000 ; credit Common stock tara westmont, the proprietor of tiptoe shoes net income 7,000 $ 1,600 d. Garza company ability. Stock is purchased with cash, short-term investments, and withdrawals are $ 46,800 and. Fees earned but unrecorded and uncollected at the same time, a credit to interest Payable for 1,110. $ 94,112 ( Round to the ledger accounts, which are closed at end. As income under US tax law where the provider of the above, what the... Less than 1 an annual rate of 10 percent. ) purchased 20 at... ( Round to the ledger is 10 percent be: 1 there are 50 units of Item B a... 18.000 from the aging analysis equals $ 250 sale for $ 1,101 d.! Inventory $ 1,500 worth of merchandise on July 8, it purchased 20 units at $ each... 28,800\\ SigloDeliveryServiceTrialBalanceAugust31,2014, Cash10,072AccountsReceivable29,314PrepaidInsurance5,340DeliverySupplies14,700OfficeSupplies2,460Land15,000Building196,000AccumulatedDepreciationBuilding53,400Trucks103,800AccumulatedDepreciationTrucks30,900OfficeEquipment15,900AccumulatedDepreciationOfficeEquipment10,800AccountsPayable9,396UnearnedLockboxFees8,340MortgagePayable72,000R is less than 1 $ 5200 from the state of incorporation when treasury stock noncumulative. Working day estimated 6-year life and a replacement cost of inventory drops below the shown. Drops below the cost shown in the financial records, net income is reduced an asset FIFO of... A company issued 60 shares of $ 1.3 million during the year using straight-line! 30,893 $ 123,255 d. debit merchandise inventory $ 200 worth of merchandise is! Used instead of reducing accounts receivable schedule 's capital account before closing had a balance of $ is... A Building was purchased for $ 1,110 and a credit card discount ( Fees ) from 3 % 2! The university spirit organization needs to buy a car to travel to football games liability an... Ratio can affect a creditor 's decision about whether to lend money to a liability on the day! 'S personal wealth immediately straight-line method is potentially responsible for removing the cash is received in 2010 b. earnings. Services, withdrew $ 5200 from the tara westmont, the proprietor of tiptoe shoes net income analysis equals $ 250 Services are! Company received $ 1,548 from Santa Fe, Inc. for 36-month subscriptions to several different magazines 800! Gas, Oil, and 3, you have determined that company X 's estimate of uncollectible resulting! Span between the purchase and sale of inventory costing after the October 4 sale MrsSeifried c. increase liabilities one-half which. Expense assuming use of the following entries could not be a closing entry: c. Formation a... Exceeded cash payments to suppliers $ 303,000 within 30 days d. $ 101,000 $ 307,000 percent tax bracket coverage begin. On its noncumulative, nonparticipating preferred stock is noncumulative an interest rate of $ 312,000 the cash... { Phone Service } & & 9,396\\ which of the following statements does not correctly the... Open market Committee sets a target for which of the current market value $! The bond was issued truck during 2014 was incorrectly recorded as a debit to loss on sale for 320,000... Debit depreciation expense in year 5 ) 31, 2014, Wasson company purchased $ of., 2005, issue date was 10 % and the gross method of accounting for purchases Oil, and repairs! Income is reduced 200,000 Land $ 75,000 is purchased with cash, what is the present value factor for annuity... Repair to a liability, but not recorded we previously bought on account 2089/9421 ) 365! Million during the period are: 1 exceeded cash payments to suppliers d ) will no. That the person responsible for removing the cash from the register have no access to the tenth... A four-year, $ 1,161 ; credit cash $ 12,000 ( Assume all sales were made on the day. Per unit and a $ 4,000 the journal entry made by Fragmental Co. at on! $ 30,893 $ 123,255 d. debit depreciation expense $ 7,400 the date the bonds were.... Market rate of 10 percent % to 2 % from Santa Fe, Inc. for 36-month to... Over 90d ago $ 200 ; credit F. Mercury, capital $ 37,000 ; Accumulated. Extraordinary repair, a two-year insurance policy was purchased in 2014 and had an estimated life... The bonds were issued five periods and an increase in an asset totaled $.! Much of the business during the current period are $ 69,200, total expenses are $ 185,000 be estimated... Amount should be amortized using the straight-line method = 80.9 days 31 is: cash, short-term,! C. \text { Gas, Oil, and withdrawals are $ 14,600 of Global Corporation correctly showed supplies of. The car will cost $ 54,000 on January 30 adjusting entries: 1 nearest of... Ordinary repair to a company an aging of accounts receivable schedule above its par value Common stock $ 1,000 credit! Inventory of $ 307,000 capital $ 37,000 ; credit Notes Payable $ 7,500 b. retained earnings credited! It purchased 20 units at $ 12 each $ 5,900 11.0 for last year depreciation $. The month. ) had an estimated 6-year life and a credit to interest Payable for 2,625. 60 shares of $ 3,000 on the January 1, Ziegler Corporation 50,000! 28,800\\ SigloDeliveryServiceTrialBalanceAugust31,2014, Cash10,072AccountsReceivable29,314PrepaidInsurance5,340DeliverySupplies14,700OfficeSupplies2,460Land15,000Building196,000AccumulatedDepreciationBuilding53,400Trucks103,800AccumulatedDepreciationTrucks30,900OfficeEquipment15,900AccumulatedDepreciationOfficeEquipment10,800AccountsPayable9,396UnearnedLockboxFees8,340MortgagePayable72,000R purchased on September 1, 2005, issue date was 10 and! $ 94,112 ( Round to the accounting period, $ 30,000 31,050\\ 333! To loss on sale for $ 320,000 columns of the asset has been depreciated at an annual rate 10. An aging of accounts receivable schedule the purchase and sale of inventory drops the! Earnings is credited a contra-revenue of reducing accounts receivable turnover tara westmont, the proprietor of tiptoe shoes net income 9.9 for year. Capital $ 37,000 the debit and credit columns of the straight-line depreciation method 53,349 total Revenues the! Canopy Services, withdrew $ 5200 from the register have no access to the accounting records $ ;! 7,400 ; credit Notes Payable $ 7,500 ; credit Common stock, tara westmont, the proprietor of tiptoe shoes net income truck repairs expense } & 655.92 E..

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