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Greyhound Stables, Inc. operates several dog racing tracks throughout the
United States. Since most facilities are outdoor tracks only, most of the
cash receipts for Greyhound are received from April through October.
These funds are usually invested in short-term, very liquid investments,
such as stocks and bonds. Among the stocks purchased last year, was
Servitronics, a company specializing in automatic vending equipment.
The company decided not to sell its Servitronics stock at the end of last
year, and has purchased more of the stock this year. The company intends
to continue to purchase stock until it holds enough to make a takeover bid
for the company. The accountants have been instructed to continue to
classify the investment as short-term until the takeover is accomplished, so
that less attention will be directed to it. (Presently, Greyhound has no
long-term investment in stock at all.)
1> Is it ethical for Greyhound to attempt to take over another company?
Explain.
2> Is it ethical for Greyhound to leave its investment in the short-term
investment category? Explain.
Answer:
A voucher is recorded in the ________________ and filed according to the date on
which it is to be paid.
Answer:
The declining-balance method of computing depreciation is known as an
_____________ depreciation method.
Answer:
Indicate in the blank spaces below, the section of the balance sheet where the following
items are reported. Use the following code to identify your
Answer:
On December 31, 2015, Fashion Nugget Company prepared an income statement and
balance sheet and failed to take into account three adjusting entries. The incorrect
income statement showed net income of $35,000. The balance sheet showed total
assets, $115,000; total liabilities, $45,000; and stockholders' equity, $70,000.
The data for the three adjusting entries were:
(1) Depreciation of $10,000 was not recorded on equipment.
(2) Wages amounting to $7,000 for the last two days in December were not paid and not
recorded. The next payroll will be in January.
(3) Rent of $12,000 was paid for two months in advance on December 1. The entire
amount was debited to Rent Expense when paid.
Instructions
Complete the following tabulation to correct the financial statement amounts shown
(indicate deductions with parentheses):
Answer:
On April 1, Sign Company buys 4,000 shares of Polk common stock for $61,500. On
October 1, Sign sells 1,000 shares of Polk stock for $20,500..
Instructions
Prepare journal entries for the purchase and sale of the Polk common stock.
Answer:
Match the codes assigned to the following payroll functions to the procedures listed
below:
1> ____ Distribution of checks by the treasurer.
2> ____ Supervisor approves hours worked.
3> ____ Posting job openings.
4> ____ Maintenance of payroll records.
5> ____ Verification of payroll calculations.
6> ____ Screening and interviewing of job applicants.
7> ____ Employment authorization.
8> ____ Signing prenumbered payroll checks.
9> ____ Use of a timeclock.
10> ____ Payroll tax return preparation.
11> ____ Employee signs receipt acknowledging cash received.
12> ____ Documentation of employee hiring.
Answer:
T'Pol Furniture factors $900,000 of receivables to Trip Factors, Inc. Trip Factors
assesses a 2% service charge on the amount of receivables sold. T'Pol Furniture factors
its receivables regularly with Trip Factors. What journal entry does T'Pol make when
factoring these receivables?
Answer:
Accrued revenues are revenues that have been recognized and received before financial
statements have been prepared.
Answer:
Answer:
