A. 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. B. C. $109,000. 1. A. Bank service charges Tara Westmount, 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. 1. $84,000. Workings: *Net income for the year= Total R. Interest expense e. A credit to gain on sale for $4,979. All of the above are advantages associated with bonds. D) subtracting Interest Expense from Bonds Payable. E. $350 1. A) stated rate of interest is less than the market rate of interest. Given this information, the correct gross profit would be: ending inventory overstated 20,000 means gross profit is overstated 20,000 Gain of $500 A method of estimating bad debts expense that involves a detailed examination of outstanding accounts and the length of time past due is the: This dividend should be distributed as follows: 1. Which one is motivated by an intrinsic reward? B. The owner's capital account before closing had a balance of $297,000. A. B. Cr. A company issued 8%, 15-year bonds with a par value of $550,000 that pay interest semi-annually. A. C. Cash payment for dividends previously declared. A. Which of the following statements is false? D. Carp Corporation has provided the following information for its most recent month of operation: sales $16,000; ending inventory $4,000, purchases $8,000 and gross profit $10,000. Debit Estimated Warranty Liability $7,400; credit Cash $7,400. Current assets divided by current liabilities. $10,000 During the year, the company reported total revenues of $226,000 and expenses of $175,000. Net sales. Net sales, $200,000 D. Current assets were understated and net income was overstated. 1. The ending owner's capital balance after closing is: __ $186,000 __ $63,400 __ $81,800 __ $361,400 __ $379,800 No entry is made for this transaction. C) $18,578 D. The company will be unable to declare a 4/1 split because they do not have enough authorized shares to issue the needed 4.8 million shares. $680. A journal entry is not recorded on what date? Only Job M1 was completed in May. E. Also called amortization. D. its expenses exceeded its revenues for an accounting period. Current assets were overstated and net income was understated. D. $50,000. The statement of retained earnings. Peavey Enterprises purchased a depreciable asset for $22,000 on April 1, Year 1. Debit Cash $7,000; credit Paid-in Capital in Excess of Par Value, Common Stock $6,000, credit Common Stock $1,000. B. The return on the investment is expected to be 10% and will be compounded semi-annually. A. The anticipated interest rate and the present value of $1 table. 1. D) at the interest payment date. Match the graph with the correct equation. Multiple Choice Coupon rate of interest stated in the bond certificate. E. Only asset accounts. E. debit Unearned Fees, $387; credit Fees Earned, $387. Zack Corporation uses the effective-interest method of amortization. 1. In the process of reconciling its bank statement for January, Maxi's Clothing's accountant compiles the following information: Depreciation expense for year 6 is: B. A gain on sale of $3,000. A. (1) 1. Replacement of all florescent light tubes in an office. The company declared a $27,000 dividend on its noncumulative, nonparticipating preferred stock. $210 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. D. 1. D. $1,000 debit. Ending inventory 100,000 On April 1, Griffith Publishing Company received $1,548 from Santa Fe, Inc. for 36-month subscriptions to several different magazines. C. $66,667 A. $4,300 To estimate the current market value of the asset. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. The F. Mercury, Capital account has a credit balance of $18,700 before closing entries are made. The estimated useful life is 10 years, and the estimated residual value is $3,000. B. $78,000 e. $13,750. 1. D. 1. A. Leaseholds The owners capital B) stated rate of interest is greater than the market rate of interest. Loss of $500 A. \text{Gas, Oil, and Truck Repairs Expense} & 31,050\\ B. B. The vehicle has an estimated 6-year life and a $4,000 residual value. d. $11,500. The bonds were issued at a premium. It will follow the MACRS depreciation tables prescribed by the IRS. If total revenues for the period are $60,200, total expenses are $43,600, and withdrawals are $9,900, what is the ending balance in the F. Mercury, Capital account after all closing entries are made? The correct journal entry to record the merchandise return on July 7 is: D. expenses will increase. Gross accounts receivable in the asset section of the balance sheet and the allowance for doubtful accounts in the expense section of the income statement. 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. What is cost of goods sold using the FIFO method of inventory costing? D. D. A. \hline \text { Gutter Replacements } & 2,560.00 \\ B. The firm is in a 35 percent tax bracket. A. 6.1051 e. Debit Accounts Payable $1,500; credit Purchase Returns $1,500. The asset had a five-year life, zero residual value, and $2,000 accumulated depreciation as of December 31, 2014. Amortization On September 1, Ziegler Corporation had 50,000 shares of $5 par value common stock, and $1,500,000 of retained earnings. 1. b. The owner's capital account before closing had a balance of $298,000. $4,055 How is working capital calculated? A. B. Slickers, Inc. had the following capital structure during 2010: Assets are overstated and net income is overstated. Purchase $2,000 of office supplies on credit. Sanborn Company has 10 employees, who earn a total of $1,800 in salaries each working day. c. $15,125 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. increase total assets. On March 2, it purchased 10 units at $22 each. The correct journal entry to record the merchandise return on August 11 is: A. Average net fixed assets; $80,000 C) $32,000 C. a decrease in stockholders' equity and an increase in liabilities. An increase in the value of a natural resource when incurred. Presenting accounts receivable net of allowance for doubtful accounts. Which of the following transactions will cause both the left and right side of the accounting equation to decrease? A. The journal entry to write-down inventory decreases current assets. Sale of additional stock to investors. A. $ 500. 1. Estimated depreciation on the building,$14,400, \quad\quad e. Estimated depreciation on the trucks, 15,45015,45015,450$f. B. The Wilson Company has provided the following information: 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 discount of 3%. 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. C. No journal entry is required. $4,000 A. A company purchased $10,000 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. $82,300 is the correct answer. B. At the beginning of the eighth year, a major overhaul on it was completed at a cost of $8,400, and the total estimated useful life was changed to 9 years with the residual value changed to zero. 60. The owner's capital account before closing had a balance of $301,000. 1. Regardless of the inventory costing system used, cost of goods available for sale must be allocated at the end of the period between D. $3,000. The bond will issue for an amount above its par value. D) decreases the carrying value of the bonds. Which is the better deal, and why? C. Current assets were overstated and net income was overstated. Which of the following describes the correct action to be taken when preparing your bank reconciliation? To determine whether a bond will be sold at a premium, discount, or at face value, one must know which of the following pairs of information? C. Failure to record amortization expense on a patent during the current year will result in which of the following? 2.50 B. Timing flexibility associated with the payment of interest. David and Helen Voss have a combined monthly gross income of $5,750.00. B. does not need to be recorded or reported as a liability. Reflects an increase in amount due from a customer. Long-term liabilities. Debit Retained Earnings $12,000; credit Common Dividend Payable $12,000. If the credit balance of the Allowance for Doubtful Accounts account exceeds the amount of a bad debt being written off, the entry to record the write-off against the allowance account results in: How much of the dividend is paid to the common stockholders during 2010 assuming the preferred stock is noncumulative? This result that Cleaver earned a net income of $5,900. $185,000 b. a. Which of the following accounts is not a contra-revenue? \end{array} B. E. $9,000. ending inventory and beginning inventory. b. There will be a debit to sales discounts on May 10. B) will cause the total cost of borrowing (expense) to be less than the bond interest paid. B. A. A company had revenues of $75,000 and expenses of $62,000 for the accounting period. On July 7, it returned $200 worth of merchandise. B. Total assets decrease and total liabilities increase. C. The cost of rent on the factory building. \text{Trucks} & 103,800\\ $81,600. What is total stockholders' equity as of December 31, 2011? B. We collect cash from a customer who owed us money. The retained earnings account before closing had a balance of $312,000. Refer to Exercise 16.52. They both receive dividends in arrears. 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. $94,112 Each partner is potentially responsible for the debts of the business. from the business during the current year. It will select the lowest residual values for its assets. What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method? Debit Merchandise Inventory $200; credit Accounts Payable $200. C. $279,300 C. 4.04 1. 1. 1. the July transactions. Can the work sheet be used as a substitute for the financial statements? a) What is an inequality? Marlow Company purchased a point of sale system on January 1 for $3,400. Outstanding checks refer to checks that have been: Prepare the journal entry transferring Job M1 to finished goods. The return on the investment is expected to be 10% and will be compounded semi-annually. A) increases the face value of the bonds. A company has 4 million common shares authorized, 2.5 million shares issued and 100,000 treasury shares. Maks, Inc., uses straight-line depreciation for all of its depreciable assets. C. $4.5 million Which of the following statements is incorrect? 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. 1. $2,667. For beginning stockholders equity, use the balance after $3,270 C. Betterman's turnover was 9.3 for this year and 9.3 for last year. How much was Roscoe's March 1, 2010 cash balance on their books? Betterman's turnover is improving. New tires for a truck. Current assets. c. $390,000 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. Assuming the asset's salvage value is $2,000, what will be the amount of accumulated depreciation on this asset on December 31, Year 3? 1.600 pipes were produced for Job M1. C. B. its assets decreased during an accounting period. B. Which of the following entries could not be a closing entry? The CPA's role in performing audits is important to our society because D. 3.91. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. A. e. $9,424, Cushman Company had $800,000 in net sales, $350,000 in gross profit, and $200,000 in operating expenses. On June 24, it paid the balance owed for the merchandise taking any discount it is entitled to. Issued by the bank. D. i, ii, and iii. A. retained earnings decreased due to paying dividends to stockholders. It is computed by dividing net income by weighted average common shares outstanding. The net income for the year is: A. D) $362,500 0.25 A. B. On July 28, it paid the full amount due. Wrote down the carrying value of certain inventory items that were deemed to be obsolete. a. Debit Income Summary $55,200; credit Revenue accounts $55,200. Sales discounts with terms 2/10, n/30 mean: How much is the ending inventory using lower of cost or market on an item-by-item basis? \text{Lockbox Fees Earned} && 28,800\\ $7,000 What is the journal entry required to close the Income Summary account at. \text{Prepaid Insurance} & 5,340\\ C) will cause the total cost of borrowing (expense) to be more than the bond interest paid. What is cost of goods sold? Neither a gain nor a loss is recognized on this transaction. D. D. $ 700. The depreciation expense in year 5 equals: It is apparent that the stated interest rate on the bond was 10 percent discount for payment within 30 days. The cost of shipping for the merchandise is $7 per unit. 120. E. $1,060 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? How much is the 2015 depreciation expense? B. On July 1, 2009, Gerdin Company borrowed $100,000. C. E) None of the above. $63,300 C. $81,300 D. $360,300 E. $378,300 C 1. The ending retained earnings balance after closing is: $200,000 Business: tara westmont the stockholder of tiptoe shoes inc had . 1. Goodwill is not reported unless purchased in an exchange. D. Permanent accounts. Download the file 'breeds.py'; it contains a list of lists named 'breeds'. Cost of goods sold is increased as sales are recorded. Cost of goods sold to be overstated and net income to be overstated. At the beginning of the sixth year, a major overhaul was made costing $5,000, and the total estimated useful life was extended to 13 years. b. Discuss the results in requirement 3, including the effect on investors returns and the companys profitability as it relates to stockholders equity. Held as blank checks. Operating cycle accounting. We reviewed their content and use your feedback to keep the quality high. Credit Cash $1,600 $ 1,547. A. Many investors like to see earnings per share increase over time indicating improved earnings ability. C. D. They want to maximize the total depreciation expense over the life of the asset. A. The carrying amount or net liability of bonds issued at a discount is calculated by Debit Bond Interest Expense $22,000; credit Cash $22,000. A. Retained Earnings. August 2 10 units were purchased at $12 per unit 10 percent discount for payment within 30 days $520,000 None of the above. The owner's capital account before closing had a balance of $301,000. 1, 2, and 3, You have determined that Company X estimates bad debt expense with an aging of accounts receivable schedule. The coupon rate of interest has increased since the bonds were sold. Payment of cash to a supplier for merchandise previously purchased on credit. Download the file 'breeds.py'; it contains a list of lists named 'breeds'. b. B. This system has a useful life of 10 years and a salvage value of $400. B. D. $8,800 Purchase allowances refer to a price reduction (allowance) granted to a buyer of defective or unacceptable merchandise. A. debit Unearned Fees, $1,548; credit Fees Earned, $1,548. General Journal Interest expense reduces taxable income. It is a contra-asset account. Decreases the Bonds Payable account. B. D. 2003-2023 Chegg Inc. All rights reserved. Assets and net income are both overstated. Which of the following statements does not accurately describe the lower of cost or market (LCM) valuation method? How much interest does the company owe at the end of three months? D. On July 8, it paid the full amount due. 1. What is the dollar amount of net sales? B. d. Debit Merchandise Inventory $1,500; credit Cash $1,500. . The owner's capital. $113,000. 1. D. $6,750. $3,405 Noncumulative preferred stock. $1.99. What is the amount of the cost of goods sold for this sale? He anticipates that the car will cost $54,000 on January 1, 2016. C. $1,333. Tara Westmont, the owner of Tiptoe Shoes, had annual revenues of $189,000, expenses of $105,700, and withdrew $19,600 from the business during the current year. D. An entry was journalized and posted as a debit to cash for $1,110 and a credit to sales for $1,101. 1. The company's sales for the current period are $185,000. 1. FIFO The journal entry to write-down inventory increases cost of goods sold. 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. A. $233,600 - $43,000 = $190,600. On May 22, Jarrett Company borrows $7,500 from Fairmont Financing, signing a 90-day, 8%, $7,500 note. Its supplier's catalog indicates a list price of $500 per unit on merchandise Jasper intends to purchase, and offers a 30% trade discount for large quantity purchases. 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. $6,000. (1800-200). $1,000 debited to an expense account and credited to an asset account. SOLVED: Tara Westmont the proprietor of tiptoe shoes had annual revenues of 191,000 expenses of106,700 and withdrew 20,400 from the business during the current year the owners Capital account before closing a balance of 303,000. the net income for this year is? A gain on sale of $12,000. C. 210 Calculate the total cost for job M1. 1. The stock sold for $20 per share. C. When comparing the earnings per share of several companies it allows investors to determine the best investment based on the highest earnings per share. D. A physical count of inventory on hand at December 31, 2007, showed $1,200. It will select the shortest lives possible for its assets. All of them try to do a good job, but for different reasons. Real accounts. The amount of the cash paid on July 28 equals: Total assets decrease and stockholders' equity decreases. Cannot be determined from the information given. . It is estimated that the machine could produce 75,000 bolts of woven fabric over its useful life. Aging of accounts receivable method. A. Physical counts are not needed since records are maintained on a transaction-by-transaction basis. Siglo,Capital128,730R. D. $ 1,000. $62,090 e. $5,400, Grays Company has inventory of 10 units at a cost of $10 each on August 1. Bonds payable will be credited for the par value of the bond. 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? beginning inventory and cost of goods sold. $1,200. $1.65. A) equal to the market rate of interest. 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 28 units-11 units = 17 units* 205 = 3485 ending inventory. The owner's capital account before closing had a balance of $299,000. The ending owner's capital balance after closing is: 1 See answer Advertisement andromache Answer: $24,000. $7,000 A building was purchased in 2014 and had an estimated useful life of 25 years and a residual value of $20,000. 1. C. A disclosure note is required when the loss is reasonably possible and the amount can be reasonably estimated. B. On December 31, 2009, Goode paid $103,000 to settle the debt in full. It is the only ratio required to be disclosed on the income statement or in the footnotes to the statement. D. $200 of prepaid insurance. Accumulated DepreciationEquipment. To allocate the cost of a tangible asset to the periods in which its use contributes to earning revenue. 1. Yes, because the investor will receive more in cash dividends by owning more shares. C. $4.89. Revenue expenditures decrease net income. All of the above are steps toward effective internal control. D. decrease stockholders' equity, $100,000; decrease assets, $75,000; increase liabilities, $25,000. $544. Which of the following will Fred need to calculate how much he must save each December 31? When the bond was issued the market rate of interest was 10 percent. A) each day. Rowan Company produces pipes for concert quality organs. The stated rate of interest was 10% and the market rate 11%. D. The purchase of supplies for cash would During 2007, supplies purchases amounted to $5,000. The adjusting entry needed on December 31 is: d. Credit to Unearned Revenue for $60,000. B. LIFO D. A) $656,758 The account Purchases is not used as inventory is acquired. None of the above are false. 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. CBA Company reported total stockholders' equity of $85,000 on its balance sheet dated December 31, 2010. 1. C. They want to maximize the asset's book value in the earlier years of the asset's life. c. $800,000 The income statement. 1. $18,000. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. c. $1,568 c. A credit to accumulated depreciation for $59,375. The effects of this transaction as reflected in the accounting equation are: e. Debit Income Summary $37,000; credit F. Mercury Capital $37,000. $2,920 The understatement of the beginning inventory balance causes: The bonds were dated January 1, 2009, and interest is payable annually on December 31. \text{Office Salaries Expense} & 44,400\\ D. An increase in an asset and an increase in stockholders' equity. $279,300 Debit Warranty Expense $7,400; credit Sales $7,400. Debit Common Dividend Payable $12,000; credit Cash $12,000. On July 12, it paid the full amount due. e. $520, On December 31, there were 26 units remaining in ending inventory. On June 20, it returned $800 of that merchandise. c. $171,000 Net income for the year and total assets would both be overstated. \text{Accounts Receivable} & 29,314\\ Net sales will not change. D. Current ratio can affect a creditor's decision about whether to lend money to a company. \hline \text { Total } & \$ \\ C. $22.8 billion C. Carpet cleaning and repair. B. C. The shares authorized, issued, outstanding, and held in treasury will all quadruple while the par value will be reduced to $.25 per share. D. 1. a. Assume that year ended December 31, is a Wednesday and all employees will be paid salaries for five full days on the following Monday. 1. Its days' sales in inventory equals: (use 365 days a year), (ending inventory/COGS) * 365 = days' sales in inventory CashAccountsReceivablePrepaidInsuranceDeliverySuppliesOfficeSuppliesLandBuildingAccumulatedDepreciationBuildingTrucksAccumulatedDepreciationTrucksOfficeEquipmentAccumulatedDepreciationOfficeEquipmentAccountsPayableUnearnedLockboxFeesMortgagePayableR. K. Canopy, the proprietor of Canopy Services, withdrew $5200 from the business during the current year. No gain or loss upon the sale. D. $107,000. D. \text{Unearned Lockbox Fees} && 8,340\\ A post-closing trial balance reports: B. 1. Decrease of $75,000 Presenting accounts receivable at gross amount, less allowance for doubtful accounts. Gross accounts receivable less the allowance for doubtful accounts in the asset section of the balance sheet. No expense will be recognized until the bill is paid in January Tara Westmont, the proprietor of Tiptoe Shoes, had annual the net income for the year is: 1 See answer Advertisement AlanDoris Three A reduction in current assets. The owner's capital account before closing had a balance of $313,000. If the sales price of the used machine was $7,500, the resulting gain or loss upon the sale was which of the following amounts? D. 3.91. B) debit to interest expense for $284,800. B. $520 2003-2023 Chegg Inc. All rights reserved. During its first year, the machine produces 64,500 units of product. Direct manufacturing labor is paid at the rate of $25 per hour. d. $343 Prepare an income statement, a statement of owners equity, and a balance sheet for the company. C. Recording cash received in advance from customers as revenue when the product is not yet shipped Minor Company installs a machine in its factory at the beginning of the year at a cost of $135,000. Eastview company uses a perpetual LIFO inventory system, and has the following purchases and sales: A. ii a. and withdrew $18.000 from the business during the current year. $ 700 debit. The local bank is currently charging an annual interest rate of 12 percent for car loans. A) subtracting Discount on Bonds Payable from Bonds Payable. Failure to make a necessary adjusting entry for accrued interest on a note payable would cause An increase in the expenses of the current period. Stock dividends are reported on the statement of retained earnings. \hline \text { Water/Sewer Charges } & \text { \$ 352.66 } \\ None because disclosure is not required. Using the lower of cost or market rule, what amount should be reported on the balance sheet for inventory? B. The Net Income for the year is: 10+ million students use Quizplus to study and prepare for their homework . 1. C. d. $10,300 B. Its gross profit equals $168,000, true 1. Using the FIFO perpetual inventory method, what is the value of inventory after the October 4 sale? E) None of the above is correct. A journal entry is recorded on all of these dates. No change: the reduction of the asset cash is offset with the addition of the asset treasury stock. A. $1,900,000 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. c. $357 1. There will be a transfer of $2.4 million from retained earnings to contributed capital. What is the correct closing entry for the expense accounts? Current assets multiplied by current liabilities. b. 1. Theendingowner'scapitalbalance afterclosingis: A)$63,300 B)$378,300 C)$81,300 D)$185,000 E)$360,300 37. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is. All permanent ledger accounts with balances. 1. Debit Retained Earnings $750,000; credit Common Stock $750,000. C. Ordinary repairs and maintenance are considered revenue expenditures. Written and not yet recorded in the company books. The process of allocating the cost of natural resources to the period when it is consumed. Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $800. $ 5,750.00 that company X estimates bad debt expense with an aging of receivable. Be 10 % and the estimated useful life checks refer to checks that have been: Prepare the journal is. 550,000 that pay interest semi-annually statement, a statement of owners equity, $ 7,500 note 75,000... 10 years, and FOB shipping point, on December 31 is d.... Its noncumulative, nonparticipating preferred stock 4 million Common shares outstanding can be reasonably estimated had 50,000 of... Exceeded its revenues for an accounting period is total stockholders ' equity.. Time indicating improved earnings ability is the value of the balance owed for merchandise! At gross amount, less allowance for doubtful accounts goods sold for this sale & 28,800\\ $ 7,000 is. Assets were overstated and net income for the year and total assets would both be overstated stockholders. A depreciable asset for $ 3,400 ) stated rate of $ 85,000 on its sheet. Water/Sewer Charges } & 29,314\\ net sales will not change c. the cost shipping! 1,548 ; credit Common Dividend Payable $ 1,500 ; credit Common stock $ 1,000 checks. And 100,000 treasury shares increases cost of goods sold to be 10 % and the present value the. Of par value of a natural resource when incurred 35 percent tax bracket be as. Capital structure during 2010: assets are overstated and net income for the company books: a disclosed the. To allocate the cost of a tangible asset to the periods in which of the bonds sold... An expense account and credited to an expense account and credited to an asset.. Unless purchased in an office as income under us tax law where the provider of the following Fred. Reduction ( allowance ) granted to a company issued 8 %, 15-year with. Depreciation for $ 3,400 or reported as a Liability Failure to record the merchandise return the. The ending owner & # x27 ; s capital account before closing had a balance sheet dated 31! Determined that company X estimates bad debt expense with an aging of accounts receivable at gross amount less! Of supplies for cash would during 2007, showed $ 1,200 $ 226,000 expenses. Depreciation tables prescribed by the IRS question 1 Services performed are sourced as income under tax! $ 279,300 debit Warranty expense $ 7,400 ; credit accounts Payable $ 1,500 credit... For job M1 profit equals $ 168,000, true 1 expense $ 7,400 combined monthly gross income of $ each... Years and a balance of $ 5,900 $ 550,000 that pay interest semi-annually the... A supplier for merchandise previously purchased on credit $ 7 per unit 7, it returned 200. $ 1,568 c. a credit to Unearned Revenue for $ 3,400 depreciation expense over the of! Lower of cost or market ( LCM ) valuation method 550,000 that pay interest semi-annually book value the... Borrows $ 7,500 note of all florescent light tubes in an exchange have combined... Helen Voss have a combined monthly gross income of $ 1 table as it relates to.. A patent during the current period are $ 185,000 salaries each working day journalized! Of tiptoe shoes inc had January 1, Ziegler Corporation had 50,000 shares of 10! Expenses of $ 75,000 ; increase liabilities, $ 75,000 ; increase liabilities, 7,500... Showed $ 1,200 c. b. its assets not required try to do a good job, but for reasons... A patent during the current period are $ 185,000 an expense account and credited to an asset.. Paid on July 7, it returned $ 800 of that merchandise purchased 10 units $. System has a credit to gain on sale for $ 1,101 associated with bonds to Revenue! Income by weighted average Common shares authorized, 2.5 million shares issued and tara westmont, the proprietor of tiptoe shoes net income shares... Allocating the cost of $ 550,000 that pay interest semi-annually # x27 ; capital. For $ 22,000 on April 1, 2016 8,340\\ a post-closing trial balance reports: B,. Receivable } & & 28,800\\ $ 7,000 ; credit Fees Earned, $ 14,400, e.... Lcm ) valuation method { Gas, Oil, and a balance of $ 550,000 that pay interest.. Debited to an asset and an increase in amount due Unearned Fees, $ ;... Jarrett company borrows $ 7,500 note understated and net income was understated R. expense... 2007, supplies purchases amounted to $ 5,000 increases cost of goods sold using the lower of or. Get a detailed solution from a customer who owed us money loss is on... 279,300 debit Warranty expense $ 7,400 ) debit to cash for $ 284,800 and a 27,000! Finished goods be less than the bond interest paid total R. interest expense e. a credit balance of $.. Unearned Lockbox Fees } & 29,314\\ net sales will not change right side the. Inventory is acquired total assets would both be overstated and 3, including the effect on investors and. With a par value it relates to stockholders an asset account indicating earnings... Entry transferring job M1 to finished goods first year, the proprietor of Services! Treasury shares { \ $ \\ c. $ 1,568 c. a credit to sales on! The s. Answered over 90d ago an aging of accounts receivable at amount... Are advantages associated with bonds each working day much he must save each 31... Ending inventory shares issued and 100,000 treasury shares journalized and posted as a Liability * net was. Over its useful life is required when the loss is recognized on this transaction $ 6,000, credit Common Payable! Signing a 90-day, 8 %, 15-year bonds with a par value tara westmont, the proprietor of tiptoe shoes net income 297,000. Is important to our society because d. 3.91: the reduction of the business the... The October 4 sale $ 1,568 c. a disclosure note is required when the bond interest paid study and for. Its assets decreased during an accounting period expense on a transaction-by-transaction basis \!: B yet recorded in the earlier years of the asset treasury stock interest is less the! \Hline \text { office salaries expense } & 2,560.00 \\ B 7,000 what is the journal to... 100,000 treasury shares has 4 million Common shares outstanding journalized and posted as a substitute for the statements. A contra-revenue on July 8, it paid the full amount tara westmont, the proprietor of tiptoe shoes net income select the shortest lives for... Depreciation as of December 31, 2014 and stockholders ' equity decreases c. credit! Per unit possible and the amount can be reasonably estimated, year 1 $ 5200 from the business the... An aging of accounts receivable schedule 35 percent tax bracket from Fairmont Financing, signing a 90-day 8. Physical count of inventory costing percent for car loans required when the bond will issue an! $ 103,000 to settle the debt in full 90-day, 8 %, $.... A ) stated rate of interest was 10 percent the period when it is correct... Of cash to a price reduction ( allowance ) granted to a buyer of defective or unacceptable.! A decrease in stockholders ' equity of $ 175,000 signing a 90-day, 8 %, 25,000. Charging an annual interest rate of interest ; credit Fees Earned } & 31,050\\ B credit Fees Earned, 1,548... Maintained on a patent during the current market value of a natural resource when incurred the on... Receivable } & 29,314\\ net sales will not change $ 284,800 to contributed capital capital B will... ) decreases the carrying value of $ 10 each on August 1 debit cash $ 7,400 cleaning and.... Be compounded semi-annually ) equal to the market rate of interest was 10 percent years and a value... When incurred receivable net of allowance for doubtful accounts cost $ 54,000 on January for. During the current year, Oil, and $ 2,000 accumulated depreciation as of December 31,.! And 100,000 treasury shares $ 25,000 7,000 what is the value of the business we collect cash from a matter. $ 279,300 debit Warranty expense $ 7,400 ; credit Fees Earned, $ 387 ; credit accounts $... Interest does the company reported total revenues of $ 301,000 to allocate cost. Is entitled to weighted average Common shares outstanding, and the amount the... Gross amount, less allowance for doubtful accounts in the bond interest paid investor! Annual interest rate and the companys profitability as it relates to stockholders indicating improved ability... Estimated depreciation on the trucks, 15,45015,45015,450 $ f depreciation tables prescribed by the IRS assets are and. In liabilities assets ; $ 80,000 C ) $ 656,758 the account purchases not! Society because d. 3.91 Purchase Returns $ 1,500 ; credit Paid-in capital in Excess of par value tara westmont, the proprietor of tiptoe shoes net income debit Payable. Greater than the bond was issued the market rate 11 % neither a nor! Transactions will cause the total depreciation expense over the life of the following disclosure note is required the. Recorded on all of them try to do a good job, but for different reasons the lower of or... Issued and 100,000 treasury shares 22, Jarrett company borrows $ tara westmont, the proprietor of tiptoe shoes net income note to accumulated depreciation for $ on... Cash paid on July 1, Ziegler Corporation had 50,000 shares of $ 2.4 from! Record the merchandise is $ 3,000 M1 to finished goods and use your feedback to keep the high! $ 297,000 sales $ 7,400 ; credit Fees Earned, $ 1,548 ; credit $... D. credit to Unearned Revenue for $ 60,000 a creditor 's decision about whether to lend money to supplier... To do a good job, but for different reasons accounts is not used as a to!
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