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Appendix B Time Value of Money QUICK STUDIES Quick Study B-1 (10 minutes) 1. 2% 2. 12% 3. 3% 4. 1% Quick Study B-2 (10 minutes) In Table B.1, where n = 15 and p = $2,745/$10,000 = 0.2745, the […]

B-1 APPENDIX B TIME VALUE OF MONEY © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

. Title: Question 1 QA_Ori: Manufacturing overhead costs cannot be directly traced to units of product Title: Question 2 QA_Ori: In the first stage, service department costs are assigned to operating departments. In the second stage, a predetermined overhead rate […]

Title: Exercise C-4 QA_Ori: 1. Total direct labor hours: Product A: 10,000 units x 0.20 DLH/unit = 2,000 DLH Plant-wide overhead rate: $249,000/2,500 DLH = $99.60/DLH Product A Product B Direct materials A: 10,000 units x $2/unit $20,000 B: 2,000 […]

Title: Problem C-4A QA_Ori: 1. Plantwide overhead rate: Engineering support $24,500 Product A 10,000 units x 0.3 DLH/unit = 3,000 DLH Product B 2,000 units x 1.6 DLH/unit = 3,200 DLH 6,200 DLH Product A Product B Direct materials per […]

Title: Problem C-3B QA_Ori: 1. The major costs of making the boxes are designing the boxes, setting up machines to make the right cuts, cutting the cardboard, printing the boxes, 3. Yes. Lakeside’s old customers bought the same type of […]

C-1 APPENDIX C ACTIVITY-BASED COSTING © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted […]

Appendix C Activity-Based Costing QUESTIONS 1. Manufacturing overhead costs cannot be directly traced to units of product like direct materials and direct labor. Assigning overhead costs to units of product requires some sort of allocation on some “reasonable” basis. 2. […]

Problem C-2A (40 minutes) 1. Grinding & Polishing ($320,000+$135,000)/13,000 MH $35/MH Product modification $600,000/1,500 Eng. Hrs. $400/Eng. Hr. Providing power $255,000/17,000 DLH $15/DLH System calibration $500,000/400 batches $1,250/batch 2. Job 3175 Job 4286 Grinding & polishing 550 MH x $35 […]

Problem C-2B (45 minutes) 1. Wrapping $500,000/100,000 units = $5/unit Assembling* $400,000/20,000 direct labor hours = $20/DLH Product design $180,000/3,000 design hours = $60/des. hr. Obtaining license* $100,000/20,000 direct labor hours = $5/DLH Cooking $270,000/1,000 batches = $270/batch * The […]

Student Name: Class: Liabilities + Equity Accounts Office Accounts H. Graham H. Graham Date Cash Receivable Equipment Payable Capital Withdrawals Revenues Expenses May 1 $40,000 40,000 1 (2,200) (2,200) 3 1,890 1,890 5 (750) (750) 8 5,400 5,400 12 2,500 […]

1-1 CHAPTER 1 ACCOUNTING IN BUSINESS © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or […]

Chapter 1 Accounting in Business QUESTIONS 1. The purpose of accounting is to provide decision makers with relevant and reliable information to help them make better decisions. Examples include information for people making investments, loans, and business plans. 2. Technology […]

Exercise 1-13 (20 minutes) a. Purchased land for $4,000 cash. b. Purchased $1,000 of office supplies on credit. c. Billed a client $1,900 for services provided. d. Paid the $1,000 account payable created by the credit purchase of office supplies […]

Problem 1-8A (Concluded) Part 3—continued Ander Electric Statement of Cash Flows For Month Ended December 31 Cash flows from operating activities Cash received from customers1 …………………………… $ 6,200 Cash paid for rent ……………………………………………….. (1,000) Cash paid for supplies ………………………………………… (800) […]

©2013 by McGraw–Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Title: Problem 1-5B QA_Ori: HalfLife Co. Statement of Cash Flows For Year Ended December 31, 2013 Cash used by operating activities ($3,000 ) Title: Problem 1-6B QA_Ori: ATV Company Statement of Owner’s Equity For Year Ended December 31, 2013 A.T. […]

Title: Problem 1-8B QA_Ori: Parts 1 and 2 Assets = Liabilitie s + Equity Date Cash + Accounts Receivabl e +Office Supplies + Office Equipmen t + Excavatin g Equipmen t = Account s Payable +R. Truro, Capital – R. […]

Title: Serial Problem SP 1 QA_Ori: Assets = Liabiliti es + Equity Date Cash + Accounts Receivab le + Comput er Supplies + Comput er System + Office Equipme nt = Accoun ts Payabl e + A. Lopez, Capital – […]

Student Name: Class: Estimated Market Percent Apportioned Value of Total Cost Building $508,800 53% $477,000 «- Correct! Land 297,600 31% 279,000 «- Correct! Land Improvements 28,800 3% 27,000 «- Correct! Vehicles 124,800 13% 117,000 «- Correct! Totals $960,000 100% $900,000 […]

10-1 AND INTANGIBLES Related Assignment Materials Student Learning Objectives Questions Quick Studies* Exercises* Problems* Beyond the Numbers Conceptual objectives: C1. Explain the cost principle for computing the cost of plant asset. 1, 2, 3, 4, 20 10-1, 10-2, 10-14 10-1, […]

Chapter 10 Plant Assets, Natural Resources, and Intangibles QUESTIONS 1. A plant asset is tangible; it is used in the production or sale of other assets or services; and it has a useful life longer than one accounting period. 2. […]

Title: Exercise 10-2 QA_Ori: Cost of land Purchase price for land……………………………………………………..$ 280,000 QA_Ori: Cost of new building and land improvements Cost of new building………………………………………………………….$1,452,200 Cost of land improvements……………………………………………….. 87,800 Total construction costs……………………………………………………..$1,540,000 Journal entry Land……………………………………………………………………… 470,500 Land Improvements………………………………………………… 87,800 Building…………………………………………………………………. […]

Exercise 10-19 (10 minutes) Jan. 1 Copyright ………………………………………………………. 418,000 Cash…………………………..……………………………..……. 418,000 To record purchase of copyright. Dec. 31 Amortization Expense—Copyright ………………………. 41,800 Accumulated Amortization—Copyright ……………. 41,800 To record amortization of copyright [$418,000 / 10 years]. Exercise 10-20 (10 minutes) 1. […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Title: Problem 10-8A QA_Ori: 1. 2013 (a) (b) July 1 Prepaid Rent…………………………………………………………80,000 Cash………………………………………………………………. 80,000 To record prepaid annual lease rental. (c) July 5 Leasehold Improvements………………………………………..130,000 Cash………………………………………………………………. 130,000 To record costs of leasehold improvements. 2. 2013 (a) Dec. 31 Rent Expense………………………………………………………..10,000 […]

Title: Problem 10-8B 1. 2013 (a) Jan. 1 Leasehold……………………………………………………………..40,000 Cash………………………………………………………………. 40,000 To record payment for sublease. (b) Jan. 1 Prepaid Rent…………………………………………………………36,000 Cash………………………………………………………………. 36,000 To record prepaid annual lease rental. (c) Jan. 3 Leasehold Improvements………………………………………..20,000 Cash………………………………………………………………. 20,000 To record costs of […]

Student Name: Class: National Fargo Locust Bank Bank 1. May 19 Jul 8 Nov 28 90 120 60 Aug 17 Nov 5 Jan 27 Correct! Correct! Correct! $35,000 $80,000 $42,000 10% 9% 8% 90/360 120/360 60/360 2. Interest due at […]

11–1 CHAPTER 11 CURRENT LIABILITIES AND PAYROLL ACCOUNTING © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, […]

Chapter 11 Current Liabilities and Payroll Accounting QUESTIONS 1. A current liability is expected to be paid within one year or the company’s operating cycle, whichever is longer. Any liability that is not current is considered to be long term. […]

Exercise 11-17 (concluded) (b) Aug 31 Salaries (or Wages) Expense ………………………….. 10,020.00 FICA—Social Sec. Taxes Payable ………….……. 298.84 FICA—Medicare Taxes Payable ……………..……. 145.29 Employee Fed. Inc. Taxes Payable ………………. 2,380.00 Employee State Inc. Taxes Payable ……….……. 388.00 Employee Benefits Plan […]

Problem 11-2B (60 minutes) 1. Each employee’s FICA withholdings for Social Security Ahmed Carlos June Marie Total Maximum base ………… $110,100 $110,100 $110,100 $110,100 Earned through 9/23 … 108,500 36,650 6,650 22,200 Amount subject to tax $ 1,600 $ 73,450 […]

Comprehensive Problem (Continued) Part 3 2013 (a) Miscellaneous Expenses …………………………………….. 15 Accounts Payable ……………………………………………….. 1,287 Interest Revenue ……………………………………………. 52 Cash ……………………………………………………………… 1,250 Adjust cash account. (Separate entries are acceptable.) (b1) Allowance for Doubtful Accounts …………………………. 679 Accounts Receivable ……………………………………… 679 […]

Title: Reporting in Action 1 QA_Ori: Times interest earned ($ thousands) 2011 2010 2009 Net income $227,575 $147,138 $101,017 Times interest earned ratio 87.9a82.5b37.8c a$350,613/$3,987 b$221,221/$2,680 c$155,285/$4,111 Analysis comment : For each of these fiscal years, it is obvious that […]

Student Name: Class: Plans a and c 40% «- Correct! 60% «- Correct! Plan b 33.33% «- Correct! 66.67% «- Correct! Plans c and d 72,000$ «- Correct! Plan d 4,200$ «- Correct! 6,300 «- Correct! Income (Loss) Year 1 […]

12-1 CHAPTER 12 ACCOUNTING FOR PARTNERSHIPS © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or […]

Title: Question 1 QA_Ori: Under the circumstances described, the death, bankruptcy, or legal inability of a partner to execute a contract ends a partnership. In addition, if a partnership is Title: Question 2 QA_Ori: Mutual agency means that each partner […]

Chapter 12 Accounting for Partnerships QUESTIONS 1. Under the circumstances described, the death, bankruptcy, or legal inability of a partner to execute a contract ends a partnership. In addition, if a partnership is organized for the purpose of completing a […]

Title: Exercise 12-11 QA_Ori: a. Loss from selling assets Total book value of assets $126,000 b. Loss and deficit allocation Turner Roth Lowe Total Capital balances before loss $ 2,500 $ 14,000 $ 31,500 $ 48,000 Allocation of loss $76,000 […]

PROBLEM SET A Problem 12-1A (50 minutes) 1. Dec. 31 Income Summary …………………………………………..… 249,000 Kara Ries, Capital …………………………………….… 83,000 Tammy Bax, Capital …………………………………… 83,000 Joe Thomas, Capital …………………………………… 83,000 To close Income Summary. 2. Dec. 31 Income Summary …………………………………………..… 249,000 […]

Title: Problem 12-5A QA_Ori: Note: All entries in this problem are dated May 31. 1. (a) Cash 600,000 (b) Gain on Sale of Inventory 62,800 Kendra, Capital ($62,800 x 3/6) 31,400 Cogley, Capital ($62,800 x 2/6) 20,933 Mei, Capital ($62,800 […]

Problem 12-4B (50 minutes) Part 1 a) Apr. 30 Gibbs, Capital ………………………………………………….. 606,000 Brady, Capital …………………………………………….. 606,000 To record admission of Brady. b) Apr. 30 Gibbs, Capital ………………………………………………….. 606,000 Cannon, Capital…………………………………………… 606,000 To record admission of Cannon. c) Apr. 30 […]

Title: Problem 12-5B QA_Ori: Note: All entries in this problem are dated Jan. 18. 1. (a) Cash 650,000 (b) Gain on Sale of Equipment 32,800 Lasure, Capital ($32,800 x 2/5) 13,120 Ramirez, Capital ($32,800 x 1/5) 6,560 Toney, Capital ($32,800 […]

13-1 CHAPTER 13 ACCOUNTING FOR CORPORATIONS Related Assignment Materials Student Learning Objectives Questions Quick Studies* Exercises* Problems* Beyond the Numbers Conceptual objectives: C1. Identify characteristics of corporations and their organization. 1, 2, 3, 4 13-1 13-1 C2. Explain characteristics of, […]

13–10 Chapter Outline Notes B. Reissuing Treasury Stock 1. Sale at cost—Treasury stock is reduced (credited) for the cost of the reissued shares and Cash is debited for the amount received. 2. Sale above cost—the amount received in excess of […]

Title: Question 1 QA_Ori: Organization expenses (costs) are incurred in creating a corporation. Title: Question 2 QA_Ori: Organization expenses (costs) are reported as expenses when incurred —as part of operating expenses—because the amount and timing of their future benefit is […]

Chapter 13 Accounting for Corporations QUESTIONS 1. Organization expenses (costs) are incurred in creating a corporation. Examples include: legal fees, promoter fees, accountant fees, costs of printing stock certificates, and fees paid to obtain a state charter. 2. Organization expenses […]

Title: Exercise 13-7 QA_Ori: 1. Feb. 5 Retained Earnings* 480,000 Common Stock Dividend Distributable** 120,000 Paid-In Capital in Excess of Par Value, Feb. 28 Common Stock Dividend Distributable 120,000 Common Stock, $10 Par Value 120,000 Distributed common stock dividend. 2. […]

Exercise 13-10 (25 minutes) 1. (a) Oct. 11 Treasury Stock (5,000 x $25) ………………………….. 125,000 Cash ……………………………………………………………….. 125,000 Purchased treasury stock. (b) Nov. 1 Cash (1,000 x $31) ………………………………………….…….. 31,000 Treasury Stock (1,000 x $25) ……………………..…… 25,000 Paid-In Capital, Treasury […]

Title: Problem 13-3A QA_Ori: Part 1 Explanations for each of the journal entries Oct. 2 Declared a cash dividend of $2 per share of common stock. ($60,000 / 30,000 shares) Part 2 Oct. 2 Oct. 25 Oct. 31 Nov. 5 […]

Problem 13-2B (Concluded) Part 2 BALTHUS CORP. Statement of Retained Earnings For Year Ended December 31, 2014 Retained earnings, December 31, 2013 ………………………. $2,160,000 Plus net income ………………………………………………………… 1,072,000 3,232,000 Less: Cash dividends declared …………………………………. (740,000) Treasury stock reissuances …………………………….. […]

Title: Serial Problem 1 QA_Ori: 1a. Journal entry for issuance of common stock to Cicely 1b. Journal entry for issuance of preferred stock to Marcello Cash 86,000 Preferred Stock 86,000 Issuance of $100 par 7% preferred stock. 1c. Journal entry […]

Student Name: Class: Part 1. Date Account Titles Debit Credit 2013 Jan 1 3,456,448 543,552 «- Correct! 4,000,000 Part 2. 120,000$ «- Correct! 18,118 «- Correct! 138,118 «- Correct! Part 3. 3,600,000$ 4,000,000 7,600,000$ (3,456,448) 4,143,552$ «- Correct! 3,600,000$ 543,552 […]

14-1 Chapter 14 Long-Term Liabilities Student Learning Objectives and Related Assignment Materials* Student Learning Objectives Discussion Questions Quick Studies Exercises Problems Beyond the Numbers Conceptual objectives: C1. Explain the types and payment patterns of notes. 1, 12 14-8 14-14 14-9 […]

14–10 Chapter Outline Notes 3. Present value of an annuity of $1 table is used to compute present value of a series of equal payments (annuity). C. Applying a Present Value Table (Complete tables in Appendix B) 1. Determine the […]

Title: Question 1 QA_Ori: Notes payable generally involve borrowing from a single creditor, whereas Title: Question 2 QA_Ori: A bond is a liability of the issuing company. A share of stock represents an ownership interest in the company. Title: Question […]

Chapter 14 Long-Term Liabilities QUESTIONS 1. Notes payable generally involve borrowing from a single creditor, whereas bonds payable are usually sold to many different lenders (bondholders). 2. A bond is a liability of the issuing company. A share of stock […]

Title: Exercise 14-5 QA_Ori: 1. Premium = Issue price – Par value = $409,850 – $400,000 = $9,850 2. Total bond interest expense over the life of the bonds Amount repaid Six payments of $26,000* $ 156,000 Par value at […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Title: Problem 14-1A QA_Ori: Part 1 Instructor note: The first printing of the textbook has an erroneous marginal check figure of $4,537 that should correctly read $5,437. a. Cash Flow Table Table Value* Amount Present Value Par value B.1 0.4564 […]

Problem 14-5AB (45 minutes) Part 1 Ten payments of $8,125* ……………….…….. $ 81,250 Par value at maturity ……………………..…… 250,000 Total repaid ………………………………………….. 331,250 Less amount borrowed ………………….…….. (255,333) Total bond interest expense …………..…….. $ 75,917 *$250,000 x 0.065 x ½ […]

Title: Problem 14-8A QA_Ori: Part 1 2013 Jan. 1 Cash 184,566 Part 2 Six payments of $9,900 $ 59,400 Par value at maturity 180,000 Total repaid 239,400 Less amount borrowed (184,566) Total bond interest expense $ 54,834 *$180,000 x 0.11 […]

Fundamental Accounting Principles, 21st Edition 842 Problem 14-3B (Concluded) Part 4 Semiannual Period-End Unamortized Premium Carrying Value 1/01/2013 ………….…….. $792,932 $4,192,932 6/30/2013 ………….…….. 753,285 4,153,285 12/31/2013 ………….…….. 713,638 4,113,638 6/30/2014 ………….…….. 673,991 4,073,991 12/31/2014 ………….…….. 634,344 4,034,344 Part 5 2013 […]

Title: Problem 14-7B QA_Ori: Part 1 2013 Jan. 1 Cash 198,494 Part 2 Thirty payments of $7,200*$ 216,000 Par value at maturity 240,000 Total repaid 456,000 Less amount borrowed (198,494) Total bond interest expense $ 257,506 *$240,000 x 0.06 x […]

Fundamental Accounting Principles, 21st Edition 854 Problem 14-10B (30 minutes) Part 1 Atlas Company Debt–to-equity ratio = $81,000 / $99,000 = 0.82 Bryan Company Debt–to-equity ratio = $562,500 / $187,500 = 3.00 Part 2 Bryan’s debt–to-equity ratio is much higher […]

15-1 INTERNATIONAL OPERATIONS Related Assignment Materials Student Learning Objectives Questions Quick Studies* Exercises* Problems* Beyond the Numbers Conceptual objectives: C1. Distinguish between debt and equity securities and between long-term investments and short-term investments. 1, 2, 5 15-5, 15-6 15-4, 15-12 […]

Title: question 1 QA_Ori: To be classified as current assets, investments must be (i) capable of being converted into cash quickly and (ii) management must intend to sell the investments as Title: question 2 QA_Ori: Short-term investments in trading securities […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Title: Exercise 15-8 QA_Ori: 2013 (a) Feb. 15 Short-Term Investments—HTM (A.G.) 160,000 (b) Mar. 22 Long-Term Investments—AFS (Fran) 35,850 Cash 35,850 Purchased 700 shares of Fran common stock ([700 x $51] + $150). (c) May 15 Cash 164,000 Short-Term Investments—HTM […]

Fundamental Accounting Principles, 21st Edition 880 Exercise 15-14 (15 minutes) 2013 return on total assets 2014 return on total assets = 14.0% = 10.9% $38,400 $60,300 Regae Industries appears to be less efficient in the use of its total assets […]

Title: Problem 15-3A QA_Ori: Part 1 2013 Jan. 20 Long-Term Investments—AFS (J&J) 20,740 Feb. 9 Long-Term Investments—AFS (Sony) 55,665 Cash 55,665 Purchased Sony shares [(1,200 x $46.20) + $225]. June 12 Long-Term Investments—AFS (Mattel) 40,695 Cash 40,695 Purchased Mattel shares […]

Problem 15-6AA (60 minutes) Part 1 2013 Apr. 8 Cash …………………………………………………………..…………………. 5,938 Sales …………………………………………………….… 5,938 July 21 Accounts Receivable⎯Sumito …………………….……. 14,100 Sales …………………………………………………….… 14,100 (1,500,000 yen x $0.0094/yen) Oct. 14 Accounts Receivable⎯Smithers ………………………….. 27,675 Sales …………………………………………………….… 27,675 (19,000£ x $1.4566/£) […]

Title: Problem 15-1B QA_Ori: Part 1 2013 Mar. 10 Short-Term Investments—Trading (AOL) 143,505 May 7 Short-Term Investments—Trading (MTV) 184,105 Cash 184,105 Purchased MTV shares [(5,000 x $36.25) + $2,855]. Sept. 1 Short-Term Investments—Trading (UPS) 69,950 Cash 69,950 Purchased UPS shares […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Title: Problem 15-6B QA_Ori: Part 1 2013 May 26 Accounts Receivable—Fuji 60,450 Sales 60,450 (6,500,000 yen x $0.0093/yen) June 1 Cash 64,800 Sales 64,800 July 25 Cash* 59,800 Foreign Exchange Loss 650 Accounts Receivable—Fuji 60,450 *(6,500,000 yen x $0.0092/yen) Oct. […]

Student Name: Class: 136,000$ (12,000) (75,000) 16,000 3,000 54,000 122,000$ «- Correct! (36,000) «- Correct! 60,000 (89,000) (29,000) «- Correct! 57,000$ «- Correct! 107,000 «- Correct! 164,000$ «- Correct! Net cash provided by operating activities Cash flows from investing activities: […]

16-1 CHAPTER 16 REPORTING THE STATEMENT OF CASH FLOWS Related Assignment Materials Student Learning Objectives Questions Quick Studies* Exercises* Problems* Beyond the Numbers Conceptual objectives: C1. Explain the purpose and importance of cash flow information. 1 16-1, 16-2, 16-18 16-1 […]

16–10 VISUAL #16-1 CLASSIFYING ACTIVITIES IN THE STATEMENT OF CASH FLOWS OPERATING ACTIVITIES Cash inflows from Cash outflows to • Customers for cash sales • Collections on credit sales • Borrowers for interest • Dividends received • Lawsuit settlements • […]

Title: Question 1 QA_Ori: The purpose of the cash flow statement is to report all major cash receipts (inflows) and cash payments (outflows) during a period. It helps users to answer questions such as: How does a company obtain its […]

Chapter 16 Reporting the Statement of Cash Flows QUESTIONS 1. The purpose of the cash flow statement is to report all major cash receipts (inflows) and cash payments (outflows) during a period. It helps users to answer questions such as: […]

Title: Quick Study 16-18 QA_Ori: 2. IFRS and US GAAP differ on the classification of the following cash flows as operating, investing or financing: Cash flow source U.S. GAAP IFRS _ a. Interest paid Operating Financing or Operating b. Dividends […]

Fundamental Accounting Principles, 21st Edition 936 Exercise 16-10 (Part 1 continued) (1) Cost of equipment sold (Given) ………………………………………………………..… $ 48,600 Accumulated depreciation of equipment sold* …………………………………..… (40,600) Book value of equipment sold ………………………………………………………….… 8,000 Gain on sale of equipment (Given) […]

Title: Exercise 16-11B QA_Ori: IKIBAN, INC. Statement of Cash Flows (Direct Method) For Year Ended June 30, 2013 Cash flows from operating activities Cash received from customers (Note 1)…………… $664,000 Cash paid for merchandise (Note 2)………………… (393,300) (See notes on […]

Problem 16-5AA (Concluded) GOLDEN CORPORATION Statement of Cash Flows For Year Ended December 31, 2013 Cash flows from operating activities Net income ……………………………………………………………………….. $136,000 Adjustments to reconcile net income to net cash provided by operating activities Increase in accounts receivable […]

Title: Problem 16-1A QA_Ori: Part 1 FORTEN COMPANY Statement of Cash Flows For Year Ended December 31, 2013 Cash flows from operating activities Net income……………………………………………………………………..$114,975 Adjustments to reconcile net income to net Cash flows from investing activities Cash received from […]

Fundamental Accounting Principles, 21st Edition 964 Problem 16-7B (35 minutes) SALT LAKE COMPANY Cash Flows from Operating Activities—Indirect Method For Year Ended December 31, 2013 Cash flows from operating activities Net income ………………………………………………………………….… $ 20,000 Adjustments to reconcile net income […]

Title: Problem 16-1B QA_Ori: Part 1 GAZELLE CORPORATION Statement of Cash Flows For Year Ended December 31, 2013 Cash flows from operating activities Net income……………………………………………………………………..$158,100 Adjustments to reconcile net income to net cash provided by operating activities Cash flows from […]

Title: Problem 16-5BA QA_Ori: SATU COMPANY Statement of Cash Flows For Year Ended December 31, 2013 Cash flows from operating activities Net income……………………………………………………………. $202,767 Adjustments to reconcile net income to net cash provided by operating activities Cash flows from investing […]

Title: Taking It to the Net 1 QA_Ori: Mendocino Brewing Company uses the indirect method to construct the consolidated statement of cash flows. Title: Taking It to the Net 2 QA_Ori: The largest reconciling item is for depreciation and amortization […]

Student Name: Class: Assets Liabilities Ratio 52,390$ 22,800$ 2.3 «- Correct! 37,924 19,960 1.9 «- Correct! 51,748 20,300 2.5 «- Correct! 2014 2013 2012 100.00% 100.00% 100.00% 51.08% 62.50% 55.36% 48.92% 37.50% 44.64% 18.54% 13.80% 18.27% 9.13% 8.80% 8.20% 27.67% […]

17–1 CHAPTER 17 ANALYSIS OF FINANCIAL STATEMENTS © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, […]

Title: Question 1 QA_Ori: Financial reporting includes the entire process of preparing and issuing financial Title: Question 2 QA_Ori: With comparative statements, financial statement items for two or more successive accounting periods are placed side by side on a single […]

Chapter 17 Analysis of Financial Statements QUESTIONS 1. Financial reporting includes the entire process of preparing and issuing financial information about a company. Financial statements are an important part of financial reporting but they are less than the whole. 2. […]

Title: Exercise 17-7 QA_Ori: Simon Company Common-Size Comparative Balance Sheets December 31, 2012-2014 At December 31 2014 2013*2012 Assets Cash………………………………………………………….. 6.1% 8.0% 10.0% Liabilities and Equity Accounts payable………………………………………… 24.8% 16.9% 13.6% Long-term notes payable secured by mortgages on plant assets […]

Fundamental Accounting Principles, 21st Edition 992 Exercise 17-14 (15 minutes) RANDA MERCHANDISING, INC. Income Statement For Year Ended December 31, 2013 Net sales ……………………………………………………………….. $2,900,000 Expenses Cost of goods sold ……………………………………………… $1,480,000 Salaries expense ………………………………………………… 640,000 Depreciation expense …………………………………………. 232,500 […]

Title: Problem 17-2A QA_Ori: Part 1 HAROUN COMPANY Income Statement Trends For Years Ended December 31, 2014-2008 2014 2013 2012 2011 2010 2009 2008 Sales……………………………….. 182.5% 161.2% 147.6% 136.2% 127.8% 119.6% 100.0% HAROUN COMPANY Balance Sheet Trends December 31, 2014-2008 […]

Problem 17-2B (120 minutes) Part 1 TRIPOLY COMPANY Income Statement Trends For Years Ended December 31, 2014-2008 2014 2013 2012 2011 2010 2009 2008 Sales ………………………………. 65.1% 70.9% 73.3% 79.1% 86.0% 89.5% 100.0% Cost of goods sold ………….. 72.6 76.3 […]

Title: Problem 17-2B QA_Ori: Part 1 TRIPOLY COMPANY Income Statement Trends For Years Ended December 31, 2014-2008 2014 2013 2012 2011 2010 2009 2008 Sales……………………………….. 65.1% 70.9% 73.3% 79.1% 86.0% 89.5% 100.0% TRIPOLY COMPANY Balance Sheet Trends December 31, 2014-2008 […]

SERIAL PROBLEM — SP 17 Serial Problem — SP 17, Success Systems (45 minutes) 1. Gross margin with services revenue Gross margin = Total revenue – Cost of goods sold = $43,853 – $14,052 = $29,801 Gross margin ratio = […]

Title: Serial Problem 2 QA_Ori: Current ratio = $105,209 / $875 = 120.2 Acid-test ratio = $100,205 / $875 = 114.5 QA_Edit: Title: Serial Problem 3 QA_Ori: Debt ratio = $875 / $129,909 = 0.7% Equity ratio = $129,034/$129,909 = […]

Student Name: Class: Merchandising Business 200,000$ 300,000 500,000 175,000 325,000$ Correct! Manufacturing Business Partial Income Statement SNO-BOARD MANUFACTURING 500,000$ 875,000 1,375,000 225,000 1,150,000$ Correct! Part 2 To: Memorandum From: Date: Subject: Problem 18-06A McGraw-Hill/Irwin Instructor For Year Ended December 31, […]

18-1 CHAPTER 18 MANAGERIAL ACCOUNTING CONCEPTS AND PRINCIPLES © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, […]

Title: Question 1 QA_Ori: The managerial accountant plays an important role in preparing the information necessary for effective planning and control decisions. One example is the budget, which Title: Question 2 QA_Ori: Financial Accounting Managerial Accounting (a) Users and decision […]

Chapter 18 Managerial Accounting Concepts and Principles QUESTIONS 1. The managerial accountant plays an important role in preparing the information necessary for effective planning and control decisions. One example is the budget, which is a quantitative expression of a company’s […]

Title: Exercise 18-5 QA_Ori: 1. Cost by Behavior Cost by Traceability Product Cost Variable Fixed Direct Indirect 1. Leather cover for soccer balls…………….. X X 2. Annual flat fee paid for office security…………………………………………. X X 2. Most fixed costs are […]

Fundamental Accounting Principles, 21st Edition 1040 Exercise 18-11 (25 minutes) Account Balance Sheet Income Statement Manufacturing Statement Overhead Report Accounts receivable ………………………. ✓ Computer supplies used in office ……. ✓ Beginning finished goods inventory ✓ Beginning goods in process inventory […]

Title: Exercise 18-15 QA_Ori: a. b. If customers rate any of the factors on the survey as anything other than “very satisfied,” managers should investigate the reasons for the customer’s lack of satisfaction. The survey itself does not identify the […]

PROBLEM SET B Problem 18-1B (20 minutes) The managerial accounting professional must do more than assign value to ending inventory and cost of goods sold. S/he must understand the industry and the current business environment of the company. The managerial […]

Part 2 DE LEON COMPANY Income Statement For Year Ended December 31, 2013 Sales…………………………………………………………………….. $4,525,000 167,350 Cost of goods manufactured…………………………………… 1,935,65 0 Goods available for sale…………………………………………2,103,000 Less finished goods inventory, December 31, 2013………… 136,49 0 Cost of goods sold………………………………………………… 1,966,510 […]

Fundamental Accounting Principles, 21st Edition 1066 SERIAL PROBLEM — SP 18 Serial Problem, Success Systems (50 minutes) 1. Cost by Behavior . Cost by Traceability . Product Costs Variable Fixed Direct Indirect 1. Monthly flat fee to clean workshop …….. […]

Title: Problem 18-7B QA_Ori: Part 1 ELEGANT FURNITURE Manufacturing Statement For Year Ended December 31, 2013 Direct materials Raw materials inventory, December 31, 2012………….. $ 40,375 Direct labor…………………………………………………………….. 562,500 Factory overhead Depreciation expense—Factory equipment……………… 35,400 Factory supervision………………………………………………. 121,500 Factory supplies […]

Title: Ethics Challenge 1 QA_Ori: Raw materials are part of inventory and should be capitalized (set up as assets). Their costs are subsequently reported as part of cost of goods Title: Ethics Challenge 2 QA_Ori: The challenge is how to […]

Student Name: Class: 1,500,000 «- Correct! 2,500,000 «- Correct! 60% «- Correct! b. Overhead costs charged to jobs: Direct Applied Labor Overhead 604,000$ 362,400$ «- Correct! 563,000 337,800 «- Correct! 298,000 178,800 «- Correct! 716,000 429,600 «- Correct! 314,000 188,400 […]

19-1 CHAPTER 19 JOB ORDER COST ACCOUNTING © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, […]

Title: Question 1 QA_Ori: Factory overhead is not identified with specific units (jobs) or batches (job lots). Therefore, to assign costs, estimates of the relation between factory overhead cost and job Title: Question 2 QA_Ori: Several other factors (allocation bases) […]

Chapter 19 Job Order Cost Accounting QUESTIONS 1. Factory overhead is not identified with specific units (jobs) or batches (job lots). Therefore, to assign costs, estimates of the relation between factory overhead cost and job or job lot are necessary. […]

Title: Exercise 19-8 QA_Ori: 1. Raw Materials Inventory……………………………………………210,000 Cash………………………………………………………………… 210,000 To record materials purchases. Title: Exercise 19-9 QA_Ori: 1. Factory Payroll………………………………………………………..345,000 Cash………………………………………………………………… 345,000 To record factory payroll. 2. Goods in Process Inventory………………………………………265,000 Factory Payroll………………………………………………….. 265,000 To assign direct labor to […]

1092 Fundamental Accounting Principles, 21st Edition Exercise 19-18 (35 minutes) 1. Estimated cost of the architectural job Labor type Estimated hours Hourly rate Total cost Architects ………………………….. 150 $300 $ 45,000 Staff ………………………….. 300 75 22,500 Clerical ……………………….…. 500 20 […]

Title: Problem 19-1A QA_Ori: Part 1 Total manufacturing costs and the costs assigned to each job 306 307 308 April Total From March Direct materials……………………$ 29,000 $ 35,000 Direct labor…………………………. 20,000 18,000 *Equals 50% of direct labor cost. Part 2 […]

Problem 19-5A (Continued) GENERAL JOURNAL a. Raw Materials Inventory ……………………………………….. 78,700 Accounts Payable ………………………………………..….. 78,700 To record materials purchases ($62,500+$16,200). d. Factory Payroll ………………………………………………….….. 174,250 Cash ……………………………………………………………….. 174,250 To record factory payroll. Factory Overhead ……………………………………………..….. 102,000 Cash ……………………………………………………………….. 102,000 To […]

Title: Problem 19-5A QA_Ori: JOB COST SHEET Customer’s Name Worldwide Company Job No. 102 Direct Materials Direct Labor Overhead Costs Applied Date Requisition Number Amount Time Ticket Number Amount Date Rate Amount #35 33,750 #1-10 90,000 May — 80% 72,000 […]

1120 Fundamental Accounting Principles, 21st Edition Problem 19-4B (35 minutes) Part 1 a. Predetermined overhead rate = = = 50% Estimated overhead costs $750,000 $750,000 b. Overhead costs charged to jobs Direct Applied Job No. Labor Overhead (50%) 625 ………………………………………………………. […]

Title: Problem 19-3B QA_Ori: Part 1 JOB COST SHEETS Job No. 487 Materials…………………….$30,000 Job No. 488 Materials…………………….$20,000 Labor………………………… 7,000 Overhead…………………… 14,000 Total cost……………………$41,000 Job No. 489 Materials…………………….$12,000 Labor………………………… 25,000 Overhead…………………… 50,000 Total cost……………………$87,000 Job No. 490 Materials…………………….$14,000 Labor………………………… 26,000 Overhead…………………… […]

Title: Reporting in Action 1 QA_Ori: We would anticipate that at least two types of costs will increase as a percent of sales with Polaris’s growth in domestic sales. The first type is broadly QA_Edit: Title: Reporting in Action 2 […]

Student Name: Class: Date Explanation Debit Credit Mar 1 150,000 22,000 172,000 «- Correct! 6,000 «- Correct! 33,000 Office Equipment 1,200 4,200 «- Correct! 64,000 Cash 4,000 «- Correct! 97,500 Accounts Receivable 7,500 «- Correct! 12 4,200 Accounts Payable 4,200 […]

2-1 CHAPTER 2 ANALYZING AND RECORDING TRANSACTIONS © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, […]

Title: Question 1 QA_Ori: a. Common asset accounts: cash, accounts receivable, notes receivable, Title: Question 2 QA_Ori: A note payable is formal promise, usually denoted by signing a promissory note to pay a future amount. A note payable can be […]

Chapter 2 Analyzing and Recording Transactions QUESTIONS 1. a. Common asset accounts: cash, accounts receivable, notes receivable, prepaid expenses (rent, insurance, etc.), office supplies, store supplies, equipment, building, and land. b. Common liability accounts: accounts payable, notes payable, and unearned […]

Title: Exercise 2-8 QA_Ori: Cash Photography Equipment Aug. 1 6,500 Aug. 2 2,100 Aug. 1 33,50 0 Office Supplies Photography Fees Earned Aug. 5 880 Aug. 20 3,331 Prepaid Insurance Utilities Expense Aug. 2 2,100 Aug. 31 675 POSE-FOR-PICS Trial […]

Exercise 2-17 (15 minutes) (a) (b) (c) (d) Answers $(28,000) $42,000 $73,000 $(45,000) Computations: Equity, Dec. 31, 2012 ………….. $ 0 $ 0 $ 0 $ 0 Owner’s investments …..…….. 110,000 42,000 87,000 210,000 Owner’s withdrawals ………….. (28,000) (47,000) (10,000) […]

Title: Exercise 2-22 QA_Ori: a. Co. Liabilities / Assets = Debt Ratio Net Income / Average Assets = ROA 1 $11,765 $ 90,500 0.13 $20,000 $100,000 0.200 2 46,720 64,000 0.73 3,800 40,000 0.095 Title: Exercise 2-23 QA_Ori: BMW Balance […]

Problem 2-3A (Continued) Accounts Payable Acct. No. 201 Date Explanation PR Debit Credit Balance April 3 G1 11,600 11,600 13 G1 11,600 0 29 G1 600 600 K. Tanner, Capital Acct. No. 301 Date Explanation PR Debit Credit Balance April […]

Title: Problem 2-3A QA_Ori: Part 1 1-Apr Cash 101 80,00 0 26,00 2-Apr Prepaid Rent 131 9,000 Cash 101 9,000 Prepaid twelve months’ rent. 3-Apr Office Equipment 163 8,000 Office Supplies 124 3,600 Accounts Payable 201 11,600 Purchased equip. & […]

Problem 2-3B (90 minutes) Part 1 Sept. 1 Cash …………………………………………………. 101 38,000 Office Equipment ………………………………. 163 15,000 H. Humble, Capital ……………………… 301 53,000 Owner invested in the business. 2 Prepaid Rent …………………………………….. 131 9,000 Cash ………………………………………….. 101 9,000 Prepaid twelve […]

Part 3 HV Consulting Trial Balance 30-Sep Debit Credit Cash $12,665 Accounts receivable 2,250 Office supplies 2,000 Office equipment 50,900 Title: Problem 2-1B QA_Ori: Part 1 a. Cash 101 65,000 Office Equipment 163 5,750 Computer Equipment 164 30,000 B. Grechus, […]

Serial Problem, Success Systems (Continued) Part 2 General Ledger accounts Cash Acct. No. 101 Date Explanation PR Debit Credit Balance Oct. 1 55,000 55,000 2 3,300 51,700 5 2,220 49,480 8 1,420 48,060 15 4,800 52,860 17 805 52,055 20 […]

Title: Problem 2-4B QA_Ori: Part 1 TAMA CO. Balance Sheet December 31, 2012 Assets Liabilities Cash………………………………$ 20,000 Accounts payable…………………………………………………………………….$ 4,000 Accounts receivable………… 35,000 TAMA CO. Balance Sheet December 31, 2013 Assets Liabilities Cash……………………………… $ 5,000 Accounts payable…………………………………………………………………….$ 12,000 Accounts receivable………… […]

Part 3 SUCCESS SYSTEMS Trial Balance 30-Nov Debit Credit Cash $48,052 Accounts receivable 12,618 Computer supplies 2,545 Prepaid insurance 2,220 Prepaid rent 3,300 Office equipment 8,000 Computer equipment 20,000 Accounts payable $0 A. Lopez, Capital 83,000 A. Lopez, Withdrawals 5,600 […]

Student Name: Class: Part 1 (a) and (b) Direct Direct Materials Labor 700,000 700,000 180,000 54,000 880,000 754,000 Correct! Correct! Direct Direct Materials Labor 420,000$ 139,000$ Cost per equivalent unit of production Costs of beginning goods in process 2,220,000 3,254,000 […]

20-1 CHAPTER 20 PROCESS COST ACCOUNTING © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or […]

Title: Question 1 QA_Ori: The main deciding factor in choosing between a job order costing system or a process costing system is the type of product or service. Examples where a process Title: Question 2 QA_Ori: The main focus in […]

Chapter 20 Process Cost Accounting QUESTIONS 1. The main deciding factor in choosing between a job order costing system or a process costing system is the type of product or service. Examples where a process costing system is likely appropriate […]

Title: Problem 20-8B QA_Ori: Part 1: Equivalent units with respect to direct materials and direct labor Direct Direct Equivalent units of production (EUP) Materials Labor Units to complete beginning goods in process Direct materials (2,000 x 0%)…………………………… 0 Part 2 […]

Part 2 (Using weighted-average) MAJOR LEAGUE BAT CO. Process Cost Summary (Weighted Average) For Month Ended July 31 Costs Charged to Production Costs of beginning goods in process Direct materials…………………………………………………………. $ 2,660 Unit cost information Units to account for Units […]

Part 5: (Using weighted-average) Computation of gross profit for July Sales……………………………………………………………………………………….$ 625,000 Title: Reporting in Action 1 QA_Ori: These costs are part of getting the products that Polaris sells to its customers, costs to fulfill warranties to its customers, and […]

Title: Exercise 20-7 QA_Ori: a. Purchased raw materials on credit at a cost of $52,000. b. Used direct materials costing $42,000 in production. QA_Edit: a. Purchased raw materials on credit at a cost of $52,000. b. Used direct materials costing […]

Fundamental Accounting Principles, 21st Edition 1148 Exercise 20-14 (Concluded) (1) Beginning goods in process $ 17,250 Direct materials $ ? Direct labor 47,250 Factory overhead 51,300 Total costs added ? Total costs in process $242,400 $17,250 + [Total costs added] […]

Title: Exercise 20-15 QA_Ori: ASHAD COMPANY Process Cost Summary – Weighted Average Method For Month Ended July 31 Costs Charged to Production Unit Cost Information Units to Account For Units Accounted For Beginning goods in process…………………. 2,000 Completed & transferred […]

Problem 20-3A (Concluded) Equivalent units of production Direct Materials Direct Labor Factory Overhead Units completed & transferred out …. 17,000 EUP 17,000 EUP 17,000 EUP Units of ending goods in process Direct materials (5,000 x 100%) …….. 5,000 EUP Direct […]

Title: Exercise 20-22 QA_Ori: HI-TEST COMPANY Process Cost Summary (Weighted-Average Method) For Month Ended September 30 Costs Charged to Production Costs of beginning work in process Direct materials……………………………………………………………….$ 45,000 Unit Cost Information Units to Account For Units Accounted For Beginning […]

Fundamental Accounting Principles, 21st Edition 1178 Problem 20-1B (Continued) d. June 30 Factory Payroll ………………………………………….…………. 400,000 Cash ………………………………………………………. 400,000 Incurred payroll cost. e. June 30 Goods in Process Inventory ……………………….…. 350,000 Factory Payroll …………………………………….…………. 350,000 Used direct labor. f. June […]

Part 2 ELLIOTT COMPANY Process Cost Summary – Weighted Average Method For Month Ended March 31 Costs Charged to Production Costs of beginning goods in process Unit cost information Units to account for Units accounted for Beginning goods in process…………………………………2,000 […]

Problem 20-8B (Concluded) Part 4 MEMORANDUM TO: FROM: DATE: RE: Percentage of Completion Error Analysis If the units in ending inventory are 75% complete instead of 25% with respect to labor, the number of equivalent units in ending inventory with […]

Title: Problem 20-6A QA_Ori: Part 1 TAMAR CO. Process Cost Summary – FIFO Method For Month Ended May 31 Costs charged to Production Costs of beginning goods in process Direct materials………………………………………………………….$ 19,800 Unit cost information Units to account for Units […]

Fundamental Accounting Principles, 21st Edition 1204 Comprehensive Problem (Continued) (Using FIFO) Cost per EUP Direct Materials Direct Labor Factory Overhead Costs incurred this period ……………… $ 52,440 $ 202,250 $ 101,125 ÷ EUP ……………………………………………. ÷ 14,000 ÷ 10,450 ÷ 10,450 […]

Title: Problem 20-9A QA_Ori: Part 1 DENGO CO. Process Cost Summary – FIFO Method For Month Ended October 31 Costs Charged to Production Costs of beginning goods in process Direct materials………………………………………………………….$ 9,900 Costs incurred this period Direct materials…………………………………………………………. 248,400 Direct […]

Title: Problem 20-3B QA_Ori: Part 1 a. May 31 Raw Materials Inventory……………………………………………221,120 b. May 31 Goods in Process Inventory………………………………………197,120 Raw Materials Inventory……………………………………… 197,120 Direct materials used in production. c. May 31 Factory Overhead…………………………………………………….40,560 Raw Materials Inventory……………………………………… 40,560 Indirect materials used. […]

Title: Problem 20-5B QA_Ori: Part 1 SWITCH CO. Process Cost Summary – Weighted Average Method For Month Ended January 31 Costs Charged to Production Costs of beginning goods in process Direct materials…………………………………………………………. $ 7,500 Unit cost information Units to account […]

Student Name: Class: 270,000$ «- Correct! 60$ «- Correct! 4,500 «- Correct! 270,000$ «- Correct! 30.00% «- Correct! 900,000$ «- Correct! 900,000$ «- Correct! 630,000 «- Correct! 270,000$ «- Correct! 270,000 «- Correct! $0 «- Correct! Problem 21-02A McGraw-Hill/Irwin Instructor […]

21–1 CHAPTER 21 COST-VOLUME-PROFIT ANALYSIS © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted […]

Title: Question 1 QA_Ori: A variable cost is one that varies proportionately with the volume of activity. For Title: Question 2 QA_Ori: Variable costs per unit stay the same (remain constant) when output volume changes. This is because each unit […]

Chapter 21 Cost-Volume-Profit Analysis QUESTIONS 1. A variable cost is one that varies proportionately with the volume of activity. For example, direct materials and direct labor (when the workers are paid for completed units) are treated as variable costs with […]

Title: Exercise 21-7 QA_Ori: The scatter diagram and line of estimated cost behavior appear below. Selecting 0 and 2,400 units sold as the activity levels yields $2,500 as the estimate of fixed costs and the following estimate of variable costs […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Title: Problem 21-3A QA_Ori: Parts 1 and 2 The scatter diagram and its estimated line of cost behavior appear below. Part 2 – Calculation of variable and fixed costs Variable costs = $220,000 – $64,000 = $0.60 per dollar of […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Kyo Company 0 20 40 60 80 100 $120 0 $50 $100 $150 $200 $250 Sales Dollars Total Costs Title: Problem 21-3B QA_Ori: Parts 1 and 2 The scatter diagram and its estimated line of cost behavior appear below. Sales […]

Fundamental Accounting Principles, 21st Edition 1254 Problem 21-7B (50 minutes) Part 1 BREAK–EVEN ANALYSIS ASSUMING USE OF SAME MATERIALS Step 1: Compute break-even in composite units—Use equation in Exhibit 21.27 Break-even in composite units = Fixed costs/Contribution margin per composite […]

