During December 2014, Markowitz Publishing sold 4,500 12-month annual magazine
subscriptions at a rate of $20 each. The first issues were mailed in February 2015.
Prepare the entries on Markowitz’s books to record the sale of the subscriptions and the
mailing of the first issues.
Answer:
The two key parties to a note are the maker and the payee.
Answer:
The ______________ assumption divides the economic life of a business into artificial
time periods.
Answer:
On January 1, 2015, Carter Corporation issued $5,000,000, 10-year, 8% bonds at 102.
Interest is payable semiannually on January 1 and July 1. The journal entry to record
this transaction on January 1, 2015 is
Answer:
The two methods of accounting for uncollectible accounts are the ____________
method and the ______________ method.
Answer:
Petersen Company received a letter from Jane Kimler, a customer. Jane had
purchased $425 worth of clothing from Petersen on credit. She has made
two payments of $50 each. She has missed the last two payments, and has
received a collection letter from Petersen. Her total debt presently, with
interest and late fees, is $3513.
Jane sent a letter to Petersen in which she asked for her debt to be forgiven.
She said she had heard that companies make allowances for accounts they
are doubtful about collecting, and that Petersen certainly should have been
doubtful about her’”that as a college student she had changed her major
three times. She also said that she could not enjoy a high quality of life
when making such high payments, but that she didn’t want to be
embarrassed by bill collectors, either. She especially didn’t want her
parents to find out that she had not paid her debts. Having Petersen write
off her account seemed to her the best solution in the circumstances. She
added that the clothes she bought at Petersen were among the best she had
ever owned, and that she “told everybody” that Petersen was definitely the
best place to get clothes.
You are the accounting manager for Petersen. Write a short letter to Jane
explaining why her debt cannot be written off.
Answer:
The complete effect of a transaction on the accounts is disclosed in the journal.
Answer:
______________ analysis, also called trend analysis, is a technique for evaluating a
percentage increase or decrease for a financial statement item over a period of time.
Answer:
Flaherty Company had beginning inventory on May 1 of $12,000. During the month,
the company made purchases of $40,000 but returned $2,000 of goods because they
were defective. At the end of the month, the inventory on hand was valued at $15,500.
Calculate cost of goods available for sale and cost of goods sold for the month.
Answer:
FICA taxes and federal income taxes are levied on employees’ earnings without limit.
Answer: