Post ACC111 Full Course Latest 2015 December

Post ACC111 Full Course Latest 2015 December in $152 only

Post ACC111 Full Course Latest 2015 December [All Discussions All Homework All Quizzes and Final with 95% Grades]

Discussions

Unit 1

View the video and read the two articles above. Participate in this discussion board answering the following questions and commenting on other student’s postings.

  • Do you practice critical thinking? Give an example.
  • Does your supervisor (manager) at work practice critical thinking?
  • Is critical thinking something you would like to do more of?
  • Should accountants practice critical thinking?

Unit 2
You are one of three partners who own and operate Marys Maid Service. The company has been operating for seven years. One of the other partners has always prepared the companys annual financial statements. Recently, you proposed that the statements be audited each year because it would benefit the partners and prevent possible disagreements about the division of profits. The partner who prepares the statements proposed that his uncle, who has a lot of financial experience, can do the job at little cost. Your other partner remained silent.

Required: What position would you take on the proposal? What would you strongly recommend?

Unit 3

You work as an accountant for a small land development company that desperately needs additional financing to continue in business. The president of your company is meeting with the manager of a local bank at the end of the month to try to obtain this financing. The president has approached you with two ideas to improve the company’s reported financial position. First, he claims that because a big part of the company’s value comes from its knowledgeable and dedicated employees, you should report their Intellectual Abilities as an asset on the balance sheet. Second, he claims that although the local economy is doing poorly and almost no one is buying land or new houses, he is optimistic that eventually things will turn around. For this reason, he asks you to continue reporting the company’s land on the balance sheet at its cost, rather than the much lower amount that real estate appraisers say its really worth.

Required: Comment on the following questions. Why do you think the president is so concerned with the amount of assets reported on the balance sheet? What accounting concept relates to the presidents first suggestion to report Intellectual Abilities as an asset? What accounting concept relates to the presidents second suggestion to continue reporting land at its cost? Who might be hurt by the presidents suggestions, if you were to do as he asks? What should you do?

Unit 5 Diss 4

Assume you work as an assistant accountant in the head office of a national movie rental business, a la Blockbuster Inc. With the increasing popularity of online movie rental operations, your company has struggled to meet its earnings targets for the year. It is important for the company to meet its earnings targets this year because the company is renegotiating a bank loan next month, and the terms of that loan are likely to depend on the companys reported financial success. Also, the company plans to issue more stock to the public in the upcoming year, to obtain funds for establishing its own presence in the online movie rental business. The chief financial officer ( CFO) has approached you with a solution to the earnings dilemma. She proposes that the depreciation period for the stock of reusable DVDs be extended from 3 months to 15 months. She explains that by lengthening the depreciation period, a smaller amount of depreciation expense will be recorded in the current year, resulting in a higher net income. She claims that generally accepted accounting principles require estimates like this, so it would not involve doing anything wrong.

Required: Discuss the CFOs proposed solution. In your discussion, consider the following questions. Will the change in depreciation affect net income in the current year in the way that the CFO described? How will it affect net income in the following year? Is the CFO correct when she claims that the change in estimated depreciation is allowed by GAAP? Who relies on the video companys financial statements when making decisions? Why might their decisions be affected by the CFOs proposed solution? Is it possible that their decisions would not be affected? What should you do?

Unit 7 Diss 5

Snake Creek Company has one trusted employee who, as the owner said, handles all of the book-keeping and paperwork for the company. This employee is responsible for counting, verifying, and recording cash receipts and payments, making the weekly bank deposit, preparing checks for major expenditures (signed by the owner), making small expenditures from the cash register for daily expenses, and collecting accounts receivable. The owners asked the local bank for a $ 20,000 loan. The bank asked that an audit be performed covering the year just ended. The independent auditor ( a local CPA), in a private conference w

E1-1 Reporting Amounts on the Four Basic Financial Statements [LO 1-2]

Using the following table and the equations underlying each of the four basic financial statements, show (a) that the balance sheet is in balance, (b) that net income is properly calculated, (c) what caused changes in the retained earnings account, and (d) what caused changes in the cash account. (Cash outflows should be indicated with a minus sign.)
Assets$19,900
Liabilities14,600
Stockholders’ Equity5,300
Revenue12,200
Expenses10,050
Net Income2,150
Dividends850
Beginning Retained Earnings5,200
Ending Retained Earnings6,500
Cash Flows from Operating Activities3,300
Cash Flows from Investing Activities(2,700)
Cash Flows from Financing Activities(1,750)
Beginning Cash2,700
Ending Cash1,550

E1-3 Preparing a Balance Sheet [LO 1-2, LO 1-3]

Luxury Shoe Warehouse, Inc. is a designer shoe warehouse, selling some of the most luxurious and fashionable shoes at prices that people can actually afford. Its balance sheet, at February 2, 2013, contained the following (listed alphabetically, amounts in thousands).
Accounts Payable$276,700
Accounts Receivable115,000
Cash313,700
Common Stock842,100
Equipment441,500
Inventory394,000
Notes Payable128,300
Retained Earnings17,100
Total Assets1,264,200
Total Liabilities and Stockholders’ Equity?

Required:
1.Prepare the balance sheet as of February 2, 2013. (Enter your answers in thousands.)
As of February 2, did most of the financing for assets come from creditors or stockholders?

M1-6 Matching Financial Statement Items to Balance Sheet and Income Statement Categories [LO 1-2]

Tootsie Roll Industries manufactures and sells more than 64 million Tootsie Rolls and 20 million Tootsie Roll Pops each day. The following items were listed on Tootsie Roll’s recent income statement and balance sheet.
For each item, select (1) the type of account (A = asset, L = liability, SE = stockholders’ equity,R = revenue, E = expense) and (2) whether it is reported on the income statement (I/S) or balance sheet (B/S).

M1-9 Matching Financial Statement Items to the Four Basic Financial Statements [LO 1-2]

Match each element with its financial statement by selecting the appropriate financial statement.

ElementFinancial Statement
1.Cash Flows from Financing Activities
2.Expenses
3.Cash Flows from Investing Activities
4.Assets
5.Dividends
6.Revenues
7.Cash Flows from Operating Activities
8.Liabilities

E1-6 Preparing an Income Statement and Inferring Missing Values [LO 1-2, LO 1-3]

Majestic Cinema, Inc. operates movies and food concession counters throughout the United States. Its income statement for the quarter ended September 30, 2013 reported the following (listed alphabetically in thousands):
Admissions Revenue$509,600
Concessions Expenses41,000
Concessions Revenue318,000
Film Rental Expenses257,800
Net Income?
Office Expenses256,700
Salaries and Wages Expense75,300
Rent Expense87,100
Total Expenses?

Required:
1.Solve for the missing amounts and prepare an income statement for the quarter ended September 30, 2013. (Enter your answers in thousands.)

unit 2

M2-9 Determining Financial Statement Effects of Several Transactions [LO 2-2]

For each of the following transactions of Spotlighter, Inc., for the month of January, indicate the accounts, amounts, and direction of the effects on the accounting equation. A sample is provided.(Enter any decreases to account balances with a minus sign.)
a.(Sample) Borrowed $5,740 from a local bank on a note due in six months.
b.Received $6,430 cash from investors and issued common stock to them.
c.Purchased $2,800 in equipment, paying $1,100 cash and promising the rest on a note due in one year.
d.Paid $1,200 cash for supplies.
e.Bought and received $1,600 of supplies on account.
M2-10 Preparing Journal Entries [LO 2-3]

The following are the transactions of Spotlighter, Inc., for the month of January:
a.Borrowed $4,190 from a local bank on a note due in six months.
b.Received $4,880 cash from investors and issued common stock to them.
c.Purchased $1,500 in equipment, paying $450 cash and promising the rest on a note due in one year.
d.Paid $550 cash for supplies.
e.Bought and received $950 of supplies on account.
Prepare journal entries for each transaction. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