Title: Problem 21-7B QA_Ori: Part 1 BREAK–EVEN ANALYSIS ASSUMING USE OF SAME MATERIALS Step 1: Compute break-even in composite units—Use equation in Exhibit 21.27 Break-even in composite units = Fixed costs/Contribution margin per composite unit * To compute the contribution […]

Student Name: Class: March April May 25,000 32,000 35,000 30% 30% 30% 7,500 9,600 10,500 15,000 25,000 32,000 22,500 34,600 42,500 (20,000) (7,500) (9,600) 2,500 27,100 32,900 Correct! Correct! Correct! March April May 90,000 95,000 90,000 30% 30% 30% 27,000 […]

22-1 CHAPTER 22 MASTER BUDGETS AND PLANNING © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, […]

Title: Question 1 QA_Ori: A budget helps managers control and monitor a business by 1) communicating plans to Title: Question 2 QA_Ori: Two common benchmarks used by managers to evaluate performance are: past performance and budgeted performance. Budgeted performance is […]

Chapter 22 Master Budgets and Planning QUESTIONS 1. A budget helps managers control and monitor a business by 1) communicating plans to employees, 2) coordinating the activities of different parts of the organization, and 3) providing a basis for deciding […]

Title: Quick Study 22-25 QA_Ori: SCORA INC. Selling Expense Budget For January, February, and March January February March Budgeted sales (from QS 22-23) $60,000 $100,000 $80,000 Title: Quick Study 22-26 QA_Ori: MESSERS COMPANY Cash Budget For Month Ended February 28 […]

Fundamental Accounting Principles, 21st Edition 1278 Exercise 22-2 (concluded) Notes: concluded (5) August beginning inventory Total required (4 above) 355,500 Less budgeted purchases (308,250) August beginning inventory 47,250 (6) August Beginning Inventory = July Ending Inventory (7) July required units […]

Title: Exercise 22-12 QA_Ori: JASPER COMPANY Cash Receipts Budget For April, May, and June April May June Sales $525,000 $535,000 $560,000 Less ending accts. receivable (70%) 367,500 374,500 392,000 Title: Exercise 22-13 QA_Ori: KARIM CORP. Cash Budget For July, August, […]

Exercise 22-19 (10 minutes) MANNER COMPANY Direct Labor Budget For July, August, and September July August Sept. Budgeted production (units) ……………….… 620 680 540 Labor requirements per unit (hours) ……… x 2 x 2 x 2 Total labor hours needed […]

Title: Problem 22-3A QA_Ori: Part 1 Cash collections of credit sales (accounts receivable) From sales in Total % Collected June July April $ 720,000 28% $201,600 Part 2 Budgeted ending inventories (in units) April May June July Next month’s budgeted […]

Fundamental Accounting Principles, 21st Edition 1308 Problem 22-5A (Continued) Part 6 DIMSDALE SPORTS CO. Cash Budgets January, February, and March 2014 January February March Beginning cash balance …………………………….…. $ 36,000 $ 30,100 $210,300 Cash receipts from customers (note A)……………. 221,250 […]

Title: Problem 22-7A QA_Ori: Part 1 ZIGBY MANUFACTURING Sales Budgets April, May, and June 2013 Budgeted Units Budgeted Unit Price Budgeted Total Dollars April 2013 20,500 $23.85 $ 488,925 Part 2 ZIGBY MANUFACTURING Production Budget April, May, and June 2013 […]

Problem 22-3B (Continued) Part 4 Cash payments on product purchases (for March and April) From purchases in Total % Paid March April February ……………………………..…. $261,600 70% $183,120 March ……………………………………. 227,400 30 68,220 ………………………………….…. 70 $159,180 April ………………………………………. 230,400 30 _______ […]

Title: Problem 22-4B QA_Ori: Part 1 COMP-MEDIA Budgeted Income Statement For Months of July, August, and September, 2013 July August September Sales* $1,265,000 $1,391,500 $1,530,650 Cost of goods sold* 660,000 726,000 798,600 Gross profit 605,000 665,500 732,050 * Volume for […]

Fundamental Accounting Principles, 21st Edition 1334 Problem 22-7B (continued) Part 6 NABAR MANUFACTURING Selling Expense Budgets July, August, and September 2013 July August Sept. Total Budgeted sales ………………………….. $357,000 $323,000 $340,000 Sales commission percent ………….….. x 10% x 10% x […]

Title: Problem 22-7B QA_Ori: Part 1 NABAR MANUFACTURING Sales Budgets July, August, and September 2013 Budgeted Units Budgeted Unit Price Budgeted Total Dollars July 2013 21,000 $17.00 $ 357,000 Part 2 NABAR MANUFACTURING Production Budget July, August, and September 2013 […]

Student Name: Class: Units Cost Total 1,615,000 $4.10 $6,621,500 1,620,000 $4.00 6,480,000 $141,500 U Correct! Yes! Units Price Total 1,615,000 $4.10 $6,621,500 1,615,000 $4.00 6,460,000 $161,500 U Correct! Yes! 1,615,000 $4.00 $6,460,000 1,620,000 $4.00 6,480,000 $20,000 F Correct! Yes! $161,500 […]

23-1 CHAPTER 23 FLEXIBLE BUDGETS AND STANDARD COSTS Related Assignment Materials Student Learning Objectives Discussion Questions Quick Studies* Exercises* Problems* Beyond the Numbers Conceptual objectives: C1. Define standard costs and explain how standard cost information is useful for management by […]

23–10 Chapter Outline Appendix 23A I. Expanded Overhead Variances A. Computing Overhead Cost Variances⎯assume predetermined rate is based on relation between standard overhead and standard labor hours. 1. Framework uses classifications of overhead costs as either variable or fixed 2. […]

Title: Question 1 QA_Ori: Fixed budget performance reports have limited usefulness because they do not Title: Question 2 QA_Ori: The primary purpose of a flexible budget is to help managers better evaluate past performance, which can improve their abilities to […]

Chapter 23 Flexible Budgets and Standard Costs QUESTIONS 1. Fixed budget performance reports have limited usefulness because they do not reflect differences in revenues and variable costs that can occur simply because actual volume is different from budgeted volume. This […]

Title: Exercise 23-1 QA_Ori: Item Cost a. Bike frames Variable b. Screws for assembly Variable c. Repair expense for tools (If these costs are only remotely related to volume, they may be better classified as fixed) Variable * Incoming shipping […]

Fundamental Accounting Principles, 21st Edition 1360 Exercise 23-6 (20 minutes) 1. Predetermined overhead rate computations Expected volume ……………………………………………………………. 75% Expected total overhead …………………………………………………. $2,100,000 Expected hours ……………………………………………………………… 375,000 hrs. Variable cost per hour ($1,500,000/ 375,000) ……………………. $4.00 Fixed cost per […]

Title: Exercise 23-9A QA_Ori: 1. Goods in Process Inventory 288,000 To record the favorable price and quantity variances. * This price variance can alternatively be computed and recorded when the direct materials are purchased. 2. Direct Materials Quantity Variance 24,000 […]

Problem 23-4A (45 minutes) Part 1 PHOENIX COMPANY Flexible Budget Performance Report For Year Ended December 31, 2013 Flexible Actual Budget Results Variances* Sales (18,000 units) …………………….. $3,600,000 $3,648,000 $48,000 F Variable costs Direct materials ………………………… 1,170,000 1,185,000 15,000 U […]

Title: Problem 23-5A QA_Ori: Part 1 Variable or Fixed Classification Per unit Amount Variable costs (total divided by 15,000 units) Indirect materials $ 3.00 Fixed costs (per month) Depreciation—Building $ 24,000 Depreciation—Machinery 80,000 Taxes and insurance 12,000 Supervision 79,000 Total […]

Fundamental Accounting Principles, 21st Edition 1390 $50,000 F (Spending variance) $10,000 F (Efficiency variance) $60,000 F (Total variable overhead variance) (b) Fixed Overhead Spending and Volume Variances Actual Overhead Budgeted Overhead Applied Overhead 252,000 x $7 $1,960,000 $2,016,000 $1,764,000 $56,000 […]

Title: Problem 23-1B QA_Ori: Part 1 Direct Materials Variances Direct materials cost variances Actual units at actual cost [1,000,000 lbs. @ $4.25] $4,250,000 Direct Materials Price and Quantity Variances Actual Cost AQ x AP AQ x SP Standard Cost SQ […]

Problem 23-6BA (Continued) Part 3 Overhead Variances (a) Variable overhead Preliminary computations Actual variable overhead (given): Indirect materials ……………………………………………….. $10,000 Indirect labor …………………………………………………….. 16,000 Power …………………………………………………………..….. 4,500 Maintenance ………………………………………………….….. 3,000 Total …………………………………………………………….….. $33,500 Actual hours: 37,600 (given) Standard hours: 36,000 […]

Part 3 Direct Materials Variances Preliminary computations Actual material used: 69,000 lbs. (given) Direct material cost variances Actual units at actual cost [69,000 lbs. @ $6.10] $420,900 Standard units at standard cost [67,500 lbs. @ $6.00] 405,000 Direct material cost […]

Part 4 GUADELUPE COMPANY Overhead Variance Report For Month Ended March 31 Volume Variance Expected production level 80% of capacity Production level achieved 90% of capacity Volume variance $6,000 (favorable) Flexible Actual Controllable Variance Budget Results Variances* Variable overhead costs […]

Student Name: Class: Square Footage Rate Total 1,000 8.25$ 8,250$ «- Correct! 1,800 8.25 14,850$ «- Correct! Value- Usage Total Based Based Costs Costs Costs 18,000$ 18,000$ 27,000 27,000 9,000 9,000 3,000 3,000$ 3,000 3,000 6,000 6,000 66,000$ 54,000$ 12,000$ […]

24-1 CHAPTER 24 PERFORMANCE MEASUREMENT AND RESPONSIBILITY ACCOUNTING © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, […]

Title: Question 1 QA_Ori: Many companies are divided into departments when they become too large to be Title: Question 2 QA_Ori: Operating departments are directly involved in manufacturing or selling the products or services of a business. Service departments support […]

Chapter 24 Performance Measurement and Responsibility Accounting QUESTIONS 1. Many companies are divided into departments when they become too large to be effectively managed as single units. This division into departments is often needed so that the responsibilities for the […]

Title: Quick Study 24-15 QA_Ori: Average invested assets = (€12,888 + €13,099) / 2 Title: Quick Study 24-16 QA_Ori: a. Process time 15.0 minutes Inspection time 2.0 minutes Move time 6.4 minutes Wait time 36.6 minutes Manufacturing cycle time 60.0 […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Title: Exercise 24-13 QA_Ori: Preliminary calculations Lobster cost (2,400 lbs. x $4.50) $10,800 Labor cost 1,800 Total cost of processed lobsters $12,600 Parts Quantity* Price Total Lobster tails 1,248 lbs. $21 $26,208 Lobster flakes 528 lbs. 14 7,392 Total market […]

©2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or […]

Title: Problem 24-4A QA_Ori: Part 1 Allocations of joint costs on the basis of sales values Tree pruning and care: $405,000 Grade Sales Value Percent of Total Allocated Cost No. 1 $450,000 48.0% $194,400 No. 2 300,000 32.0 129,600 No. […]

Fundamental Accounting Principles, 21st Edition 1454 Problem 24-5B (60 minutes) Part 1 Process time …………………………………………………………………… 16.0 hours Inspection time ……………………………………………………………..… 3.5 hours Move time ……………………………………………………………………..… 9.0 hours Wait time ………………………………………………………………………… 21.5 hours Manufacturing cycle time ………………………………………………… 50.0 hours Part 2 […]

Title: Problem 24-4B QA_Ori: Part 1 Allocations of joint cost on the basis of sales values Land preparation, seeding, and cultivating: $700,000 Grade Sales Value Percent of Total Allocated Cost No. 1 $ 900,000 62.5% $437,500 Harvesting, sorting, and grading: […]

Student Name: Class: 115,000$ Correct! Net Net Cash Income Flow 1,840,000$ 1,840,000$ (480,000) (480,000) (672,000) (672,000) (336,000) (336,000) (115,000) (160,000) (160,000) 77,000 (23,100) (23,100) 53,900$ Correct! 168,900$ Correct! 2.84 years Correct! Income taxes Net income Net cash flow Part 3 […]

25-1 CAPITAL BUDGETING AND MANAGERIAL DECISIONS Related Assignment Materials Conceptual objectives: C1. Describe the importance of relevant costs for short-term decisions. 25-7 25–10 25-9 Analytical objectives: A1. Evaluate short-term managerial decisions using relevant costs. 11, 12, 13, 15 25-8, 25-9, […]

Title: Question 1 QA_Ori: Capital budgeting decisions require careful analysis because they are generally the Title: Question 2 QA_Ori: Capital budgeting is the process of planning the acquisition or sale of plant assets. Title: Question 3 QA_Ori: Capital budgeting decisions […]

Chapter 25 Capital Budgeting and Managerial Decisions QUESTIONS 1. Capital budgeting decisions require careful analysis because they are generally the most difficult and risky decisions that management faces. 2. Capital budgeting is the process of planning the acquisition or sale […]

Title: Exercise 25-7 QA_Ori: 1. PROJECT C1 Net Cash Flows Present Value of 1 at 12% Present Value of Net Cash Flows Year 1 $ 12,000 0.8929 $ 10,715 PROJECT C2 Net Cash Flows Present Value of 1 at 12% […]

Fundamental Accounting Principles, 21st Edition 1478 Exercise 25-11 (20 minutes) ALTERNATIVE A: INCREASE OR (DECREASE) IN NET INCOME Cost to buy new machine ………………………………………………………. $(115,000) Cash received to trade in old machine …………………………………..…………. 52,000 Reduction in variable manufacturing costs* ………………………….. […]

Title: Problem 25-2A QA_Ori: Part 1 PROJECT Y Net income $ 56,000 PROJECT Z Part 2 PROJECT Y PROJECT Z 4 years 3 years $350,000 $143,500 $350,000 $153,067 Net income $ 36,400 Depreciation expense* 116,667 Net cash flow $153,067 *Annual […]

Problem 25-5A (55 minutes) Part 1 Product G Product B Selling price per unit …………………………………………..… $120 $160 Variable costs per unit ………………………………………..… 40 90 Contribution margin per unit ……………………………….… $ 80 $ 70 Machine hours to produce 1 unit ………………………….. […]

Title: Problem 25-6A QA_Ori: Part 1 ELEGANT DECOR COMPANY Analysis of Expenses under Elimination of Department 200 Total Eliminated Continuing Expenses Expenses Expenses Cost of goods sold $469,000 $207,000 $262,000 Direct expenses *Computation notes. Closing Department 200 will eliminate 70% […]

Problem 25-5B (55 minutes) Part 1 Product R Product T Selling price per unit …………………………………………….. $ 60 $ 80 Variable costs per unit ………………………………………….. 20 45 Contribution margin per unit …………………………………. $ 40 $ 35 Machine hours to produce 1 […]

Title: Problem 25-4B QA_Ori: WINDMIRE COMPANY COMPARATIVE INCOME STATEMENTS (1) (2) (3) Normal New Volume Business Combined Supporting computations Normal direct material cost $384,000 Units of output 300,000 Cost per unit $ 1.28 New business volume 50,000 New business direct […]

Student Name: Class: Parts 1 and 2 Unadj. Bal. 34,000 Unadj. Bal. 80,000 Bal. 34,000 Bal. 80,000 Correct! Correct! Unadj. Bal. 0 Unadj. Bal. 15,000 (f) 7,500 ( c) 13,200 Adj. Bal. 7,500 Adj. Bal. 28,200 Correct! Correct! Unadj. Bal. […]

3-1 STATEMENTS Related Assignment Materials Student Learning Objectives Questions Quick Studies* Exercises* Problems* Beyond the Numbers Conceptual objectives: C1. Explain the importance of periodic reporting and the time period principle. 3 3-4, 3-6 3-2 3-1, 3-3, 3-4, 3-5, 3-8, 3- […]

