1) Following are selected accounts and their balances for a company after the
adjustments as of May 31, the end of its fiscal year. (All accounts have normal
balances.)
Prepare all the necessary closing entries for this company.
2) Under the ___________ system, each purchase, purchase return and allowance,
purchase discount, and transportation-in transaction is recorded in a separate temporary
account.
3) A corporation had current year net income of $2,375,000. It paid preferred dividends
of $80,000 cash and had 500,000 weighted-average shares of common stock
outstanding. Calculate the corporation’s earnings per share.
4) A company established a petty cash fund in February of the current year and
experienced the following transactions affecting the fund during February:
Prepare the journal entries to establish the find, reimburse the fund and to reduce its
amount on February 28.
5) Describe the two-stage allocation of overhead costs.
6) On May 1 of the current year, a company paid $200,000 to purchase 8%, 10-year
bonds with a par value of $200,000; interest is paid semiannually on March 1 and
September 1. The company intends to hold the bonds until they mature. Prepare the
journal entries to record
1) the bond purchase,
(2) the receipt of the first semiannual interest payment on September 1 of the current
year,
(3) the accrual of interest for year-end December 31, and
(4) the receipt of the second semiannual payment on May 1
7) A company made the following expenditures in connection with the construction of
its new building:
Prepare a schedule showing the amounts to be recorded as Land, Buildings, and
Machinery.