M2-11 Posting to T-Accounts [LO 2-3]

The following are the transactions of Spotlighter, Inc., for the month of January:
a.Borrowed $4,790 from a local bank on a note due in six months.
b.Received $5,480 cash from investors and issued common stock to them.
c.Purchased $2,700 in equipment, paying $1,050 cash and promising the rest on a note due in one year.
d.Paid $1,150 cash for supplies.
e.Bought and received $1,550 of supplies on account.
Post the effects to the appropriate T-accounts and determine ending account balances. Show a beginning balance of zero.

PB2-2 Recording Transactions (in a Journal and T-Accounts); Preparing and Interpreting the Balance Sheet [LO 2-2, LO 2-3, LO 2-4, LO 2-5]

[The following information applies to the questions displayed below.]

Bearings & Brakes Corporation (B&B) was incorporated as a private company. The company’s accounts included the following at June 30:
Accounts Payable$91,000
Buildings660,000
Cash106,000
Common Stock330,000
Equipment180,000
Land524,000
Notes Payable (long-term)9,000
Retained Earnings1,046,000
Supplies6,000

During the month of July, the company had the following activities:
a.Issued 4,500 shares of common stock for $450,000 cash.
b.Borrowed $140,000 cash from a local bank, payable in four years.
c.Bought a building for $198,000; paid $82,000 in cash and signed a three-year note for the balance.
d.Paid cash for equipment that cost $106,000.
e.Purchased supplies for $106,000 on account.

ReferencesSection BreakPB2-2 Recording Transa
PB2-2 Part 1

Required:
1.Analyze transactions (a)–(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with a minus sign.)

PB2-2 Part 2

2.Record the transaction effects determined in part 1 using a journal entry format. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)


PB2-2 Part 3

3.Summarize the journal entry effects from part 2 using T-accounts.

PB2-2 Part 4

4.Prepare a trial balance at July 31.

PB2-2 Part 5

5.Prepare a classified balance sheet at July 31.

<pclass=”hm_questiontitle”>PB2-2 Part 6

6.As of July 31, has the financing for APC’s investment in assets primarily come from liabilities or stockholders’ equity?

unit 3

M3-1 Reporting Cash Basis versus Accrual Basis Income [LO 3-2]

Mostert Music Company had the following transactions in March:
a.Sold music lessons to customers for $13,350; received $8,350 in cash and the rest on account.
b.Paid $800 in wages for the month.
c.Received a $370 bill for utilities that will be paid in April.
d.Received $4,200 from customers as deposits on music lessons to be given in April.
1.Based on the information above, prepare a cash basis and an accrual basis income statement.

M3-2 Identifying Accrual Basis Revenues [LO 3-2]

The following transactions are July activities of Bill’s Extreme Bowling, Inc., which operates several bowling centers. If revenue is to be recognized in July, indicate the amount.

ActivityAmount
a.Bill’s collected $13,500 from customers for services related to games played in July.$
b.Bill’s billed a customer for $590 for a party held at the center on the last day of July. The bill is to be paid in August.$
c.The men’s and women’s bowling leagues gave Bill’s advance payments totaling $2,450 for the fall season that starts in September.
d.Bill’s received $2,000 from credit sales made to customers last month (in June).$

M3-3 Identifying Accrual Basis Expenses [LO 3-2]

The following transactions are July activities of Bill’s Extreme Bowling, Inc., which operates several bowling centers. If an expense is to be recognized in July, indicate the amount.
ActivityAmount
a.Bill’s paid $3,400 to plumbers for repairing a broken pipe in the restrooms.
b.Bill’s paid $3,050 for the June electricity bill and received the July bill for $3,500, which will be paid in August.
c.Bill’s paid $5,735 to employees for work in July.

M3-13 Preparing Accrual Basis Journal Entries for Business Activities [LO 3-3]

Quick Cleaners, Inc. (QCI) has been in business for several years. It specializes in cleaning houses but has some small business clients as well.
a.Issued $27,000 of QCI stock for cash.
b.Incurred $890 of utilities costs this month and will pay them next month.
c.Paid wages for the current month, totaling $1,850.
d.Performed cleaning services on account worth $3,200.
e.Some of Quick Cleaners’ equipment was repaired at a total cost of $254. The company paid the full amount at the time the repair work was done.
1.Prepare journal entries for the above transactions, which occurred during a recent month. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)
Determine QCI’s preliminary net income.

M3-22 Calculating and Interpreting Net Profit Margin [LO 3-5]

TravelLite and FareLine compete as online travel agencies. Historically, TravelLite has focused more on flights whereas FareLine has focused on hotel bookings. The following amounts were reported by the two companies in 2012.
(in millions)Net IncomeTotal AssetsTotal LiabilitiesTotal Revenues
TravelLite$ 880$8,530$6,000$5,830
FareLine2,6208,0103,8707,060

1.Calculate each company’s net profit margin expressed as a percent.(Round your answers to the nearest whole percent.)
2.Which company has generated a greater return of profit from each revenue dollar?

E3-12 and E3-13 Recording and Posting Accrual Basis Journal Entries and Preparing an Unadjusted Trial Balance [LO 3-2, LO 3-3 and LO 3-4]

[The following information applies to the questions displayed below.]
Ricky’s Piano Rebuilding Company has been operating for one year. On January 1, at the start of its second year, its income statement accounts had zero balances and its balance sheet account balances were as follows:
Cash$5,800Accounts Payable$10,050
Accounts Receivable33,750Unearned Revenue (deposits)4,600
Supplies1,400Notes Payable57,250
Equipment14,800Common Stock13,500
Land8,700Retained Earnings4,050
Building25,000

Following are the January 2013 transactions:
a.Received a $955 deposit from a customer who wanted her piano rebuilt in February.
b.Rented a part of the building to a bicycle repair shop; $385 rent received for January.
c.Delivered five rebuilt pianos to customers who paid $17,275 in cash.
d.Delivered two rebuilt pianos to customers for $8,800 charged on account.
e.Received $5,950 from customers as payment on their accounts.
f.Received an electric and gas utility bill for $720 for January services to be paid in February.
g.Ordered $885 in supplies.
h.Paid $2,200 on account in January.
i.Paid $19,200 in wages to employees in January for work done this month.
j.Received and paid cash for the supplies in (g).

E3-12 Part 2

2.Prepare journal entries for the above January transactions. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

E3-12 Part 3

3.Post the journal entries to the T-accounts. Show the unadjusted beginning and ending balances in the T-accounts.

E3-13 Preparing an Unadjusted Trial Balance [LO 3-4]

Required:
Prepare an unadjusted trial balance at the end of January.

unit 4
M4-18 Preparing and Posting Adjusting Journal Entries [LO 4-2]

At December 31, the unadjusted trial balance of H&R Tacks reports Supplies of $8,300 and Supplies Expense of $0. On December 31, supplies costing $7,350 are on hand.
1.Prepare the adjusting journal entry on December 31. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)
2.Prepare the T-accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance

<pclass=”hm_questiontitle”>M4-19 Preparing and Posting Adjusting Journal Entries [LO 4-2]

At December 31, the unadjusted trial balance of H&R Tacks reports Equipment of $32,500 and zero balances in Accumulated Depreciation—Equipment and Depreciation Expense. Depreciation for the period is estimated to be $6,500.
1.Prepare the adjusting journal entry on December 31. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)
.P
2.Prepare the T-accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance.

