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Identify which of the following reconciling items would require an adjusting entry to be
made by Danielle Doyle Company.
1> Deposits in transit totaled $2,000.
2> A check written to the company for $415 by Cartography Company was returned
NSF.
3> The bank charged the company $25 for printing checks.
4> Outstanding checks totaled $3,300
5> A debit memorandum reported an EFT of $178 to Salome Utilities
Answer:
In the vertical analysis of the income statement, each item is generally stated as a
percentage of net income.
Answer:
After all closing entries have been journalized and posted, the final step in the
accounting cycle is to prepare a ______________ trial balance.
Answer:
An advantage of using a subsidiary ledger is that one employee must post to both the
subsidiary ledger and the general ledger.
Answer:
The Restor-It is a company specializing in the restoration of old homes. To
showcase its work, the company purchased an old Victorian home in
downtown Pittsburg, Kansas. The original home was purchased for
$125,000. A new heating and air-conditioning system was added for
$30,000. The house was completely rewired and re-plumbed at a cost of
$50,000. Custom cabinets were added, and the floors and trim were
refurbished to their original condition, at a cost of $75,000.
The project was such a success, that Restor-It decided to purchase another
very large home, this time in nearby Joplin, Missouri. A realtor offered to
purchase the home in Pittsburg for $175,000. He plans to lease it as luxury
short-term apartments for visiting dignitaries. Restor-It decided that a
modest return was all that was required, and so they agreed to sell. Only
afterward did they learn that they had a $10,000 loss on the sale. The
president of the company, Dan Easler, does not believe that a loss is
possible. "We sold that house for more than we paid for it," he said. "I
know we put some money in it, but we had depreciated it for three years.
How in the world can we have a loss?"
Write a short memo to Mr. Easler explaining how it would be possible to
have a loss. Do not try to use specific numbers for cost or depreciation.
Answer:
Most notes are not interest bearing.
Answer:
