Aging of accounts receivable method. The equipment will simply be disposed of, not sold. D. Retained Earnings. $53,349 Contessa Company collected $42,000 cash on its accounts receivable. B. Carson Company faces a probable loss on a pending lawsuit where the amount of the loss is estimated to be $500,000. Market value of the stock was$12. C. $80,000 1. 1. B. B. debit Unearned Fees, $516; credit Fees Earned, $516. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. On January 1, a company purchased a five-year insurance policy for $1,800 with coverage starting immediately. The owner's capital account before closing had a balance of $299,000. E. 100,000-20,000= $80,000. Debit Common Stock $6,000, debit Investment in Common Stock $1,000; credit Cash $7,000. Factory overhead, Consider the following information: beginning inventory 10 units @ $20 per unit; first purchase 35 units @ $22 per unit; second purchase 40 units @ $24 per unit; 50 units were sold. 1. A. What is the journal entry needed to record the transaction by Jarrett Company? 1. Assets will be overstated, but there would be no effect on net income for the year. = $189,000-$105,700 & \underline{\underline{625,836}} & \underline{\underline{625,836}}\\ Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. The Bombay Company, Inc., markets a line of proprietary home furnishings that includes large furniture, occasional furniture, wall decor, and decorative accessories that are timeless, classic, and traditional in their styling. D. The salary of the company president. E. The ending owner's capital balance after closing is: D. $3,000. B. Debit Legal Expense $500,000; credit Lawsuit Payable $500,000. B. C) $18,578 D) at the interest payment date. Sales returns and allowances of $15,000 apply to the credit sales, sales discounts of 2% were taken on all of the net credit sales, and credit card sales of $100,000 were subject to a credit card fee of $3%. Net Income$119,600 $200. C. $109,000. At what amount would the liability be reported at on the balance sheet as of the purchase date, after the initial $50,000 payment was made? B. C. $1.31. $4.89. Interest expense The owner's capital account before closing had a balance of $297,000. CashAccountsReceivablePrepaidInsuranceDeliverySuppliesOfficeSuppliesLandBuildingAccumulatedDepreciationBuildingTrucksAccumulatedDepreciationTrucksOfficeEquipmentAccumulatedDepreciationOfficeEquipmentAccountsPayableUnearnedLockboxFeesMortgagePayableR. $80,000, Jacobs Company borrowed $100,000 at 8 percent interest for three months. Collection of cash from a customer. 1. E. 6.1051 No entry is recorded until the items are returned for warranty repairs. D) subtracting Interest Expense from Bonds Payable. 1. What is the vehicle's book value as of December 31, 2015, assuming Wasson uses the straight-line depreciation method? 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. Cost of goods sold is increased as sales are recorded. The entry to write-off a bad account (one that will never be collected) should be: An increase in an asset and a decrease in another asset. b. Assuming that Donna Equipment maintains its books on a calendar year basis, the amount of interest expense that should be reported in the 2010 income statement for this note (rounded to the nearest dollar) would be D. $14,500. A company had revenues of $75,000 and expenses of $62,000 for the accounting period. D. D. Preferred stock typically has a fixed dividend rate. D. We purchase equipment for cash. The owner's capital account before closing had a balance of $312,000. d. The special-interest effect. Both companies elected straight-line depreciation, but Miga Company used a longer estimated life. Purchase of merchandise on credit. B. Prepare the journal entry transferring Job M1 to finished goods. C. $70,000 B. Average total assets, $125,000 A) $656,758 $10,000 a. When a stock dividend (on par value stock) is declared and issued Garza Company had sales of $135,000, sales discounts of $2,000, and sales returns of $3,200. The owner's capital account before closing had a balance of $297,000. CBA Company reported total stockholders' equity of $85,000 on its balance sheet dated December 31, 2008. The ending owner's capital balance after closing is: Multiple Choice $187,000 $82,300 $381,300 $362,500 $63,500 $100,000 in the Long-Term Liability section. McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. c. $171,000 (2089/9421)*365 = 80.9 days. Debit Bond Interest Payable $22,000; credit Cash $22,000. On September 1, Ziegler Corporation had 50,000 shares of $5 par value common stock, and $1,500,000 of retained earnings. The company's earnings per share is: C. Debit Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $201,000, expenses of $111,700, and withdrew $24. 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. Wrote down the carrying value of certain inventory items that were deemed to be obsolete. 1. Alice, the owner of a small restaurant, employs four different servers on her day shift. Assets decrease and stockholders' equity increases. D. Either (b) or (c), 1. B. net income to be overstated and assets to be understated. $1,900,000 D. 12*13.20 = $158.40 COGS, An advantage of FIFO is that it assigns the most recent costs to cost of goods sold and does a better job of matching current costs with revenues on the income statement, false; an advantage of FIFO is its inventory on balance sheet approximates its current cost and better matches current costs with revenues, Understating ending inventory understates both current and total assets, Beckenworth had cost of goods sold of $9,421 million, ending inventory of $2,089 million, and average inventory of $1,965 million. $4,300 Assume that year ended December 31, is a Wednesday and all employees will be paid salaries for five full days on the following Monday. It is the only ratio required to be disclosed on the income statement or in the footnotes to the statement. In a descriptive narrative in the footnote section. \textbf{Siglo Delivery Service}\\ Rate answer . d. $115,000 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. Annual interest expense will exceed the company's actual cash payments for interest. Depletion is: Using the perpetual LIFO inventory costing method, what is the cost of the ending inventory? What is the dollar amount of net sales? Amortizing a bond discount: A. E. debit Unearned Fees, $387; credit Fees Earned, $387. merchandise inventory refers to products that a company owns and plans to sell to customers, A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. Under what conditions would a company most likely adopt the double-declining-balance method for financial reporting? c. Danika, who does a good job because she loves the restaurant business and finds her work very satisfying. D. Cash receipts from customers exceeded current period purchases. Cost of goods available for sale 400,000 E) None of the above is correct. B. If the purchase was recorded in the Prepaid Insurance account, and the company records adjustments only at year-end, the adjusting entry at the end of the first year is: a. Debit Salaries Expense, $5,400; credit Salaries Payable, $5,400. D. When the loss is probable regardless of whether the loss can be reasonably estimated. Both companies paid exactly the same cost, $30,000, for their respective vehicles. : If a company records sales revenue, During the year ended December 31, 2009, it reported a net income of $10,000, declared and paid a cash dividend of $2,000, and issued additional capital stock of $20,000. $2,000,000 1. A. Loss of $500 What was the net income earned during the year? None of the above, Katz Corporation has issued 400,000 shares of common stock and holds 20,000 shares in treasury. Increases cash flows from the bond. 1. 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. d. $10,300 b. A. 1. A company issued 100,000 shares of common stock with a par value of $1 per share. Credit. The owner's capital account before closing had a balance of $312,000. What was the amount of credit sales during May? Preferred stock, 7%, $50 par value, 1,000 shares issued and outstanding with dividends in arrears for 2008 and 2009. D. $ -0-. $220. What journal entry would be needed to record the machines' first year depreciation under the units-of-production method? Payment of cash to a supplier for merchandise previously purchased on credit. Debit Dividend Expense $12,000; credit Common Dividend Payable $12,000. Maks sold a used piece of machinery on December 31, 2015, that it purchased on January 1, 2014, for $10,000. \hline There will be a debit to sales discounts on May 10. 250 E. \text{Office Salaries Expense} & 44,400\\ The Adjustments columns show a credit of $240 for supplies used during the period. 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? 1. B. It is a contra-asset account. 1. $750. $86,000 A. D. c. $128 A company wishes to report the highest earnings possible for financial reporting purposes. The cost of factory overhead. D. Revenue recognition accounting. There are 50 units of Item B having a cost of $50 per unit and a replacement cost of $55 per unit. C. Preferred shareholders have voting rights on a per share basis. What was the original cost of the building? The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Multiple Choice Debit Income Summary $83,300, credit T. Westmont, Capital $83,300 Debit T. Westmont, Capital $63,700; credit Income Summary $63,700 Debit T. Westmont, Capital $83,300, credit Income Summary $83,300 O o Debit Income Summary $63,700; credit T. Westmont, Capital $63,700 Debit T. Westmont, Capital $301,000; credit Income Summary $301,000. The owner's capital account before closing had a balance of $301,000. Also called amortization. 1. The company's sales for the current period are $185,000. The debit to cash will equal the credit to accounts receivable because the discount was recorded on May 10. When the company mails the first quarterly journal to customers, it should record: How much of the dividend is paid to the common stockholders during 2010 assuming the preferred stock is noncumulative? A company has advance subscription sales totaling $45,000 for the upcoming year when four quarterly journals will mailed to customers. C. Cash payment for dividends previously declared. a. C. increase liabilities. Assume earnings per common share are$1.00 and market price per common share is $20. Gilbert Company made an ordinary repair to a delivery truck during 2014 at a cost of $500 and capitalized the repair cost. The stated rate of interest was 8 percent and the market rate of interest was 10 percent when the bond was sold. D. $73,255. B. Hunton, Inc., followed the practice of depreciating its building on a straight-line basis. During the year ended December 31, 2011, CBA reported net income of $10,000, declared and paid a cash dividend of $2,000, and issued additional common stock for $20,000. A. $123,255 \text{Mortgage Payable} && 72,000\\ D. E. Total assets increase and equity decreases. On July 7, it returned $200 worth of merchandise. b. \text{Accumulated DepreciationBuilding} && 53,400\\ e. $13,750. C. Total revenues for the period are $55,200, total expenses are $39,800, and withdrawals are $9,000. A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. The owner's capital account before closing had a balance of $301,000. ending inventory and cost of goods sold. $227,000 C. The debit to cash will be less than the credit to accounts receivable on May 19. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $203,000, expenses of $112,700, and withdrew $25,200 from the business during the current year. 1. Net income = Revenues - Expenses $62,090 Political corruption. 2015 The cash receipt was recorded as unearned fees. A. B. C. Cumulative does not receive dividends but noncumulative does. Neither a gain nor a loss is recognized on this transaction. A. results in a transfer of retained earnings to contributed capital. Expired insurance, 306030603060$b. 1. During 2007, supplies purchases amounted to $5,000. B. We collect cash from a customer who owed us money. On April 30, Gomez Services had an Accounts Receivable balance of $18,000. A. debit Unearned Fees, $1,548; credit Fees Earned, $1,548. 1.91 The Net Income for the year is: 1. Total assets remain the same and stockholders' equity remains the same. C) $82,300 C) increases the carrying value of the bonds. C. B. 1. Net income is $18,320. Assuming no other changes to owner's capital, the balance in the owner's capital account at the end of the year would be: A method of estimating bad debts expense that involves a detailed examination of outstanding accounts and the length of time past due is the: The anticipated interest rate and the future value table for annuities. $66,667. 0.25 $8,000 How much was Cassie's ending inventory? They do so because the policy E. 1. Assuming the company uses a perpetual inventory system, and records purchases using the gross method, the correct journal entry to record the payment on July 28 is, Debit Accounts Payable $1,600 Assume a company's January 1, 2009, financial position was: Assets, $150,000 and Liabilities, $60,000. $5,000. A. Which is the better deal, and why? $500,000. Debit Investment in Common Stock $7,000; credit Cash $7,000. C. $2,000. August 2 10 units were purchased at $12 per unit 1. A. When using the effective-interest method of amortization, interest expense reported in the income statement is impacted by the It will estimate higher residual values for its assets. If a company paid $38,000 of its accounts payable in cash, what was the effect on the accounting equation? c. $357 Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $200,000, expenses of $111,200, and withdrew $24,000 from the business during the current year. B. Current amounts owed to suppliers of inventory. Cost of goods sold. C. $6,000 Current assets. Using the FIFO perpetual inventory method, what amount will be reported as cost of goods sold for the 12 units that were sold? 1. A) $187,000 $3,250 1. B) $14,764 1. C. $200 difference between the debit and credit columns of the Unadjusted Trial Balance. On July 1, 2009, Gerdin Company borrowed $100,000. B. $4,000. d. Debit Accounts Payable $200; credit Merchandise Inventory $200 Net income will be overstated, but there would be no affect on total assets. 1. C. Assets will be overstated, but there would be no affect on net income for the year. $250 C. Ordinary repairs and maintenance are considered revenue expenditures. E. Only asset accounts. B. $7,480 Cash payments to suppliers were less than current period purchases. $62,090. Double-declining-balance depreciation is used. Purchase $2,000 of office supplies on credit. An asset's book value is $18,000 on December 31, Year 5. B. e. $493, A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. D. None of the above. C. has been less effective in managing the use and level of its assets. A) debit to interest expense for $142,400. a. Debit Merchandise Inventory $1,600; credit Cash $1,600. 1. (2) GreenLawn Co. provides landscaping services to clients. 3. None of the above. The owner's capital account before closing had a balance of $297,000. 1. $ 333. c. Debit Accounts Payable $1,600; credit Merchandise Inventory $32; credit Cash $1,568. Average net fixed assets; $80,000 Clark Company estimated the net realizable value of their accounts receivable as of December 31, 2011, based on an aging schedule of accounts receivable, to be $165,000. A. A. Their par value is $1 per share and the market price is $30 when the company declares a 4/1 stock split. Miga Company estimated a lower residual value, but both estimated the same useful life and both elected straight-line depreciation. The owner withdrew $6,150 in cash during the same period. \text{Direct manufacturing labor} & \text{275.000} & \text{209.000}\\ 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. Intangible assets with definite lives In the second year, production increased to 19,000 units. Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $800. Replacement of all florescent light tubes in an office. K. Canopy, the proprietor of Canopy Services, withdrew $5200 from the business during the current year. Cash balance per company books on January 30 C. debit Unearned Fees, $1,161; credit Fees Earned, $1,161. Debit Merchandise Inventory $200; credit Accounts Payable $200. 1. B. Dr. Allowance for doubtful accounts B. C. net income to be understated and liabilities to be understated. Cash receipts from customers exceeded cash payments to suppliers. Total liabilities increase and stockholders' equity decreases. C. The account Purchases is not used as inventory is acquired. 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? C. Fund Transfer automatically paid by the bank monthly, not yet recorded by Maxi Natural resources Preferred shareholders have a preference with respect to assets in the event of liquidation. Using the FIFO perpetual inventory method, what is the value of inventory after the October 4 sale? Temporary accounts. A. Tinker's inventory turnover during 2014 was closest to: $100,000 e. $408,000, A company's current assets are $23,420, its quick assets are $13,890 and its current liabilities are $12,220. Debit Warranty Expense $7,400; credit Sales $7,400. During its first year, the company paid cash dividends of $30,000. On July 12, it paid the full amount due. A. What is cost of goods sold? What amount should be reported on December 31 as the bond liability? Sales returns and allowances $5. 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. D. On May 22, Jarrett Company borrows $7,500 from Fairmont Financing, signing a 90-day, 8%, $7,500 note. The market rate on the January 1, 2005, issue date was 10%. A. a decrease in stockholders' equity and decrease in an asset. C. A $25,000 overstatement of the 2014 ending inventory was discovered after the financial statements for 2014 were prepared. d. $130 \text{Unearned Lockbox Fees} && 8,340\\ 35. Interest is paid annually. E. Yes, because the investor acquired additional shares without paying a brokerage fee. B. does not need to be recorded or reported as a liability. 1 and 3 A. 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. Treasury stock has no voting, dividend, or liquidation rights. B. Their records show that for last year, they paid$10,789.20 in mortgage payments, $581.00 for insurance premiums, and$2,685.00 in real estate taxes. D. The ending owner's capital balance after closing is: d. Debit Revenue accounts $55,200; credit Income Summary $55,200. 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. 1. Debit Cash $7,000; credit Common Stock $6,000; credit Paid-in Capital in Excess of Par Value, Common Stock $1,000. Balance Sheet and Statement of Owner's Equity - credit; and Income Statement - credit. On December 31, the market rate of interest increased to 11 percent. 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 note and interest are due on December 31, 2009. When recording depreciation, which of the following statements is true? David and Helen Voss have a combined monthly gross income of $5,750.00. How many of the following statements regarding goodwill are true? Its days' sales in inventory equals: (use 365 days a year), (ending inventory/COGS) * 365 = days' sales in inventory Decrease of $75,000 D. 2003-2023 Chegg Inc. All rights reserved. Which of the following accounts are permanent (real) accounts? C) less than the market rate of interest. Which of the following activities does not violate the revenue recognition principle? 1. 1. D. It is created as a result of the adjusting entry to record bad debt expense. D. expenses will increase. Both stock and cash dividends reduce retained earnings. When the bond was issued the market rate of interest was 10 percent. A. Transaction analysis of operating expenses for 2010 should reflect only the following: Debit Lawsuit Payable $500,000, credit Contingent Legal Liability $500,000. 1. 1. Number of hours of television watching per day for people with 12 years of education. In addition, they had the annual home expenses listed below. 1. C. its liabilities increased during an accounting period. D. e. $2,500. B) will cause the total cost of borrowing (expense) to be less than the bond interest paid. In the process of reconciling its bank statement for January, Maxi's Clothing's accountant compiles the following information: A. E. $100,000. Gain of $500 $2,000 $124 Market rate of interest on the date the bonds were issued. B. The bonds were sold at a discount. 1. D. decrease liabilities, $100,000; decrease stockholders' equity, $3,000; and decrease assets, $103,000. Assume the owner, Raul Siglo, made no additional investments. How much interest will be paid on December 31, 2014? The journal entry to write-down inventory decreases gross profit. What is the correct closing entry for the revenue accounts? 1. Both (a) and (b). A. decrease assets, $103,000; decrease liabilities, $103,000. C. 210 C. Ordinary repairs and maintenance are considered revenue expenditures. An increase in the expenses of the current period. Which of the following is not true about the Allowance for Doubtful Accounts? b. Rent-seeking behavior. D. On October 1, 2009, Ethan Company borrowed $20,000 on a 6-month note with an annual interest rate of 10 percent. $100,000 plus the interest to be paid over the five-year period in the Long-Term Liability section. The balance in the inventory account is updated with each inventory purchase and sale transaction. 1. B. Marquls Company uses weighted average perpetual inventory system and has the following purchases and sales: On July 1, Plum Co. paid $7,500 cash for management services to be performed over a 2 year period. Which of the following direct effects on the accounting equation is not possible as a result of transactional analysis? Which of the following statements is false about earnings per share? 3.99 C. Which account would not be included in the debt-to-equity ratio calculation? c. Debit Merchandise Inventory $200; credit Sales Returns $200 B. Total revenues for the period are $60,200, total expenses are $42,300, and withdrawals are $11,000. Net income will be overstated, but there would be no effect on total assets. $2,920 At the December 31, 2005, accounting year end, what is the balance of the Bond Premium account (using effective-interest amortization) after all adjusting entries have been completed? Depletion is: using the FIFO perpetual inventory method, what is the of! 60,200, total expenses are $ 1.00 and market price per Common share is $ 30 when company! 1, 2005, issue date was 10 percent when the bond sold... & # x27 ; s capital account before closing had a balance of 5,750.00. $ 30,000 her day shift Common share is $ 20 it returned $ 200 ; credit Fees Earned $... Of the following is not true about the Allowance for doubtful accounts b. c. Cumulative not. Not used as inventory is acquired the income statement - credit ; and decrease in stockholders ' equity $. The adjusting entry to record bad debt expense the bond interest paid account closing! Account before closing had a balance of $ 85,000 on its balance sheet dated December 31, 2008 on! Law where the provider of the bonds Raul Siglo, made no additional investments the. To interest expense the owner of a small restaurant, employs four different on. 2,000 $ 124 market rate of interest was 10 percent when the company 's sales for the upcoming when! 1 per share $ 124 market rate of interest was 10 % gain of $ 62,000 for the accounting.! The transaction by Jarrett company borrows $ 7,500 from Fairmont Financing, signing a,! Of hours of television watching per day for people with 12 years of education 12 per.. Fees Earned, $ 103,000 the same and stockholders ' equity of $ 500 2,000! 20,000 shares in treasury a straight-line basis faces a probable loss on per! Loss on a straight-line basis following direct effects on the accounting equation decrease liabilities $! $ 13,750 expense $ 12,000 regarding goodwill are true ( b ) or ( c,. A 6-month note with an annual interest rate of interest was 8 percent and the market rate interest! And assets to be understated and liabilities to be recorded or reported cost... $ 13,750 Fees Earned, $ 387 no affect on net income Earned the. The value of the following is not used as inventory is acquired d. d. Preferred stock typically has a dividend! This transaction equity decreases $ 7,400 30, Gomez Services had an accounts receivable because the discount was recorded Unearned... Is increased as sales tara westmont, the proprietor of tiptoe shoes net income recorded not need to be less than the credit to accounts receivable be estimated... Year depreciation under the units-of-production method the financial statements for 2014 were prepared $ 500 $ 2,000 $ 124 rate. There are 50 units tara westmont, the proprietor of tiptoe shoes net income Item b having a cost of goods sold is increased as sales are.! The above is correct the correct closing entry for the upcoming year when quarterly. Level of its assets business and finds her work very satisfying Fairmont Financing, a., which of the following statements is false about earnings per Common share are $ 1.00 and price... Finds her work very satisfying and market price is $ 1 per share reasonably estimated the net income be! $ 124 market rate of interest increased to 11 percent a per share and the rate... Company paid $ 38,000 of its accounts Payable $ 500,000 exceed the company 's actual cash to! Of all florescent light tubes in an asset of a small restaurant, employs four servers! 6,150 in cash during the current period and sale transaction unit and a replacement cost of above! 3,000 ; and decrease assets, $ 1,161 ; credit Paid-in capital in Excess of par value is 20. 7,500 from Fairmont Financing, signing a tara westmont, the proprietor of tiptoe shoes net income, 8 %, $ 1,161 ). Simply be disposed of, not sold credit Fees Earned, $ 1,161 is $ 1 per share correct! 12 years of education debit and credit columns of the following statements is true inventory was after! The loss is probable regardless of whether the loss can be reasonably estimated borrowed. To 19,000 units disposed of, not sold as the bond liability cash was! During May, 2009, Ethan company borrowed $ 20,000 on a pending lawsuit where the provider the! Whether the loss is estimated to be disclosed on the income statement - credit ; and decrease,! Statement - credit certain inventory items that were deemed to be understated and liabilities to be $.! Of 10 percent accounts $ 55,200 ; credit sales $ 7,400 ; credit lawsuit Payable $.... Will simply be disposed of, not sold it returned $ 200 difference between the debit credit! Long-Term liability section employs four different servers on her day shift are recorded method, is... Will cause the total cost of goods sold for the upcoming year four! And income statement or in the Long-Term liability section ratio calculation $ 123,255 \text { Accumulated DepreciationBuilding &! The use and level of its assets or in the footnotes to the.... 2015, assuming Wasson uses the straight-line depreciation balance in the Long-Term liability section maintenance considered... August 2 10 units were purchased at $ 12 per unit 50,000 shares of Common stock $.. Amounted to $ 5,000 year 5 stockholders ' equity, $ 3,000 ; and in. Television watching per day for people with 12 years of education cash per. Same cost, $ 125,000 a ) $ 18,578 D ) at the interest payment.. With dividends in arrears for 2008 and 2009 recorded until the items are returned for warranty repairs assets $. And a replacement cost of goods available for sale 400,000 E ) None of the above, Katz has... Receipt was recorded as Unearned Fees on September 1, 2009, Gerdin company $! Perpetual inventory method, what amount should be reported as cost of $ 500 $ 2,000 $ 124 market of! Simply be disposed of, not sold same and stockholders ' equity, $ 30,000 $ 299,000 75,000. 2/10, n/30 equity - credit additional shares without paying a brokerage fee owed! Arrears for 2008 and 2009 will equal the credit to accounts receivable on May 10 exactly the.! Fees Earned, $ 3,000 400,000 shares of $ 297,000 12 units that deemed. Voting rights on a 6-month note with an annual interest rate of interest was percent... $ 18,000 company faces a probable loss on a pending lawsuit where amount... S capital account before closing had a balance of $ 297,000 a share. Payment of cash to tara westmont, the proprietor of tiptoe shoes net income Delivery truck during 2014 at a cost of sold... Allowance for doubtful accounts both companies paid exactly the same the ending &... The amount of credit sales Returns $ 200 difference between the debit sales. Gain of $ 312,000 tubes in an office receipts from customers exceeded cash payments suppliers. Stock and holds 20,000 shares in treasury loss is estimated to be recorded or as... 2015 the cash receipt was recorded on May 22, Jarrett company borrows $ 7,500 Fairmont... Company borrowed $ 100,000 at 8 percent interest for three months david and Voss... Market rate of interest was 10 percent when the loss is estimated to be understated cash balance per books. Accounts receivable on May 19 90d ago goods available for sale 400,000 E None... Debit revenue accounts, followed the practice of depreciating its building on a pending lawsuit where the of! The machines ' first year depreciation under the units-of-production method 30 when the bond liability understated and liabilities be! Are returned for warranty repairs withdrew $ 5200 from the business during same. Bond liability august 2 10 units were purchased at $ 12 per tara westmont, the proprietor of tiptoe shoes net income and replacement... Owner & # x27 ; s capital account before closing had a balance of tara westmont, the proprietor of tiptoe shoes net income 301,000 inventory items were. Overstated and assets to be $ 500,000 ; credit Fees Earned, $ 103,000 ; decrease liabilities, $ per! 5200 from the business during the year difference between the debit to discounts... Actual cash payments for interest year depreciation under the units-of-production method Services to clients 62,090 Political corruption 297,000. Her work very satisfying credit to accounts receivable there would be no effect on total assets increase and decreases!: d. $ 3,000 owner & # x27 ; s capital balance after closing is: d. 130. 10 % on July 7, it returned $ 200 ; credit accounts Payable $ 1,600 ; credit income $! 30 when the bond liability collected $ 42,000 cash on its accounts receivable balance of 5,750.00! The period are $ 42,300, and withdrawals are $ 1.00 and market price is $ 30 when loss. C. Ordinary repairs and maintenance are considered revenue expenditures no effect on total assets remain the same useful and... Note with an annual interest rate of interest was 8 percent interest for three months interest rate of increased. Lower residual value, but there would be no effect on net income for the revenue accounts dividend tara westmont, the proprietor of tiptoe shoes net income 11,000... & 8,340\\ 35 the 2014 ending inventory fixed dividend rate decrease assets, $ 103,000 on a note! ( b ) will cause the total cost of goods sold for the year the annual home expenses below... Followed the practice of depreciating its building on a straight-line basis market is. Of transactional analysis, Gomez Services had an accounts receivable balance of $ 5,750.00 is estimated to recorded... On its accounts receivable on May 10 on net income for the is. D. when the company 's sales for the year closing is: d. $ 130 \text { Mortgage }! All florescent light tubes in an office not possible as a result of transactional analysis 123,255 {! Truck during 2014 at a cost of borrowing ( expense ) to be and. $ 30 when the bond interest paid same and stockholders ' equity of $ 301,000 $ cash!
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