127. The following is an example of:
Segment
2014
Percent
2013
Percent
College textbooks
$78,000
25.0%
$55,000
18.9%
High school textbooks
129,000
41.3%
115,000
39.5%
Elementary school textbooks
105,000
33.7%
121,000
41.6%
Total textbook revenue
$312,000
100%
$291,000
100%
128. Briefly describe the three-step process of accounting system development.
(2)
(3)
129. Define and describe an accounting system.
130. Utilizing the Revenue Journal, below, journalize the following five transactions of Porshe Creations:
(a)
On March 20th Porshe sells 25 cell phone covers to Xtreme at $4.50 per cover on invoice 887.
(b)
On March 21st Porshe sells 5 cell phone covers to Sidekick for $7.50 per cover on invoice 908.
(c)
On March 22nd Porshe sells 18 cell phone covers to Rock-On at $4.25 per cover on invoice 938.
(d)
On March 26th Porshe sells 200 cell phone covers to Micro at $3.75 each on invoice 959.
(e)
On March 29th Porshe sells 6 cell phone covers to Charmers for $8.35 each on invoice 997.
Revenue
Journal
Pg 15
Date:
Invoice
No.
Account Debited
Post
Ref.
A/R Dr.
Sales Rev Cr.
Date:
Invoice
No.
Account Debited
Post
Ref.
A/R Dr.
Sales Rev Cr.
March 20
Xtreme
112.50
March 21
Sidekick
37.50
March 22
76.50
March 26
Micro
750.00
March 29
Charmers
50.10
131. Discuss the process of posting from a revenue journal to the subsidiary ledger and to the general ledger.
132. The debits and credits from two transactions are presented in the following customer account:
NAME: Boogie Board Water Wear
ADDRESS: 2340 Xtreme Surf
Date
Item
Post Ref
Debit
Credit
Balance
July 1
Balance
805
July 6
Invoice 406
R42
645
1,450
July 24
Invoice 456
CR56
710
740
Describe each transaction and the source of each posting.
133. The following purchase transactions occurred during August for Backcountry Kayak Company.
Aug 1
Purchased kevlar kayaks for $5,600 on account from Gear Inc.
Aug 6
Purchased kevlar kayaks for $3,250 on account from Southland Company.
Aug 14
Purchased kayak paddles for $2,500 on account from Gear Inc.
Record these transactions in a purchase journal.
Purchases
Journal
Date
Acct Cr
Post Ref
Acct Pay Cr
Kevlar
KayaksDr
Other Accts
Dr
Post Ref
Amount
Purchases
Journal
Date
Acct Cr
Post Ref
Acct Pay Cr
Kevlar
Other Accts
Post Ref
Amount
Aug 1
Gear Inc
5,600
5,600
Southland Co
3,250
3,250
Gear Inc
2,500
Paddles
2,500
134. The debits and credits from two transactions are presented in the following creditor’s account:
NAME Windsurf, Inc.
ADDRESS 343 Coastline Road
Date
Item
Post Ref
Debit
Credit
Balance
Aug 1
Balance
1,210
8
Invoice 333
CP38
1,210
0
15
Invoice 567
P11
735
735
Describe each transaction and the source of each posting.
135. Define the meaning of B2C and B2B.
136. The discovery and correction of errors is important in a computerized system. What kind of error(s) might
occur in these systems? What type of error(s) will be prevented in a computerized system?
137. Describe and discuss e-commerce.
138. The Internet creates opportunities for improving the speed and efficiency of transactions. Name and
describe three key areas besides e-commerce where the Internet is being used for business purposes.
139. Morgan Company has the following segment revenues for fiscal 2014 and 2013.
2014
(in millions)
2013
(in millions)
U.S.
$825.0
$600.00
Canada
325.5
345.5
Other countries
215.5
168.5
Total Revenues
1,366.0
1,114.0
Prepare a horizontal analysis of the segment data using 2013 as the base year.
U.S.
$825.0
$600.00
$225.0
37.5%
Canada
325.5
345.5
(20.0)
(5.8)
Other countries
215.5
168.5
47.0
27.9
Total Revenues
$1,366.0
$1,114.0
252.0
22.6
140. Morgan Company has the following segment revenues for fiscal 2011 and 2010.
2011
(in millions)
2010
(in millions)
U.S.
$775.0
$650.00
Canada
325.5
245.5
Other countries
215.5
168.5
Total Revenues
1,316.0
1,064.0
Prepare a vertical analysis of the segment data.
141. Johnson Corporation provided revenue disclosures for 2009 by its major product segments in the notes to
its financial statements as follows:
Major Product Segments
Fiscal Year 2009 (in millions)
Petroleum-based products
$10,450
Industrial chemicals
9,460
Refined chemical products
8,575
Food additives
7,325
Emulsifiers
6,900
Pesticides
5,870
Salts
4,545
Wetting agents
3,215
Total Revenues
$56,340
Prepare a vertical analysis.
Petroleum-based products
$10,450
18.5
Industrial chemicals
9,460
16.8
Refined chemical products
8,575
15.2
Food additives
7,325
13.0
Emulsifiers
6,900
12.2
Pesticides
5,870
10.4
Salts
4,545
8.1
Wetting agents
3,215
5.7
U.S.
$ 775.0
58.9%
$ 650.00
61.1%
Canada
325.5
24.7
245.5
23.1
Other countries
215.5
16.4
168.5
15.8
Total Revenues
$1,316.0
100.0%
$1,064.0
100.0%
142. Explain whether each of the following would usually be used in a computerized accounting system and
why.
143. For each of the following businesses, explain how a purchase journal might be modified for the specific
business.
144. For each of the following business, explain how a revenue journal might be modified for the specific
business.
145. Explain what subsidiary ledgers are and give examples of three types of subsidiary ledgers that a business
might use.
146. Mobile Service Corp. has the following debits and credits from two transactions presented in the a
customer account:
NAME: Gen-X Products, Inc.
Address: 123 My Way
Date
Item
Post. Ref.
Debit
Credit
Balance
Mar.1
Balance
Ö
1,150
Mar. 10
Invoice 987
R45
990
2,140
Mar. 19
Invoice 995
CR78
825
1,315
Describe each transaction and the source of each posting.
147. Vision Service Company has the following debits and credits from two transactions presented in a
customer account:
NAME: Roswell Communications, Inc.
Address: 345 Alien Way
Date
Item
Post. Ref.
Debit
Credit
Balance
May 1
Balance
Ö
750
May 14
Invoice 522
CR 230
625
125
May 25
Invoice 545
R115
3,500
3,625
Describe each transaction and the source of each posting.
148. The debits and credits from two transactions are presented in the following supplier’s (creditor’s) account:
NAME: Xample, Inc.
Address: 567 Harrison Blvd.
Date
Item
Post. Ref.
Debit
Credit
Balance
Nov 1
Balance
Ö
125
Nov 9
Invoice 564
CP 45
55
70
Nov 18
Invoice 574
P28
75
145
Describe each transaction and the source of each posting.
149. The debits and credits from two transactions are presented in the following supplier’s (creditor’s) account:
NAME: Banner Computer Services, Inc.
Address: 890 Novice Lane
Date
Item
Post. Ref.
Debit
Credit
Balance
July 1
Balance
Ö
5,645
July 19
Invoice 45
P16
1,755
7,400
July 26
Invoice 39
CP36
3,500
3,900
Describe each transaction and the source of each posting.
Paid $3,500 to Banner Computer Services Inc. on account (Invoice 39). Amount posted from page 36 of the cash
150. The following cash receipts journal heading have been suggested for Tower Tree-Trimming Service
Company. What problems do you see with these headings?
Date
Account Credited
Post.
Ref.
Fees Earned
Cr.
Accounts Receivable Cr.
Cash
Cr.
Other Accounts Dr.
Nov. 9
Paid $55 to Xample Inc. on account (Invoice 564). Amount posted from page 45 of the cash payments journal.
Purchased $75 on account from Xample Inc., itemized on Invoice 574. Amount posted from page 28 of the
151. Davidson, Inc. incurred the following transactions during the month of January. Record the appropriate
ones in the Cash receipts journal. If a transaction should not be recorded in the Cash receipts journal, indicate
where it should be posted.
(a)
On January 3rd a one-year insurance policy was purchased for $2,400. The account number for Prepaid Insurance is 16.
(b)
On January 5th Davidson received a payment on account from Pasher Industries of $625.
(c)
On January 12th Davidson made sales on account of $3,500 and sales for cash of $2,300. The Fees Earned account
number is 41.
(d)
On January 26th Davidson received $1,250 in rent revenue from a tenant who leases a portion of their building. The Rent
Revenue account number is 44.
(e)
On January 29th Davidson received a payment on account from Gooden, Inc. for $2,000.
Date
Account Credited
Post.
Ref.
Other Account
Cr.
Accounts
Receivable Cr.
Cash
Dr.
Other Account
Accounts
Jan.5
Jan. 12
Fees Earned
2,300
2,300
Jan. 26
Rent Revenue
1,250
1,250
Jan. 29
Gooden, Inc.
2,000
2,000
152. Anderson, Inc. incurred the following transactions during the month of February, 2010. Record the
appropriate ones in the Cash payments journal. If a transaction should not be recorded in the Cash payments
journal, indicate where it should be posted.
(a)
On February 3rd the company purchased $650 worth of supplies on account. The Supplies account number is 15.
(b)
On February 5th Anderson made a payment on account to Sanders Industries in the amount of $1,125 – check number
2004.
(c)
On February 14th Anderson bought a one-year insurance policy for $1,500. The Prepaid Insurance account number is 14
– check number 2005
(d)
On February 22nd Anderson paid monthly rent of $2,000. The Rent Expense account number is 63 – check number
2006.
(e)
On February 26th Anderson purchased equipment making a down payment of $3,000 (check number 2007) and agreeing
to pay the $4,000 balance in 30 days. The Equipment account number is 18.
Date
Check Number
Account Debited
Post.
Ref.
Other Account
Dr.
Accounts Payable
Dr.
Cash
Cr.
2/5/10
2004
Sanders Industries
1,125
1,125
2/14/10
2005
Prepaid Insurance
1,500
1,500
2/22/10
2006
Rent Expense
2,000
2,000
2/26/10
2007
Equipment
3,000
3,000
153. The following purchases journal headings have been suggested for Tower Tree-Trimming Service
Company. What problems do you see with these headings?
154. List the 4 most common special journals used in accounting and describe the transaction recorded in each
journal.
155. Westsouth Publishing reports the following segment data regarding its textbook sales:
Segment
2014
2013
College textbooks
$78,000
$55,000
High school textbooks
129,000
115,000
Elementary school textbooks
105,000
121,000
Total textbook revenue
$312,000
$291,000
Perform a horizontal analysis and a vertical analysis for Westsouth Publishing Company. Round to one decimal place.
156. Identify the three main advantages of a computerized accounting system over a manual accounting
system.
157. What is a business segment? How can business segments be analyzed?
Segment
2014
2013
Amount
Percent
College textbooks
$78,000
$55,000
$23,000
41.8%
High school textbooks
129,000
115,000
14,000
12.2%
Elementary school textbooks
105,000
121,000
(16,000)
(13.2%)
Total textbook revenue
$312,000
$291,000
$21,000
7.2%
Segment
2014
Percent
2013
Percent
College textbooks
$78,000
25.0%
$55,000
18.9%
High school textbooks
129,000
41.3%
115,000
39.5%
Elementary school textbooks
105,000
33.7%
121,000
41.6%
Total textbook revenue
$312,000
100%
$291,000
100%