M4-20 Preparing and Posting Adjusting Journal Entries [LO 4-2]

At December 31, the unadjusted trial balance of H&R Tacks reports Prepaid Insurance of $9,600 and Insurance Expense of $0. The insurance was purchased on July 1 and provides coverage for 24 months.
1.Prepare the adjusting journal entry on December 31. (If no entry is required for atransaction/event, select “No Journal Entry Required” in the first account field.)
2.Prepare the T-accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance.

M4-21 Preparing and Posting Adjusting Journal Entries [LO 4-2]

At December 31, the unadjusted trial balance of H&R Tacks reports Unearned Revenue of $4,700 and Service Revenues of $33,500. One-half of the unearned revenue has been earned as of December 31.
1.Prepare the adjusting journal entry on December 31. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)
2.Prepare the T-accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance.
M4-22 Preparing and Posting Adjusting Journal Entries [LO 4-2]

At December 31, the unadjusted trial balance of H&R Tacks reports Salaries and Wages Payable of $0 and Salaries and Wages Expense of $16,000. Employees have been paid for work done up to December 27, but the $1,100 they have earned for December 28–31 has not yet been paid or recorded.
1.Prepare the adjusting journal entry on December 31. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)
2.Prepare the T-accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance.

M4-23 Preparing and Posting Adjusting Journal Entries [LO 4-2]

At December 31, the unadjusted trial balance of H&R Tacks reports Interest Payable of $0 and Interest Expense of $0. Interest incurred and owed in December totals $430.
Required:
a.Prepare the adjusting journal entry on December 31. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

b.Prepare the T-accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance.

M4-24 Preparing and Posting Journal Entries for Amortization [LO 4-2]

At December 31, the unadjusted trial balance of H&R Tracks reports Software of $21,500 and zero balances in Accumulated Amortization—Intangibles and Amortization Expense. Amortization for the period is estimated to be $4,300.
1.Prepare the required journal entry on December 31. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.

Prepare the T-accounts for each account, enter the unadjusted balances, post the journal entry, and report the adjusted balance.

)

ASSIGNMENT B
E4-15 Recording Adjusting Entries and Preparing an Adjusted Trial Balance [LO 4-2, 4-3]

[The following information applies to the questions displayed below.]
North Star prepared the following unadjusted trial balance at the end of its second year of operations ending December 31.
Account TitlesDebitCredit
Cash$11,400
Accounts Receivable5,400
Prepaid Rent2,280
Equipment20,400
Accumulated Depreciation—Equipment$1,160
Accounts Payable1,160
Income Tax Payable0
Common Stock24,200
Retained Earnings1,500
Sales Revenue47,760
Salaries and Wages Expense24,400
Utilities Expense11,900
Rent Expense0
Depreciation Expense0
Income Tax Expense0






Totals$75,780$75,780













Other data not yet recorded at December 31:
a.Rent expired during the year, $1,140.
b.Depreciation expense for the year, $1,160.
c.Utilities owing, $8,400.
d.Income tax expense, $330.

E4-15 Part 1

Required:
1.Indicate the accounting equation effects of each required adjustment.(Enter any decreases to Assets, Liabilities, or Stockholders’ Equity with a minus sign.)

E4-15 Part 2

<pclass=”hm_questiontitle”>

4-a.Compute the amount of net income using (a) the preliminary (unadjusted) numbers, and (b) the final (adjusted) numbers.
4-b.Had the adjusting entries not been recorded, would net income have been overstated or understated, and by what amount?

Recording Four Adjusting Journal Entries and Preparing an Adjusted Trial Balance, Reporting an Income Statement, Statement of Retained Earnings, and Balance Sheet and Recording Closing Entries [LO 4-2, LO 4-3, LO 4-4 and LO 4-5]

[The following information applies to the questions displayed below.]
Mint Cleaning Inc. prepared the following unadjusted trial balance at the end of its second year of operations ending December 31.
Account TitlesDebitCredit
Cash$41
Accounts Receivable12
Prepaid Insurance9
Equipment86
Accumulated Depreciation$0
Accounts Payable12
Common Stock82
Retained Earnings5
Sales Revenue91
Insurance Expense0
Salaries and Wages Expense13
Supplies Expense29






Totals$190$190













Other data not yet recorded at December 31:
a.Insurance expired during the year, $7.
b.Depreciation expense for the year, $6.
c.Wages payable, $9.
d.Income tax expense, $11.


Required:
1.Prepare the adjusting journal entries for the year ended December 31. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

E4-16 Part 2

2.Using T-accounts, determine the adjusted balances in each account and prepare an adjusted trial balance as of December 31.

4-16 Part 3

3.By what amount would net income have been understated or overstated had the adjusting journal entries not been recorded?

E4-17 part 1

Required:
Using the above adjusted balances, prepare an income statement.

<pclass=”hm_questiontitle”>E4-17 part 2

Required:
Using the above adjusted balances, prepare a statement of retained earnings.

<pclass=”hm_questiontitle”>E4-17 part 3

Required:
Using the above adjusted balances, prepare a classified balance sheet for 2015. (Amounts to be deducted should be indicated by a minus sign.)

<pclass=”hm_questiontitle”>E4-18

Required:
Using the above adjusted balances, prepare the closing journal entry as of December 31. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

unit 5

M5-12 Preparing a Bank Reconciliation [LO 5-4]

Use the following bank statement and T-account to prepare the May 31 bank reconciliation.
BANK STATEMENT
DateChecksDepositsOtherBalance
May 1$560
4#2$100$140600
12#4190NSF Check $140270
28#5110160
30#6105560615
May 31#8145Service charge 95375

Cash (A)


May 1560
May 3140100May 3 #2
100May 4 #3
190May 8 #4
110May 11 #5
105May 21 #6
May 29560115May 29 #7
May 30330145May 30 #8


May 31725


M5-13 Accounting for Unrecorded Items on Bank Reconciliation [LO 5-4]

Use the following bank statement and T-account to prepare any journal entries needed as a result of the May 31 bank reconciliation. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)
BANK STATEMENT
DateChecksDepositsOtherBalance
May 1$260
4#2$25$65300
12#4115NSF Check $65120
28#53585
30#630260315
May 31#870Service charge 20225

Cash (A)


May 1260
May 36525May 3 #2
85May 4 #3
115May 8 #4
35May 11 #5
30May 21 #6
May 2926040May 29 #7
May 3018070May 30 #8


May 31365


M5-4 Matching Cash Receipt Processes to Internal Control Principles [LO 5-2, LO 5-3]

Match each of the following cash receipt activities to the internal control principle to which it best relates. Select the appropriate Internal Control Principle from the dropdown listed below.

Cash Receipt Activities
1.A list of checks received in the mail is prepared.
2.Total cash receipts are compared to the amount on the bank deposit slip.
3.A password is required to open the cash register.
4.Price changes at the checkout require a manager’s approval.
5.Cashiers are required to count the cash in their register at the beginning and end of each shift.
Chapter 6
M6-15 Computing and Interpreting the Gross Profit Percentage [LO 6-5]

Sole Occhiali Group, an Italian company that sells sunglasses, reported Net Sales of $179,000 and Cost of Goods Sold of $58,500. Candy Electronics Corp. reported Net Sales of $37,000 and Cost of Goods Sold of $27,000.
a.Calculate the Gross Profit Percentage for both companies. (Round your answers to 1 decimal plac
Which company has a greater proportion of its sales available to cover expenses other than cost of goods sold?

M6-17 Determining the Cause of Increasing Gross Profit [LO 6-5]

Fortune Brands Home & Security, Inc.sells Master Lock padlocks. It reported an increase in net sales from $5.2 billion in 2011 to $5.5 billion in 2012, and an increase in gross profit from $1.7 billion in 2011 to $1.9 billion in 2012.
a.Calculate each year’s gross profit percentage. (Round your answers to 1 decimal place.)

b

Determine whether the change in gross profit was caused by.

E6-5 Inferring Missing Amounts Based on Income Statement Relationships [LO 6-2, LO 6-5]

Supply the missing dollar amounts for each of the following independent cases.
CasesSales RevenueBeginning InventoryPurchasesCost of Goods Available for SaleCost of Goods SoldCost of Ending InventoryGross Profit
A$1,400$800$1,500$$1,040$
B1,6009001,500840
C8009001,0001,100
D1,5401,3001,350950
E1,7007501,6001,240

E6-7 Reporting Purchases and Purchase Discounts Using a Perpetual Inventory System [LO 6-3]

During the months of January and February, Axe Corporation purchased goods from three suppliers. The sequence of events was as follows:
Jan. 6Purchased goods for $2,000 from Green with terms 2.5/15, n/60.
6Purchased goods from Munoz for $850 with terms 2.5/15, n/60.
14Paid Green in full.
Feb. 2Paid Munoz in full.
28Purchased goods for $750 from Reynolds with terms 2.5/15, n/60.
Required:
Assume that Axe uses a perpetual inventory system, the company had no inventory on hand at the beginning of January, and no sales were made during January and February. Calculate the cost of inventory as of February 28.

unit 6

E7-2 Determining the Correct Inventory Balance [LO 7-1, LO 7-2, LO 7-4]

Seemore Lens Company (SLC) sells contact lenses FOB destination. For the year ended December 31, the company reported Inventory of $86,000 and Cost of Goods Sold of $452,000.
a.Included in Inventory (and Accounts Payable) are $13,200 of lenses held on consignment.
b.Included in the Inventory balance are $6,600 of office supplies held in SLC’s warehouse.
c.Excluded from the Inventory balance are $9,600 of lenses in the warehouse, ready to send to customers on January 1. SLC reported these lenses as sold on December 31, at a price of $18,200.
d.Included in the Inventory balance are $3,800 of lenses that were damaged in December and will be scrapped in January, with no recoverable value.
Required:
Prepare the table showing the balances presently reported for Inventory and Cost of Goods Sold, and then displaying the adjustment(s) needed to correctly account for each of items (a)-(d), and finally determining the appropriate Inventory and Cost of Goods Sold balances. (Enter any decreases to account balances with a minus sign.)

<pclass=”hm_questiontitle”>E7-3 Recording Journal Entries to Correct Inventory Misreporting [LO 7-1, LO 7-2, LO 7-4]

Seemore Lens Company (SLC) manufactures and sells contact lenses. For the year ended December 31, the company reported Inventory of $78,000 and Cost of Goods Sold of $436,000.
a.Included in Inventory (and Accounts Payable) are $11,600 of lenses held on consignment.
b.Included in the Inventory balance are $5,800 of office supplies held in SLC’s warehouse.
c.Excluded from the Inventory balance are $8,800 of lenses in the warehouse, ready to send to customers on January 1. SLC reported these lenses as sold on December 31, at a price of $16,600.
d.Included in the Inventory balance are $3,400 of lenses that were damaged in December and will be scrapped in January, with no recoverable value.
Required:
For each item, (a–d), prepare the journal entry to correct the balances presently reported. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

<pclass=”hm_questiontitle”>E7-5 Calculating Cost of Ending Inventory and Cost of Goods Sold under Periodic FIFO, LIFO, and Weighted Average Cost [LO 7-3]

Oahu Kiki tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the end of each month, as if it uses a periodic inventory system. Assume Oahu Kiki’s records show the following for the month of January. Sales totaled 330 units.
DateUnitsUnit CostTotal Cost
Beginning InventoryJanuary 1180$75$13,500
PurchaseJanuary 154208535,700
PurchaseJanuary 2432010533,600

Required:
1.Calculate the number and cost of goods available for sale.
2.Calculate the number of units in ending inventory.
3.Calculate the cost of ending inventory and cost of goods sold using the (a) FIFO, (b) LIFO, and (c) weighted average cost methods.

chapter 8

<pclass=”hm_questiontitle”>M8-8 Estimating Bad Debts Using the Aging Method [LO 8-2]

Assume that Simple Co. had credit sales of $256,000 and cost of goods sold of $156,000 for the period. Simple uses the aging method and estimates that the appropriate ending balance in the Allowance for Doubtful Accounts is $3,600. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $310.
What amount of Bad Debt Expense would the company record as an end-of-period adjustment?
M8-11 Recording Note Receivable Transactions [LO 8-3]

Nova Corporation hired a new product manager and agreed to provide her a $26,000 relocation loan on a six-month, 5 percent note.
a.The company loans the money on January 1.
b.The new employee pays Nova the interest owed on the maturity date.
c.The new employee pays Nova the full principal owed on the maturity date.
Prepare journal entries to record the above transactions for Nova Corporation. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field. Do not round intermediate calculations.)

M8-13 Reporting Accounts and Notes Receivable in a Classified Balance Sheet [LO 8-2, LO 8-3]

Terracotta, Inc. reported the following accounts and amounts (in millions) in its financial statements for the year ended November 30, 2013.
Accounts Payable$730
Accounts Receivable630
Accumulated Amortization460
Accumulated Depreciation800
Allowance for Doubtful Accounts20
Cash and Cash Equivalents840
Equipment5,055
Income Taxes Payable20
Notes Payable (long-term)1,600
Notes Payable (short-term)20
Notes Receivable (long-term)220
Prepaid Rent280
Retained Earnings7,030
Service Revenue460
Short-term Investments2,440
Software615
Unearned Revenue790

Prepare the current assets section of its balance sheet. The Allowance for Doubtful Accounts relates entirely to Accounts Receivable. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

unit 7

M9-4 Computing Book Value (Straight-Line Depreciation) [LO 9-3]

A machine that cost $500,000 has an estimated residual value of $25,000 and an estimated useful life of five years. The company uses straight-line depreciation. Calculate its book value at the end of year 4. (Do not round intermediate calculations.)

M9-9 Recording the Disposal of a Long-Lived Asset [LO 9-5]

[The following information applies to the questions displayed below.]

The following are the transactions of Morrell Corporation:
a.Morrell Corporation disposed of two computers at the end of their useful lives. The computers had cost $4,640 and their Accumulated Depreciation was $4,640. No residual value was received.
b.Assume the same information as (a), except that Accumulated Depreciation, updated to the date of disposal, was $3,280.

M9-9 Part 1

Prepare journal entries to record above transactions. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

M9-9 Part 2

Prepare journal entries to record above transactions. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

E9-12 Computing and Reporting the Acquisition and Amortization of Three Different Intangible Assets [LO 9-6]

Bluestone Company had three intangible assets at the end of the current year:
a.A patent purchased this year from Miller Co. on January 1 for a cash cost of $4,200. When purchased, the patent had an estimated life of 14 years.
b.A trademark was registered with the federal government for $3,000. Management estimated that the trademark could be worth as much as $100,000 because it has an indefinite life.
c.Computer licensing rights were purchased this year on January 1 for $20,000. The rights are expected to have a four-year useful life to the company.
Required:
1.Compute the acquisition cost of each intangible asset.
2.Compute the amortization of each intangible for the current year ended December 31. (Do not round intermediate calculations.)
3.Show how these assets and any related expenses should be reported on the balance sheet and income statement for the current year.

Chapter 10

[The following information applies to the questions displayed below.]

Heines Clocks is a retailer of wall, mantle, and grandfather clocks and is located in the Empire Mall in Sioux Falls, South Dakota. Assume that a grandfather clock was sold for $11,500 cash plus 6 percent sales tax. The clock had originally cost Heines $7,500. Assume Heines uses a perpetual inventory system.

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