193.
A company receives $2,500 cash from customers for services to be provided next month.
Record the cash receipt using (a) accrual-basis accounting and (b) cash-basis accounting.
194.
A company performs $2,800 of services during the month and bills customers. The
customers are expected to pay next month. Record the customer billing using (a) accrual–
basis accounting and (b) cash-basis accounting.
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195.
A company performs $4,200 of services during the month and receives full cash payment
from customers at the time of service. Record the cash receipt using (a) accrual-basis
accounting and (b) cash-basis accounting.
196.
A company pays $1,700 cash to employees for work performed during the month. Record
the payment using (a) accrual-basis accounting and (b) cash-basis accounting.
197.
A company receives a $700 utility bill for the current month but does not plan to pay the
bill until early next month. Record the receipt of the utility bill using (a) accrual-basis
accounting and (b) cash-basis accounting.
198.
A company pays $1,200 on account for supplies purchased last month. All supplies were
used last month. Record the payment using (a) accrual-basis accounting and (b) cash-
basis accounting.
199.
A company maintains its records using cash-basis accounting. During the year, the
company received cash from customers, $34,000, and paid cash for taxes, $24,000. At the
beginning of the year, customers owe the company $3,000. By the end of the year,
customers owe $5,000. At the beginning of the year, the company owes taxes of $4,000. At
the end of the year, the company owes taxes of $5,000. Determine cash-basis net income
and accrual-basis net income for the year.
200.
The following data are taken from the cash–basis accounting records of Myerson Company
for the year ended December 31, 2018:
Selected Data as of December 31, 2018
Customers billed in 2018 for services provided
$400,000
Cash collections in 2018 for accounts billed in 2017
20,000
Cash collections in 2018 for accounts billed in 2018
300,000
Cash paid for supplies purchased in 2018
12,000
Supplies remaining at the end of 2018
2,000
Cash paid for salaries in 2018
10,000
Cash paid for annual rent on March 1, 2018
18,000
Calculate the amount of revenues and expenses for 2018 under cash-basis accounting.
201.
The following data are taken from the cash–basis accounting records of Myerson Company
for the year ended December 31, 2018:
Selected Data as of December 31, 2018
Customers billed in 2018 for services provided
$400,000
Cash collections in 2018 for accounts billed in 2017
20,000
Cash collections in 2018 for accounts billed in 2018
300,000
Cash paid for supplies purchased in 2018
12,000
Supplies remaining at the end of 2018
2,000
Cash paid for salaries in 2018
10,000
Cash paid for annual rent on March 1, 2018
18,000
Calculate the amount of revenues and expenses for 2018 under accrual-basis accounting.
202.
At the beginning of the period, a company reports a balance in office supplies of $500.
During the period, the company purchases an additional $3,500 of office supplies for cash.
By the end of the period, only $700 of office supplies remains. Record the period-end
adjusting entry.
203.
Suppose a company rents office space for one year, paying $12,000 ($1,000/month) in
advance on September 1. Record the adjusting entry on December 31.
204.
A company purchases one year of flood insurance in advance on May 1, paying $24,000
($2,000/month). Record the adjusting entry on December 31.
205.
A company purchases new equipment for $24,000 cash on August 1, 2018. At the time of
purchase, the equipment is expected to be used in operations for four years (48 months)
and have no resale or scrap value at the end. The company depreciates the equipment
evenly over the 48 months ($500/month). Record the adjusting entry for depreciation on
December 31, 2018.
206.
Suppose a customer rents a vehicle for four months from Rent-A-Car on October 1, paying
$4,000 ($1,000/month). Record Rent-A-Car’s adjusting entry on December 31.
207.
A company pays its employees $5,600 every two weeks ($400/day). The current two-week
pay period ends on December 26, 2018, and employees are paid $5,600. The next two–
week pay period ends on January 9, 2019, and employees will be paid $5,600. Record the
adjusting entry on December 31, 2018.
208.
A company borrows $20,000 with 8% interest on October 1, 2018. This amount plus
interest is due on September 30, 2019. Record the adjusting entry on December 31, 2018.