Title: Question 1 QA_Ori: The cash basis of accounting reports revenues when cash is received while the Title: Question 2 QA_Ori: The accrual basis of accounting generally provides a better indication of company performance and financial condition than does the […]

Chapter 3 Adjusting Accounts and Preparing Financial Statements QUESTIONS 1. The cash basis of accounting reports revenues when cash is received while the accrual basis reports revenues when they are earned. The cash basis reports expenses when cash is paid […]

Part 2 JKL CoMPANY Income Statement For Year Ended July 31, 2013 Revenues Consulting fees earned $134,24 0 Expenses Depreciation expense—Office equipment $6,00 0 74,00 JKL CoMPANY Statement of Owner’s Equity For Year Ended July 31, 2013 J. Logan, Capital, […]

Title: Problem 3-5B Part 1 QA_Ori: SPEEDY COURIER Income Statement For Year Ended December 31, 2013 Revenues Delivery fees earned $611,80 0 Interest earned 34,000 Total revenues $645,80 0 SPEEDY COURIER Statement of Owner’s Equity For Year Ended December 31, […]

Title: Quick Study 3-18 QA_Ori: a. Step 1: Salaries Payable equals $0 Step 2: Salaries Payable should equal $15,500 (not yet recorded) Step 3: Adjusting entry to get from Step 1 to Step 2 Salaries Expense……………………………………………………. 15,500 Salaries Payable…………………………………………………. 15,500 […]

Exercise 3-6 (15 minutes) a. Supplies expense for current year: $2,550 b. Supplies available – current year-end: $6,500 c. Supplies purchased in current year: $8,490 d. Supplies available – prior year end: $2,288 Proof: (a) (b) (c) (d) Supplies available […]

Title: Exercise 3-10A QA_Ori: a. Dec. 1 Supplies Expense 2,000 b. Dec. 2 Insurance Expense 1,540 Cash 1,540 Paid insurance premiums. c. Dec. 15 Cash 13,00 0 Remodeling Fees Earned 0 Received fees for work to be done. 13,00 d. […]

Problem 3-4A (45 minutes) — Part 1 Account Unadjusted Trial Balance Adjustments Adjusted Trial Balance Cash ………………………………….. $ 34,000 $ 34,000 Accounts receivable ……….. 14,000 (a) 8,000 22,000 Office supplies …………………. 16,000 (b) 14,000 2,000 Prepaid insurance ……………. 8,540 (c) […]

Title: Problem 3-4A QA_Ori: Part 1 Account Unadjusted Trial Balance Adjustments Adjusted Trial Balance Cash…………………….. $ 34,000 $ 34,000 Accounts receivable…… 14,000 (a ) 8,000 22,000 Office supplies………….. 16,000 (b ) 14,000 2,000 Prepaid insurance……… 8,540 (c) 5,580 2,960 Office […]

Problem 3-3B (Concluded) AUGUSTUS INSTITUTE Balance Sheet December 31, 2013 Assets Cash …………………………………………………………………… $ 60,000 Accounts receivable …………………………………………… 5,750 Teaching supplies ………………………………………………. 20,000 Prepaid insurance ………………………………………………. 9,500 Professional library …………………………………………….. $12,000 Accumulated depreciation—Professional library ………. (4,900) 7,100 Equipment ………………………………………………………….. 40,000 […]

Title: Problem 3-3B Parts 1 and 2 QA_Ori: Cash Accounts Payable Accounts Receivable Salaries Payable Unadj. Bal. 0 Unadj. Bal. 0 (f) 5,750 (g) 450 Adj. Bal. 5,750 Adj. Bal. 450 Teaching Supplies Unearned Training Fees Unadj. Bal. 70,000 Unadj. […]

Serial Problem, SP 3 (Continued) Part 6 SUCCESS SYSTEMS Balance Sheet December 31, 2013 Assets Cash …………………………………………………………………….. $ 58,160 Accounts receivable …………………………………………….. 5,668 Computer supplies ……………………………………………….. 580 Prepaid insurance ………………………………………………… 1,665 Prepaid rent …………………………………………………………. 825 Office equipment ………………………………………………….. $ 8,000 […]

Part 2 SPEEDY COURIER Balance Sheet December 31, 2013 Assets Cash $ 58,000 Accounts receivable 120,000 Interest receivable 7,000 Notes receivable (due in 90 days) 210,000 Office supplies 22,000 Trucks $ 134,000 Accumulated depreciation—Trucks (58,000) 76,000 Equipment 270,000 Accumulated depreciation—Equipment […]

Part 6 SUCCESS SYSTEMS Balance Sheet December 31, 2013 Assets Cash $58,16 0 Accounts receivable 5,668 Computer supplies 580 Liabilities Accounts payable $1,100 Wages payable 500 Unearned computer services revenue 1,500 Total liabilities 3,100 Equity A. Lopez, Capital 90,148 Total […]

Title: Quick Study 3-19 QA_Ori: a. Step 1: Accounts Receivable equals $0 Step 2: Accounts Receivable should equal $19,000 (not yet recorded) Step 3: Adjusting entry to get from Step 1 to Step 2 Accounts Receivable……………………………………………….. 15,500 Services Revenue……………………………………………….. 15,500 […]

Title: Exercise 3-11A QA_Ori: a. Initial credit recorded in the Unearned Fees account 1-Jul Cash 6-Jan Cash 7,500 Unearned Fees 7,500 Received fees for work to be done for Haru. 12-Jan Unearned Fees 3,000 Fees Earned 3,000 Completed work for […]

Student Name: Class: NOTE: Ledger accounts begin at cell A150, and show all entries that need to be posted. Date Account Titles Acct. No. Debit Credit Apr 1 101 30,000 167 20,000 301 50,000 «- Correct! 2640 1,800 101 1,800 […]

4-1 CHAPTER 4 COMPLETING THE ACCOUNTING CYCLE © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, […]

Title: Question 1 QA_Ori: The four-step closing entry process is: (i) close the revenue (and gain) accounts to the Title: Question 2 QA_Ori: Closing entries affect temporary accounts: revenues, expenses, withdrawals, and income summary. Specifically, closing entries at the end […]

Chapter 4 Completing the Accounting Cycle QUESTIONS 1. The four-step closing entry process is: (i) close the revenue (and gain) accounts to the Income Summary account, (ii) close the expense (and loss) accounts to the Income Summary account, (iii) close […]

Title: Exercise 4-2 QA_Ori: 1. 2013 31-Dec Services Revenue 404 44,000 Income Summary 901 44,000 To close the revenue account. 31-Dec Income Summary 901 33,100 To close the withdrawals account. 2. Cruz company Post-Closing Trial Balance 31-Dec-13 Debit Credit Cash […]

Exercise 4-10 (20 minutes) Instructor note: Entries are shown without an account reference column because no posting is required. (a) Insurance Expense—Office Equipment ……………… 332 Insurance Expense—Store Equipment ………………. 568 Prepaid Insurance ………………………………………. 900 To record expired insurance. (b) Office […]

Title: Exercise 4-12 Part 1 QA_Ori: DYLAN DELIVERY COMPANY Work Sheet For Year Ended December 31, 2013 Unadjusted Trial Balance Adjustments Adjusted Trial Balance Income Statement Balance Sheet and Statement of Owner’s Equtiy Account Title Dr. Cr. Dr. Cr. Dr. […]

Problem 4-2A (Continued) Part 7—continued Ledger as of April 30 Cash Acct. No. 101 Date Explanation PR Debit Credit Balance April 1 30,000 30,000 2 1,800 28,200 3 1,000 27,200 10 2,400 24,800 14 1,600 23,200 24 8,000 31,200 28 […]

Part 7 aDVENTURE TRAVEL Post-Closing Trial Balance 30-Apr-13 Debit Credit Cash $27,000 Accounts receivable 1,750 Ledger as of April 30 Cash Acct. No. 101 Date Explanation PR Debit Credit Balance 1 30000 30000 2 1800 28200 3 1000 27200 10 […]

Problem 4-5A (Continued) TYBALT CONSTRUCTION Balance Sheet December 31, 2013 Assets Current assets Cash …………………………………………………………… $ 5,000 Short-term investments ………………………………. 23,000 Supplies …………………………………………………….. 8,100 Prepaid insurance ………………………………………. 7,000 Total current assets ……………………………………. $ 43,100 Plant assets Equipment ………………………………………………….. 40,000 Accumulated […]

Title: Problem 4-5A QA_Ori: Part 1 Tybalt CONSTRUCTION Income Statement For Year Ended December 31, 2013 Revenues Professional fees earned $97,000 Expenses Depreciation expense—Building 11,000 Depreciation expense—Equipment 6,000 Wages expense 32,000 Interest expense 5,100 Insurance expense 10,000 Rent expense 13,400 […]

Problem 4-2B (Concluded) Office Supplies Expense Acct. No. 650 Date Explanation PR Debit Credit Balance July 31 Adjusting 875 875 31 Closing 875 0 Repairs Expense Acct. No. 684 Date Explanation PR Debit Credit Balance July 29 950 950 31 […]

Part 6 Closing entries 31-Jul Storage Fees Earned 40 1 10,950 90 31-Jul Income Summary 90 1 8,225 Depreciation Exp—Buildings 60 6 1,500 Salaries Expense 2 2,100 Insurance Expense… 63 7 400 Rent Expense 64 0 2,000 Office Supplies Expense […]

Problem 4-6BA (Continued) Part 2 (all adjusting entries dated December 31, 2013) Instructor note: Entries are shown without an account reference column because no posting is required. (a) Salaries Expense …………………………………… 400 Salaries Payable……………………………… 400 To record accrued wages. (b) […]

Part 3 Closing entries (all dated December 31, 2013) Instructor note: Entries are shown without an account reference column because no posting is required. 1 Repair Fees Earned 54,700 Income Summary 54,700 To close the revenue account. 2 Income Summary […]

Reporting in Action — BTN 4-1 1. The revenue items from its income statement must be identified, and those would be credited to Income Summary as step 1 in the closing entry process. For Polaris’ year ended December 31, 2011, […]

Title: Reporting in Action 1 QA_Ori: The revenue items from its income statement must be identified, and those would be credited to Income Summary as step 1 in the closing entry process. Title: Reporting in Action 2 QA_Ori: The total […]

Student Name: Class: Trans. Date Account Titles no. Debit Credit Jan. 31 4,050 4,050 «- Correct! 31 1,400 31 1,525 1,525 «- Correct! 31 1,600 1,600 «- Correct! 1,400 «- Correct! Prepaid Insurance 111,950$ 2,000$ 2,200 4,200 107,750 40,000 67,750 […]

5-1 CHAPTER 5 ACCOUNTING FOR MERCHANDISING OPERATIONS © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, […]

Title: Question 1 QA_Ori: Merchandising companies report Merchandise Inventory on the balance Title: Question 2 QA_Ori: Additional accounts of a merchandising company likely include Merchandise Inventory, Sales (of goods), Cost of Goods Sold, Sales Discounts, and Sales Returns and Allowances […]

Title: Exercise 5-3 QA_Ori: 1. BUYER- Santa Fe Company a) Credit Purchase Merchandise Inventory 24,000 2. SELLER – Mesa Company a) Credit Sale Accounts Receivable 24,000 Sales 24,000 Sold merchandise on account. Cost of Goods Sold 16,000 Merchandise Inventory 16,000 […]

Exercise 5-7 (25 minutes) 1. Entries for Sydney Company (BUYER): May 11 Merchandise Inventory ……………………………. 40,000 Accounts Payable ……………………………… 40,000 Purchased merchandise on credit. 11 Merchandise Inventory ……………………………. 345 Cash …………………………………………………. 345 Paid shipping charges on purchased merchandise. 12 Accounts […]

Title: Exercise 5-14 QA_Ori: Perpetual 1) 1-Nov Merchandise Inventory 1,50 0 2) 5-Nov Accounts Payable 1,50 0 Merchandise Inventory 30 Cash 1,470 To record cash payment in discount period. 3) 7-Nov Cash 196 Merchandise Inventory 196 To record check received […]

Problem 5-2A (Concluded) Aug. 15 Cash ………………………………………………………….. 4,508 Sales Discounts* ……………………………………….. 92 Accounts Receivable—Laird ……………….. 4,600 Collected receivable within 2% discount period. *[($5,200 – $600) x 2%] 18 Accounts Payable—Waters ………………………… 4,840 Merchandise Inventory * ……………………… 47 Cash …………………………………………………… 4,793 […]

Part 4 Current assets Cash…………………………………………………………………… $ 1,000 Merchandise inventory………………………………………….. 10,900 Title: Problem 5-4A QA_Ori: 1. Net sales Sales…………………………………………………………………….. $225,600 Less: Sales discounts……………………………………………. (2,250) Sales returns and allowances………………………… (12 ,000) Net sales……………………………………………………………….. $211 ,350 2. Cost of Merchandise purchased Invoice cost […]

Problem 5-3B (Continued) Part 2 Multiple-step income statement FOSTER PRODUCTS COMPANY Income Statement For Year Ended October 31, 2013 Sales ………………………………………………………………. $227,100 Less: Sales discounts …………………………………….. $ 1,000 Sales returns and allowances ………………… 5,000 6,000 Net sales …………………………………………………………. 221,100 Cost […]

Title: Problem 5-2B QA_Ori: 3-Jul Merchandise Inventory 15,00 0 Accounts Payable—OLB 15,000 Purchased goods on credit, terms 1/10, n/30. 4-Jul Accounts Payable—OLB 150 Cash 150 Paid freight for OLB Corp. Paid payable within discount period. 7-Jul Accounts Receivable—Brill 11,500 Sales […]

Serial Problem — SP 5 (Continued) A. Lopez, Capital Acct. No. 301 Date Explanation PR Debit Credit Balance Dec. 31 Balance 90,148 Jan. 5 25,000 115,148 A. Lopez, Withdrawals Acct. No. 302 Date Explanation PR Debit Credit Balance Feb. 15 […]

Title: Problem 5-6BB QA_Ori: FOSTER PRODUCTS COMPANY Work Sheet For Year Ended October 31, 2013 Unadjusted Trial Balance Adjustments Adjusted Trial Balance Income Statement Balance Sheet Account Title Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Cash……………….…….……7,400 7,400 […]

Part 3 SUCCESS SYSTEMS Partial Work Sheet March 31, 2014 Acct. No. Account Title Unadjusted Trial Balance Adjustments Adjusted Trial Balance 101 Cash…………………………….77,845 77,845 106.1 Alex’s Engineering Co………… 0 0 106.2 Wildcat Services……………….2,800 2,800 106.3 Easy Leasing…………………..8,900 8,900 106.4 IMF […]

Student Name: Class: 2012 2013 2014 615,000$ 957,000$ 780,000$ (56,000) 56,000 20,000 (20,000) 559,000$ 1,033,000$ 760,000$ Correct! Correct! Correct! 2012 2013 2014 230,000$ 285,000$ 241,000$ 56,000 (56,000) (20,000) 20,000 286,000$ 209,000$ 261,000$ Correct! Correct! Correct! 2012 2013 2014 1,255,000$ 1,365,000$ […]

6-1 CHAPTER 6 INVENTORIES AND COST OF SALES © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, […]

Title: Question 1 QA_Ori: (a) FIFO: The cost of the first (earliest) items purchased in inventory flow to cost (b) LIFO: The cost of the last (most recent) items purchased in inventory flow to cost of goods sold first. Title: […]

Chapter 6 Inventories and Cost of Sales QUESTIONS 1. (a) FIFO: The cost of the first (earliest) items purchased in inventory flow to cost of goods sold first. (b) LIFO: The cost of the last (most recent) items purchased in […]

Title: Exercise 6-1 QA_Ori: The consignor is Harris Company. The consignee is Harlow Company. The The title will pass at “destination” which is Harlow Company’s receiving dock. Harris should show the $12,500 in its inventory at year-end as Harris retains […]

Exercise 6-7 (Concluded) Alternate Solution Format Ending Cost of Inventory Goods Sold a. FIFO (100 x $25) + (120 x $20) ………………………………………………… $4,900 (150 x $10) + (50 x $10) + (250 x $15) + (100 x $15)+ (330 x […]

Title: Exercise 6-16B QA_Ori: At Cost At Retail Goods available for sale Beginning inventory $ 63,800 $128,400 Title: Exercise 6-17B QA_Ori: Goods available for sale Inventory, January 1 $ 225,000 Net cost of goods purchased* 802,250 Goods available for sale […]

Problem 6-3A (Continued) 3d. Specific Identification Cost of goods available for sale ………………. $77,200 Less: Cost of Goods Sold 600 @ $45.00 ………………………………. $27,000 300 @ $42.00 ………………………………. 12,600 200 @ $27.00 ………………………………. 5,400 50 @ $50.00 ………………………………. 2,500 250 […]

Title: Problem 6-4A QA_Ori: 1. Calculate cost of goods available for sale and units available for sale Beginning inventory 600 units @ $45.00 $27,00 0 Feb. 10 400 units @ $42.00 16,800 Units available 1,800 units Cost of goods available […]

Problem 6-2B (40 minutes) 1. Compute cost of goods available for sale and units available for sale Beginning inventory ……………………… 20 units @ $3,000 $ 60,000 April 6 ………………………………………….. 30 units @ $3,500 105,000 April 17 …………………………………………. 5 units @ […]

QA_Ori: 1. Compute cost of goods available for sale and units available for sale Beginning inventory 20 units @ $3,000 $ 60,000 April 6 30 units @ $3,500 105,000 2. Units in ending inventory Units available (from part 1) 65 […]

Serial Problem — SP 6, Success Systems (concluded) 2. Per Unit Total Total LCM Applied Inventory Items Units Cost Market Cost Market To Items Office productivity …….. 3 $ 76 $ 74 $228 $222 $222 Desktop publishing …… 2 103 […]

Title: Problem 6-7BA QA_Ori: Part 1 Number and total cost of units available for sale 6,500 units in beginning inventory @ $35 $ 227,500 11,500 units purchased @ $33 379,500 Part 2 a. FIFO periodic Total cost of 50,000 units […]

Title: Teamwork in Action QA_Ori: Concepts and procedures to illustrate in expert presentation: Specific Identification Expert: (a) and (b) Concept: Purchases are always recorded at the actual specific costs. The specific identification cost flow assumption requires units sold be assigned […]

Student Name: Class: Page 2 CHURCH COMPANY Sales Journal COGS Inv. Acct. Rec. Debit Debit Date No. PR Sales Cr. Inv. Credit Mar. 2 854 √16,800 8,400 3855 √10,200 5,800 10 856 √5,600 2,900 27 857 √14,910 7,220 28 858 […]

Student Name: Class: Instructor McGraw-Hill/Irwin Problem 07A-06A Debit Credit 69,884$ 19,225 10,000 1,230 1,770 21,220 24,220$ 82,000 10,000 116,685 652 76,225 2,425 1,476 36,600 236,806$ 236,806$ Correct! Correct! 14,910$ 4,315 19,225$ Correct! 3,000$ 21,220 24,220$ Total accounts receivable Gabel Company […]

7-1 CHAPTER 7 ACCOUNTING INFORMATION SYSTEMS Related Assignment Materials Student Learning Objectives Questions Quick Studies* Exercises* Problems* Beyond the Numbers Conceptual objectives: C1. Identify the fundamental principles and components of accounting information systems. 1, 2, 3, 4, 5, 6 7-1, […]

7-10 28 Post to the customer and creditor accounts and post any amounts that should be posted as individual amounts to general ledger accounts. 28 Foot and crossfoot the journals and make the month–end postings. Required: 1. Open the following […]

Title: Question 1 Title: Question 2 QA_Ori:Source documents contain data about business transactions or events that are put into the accounting system and processed. Examples of source documents are invoices from suppliers, checks received from customers, and payroll forms filled […]

Parts 2 and 3 QA_Ori GENERAL LEDGER Cash Acct. No. 101 Date Explanation PR Debit Credit Balance Accounts Receivable Acct. No. 106 Date Explanation PR Debit Credit Balance Apr. 30 S3 37,470 37,470 30 R3 27,600 9,870 Inventory Acct. No. […]

Problem 7-1A (Continued) Parts 2 and 3 (continued) ACCOUNTS RECEIVABLE LEDGER Page Alistair Date Explanation PR Debit Credit Balance Apr. 3 S3 4,000 4,000 13 R3 4,000 0 13 S3 5,100 5,100 23 R3 5,100 0 Paula Kohr Date Explanation […]

Part 3 QA_Ori CHURCH COMPANY Trial Balance March 31 Debit Credit Cash $ 69,884 Accounts receivable 19,225 Inventory 17,694 Office supplies 1,230 QA_Ori CHURCH COMPANY Schedule of Accounts Receivable March 31 Jovita Albany $14,910 Linda Witt 4,315 Total accounts receivable […]

Problem 7-1B (Concluded) Part 4—continued ACORN INDUSTRIES Schedule of Accounts Receivable July 31 Ruth Blake …………………………………..………………… $17,500 Ashton Moore ………………………………………………… 16,820 Total accounts receivable …………….……………. $34,320 Part 5 Analysis component To find the error(s), first re-add the account balances on […]

Title: Problem 7-3B Parts 1 and 2 QA_Ori SALES JOURNAL Page 2 Date Account Debited Invoice Number PR Accounts Receivable Dr. Sales Cr. Cost of Goods Sold Dr. Inventory Cr. Nov. 8 Cyd Rounder 439 6,550 3,910 10 Carlos Mantel […]

Fundamental Accounting Principles, 21st Edition 478 Comprehensive Problem, Colo Company (Part 1—Continued) PURCHASES JOURNAL Page 2 Date Account Date of Invoice Terms PR Accounts Payable Cr. Inventory Dr. Office Supplies Dr. Other Accounts Dr. May 4 Store Supp./Gear Supp …………….……………. […]

Part 2 QA_Ori: COLO COMPANY Work Sheet for Month Ended May 31, 2013 Unadjusted Trial Balance Adjustments Income Statement Balance Sheet or State-ment of Owner’s Equity Account Debit Credit Debit Credit Debit Credit Debit Credit Cash 135,911 135,911 Accounts receivable […]

Comprehensive Problem, Colo Company (Continued) Part 2—continued ACCOUNTS PAYABLE LEDGER Fink Corp. Date Explanation PR Debit Credit Balance May 17 P2 13,650 13,650 23 D2 13,650 0 Garcia, Inc. Date Explanation PR Debit Credit Balance May 11 P2 8,800 8,800 […]

Title: Quick Study 7-12A PURCHASES JOURNAL Date Account Date of Invoice Terms PR Account s Payable Cr. Purchases Dr. Office Supplies Dr. Other Accounts Dr. May 1 Krause, Inc……………… 5/01 n/30 10,100 10,100 Company………………. 14 Store Supplies/ Chang Co……………. 5/14 […]

Title: Problem 7-5AA Part 4 WISET COMPANY Trial Balance April 30 Debit Credit Cash……………………………………………………..$ 35,847 Inventory……………………………………………… 125,000 Office supplies……………………………………… 1,400 WISET COMPANY Schedule of Accounts Payable April 30 Custer, Inc…………………………………………… $ 1,400 Hal’s Supply………………………………………… 12,955 Noth Company……………………………………. 11,375 Total accounts […]

Title: Problem 7-4BA ACCOUNTS RECEIVABLE LEDGER Ruth Blake Date Explanation PR Debit Credit Balance July 6 S3 7,500 7,500 Ashton Moore Date Explanation PR Debit Credit Balance July 13 S3 8,550 8,550 23 R3 8,550 0 30 S3 16,820 16,820 […]

Title: Problem 7-6BA Parts 1 and 2 SALES JOURNAL Page 2 Date Account Debited Invoice Number PR Accounts Receivable Dr. Sales Cr. Nov. 8 Cyd Rounder………………………………..439 6,550 30 Totals…………………………………………. 33,275 (106/413) PURCHASES JOURNAL Page 2 Date Account Date of Invoice […]

Appendix 7A—PERIODIC Accounting Information Systems QUICK STUDIES Quick Study 7-12A (20 minutes) PURCHASES JOURNAL Date Account Date of Invoice Terms PR Accounts Payable Cr. Purchases Dr. Office Supplies Dr. Other Accounts Dr. May 1 Krause, Inc. ……….………….. 5/01 n/30 10,100 […]

Problem 7-6AA (Continued) Accounts Payable Acct. No. 201 Date Explanation PR Debit Credit Balance Mar. 17 G2 2,425 (2,425) 19 G2 630 (3,055) 31 P2 101,075 98,020 31 D2 73,800 24,220 Long-Term Notes Payable Acct. No. 251 Date Explanation PR […]

Problem 7-5BA (Continued) Parts 2 and 3—continued ACCOUNTS PAYABLE LEDGER Charm’s Supply Date Explanation PR Debit Credit Balance July 9 P3 38,220 38,220 20 P3 650 38,870 Drake Company Date Explanation PR Debit Credit Balance July 17 P3 7,200 7,200 […]

Student Name: Class: 27,233$ 27,497$ 11,514 7,955 38,747 35,452 1,482$ NSF check 805$ 382 Service charge 25 2,281 4,145 Error (Check no. 3056) 20 850 34,602$ «- Correct! Adjusted book balance 34,602$ «- Correct! Date Account Title Debit Credit Jul […]

8-1 CHAPTER 8 CASH AND INTERNAL CONTROLS © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, […]

Title: Question 1 QA_Ori: The seven broad principles are: Establish responsibilities; Maintain adequate records; Insure assets and Title: Question 2 QA_Ori: Internal control procedures become especially critical when the manager of a business can no longer control the business through […]

Chapter 8 Cash and Internal Controls QUESTIONS 1. The seven broad principles are: Establish responsibilities; Maintain adequate records; Insure assets and bond key employees; Separate recordkeeping from custody of assets; Divide responsibilities for related transactions; Apply technology controls; Perform regular […]

QA_Ori: Title: Exercise 8-14B a. Recording inventory at gross amounts Oct. 2 Merchandise Inventory………………………………………………………………………….. 3,000 Accounts Payable……………………………………………………………………………. 3,000 To record merchandise purchases. 10 Accounts Payable…………………………………………………………………………………. 500 Merchandise Inventory ……………………………………………………………………. 500 To record credit memo for returns. 17 Merchandise Inventory………………………………………………………………………….. 5,400 […]

Exercise 8-14B (Concluded) b. Recording inventory at net amounts Oct. 2 Merchandise Inventory …………………………………….….. 2,940 Accounts Payable ………………………………………….. 2,940 To record merchandise purchases less discount [$3,000 – ($3,000 x .02) = $2,940]. 10 Accounts Payable ……………………………………………….. 490 Merchandise Inventory ……………………………….….. […]

Title: Problem 8-3B Part 1 Jan. 3 Petty Cash…………………………………………………………………………………………… 150.00 Cash……………………………………………………………………………………………… 150.00 To establish the petty cash fund. Jan. 14 Office Supplies Expense……………………………………………………………………….. 14.29 Merchandise Inventory*………………………………………………………………………… 19.60 Repairs Expense—Computer…………………………………………………………………. 38.57 Miscellaneous Expenses………………………………………………………………………… 12.82 Cash Over and Short…………………………………………………………………………….. 2.44 Cash……………………………………………………………………………………………… 87.72 […]

Problem 8-5B (Concluded) Part 3 There are several possible reasons why some prenumbered checks are missing from the sequence of canceled checks returned with a bank statement. Reasons include: (1) Some of the checks in the numbered sequence may have […]

9-1 CHAPTER 9 ACCOUNTING FOR RECEIVABLES © 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or […]

Title: Question 1 QA_Ori: When customers use credit cards, the selling companies can avoid having to directly evaluate Title: Question 2 QA_Ori: Revenues and expenses usually are not matched under the direct write-off method because the revenues recorded from the […]

Chapter 9 Accounting for Receivables QUESTIONS 1. When customers use credit cards, the selling companies can avoid having to directly evaluate the credit standing of their customers. They also avoid the risk of bad debts and often are paid cash […]

Title: Exercise 9-6 QA_Ori: a. Computation of the estimated balance of the allowance for uncollectibles: Not due: $396,000 x 0.01 = $ 3,960 1 to 30: 90,000 x 0.02 = 1,800 Title: Exercise 9-6 b. Dec. 31 Bad Debts Expense……………………………………….. […]

PROBLEM SET A Problem 9-1A (30 minutes) June 4 Accounts Receivable—N. Morris ……………………….. 650 Sales …………………………………………………………… 650 To record sales on credit. 4 Cost of Goods Sold ………………………………………….…….. 400 Merchandise Inventory ……………………………….…….. 400 To record cost of sales. 5 Cash […]

Title: Problem 9-2A QA_Ori: 2012 a. Accounts Receivable…………………………………….. 1,345,434 b. Allowance for Doubtful Accounts…………………….. 18,300 Accounts Receivable……………………………….. 18,300 To write off accounts. c. Cash……………………………………………………………. 669,200 Accounts Receivable……………………………….. 669,200 To record cash received on account. d. Bad Debts Expense………………………………………. 28,169 Allowance […]

Problem 9-5B (75 minutes) Part 1 2012 Nov. 1 Notes Receivable—S. Julian ………………………….. 4,800 Accounts Receivable—S. Julian …………………. 4,800 To record note received on account. Dec. 31 Interest Receivable ………………………………………….. 64 Interest Revenue ……………………………………….. 64 To record interest earned [$4,800 […]

Title: Problem 9-2B QA_Ori: 2013 e. Accounts Receivable………………………………………. 870,220 Sales………………………………………………………. 870,220 To record sales on account. Cost of Goods Sold…………………………………………………650,000 Merchandise Inventory……………………………………… 650,000 To record cost of sales. f. Cash…………………………………………………………….. 990,800 Accounts Receivable…………………………………. 990,800 To record cash received on account. […]

Title: Ethics Challenge Title: Question 1 QA_Ori: If the estimate for bad debts is reduced then less Bad Debts Title: Question 2 QA_Ori: Accounting procedures often allow for alternate methods or require the use of estimates. Therefore, managers have some […]

Instructor’s Resource Manual, Section I 3 ACTIVE LEARNING INSTRUCTIONAL STRATEGIES The following is a list and description of active learning instructional strategies. They can be used in any instructor-designed activity. It is not by any means a complete list of […]

Provided for class distribution. Use file to edit to suit instructor’s preference OBJECTIVES AND REQUIREMENTS FOR TEAM PRESENTATION ASSIGNMENTS A. Broad Objectives 1. To develop learning to learn skills. These assignments will require you to utilize outside resources to gather […]

APPENDIX B PRESENT AND FUTURE VALUES IN ACCOUNTING Present Value of 1 Periods 3% 4% 5% 6% 7% 8% 9% 10% 12% 3 0.9151 0.8890 0.8638 0.8396 0.8163 0.7938 0.7722 0.7513 0.7118 4 0.8885 0.8548 0.8227 0.7921 0.7629 0.7350 0.7084 […]

3.7908 is the interest factor on the Present Value of an Annuity table; i = 10%; n = 5 31. A company is considering an investment that will return $20,000 semiannually at the end of each semiannual period for 4 […]

AAPPENDIX C ACTIVITY-BASED COSTING 1. Activity-based costing attempts to better allocate costs to the proper users of overhead by focusing on activities. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Resource Management AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: […]

27. Activity rates from Quattrone Corporation’s activity-based costing system are listed below. The company uses the activity rates to assign overhead costs to products: Last year, Product F76D involved 2 customer orders, 434 assembly hours, and 20 batches. How much […]

Chapter 1 ACCOUNTING IN BUSINESS 1. Accounting is an information and measurement system that identifies, records, and communicates relevant, reliable, and comparable information about an organization’s business activities. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision […]

79. The statement of cash flows identifies cash flows separated into operating, investing, and financing activities over a period of time. Answer: True Blooms: Remember AACSB: Analytic AICPA BB: Industry AICPA FN: Reporting Difficulty: 1 Easy Learning Objective: 01-P2 Topic: […]

Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: 01–A1 Topic: Accounting Equation 130. Distributions of assets by a business to its owners are called: A. Withdrawals. B. Expenses. C. Assets. D. Retained earnings. […]

1-61 172. Della’s Donuts had cash inflows from operating activities of $27,000; cash outflows from investing activities of $22,000, and cash outflows from financing activities of $12,000. Calculate the net increase or decrease in cash. A. $61,000 increase. B. $37,000 […]

Blooms: Apply AACSB: Analytic AICPA BB: Industry AICPA FN: Measurement Difficulty: 3 Hard Learning Objective: 01-A1 Topic: Accounting Equation 209. For each of the following transactions, identify the effects as reflected in the accounting equation. Use “+” to indicate an […]

1-93 219. Graham Roofing Company, owned by R. Graham, began operations in May and completed the following transactions during that first month of operations. Show the effects of the transactions on the accounts of the accounting equation by recording increases […]

Chapter 10 PLANT ASSETS, NATURAL RESOURCES AND INTANGIBLES 1. Plant assets refer to intangible assets that are used in the operations of a business. Answer: False Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision Making Difficulty: 1 Easy […]

67. When originally purchased, a vehicle had an estimated useful life of 8 years. The vehicle cost $23,000 and its estimated salvage value is $1,500. After 4 years of straight-line depreciation, the asset’s total estimated useful life was revised from […]

108. A company had a bulldozer destroyed by fire. The bulldozer originally cost $125,000 with accumulated depreciation of $60,000. The proceeds from the insurance company were $90,000. The company should recognize: A. A loss of $25,000. B. A gain of […]

Blooms: Understand AACSB: Communication AICPA BB: Industry AICPA FN: Measurement Difficulty: 2 Medium Learning Objective: 10-P1 Topic: Depreciation Methods 147. Explain how to calculate total asset turnover. Describe what it reveals about a company’s financial condition, whether a higher or […]

10–85 storm. Aug 25 Purchased used office equipment for $14,700 cash. Sales tax was $825, freight costs $250, and reconditioning costs $900, all of which were paid in cash. The estimated useful life of the equipment is 3 years and […]

10-100 196. Record the following events and transactions for Axle Company for the current year. 1. On January 2, Axle purchased a patent for $35,000 with a useful life of 10 years. Prepare the journal entry to amortize the patent […]

Chapter 11 CURRENT LIABILITIES AND PAYROLL ACCOUNTING 1. A liability is a probable future payment of assets or services that a company is presently obligated to make as a result of past transactions or events. Answer: True Blooms: Remember AACSB: […]

63. The times interest earned ratio reflects: A. A company’s ability to pay its operating expenses on time. B. A company’s ability to pay interest even if sales decline. C. A company’s profitability. D. The relation between income and debt. […]

109. Maryland Company offers a bonus plan to its employees equal to 3% of net income. Maryland’s net income is expected to be $960,000. The amount of the employee bonus expense is estimated to be: A. $27,961 B. $28,800 C. […]

Feedback: Times Interest Earned Ratio = Income before Interest Expense and Income Taxes/Interest Expense Times Interest Earned Ratio = $395,000/$125,000 = 3.2 (2010) Times Interest Earned Ratio = $427,000/$125,000 = 3.4 (2011) 147. Agro Depot’s income before interest expense and […]

Blooms: Apply AACSB: Analytic AICPA BB: Industry AICPA FN: Measurement Difficulty: 3 Hard Learning Objective: 11-P2 Topic: Employee Payroll Concepts 170. A company’s payroll information for the month of May follows: Administrative salaries ……………………………………. $2,000 Sales salaries ……………………………………………………. 3,500 Shop […]

Chapter 12 ACCOUNTING FOR PARTNERSHIPS True /False Questions 1. A partnership has an unlimited life. Answer: False Blooms: Remember AACSB: Communication AICPA BB: Legal AICPA FN: Decision Making Difficulty: 1 Easy Learning Objective: 12-C1 Topic: Partnerships and Similar Organizations 2. […]

Blooms: Understand AACSB: Analytic AICPA BB: Industry AICPA FN: Measurement Difficulty: 2 Medium Learning Objective: 12-P2 Topic: Allocation of Income and Loss 57. Rice, Hepburn, and DiMarco formed a partnership with Rice contributing $60,000, Hepburn contributing $50,000 and DiMarco contributing […]

Blooms: Understand AACSB: Communication AICPA BB: Industry AICPA FN: Measurement Difficulty: 2 Medium Learning Objective: 12-P3 Topic: Admission of a Partner 95. What are the ways a partner can withdraw from a partnership? Explain how to account for the withdrawal […]

115. The BlueFin Partnership agrees to dissolve. The remaining cash balance after liquidating partnership assets and liabilities is $60,000. The final capital account balances are: Smith, $30,000; Nagy, $20,000; and Russ, $10,000. Prepare the journal entry to distribute the remaining […]

13-1 Chapter 13 ACCOUNTING FOR CORPORATIONS True /False Questions 1. A corporation is a legal entity separate from its owners. 2. Corporations are subject to substantially fewer regulations and laws than are proprietorships and partnerships. Answer: False Blooms: Remember AACSB: […]

72. Par value of a stock refers to the: A. Issue price of the stock. B. Value assigned per share of stock by the corporate charter. C. Market value of the stock on the date of the financial statements. D. […]

120. A company declared a $0.50 per share cash dividend. The company has 20,000 shares authorized, 9,000 shares issued, and 8,000 shares of common stock outstanding. The journal entry to record the dividend declaration is: A. Debit Retained Earnings $4,000; […]

Answer: (1) This is an error that should be reported as a prior period adjustment. Accordingly, it should be reported in the statement of retained earnings, net of taxes, as a reduction from the beginning retained earnings balance. (2) The […]

189. The following selected transactions took place during the current year for a company: March 25 Declared a $2 per share cash dividend on 20,000 shares of common stock outstanding April 20 Paid the cash dividends declared on March 25. […]

Chapter 14 LONG-TERM LIABILITIES 1. The legal contract between the issuing corporation and the bondholders is called the bond indenture. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Legal AICPA FN: Decision Making Difficulty: 1 Easy Learning Objective: 14-A1 Topic: […]

67. The contract between the bond issuer and the bondholders, which identifies the rights and obligations of the parties, is called a(n): A. Debenture. B. Bond indenture. C. Mortgage. D. Installment note. E. Mortgage contract. Answer: B Blooms: Remember AACSB: […]

14–41 113. A company issued 5-year, 7% bonds with a par value of $100,000. The market rate when the bonds were issued was 6.5%. The company received $101,137 cash for the bonds. Using the effective interest method, the amount of […]

148. Shin Company has a loan agreement that provides it with cash today, and the company must pay $25,000 4 years from today. Shin agrees to a 6% interest rate. The present value factor for 4 periods, 6% is 0.7921. […]

Plus Unamortized Premium on Bonds Payable ……………………………………………… 368,035 $5,368,035 (c) 6/30 Bond Interest Expense ($5,368,035 x 0.12 x ½) 322,082 Premium on Bonds Payable ($350,000 – $322,082) 27,918 Cash ($5,000,000 x 0.14 x ½) ………………….. 350,000 (d) 6/30 Bond Interest […]

Chapter 15 INVESTMENTS AND INTERNATIONAL OPERATIONS 1. Long-term investments are usually held as an investment of cash for use in current operations. Answer: False Blooms: Remember AACSB: Communication AICPA BB: Decision Making AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: […]

Blooms: Remember AACSB: Analytic AICPA BB: Industry AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: 15-P1 Topic: Accounting for Trading Securities 63. All of the following statements regarding equity securities are true except: A. Equity securities should be recorded at […]

Answer: A Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: 15-P4 Topic: Accounting for Equity Securities with Significant Influence 107. Vans purchased 40,000 shares of Skechs common stock for $232,000. This represents 40% […]

Blooms: Understand AACSB: Analytic AICPA BB: Global AICPA FN: Measurement Difficulty: 2 Medium Learning Objective: 15-C3 Topic: Foreign Exchange Rates and Currency 143. Define the return on total assets and explain how it is used to measure a company’s financial […]

© 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole […]

Chapter 16 REPORTING THE STATEMENT OF CASH FLOWS 1. The primary purpose of the statement of cash flows is to report all major cash receipts (inflows) and cash payments (outflows) during a period. Answer: True Blooms: Remember AACSB: Communication AICPA […]

69. If a company borrows money from a bank, the interest paid on this loan should be reported on the statement of cash flows as a(n): A. Operating activity. B. Investing activity. C. Financing activity. D. Noncash investing and financing […]

16–41 110. The accountant for Robinson Company is preparing the company’s statement of cash flows for the fiscal year just ended. The following information is available: Retained earnings balance at the beginning of the year $156,000 Cash dividends declared for […]

140. Describe the format of the statement of cash flows, including the reporting of significant noncash investing and financing activities. Answer: The statement of cash flows involves reporting cash receipts and cash payments organized into three categories: operating, financing, and […]

158. The following selected account balances are taken from a merchandising company’s records: Dec. 31 Dec. 31, For the 2012 2013 Year 2013 Merchandise inventory $ 15,600 $ 21,200 Accounts payable 32,400 27,400 Salaries payable 4,400 3,000 Accounts receivable 42,000 […]

16–95 Answer: (1) Crockett Company Cash flows from operating activities: Net income $ 51,500 Adjustments to reconcile net income to net cash provided by operating activities: Increase in accounts receivable (32,000 ) Decrease in merchandise inventory 14,000 Decrease in prepaid […]

Chapter 17 ANALYSIS OF FINANCIAL STATEMENTS 1. Financial statement analysis is the application of analytical tools to general-purpose financial statements and related data for making business decisions. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision Making […]

72. Standards for comparisons in financial statement analysis include: A. Intra-company standards. B. Competitors’ standards. C. Industry standards. D. Guidelines (rules of thumb). E. All of the choices are standards for comparisons. Answer: E Blooms: Remember AACSB: Communication AICPA BB: […]

17–41 A. 36.4% for Year 2 and 41.1% for Year 1. B. 55.0% for Year 2 and 56.0% for Year 1. C. 119.4% for Year 2 and 100.0% for Year 1. D. 117.2% for Year 2 and 100.0% for Year […]

Cash $ 569 $ 448 Accounts receivable 2,234 2,337 Merchandise inventory 1,062 1,071 Plant assets 2,432 2,138 Bonds payable 1,164 1,666 Equity 2,777 2,894 Answer: Cash [($569 – $448)/$448] * 100 = 27.0% increase Accounts receivable [($2,234 – $2,337)/$2,337] * […]

(a) working capital (b) acid-test ratio (c) current ratio (d) debt ratio (e) equity ratio (f) debt-to-equity ratio Cash……………………….. $ 40,000 Current liabilities …………. $ 64,000 Accounts receivable………. 35,000 Long-term liabilities……….72,000 Inventory………………….. 60,000 Common stock……………..100,000 Equipment………………… 150,000 Retained earnings…………. 49,000 […]

Chapter 18 MANAGERIAL ACCOUNTING CONCEPTS AND PRINCIPLES 1. Managerial accounting assists in analysis, planning, and control of costs. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision Making Difficulty: 1 Easy Learning Objective: 18-C1 Topic: Purpose of […]

Blooms: Remember AACSB: Communication AICPA BB: Resource Management AICPA FN: Decision Making Difficulty: 1 Easy Learning Objective: 18-C6 Topic: Trends in Managerial Accounting 66. The model whose goal is to eliminate waste while satisfying the customer and providing a positive […]

111. If beginning and ending goods in process inventories are $5,000 and $15,000, respectively, and cost of goods manufactured is $170,000, what is the total manufacturing cost for the period? A. $180,000. B. $155,000. C. $160,000. D. $175,000. E. $165,000. […]

141. There are many differences between financial and managerial accounting. Identify and explain at least three of these differences. 18-60 Answer: The differences include: (1) Users and decision makers – Financial accounting focuses on external decision makers and managerial accounting […]

18-76 Beginning raw materials inventory _______ ______ Ending raw materials inventory _______ ______ Raw material purchases _______ ______ Depreciation of factory building _______ ______ Cost of goods manufactured _______ ______ 167. Information for Gifford, Inc., as of December 31 follows. […]

Chapter 19 JOB ORDER COST ACCOUNTING 1. Cost accounting systems accumulate costs and then assign them to products or services. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: 19-C1 Topic: Features […]

19–21 64. A source document that production managers use to request materials for production and that is used to assign materials costs to specific jobs or to overhead is a: A. Job cost sheet. B. Production order. C. Materials requisition. […]

Feedback: OH rate = $396,000/$220,000 = 180% 105. Hancock Manufacturing allocates overhead to production on the basis of direct labor costs. At the beginning of the year, Hancock estimated total overhead of $396,000; materials of $410,000 and direct labor of […]

Fill in the blanks for the following: (1) The total cost of the direct materials, direct labor, and factory overhead applied in the December 31 goods in process inventory is $_______________________. (2) The company’s overhead application rate is __________________% (3) […]

Factory equipment rental…………………… 100,000 (a) Calculate the predetermined overhead rate and calculate the overhead applied during the year. (b) Determine the amount of over- or underapplied overhead and prepare the journal entry to eliminate the over- or underapplied overhead assuming […]

Chapter 2 ANALYZING AND RECORDING TRANSACTIONS True /False Questions 1. The first step in the processing of a transaction is to analyze the transaction and source documents. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision Making […]

Blooms: Understand AACSB: Communication AICPA BB: Industry AICPA FN: Reporting Difficulty: 2 Medium Learning Objective: 02-C3 Topic: Ledger and Chart of Accounts 71. A debit: A. Always increases an account. B. Is the right-hand side of a T-account. C. Always […]

114. A company had the following accounts and balances year-end: Cash $30,000 Accounts receivable 32,000 Accounts payable 20,000 Fees earned 65,000 Rent expense 15,000 Insurance expense 4,800 Supplies 5,000 Sam, Capital 19,800 Sam, Withdrawals 18,000 If all of the accounts […]

149. Indicate whether a debit or credit entry would be made to record the following changes in each account. a. To decrease Cash b. To increase Owner, Capital c. To decrease Accounts Payable. d. To increase Salaries Expense. e. To […]

2-81 172. The following trial balance is prepared from the general ledger of Hal’s Auto Repair. HAL’S AUTO REPAIR Trial Balance October 31 Debit Credit Cash $ 975 Accounts receivable 3,800 Supplies 500 Repair equipment 13,000 Office equipment 6,600 Accounts […]

20-1 Chapter 20 PROCESS COST ACCOUNTING 1. The managers of process manufacturing systems focus on the series of processes needed to complete the production of products. 2. Process manufacturing usually reflects a manufacturer that produces large quantities of identical products. […]

66. Since the process cost summary describes the activities of a production department for a specified reporting period, it does not present information about any costs incurred in prior periods. Answer: False Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA […]

A. Debit Raw Materials Inventory $87,000; credit Accounts Payable $87,000. B. Debit Raw Materials Inventory $87,000; credit Finished Goods Inventory $87,000. C. Debit Cost of Goods Sold $87,000; credit Finished Goods Inventory $87,000. D. Debit Goods in Process Inventory $87,000; […]

20–61 Blooms: Apply AACSB: Analytic AICPA BB: Industry AICPA FN: Measurement Difficulty: 3 Hard Learning Objective: 20-C2 Learning Objective: 20-C4 Topic: Equivalent Units Topic: Process Costing using FIFO 136. Refer to the following information about the Painting Department in the […]

Costs incurred this period $2,400,000 $5,120,000 Total costs incurred $2,976,000 5,520,000 Equivalent units of production 96,000 92,000 Cost per EUP $31.00 $60 Costs of units transferred out Direct materials (90,000 * $31) $2,790,000 Direct labor & Overhead (90,000 * $60) […]

Chapter 21 COST-VOLUME-PROFIT ANALYSIS 1. Total variable costs change proportionately with changes in output activity. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Resource Management AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: 21-C1 Topic: Different Types of Cost Behavior […]

21–21 65. Use the following information to determine the margin of safety in dollars: Unit sales 50,000 Units Dollar sales ………………………………………………………… $500,000 Fixed costs ………………………………………………………… $204,000 Variable costs …………………………………………………….. $187,500 A. $ 88,500. B. $108,500. C. $173,600. D. $326,400. E. […]

104. Camden Corporation sells three products (M, N, and O) in the following mix: 3:1:2. Unit price and cost data are: M N O Unit sales price ……………………………… $7 $4 $6 Unit variable costs ………………………… 3 2 3 Total fixed […]

145. A firm produces and sells a product with a contribution margin of $32 per unit. The firm is presently selling 90,000 units and earning $240,000 in after-tax income. Taxes are $80,000 at a 25% tax rate. If the firm […]

Answer: (a) Profit area; (b) Loss area; (c) Breakeven point Blooms: Understand AACSB: Analytic AICPA BB: Resource Management AICPA FN: Measurement Difficulty: 2 Medium Learning Objective: 21-P3 Topic: Graphing Costs and Sales 168. The sales mix of Palm Company is […]

Chapter 22 MASTER BUDGETS AND PLANNING 1. Consulting the persons affected by a budget when it is prepared can provide an effective means of motivation and cooperation. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Resource Management AICPA FN: Measurement […]

63. A plan that lists dollar amounts to be received from disposing of plant assets and dollar amounts to be spent on purchasing additional plant assets is called a: A. Cash budget. B. Capital expenditures budget. C. Rolling budget. D. […]

April May June June Sales in Units ……….. 240 280 300 240 Although each month’s ending inventory of finished units should be 60% of the next month’s sales, the March 31 finished goods inventory is only 100 units. A finished […]

22–65 January February March Sales budget: Sales in Units 1,200 1,000 1,600 Price per unit * $25 * $25 * $25 Dollar Sales $30,000 $25,000 $40,000 Cash receipts table: Cash sales (40% of current mo. sales) $ 12,000 $ 10,000 […]

149. Sweeny Co. is preparing a cash budget for the second quarter of the coming year. The following data have been forecasted: April May Sales ………………………………………………. $150,000 $157,500 Merchandise purchases …………………………… 107,000 112,400 Operating expenses: Payroll …………………………………………. 13,600 14,280 Advertising […]

Chapter 23 FLEXIBLE BUDGETS AND STANDARD COSTS 1. Standard costs can serve as a basis for evaluating actual performance. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Resource Management AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: 23-C1 Topic: Standard […]

23–21 60. Kyle, Inc. has collected the following data on one of its products. The direct materials quantity variance is: Direct materials standard (4 lbs. @ $1/lb.) $4 per finished unit Total direct materials cost variance—unfavorable $13,750 Actual direct materials […]

23–41 95. Bok Company’s output for the current period was assigned a $200,000 standard direct materials cost. The direct materials variances included a $5,000 favorable price variance and a $3,000 unfavorable quantity variance. What is the actual total direct materials […]

Operating expenses: Fixed ……………………………………….. $12,000 Variable ……………………………………. 40,000 52,000 Income from operations ……………………….. $ 48,000 The company’s actual activity tor the year follows: Sales (21,000 units) ……………………………. $651,000 Cost of goods sold: Direct materials …………………………….. $231,000 Direct labor ………………………………… 168,000 […]

23–29 148. The following information comes from the records of Dina Co. for the current period. a. Compute the overhead controllable and volume variances. In each case, state whether the variance is favorable or unfavorable. b. Prepare the journal entries […]

Chapter 24 PERFORMANCE MEASUREMENT AND RESPONSIBILITY ACCOUNTING 1. Evaluation of the performance of a department involves only financial measures. Answer: False Blooms: Understand AACSB: Communication AICPA BB: Resource Management AICPA FN: Decision Making Difficulty: 2 Medium Learning Objective: 24-P1 Topic: […]

Feedback: Percent Market Sales of total value per value at value at $7,500 Product Gallons Gallon split-off split-off Allocated Breon 10,000 $6.00 $60,000 60% $4,500 Baron 20,000 $2.00 40,000 40% 3,000 Total $100,000 100% $7,500 Blooms: Apply AACSB: Analytic AICPA […]

Blooms: Apply AACSB: Analytic AICPA BB: Resource Management AICPA FN: Measurement Difficulty: 3 Hard Learning Objective: 24–P3 Topic: Departmental Income Statements and Contribution Reports 92. Mach Co. operates three production departments as profit centers. The following information is available for […]

24–61 __________ (1) Investment center __________ (2) Performance report __________ (3) Cost center __________ (4) Departmental contribution to overhead __________ (5) Profit center __________ (6) Responsibility accounting system Blooms: Remember AACSB: Communication AICPA BB: Resource Management AICPA FN: Measurement Difficulty: […]

24–76 Blooms: Apply AACSB: Analytic AICPA BB: Resource Management AICPA FN: Measurement Difficulty: 3 Hard Learning Objective: 24–P1 Learning Objective: 24–P2 Learning Objective: 24–P3 Topic: Responsibility Report Topic: Allocate Indirect Expenses to Department Topic: Departmental Income Statements and Contribution Reports […]

Chapter 25 CAPITAL BUDGETING AND MANAGERIAL DECISIONS 1. Capital budgeting is the process of analyzing alternative long-term investments and deciding which assets to acquire or sell. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Resource Management AICPA FN: Decision Making […]

54. Marsden manufactures a cat food product called Special Export. Marsden currently has 10,000 bags of Special Export on hand. The variable production costs per bag are $1.80 and total fixed costs are $10,000. The cat food can be sold […]

86. A company is considering a 5-year project. The company plans to invest $60,000 now and it forecasts cash flows for each year of $16,200. The company requires a hurdle rate of 12%. Calculate the internal rate of return to […]

Blooms: Apply AACSB: Analytic AICPA BB: Resource Management AICPA FN: Decision Making Difficulty: 3 Hard Learning Objective: 25-A1 Topic: Evaluation Using Relevant Costs 117. A company has just received a special, one-time order for 1,000 units. Producing the order will […]

Calculate the profitability index for each project. Based on the profitability index, which project should the company pursue and why? Answer: Calculation Profitability Index Project A… $800,000/$2,000,000 .4 Project B… $300,000/$500,000 .6 Since a higher profitability index suggests a more […]

Chapter 3 Adjusting Accounts and Preparing Financial Statements 1. A company’s fiscal year must correspond with the calendar year. Answer: False Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision Making Difficulty: 1 Easy Learning Objective: 03-C1 Topic: Time […]

72. The 12-month period that ends when a company’s sales activities are at their lowest level is called the: A. Fiscal year. B. Calendar year. C. Natural business year. D. Accounting period. E. Interim period. Answer: C Blooms: Remember AACSB: […]

119. A company recorded 2 days of accrued salaries of $1,400 for its employees on January 31. On February 9, it paid its employees $7,000 for these accrued salaries and for other salaries earned through February 9. The January 31 […]

Blooms: Understand AACSB: Communication AICPA BB: Industry AICPA FN: Decision Making Difficulty: 2 Medium Learning Objective: 03-C1 Learning Objective: 03-C3 Learning Objective: 03-P2 Learning Objective: 03-P3 Topic: Time Period Assumption Topic: Adjustments Topic: Adjusted Trial Balance Topic: Financial Statements 158. […]

Salaries expense 3,500 4,500 Depreciation expense—Equip. 900 Insurance expense 700 1,100 Black, Capital ______ 18,800 5,400 18,800 ______ 20,700 5,400 20,700 Present the four adjusting journal entries that were recorded by Black Company. Answer: Dec. 31 Insurance Expense …….. ……………………….. […]

205. The following information is available for Hughes Co. 2011 2010 2009 Net income 2,500 1,700 1,900 Net sales 37,000 35,000 32,000 Total assets 420,000 395,000 375,000 From the information provided, calculate Hughes’ profit margin ratio for each of the […]

Chapter 4 COMPLETING THE ACCOUNTING CYCLE True /False Questions 1. Accounts that appear in the balance sheet are often called temporary (nominal) accounts. Answer: False Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision Making Difficulty: 1 Easy Learning […]

71. Which of the following is the usual final step in the accounting cycle? A. Journalizing transactions. B. Preparing an adjusted trial balance. C. Preparing a post-closing trial balance. D. Preparing the financial statements. E. Preparing a work sheet. Answer: […]

4-41 115. Permanent accounts include all of the following except: A. Accumulated Depreciation – Equipment. B. Prepaid Rent. C. Unearned Consulting Revenue. D. Accounts Payable. E. Depreciation Expense – Equipment. 116. Which of the following statements about a company’s operating […]

144. The calendar year-end adjusted trial balance for Acosta Co. follows: ACOSTA CO. Adjusted Trial Balance December 31 Cash $ 100,000 Accounts receivable 7,000 Prepaid rent 15,000 Prepaid Insurance 9,000 Office supplies 3,300 Office equipment 8,000 Accumulated depreciation—Equipment $ 3,200 […]

Accumulated depreciation—Office equipment $ 5,000 Long-term notes payable 25,000 Brady, Capital ($30,260 + $14,640 — $1,000) 43,900 Totals $73,900 $73,900 Blooms: Apply AACSB: Analytic AICPA BB: Industry AICPA FN: Measurement Difficulty: 3 Hard Learning Objective: 04-P2 Learning Objective: 04-P3 Topic: […]

Chapter 5 ACCOUNTING FOR MERCHANDISING OPERATIONS True /False Questions 1. Merchandise inventory consists of products that a company acquires to resell to customers. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision Making Difficulty: 1 Easy Learning […]

71. The following statements regarding merchandise inventory are true except: A. Merchandise inventory is reported on the balance sheet as a current asset. B. Merchandise inventory refers to products a company owns and intends to sell. C. Merchandise inventory can […]

5-41 114. An account used in the periodic inventory system that is not used in the perpetual inventory system is A. Merchandise Inventory B. Sales C. Sales Returns and Allowances D. Accounts Payable E. Purchases 115. When preparing an unadjusted […]

Prepaid expense 900 6,750 2,450 Accounts payable 19,400 13,750 26,800 Salaries payable 1,200 3,500 6,250 Other current payables 600 1,200 2,150 The industry standard for the current ratio is 1.8 and the industry standard for the acid-test ratio is 1. […]

Answer Dec. 31 Sales 325,000 Income Summary 325,000 Dec. 31 Income Summary 270,400 Sales discounts 6,000 Sales returns and allowances 16,500 Cost of goods sold 195,000 Sales salaries expense 32,500 Depreciation expense — store equipment 11,000 Depreciation expense — office […]

Chapter 6 INVENTORIES AND COST OF SALES 1. Goods in transit are automatically included in inventory. Answer: False Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: 06-C1 Topic: Merchandise Inventory 2. Goods on […]

65. Gotham Company reported a December 31 ending inventory balance of $412,000. The following additional information is also available: · The ending inventory balance of $412,000 included $72,000 of consigned inventory for which Gotham was the consignor. · The ending […]

100. Given the following information, determine the cost of the inventory at June 30 using the LIFO perpetual inventory method. June 1 Beginning inventory, 15 units at $20 each June 15 Sale of 6 units for $50 each June 29 […]

6-61 2013. 2013 2012 Net sales $647,500 $582,000 Cost of goods sold 388,500 360,840 Ending inventory 77,700 79,380 A. 8.33 B. 5.00 C. 4.95 D. 4.54 E. 7.33 134. Use the following information for Razor Company to compute days’ sales […]

163. Using the information given below for a company that uses a perpetual inventory system, calculate the ending inventory using FIFO. Units Unit Cost Beginning inventory 100 $10 Jan. 5 purchased 40 12 Jan. 10 sold 60 – Jan. 15 […]

Blooms: Apply AACSB: Analytic AICPA BB: Industry AICPA FN: Measurement Difficulty: 3 Hard Learning Objective: 06-P4 Topic: Retail Inventory Method 177. A company uses the retail inventory method and has the following information available concerning its most recent accounting period: […]

Chapter 7 ACCOUNTING INFORMATION SYSTEMS 1. Accounting information systems collect and process data from transactions and events, organize them in useful reports, and communicate results to decision makers. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Decision […]

7-21 66. Output devices include all of the following except: A. Printers. B. Monitors. C. LCD projectors. D. Web communications. E. Bar code readers. 67. Information processors: A. Include information storage. B. Interpret, transform, and summarize information for use in […]

110. Match the following accounting system components a through e with the appropriate application(s) 1 through 10: a. Source documents b. Input devices c. Information processor d. Information storage e. Output devices ____ 1. Computer keyboard ____ 2. Computer hard […]

PR Cash Cr. Inventory Cr. Other Accounts Dr. Accounts Payable Dr. General Journal 7-61 Answer: Sales Journal Date Account Debited Invoice Number PR Accounts Receivable Dr. Sales Cr. Cost of Goods Sold Dr. Inventory Cr. 8 / 4 Coe Co. […]

140. Argon Sales uses special journals to record business transactions. Argon sells construction equipment. Argon completed the following transactions a through j. Identify the journal in which each transaction should be recorded. a. Borrowed cash from the bank. b. Purchased […]

8-1 Chapter 8 CASH AND INTERNAL CONTROLS 1. A properly designed internal control system is a key part of systems design, analysis, and performance. 2. The use of internal controls provides guaranteed protection against losses due to operating activities. Answer: […]

8-21 70. Internal control policies and procedures have limitations including: A. Human error. B. Human fraud. C. Cost-benefit principle. D. Collusion. E. All of the options are limitations. 71. Internal control systems are: A. Developed by the Securities and Exchange […]

Topic: Bank Reconciliation 114. A company made a bank deposit on September 30 that did not appear on the bank statement dated as of September 30. In preparing the September 30 bank reconciliation, the company should: A. Deduct the deposit […]

155. Marbel had $2,816 million in sales and $555 million in ending accounts receivable for the current period. For the same period, Maxtel reported $4,885 million in sales and $491 million in ending accounts receivable. Calculate the days’ sales uncollected […]

170. A company had the following transactions during January: Jan. 2 Purchased merchandise, invoice price of $20,000, with terms 2/10, n/30. 4 Received a credit memorandum for $4,000, the invoice price on merchandise returned from the purchase of January 2. […]

Chapter 9 Accounting for Receivables 1. Accounts receivable occur from credit sales to customers. Answer: True Blooms: Remember AACSB: Communication AICPA BB: Industry AICPA FN: Measurement Difficulty: 1 Easy Learning Objective: 09-C1 Topic: Accounts Receivable 2. Credit sales are recorded […]

9-21 67. A company receives a 10%, 90-day note for $1,500. The total interest due on the maturity date is: A. $ 50.00 B. $150.00. C. $ 75.00. D. $ 37.50. E. $ 87.50. 68. A company borrowed $10,000 by […]

9-41 107. Darby uses the allowance method to account for uncollectible accounts. Its year-end unadjusted trial balance shows Accounts Receivable of $104,500, allowance for doubtful accounts of $665 (credit) and sales of $925,000. If uncollectible accounts are estimated to be […]

147. At December 31 of the current year, a company reported the following: Total sales for the current year: $780,000 includes $160,000 in cash sales Accounts receivable balance at Dec. 31, end of current year: $190,000 Allowance for Doubtful Accounts […]

160. On September 30, Emerson Co. has $540,250 of accounts receivable. Emerson uses the allowance method of accounting for bad debts and has an existing credit balance in the allowance for doubtful accounts of $13,750. 1. Prepare journal entries to […]