1) Amy Pond, a fellow employee, wants to understand the basic steps in the recording
process. Identify and briefly explain the steps in the order in which they occur.
2) Hamilson Company’s static budget at 4,000 units of production includes $16,000 for
direct labor, $4,000 for utilities (variable), and total fixed costs of $33,000. Actual
production and sales for the year was 12,000 units, with an actual cost of $94,500.
Instructions
Determine if Hamilton is over or under budget.
3) Prepare adjusting entries for the following transactions. Omit explanations.
1>Depreciation on equipment is $900 for the accounting period.
2>There was no beginning balance of supplies and purchased $500 of supplies during
the period. At the end of the period $150 of supplies were on hand.
3>Prepaid rent had a $1,000 normal balance prior to adjustment. By year end $400 was
unexpired.
4) “GAAP” refers to
General Association of Accounting Practitioners
General Accounting and Auditing Principles
c.Generally Accepted Accounting Principles
d.Guidelines for American Accounting Procedures
5) Fig Company had cash sales of $65,100 (including taxes) for the month of June.
Sales are subject to 8.5% sales tax. Prepare the entry to record the sale.
6) In recording the purchase of a business, goodwill should be recorded for the excess
of ______________ over the _______________ of the net assets acquired.
7) A classmate who is a computer science major thinks that accountants are obsolete.
She states that computers can do the entire process without any human assistance.
Discuss the steps in the recording process and indicate what role the computer plays in
that process.
8) What are the similarities and differences between the terms depreciation, depletion,
and amortization?
9) On March 9, Phillips gave Jackson Company a 60-day, 12% promissory note for
$5,200. Phillips dishonors the note on May 9 . Record the entry that Jackson would
make when the note is dishonored, assuming that no interest has been accrued.
10) The following information was available for Pete Company at December 31, 2014:
beginning inventory $90,000; ending inventory $70,000; cost of goods sold $984,000;
and sales $1,350,000. Petes days in inventory in 2014 was
a21.6 days
b.25.9 days
c.29.7 days
d.33.5 days