209.
A company lends $30,000 with 10% interest on May 1, 2018. This amount plus interest is
due on April 30, 2019. Record the adjusting entry on December 31, 2018.
210.
Prepare adjusting journal entries, as needed, for the following items.
(a) The Supplies account shows a balance of $500, but a count of supplies reveals only
$200 on hand at year-end.
(b) The company initially records the payments of all insurance premiums as prepaid
insurance. The unadjusted trial balance at year-end shows a balance of $500 in Prepaid
Insurance. A review of insurance policies reveals that $100 of insurance is unexpired.
(c) Employees work Monday through Friday, and salaries of $2,500 per week are paid each
Friday. The company’s year-end falls on Tuesday.
(d) At year-end, the company received a utility bill for December’s electricity usage of
$200 that will be paid in early January.
211.
A company reports the following amounts: Assets = $6,000; Liabilities = $2,000;
Stockholders’ equity = $4,000; Dividends = $500; Revenues = $5,000; and Expenses =
$3,000. What amount is reported for net income?
212.
For each of the following accounts, indicate whether the account is shown in the income
statement or the balance sheet:
Accounts
Financial
Statement
1.
Rent Expense
2.
Accounts Payable
3.
Service Revenue
4.
Common Stock
5.
Accounts Receivable
6.
Retained Earnings
Accounts
Financial
1.
Rent Expense
Income Statement
2.
Accounts Payable
Balance Sheet
3.
Service Revenue
Income Statement
4.
Common Stock
Balance Sheet
5.
Accounts Receivable
Balance Sheet
6.
Retained Earnings
Balance Sheet
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213.
The adjusted trial balance for China Tea Company at December 31, 2018, is presented
below:
Debit
Credit
Cash
$11,000
Accounts Receivable
150,000
Prepaid Rent
5,000
Supplies
25,000
Equipment
300,000
Accumulated
Depreciation
$135,000
Accounts Payable
20,000
Salaries Payable
4,000
Interest Payable
1,000
Notes Payable (due in
two years)
30,000
Common Stock
200,000
Retained Earnings
50,000
Dividends
20,000
Service Revenue
400,000
Salaries Expense
180,000
Advertising Expense
70,000
Rent Expense
15,000
Depreciation Expense
30,000
Interest Expense
2,000
Utilities Expense
32,000
_______
Totals
$840,000
$840,000
Prepare an income statement for China Tea Company for the year ended December 31,
2018:
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214.
The adjusted trial balance for China Tea Company at December 31, 2018, is presented
below:
Debit
Credit
Cash
$11,000
Accounts Receivable
150,000
Prepaid Rent
5,000
Supplies
25,000
Equipment
300,000
Accumulated
Depreciation
$135,000
Accounts Payable
20,000
Salaries Payable
4,000
Interest Payable
1,000
Notes Payable (due in
two years)
30,000
Common Stock
200,000
Retained Earnings
50,000
Dividends
20,000
Service Revenue
400,000
Salaries Expense
180,000
Advertising Expense
70,000
Rent Expense
15,000
Depreciation Expense
30,000
Interest Expense
2,000
Utilities Expense
32,000
_______
Totals
$840,000
$840,000
Prepare a classified balance sheet for China Tea Company as of December 31, 2018:
215.
The December 31, 2018, post-closing trial balance for Strong Corporation is presented
below:
Debits
Credits
Cash
$18,500
Long-Term Investments
55,000
Accounts Receivable
26,500
Prepaid Insurance
4,500
Supplies
100,000
Land
45,000
Buildings
277,500
Accumulated
Depreciation
80,000
Accounts Payable
37,500
Notes Payable, due 2019
65,000
Interest Payable
10,000
Notes Payable, due 2028
120,000
Common Stock
150,000
Retained Earnings
64,500
Totals
$527,000
$527,000
Prepare a classified balance sheet for Strong Corporation at December 31, 2018.
Cash
Accounts receivable
Supplies
