978-0077862381 Chapter 3 Solution Manual Part 7

subject Type Homework Help
subject Pages 9
subject Words 1032
subject Authors Jan Williams, Joseph Carcello, Mark Bettner, Susan Haka

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Revenue Expenses = Assets Liabilities =
NE NE NE I NE I
NE NE NE I I NE
NE NE NE NE NE NE
PROBLEM 3.5B
60 Minutes, Strong
DR. CRAVATI, DMD
Balance SheetIncome Statement
a.
Owners'
Equity
Transaction Net
Income
Aug. 1
Aug. 4
Aug. 9
Education.
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b.
Au
g
. 1 280,000
Ca
p
ital Stock 280,000
4 60,000
340,000
Cash 80,000
Issued 1,000 shares of capital stock.
Cash
PROBLEM 3.5B
DR. CRAVATI, DMD (continued
)
2015
General Journal
Land
Building
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c.
Aug. 1 280,000 Aug. 4 80,000 Aug. 4 320,000
Aug. 24 1,000 Aug. 9 75,000
PROBLEM 3.5B
DR. CRAVATI, DMD (continued)
Notes Payable
Cash
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d.
110,100$
11,500
4,200
75,000
25,000
60,000
340,000
320,000$
Accounts receivable
Notes payable
Office supplies
Land
Building
Medical instruments
Office fixtures and equipment
Cash
Trial Balance
PROBLEM 3.5B
DR. CRAVATI, DMD (continued)
DR. CRAVATI, DMD
August 31, 2015
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e.
Total Assets: 110,100$
11,500
4,200
75,000
320,000$
Office supplies
Notes payable
Total Liabilities:
PROBLEM 3.5B
DR. CRAVATI, DMD (concluded
)
Medical instruments
Cash
Accounts receivable
Education.
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a.
Feb. 2 750
Cash 750
6 900
Accounts Receivable 900
General Journal
PROBLEM 3.6B50 Minutes, Strong
CLOWN AROUND, INC.
2015 Accounts Payable
Paid $750 in partial settlement of outstanding
accounts payable.
Cash
Declared and distributed dividend to Ralph
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b.
Feb. 1 Bal. 2,850 Feb. 2 750 Feb. 1 Bal. 900 Feb. 6 900
Feb. 1 Bal. 1,350 Feb. 1 Bal. 830
Feb. 18 175 Feb. 28 260
Feb. 26 480
Feb. 28 Bal. 2,005 Feb. 28 Bal. 1,090
Travel Expense
Salaries Expense
Party Food Expense
Party Revenue
PROBLEM 3.6B
CLOWN AROUND, INC. (continued)
Accounts Receivable
Cash
Education.
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c.
3,080$
175
50$
2,000
750
d.
Retained earnings
Cash
Capital stock
Accounts payable
Dividends are not an expense. Thus, they are not deducted from revenue in the determination of
net income reported in the income statement. The reason dividends are not viewed as expenses
is that these payments do not serve to generate revenue. Rather, they are a distribution of profits
to the owners of the business.
February 28, 2015
Accounts receivable
(concluded)
PROBLEM 3.6B
CLOWN AROUND, INC.
Trial Balance
CLOWN AROUND, INC.
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a.
Mar. 3 1,200
Accounts Receivable 1,200
11 700
Cash 700
Recorded printing expense on account.
Collected $1,200 from Kim Mitchell on account.
Cooking Supplies
Purchased cooking supplies with cash.
Cash
PROBLEM 3.7B50 Minutes, Strong
2015
General Journal
A
HUNA, INC.
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b. Cash
Mar. 1 bal. 5,700 Mar. 11 700 Mar. 1 bal. 1,800 Mar. 3 1,200
Mar. 3 1,200 Mar. 15 200 Mar. 24 6,200
Cooking Supplies Accounts Payable
Dividends Payable Dividends
Capital Stock Retained Earnings
Mar. 31 bal. 10,000 Mar. 31 bal. 1,400
Client Revenue Salaries Expense
Mar. 1 bal. 5,800 Mar. 1 bal. 3,100
Mar. 24 6,200 Mar. 27 900
Mar. 31 bal. 12,000 Mar. 31 bal. 4,000
Travel Expense Printing Expense
Mar. 1. bal. 1,500 Mar. 1 bal. 600
Accounts Receivable
PROBLEM 3.7B
AHUNA, INC. (continued)
Education.
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c.
8,700$
6,800
1,500
400$
500
500
10,000
1,400
d.
The company has not paid the dividends it previously declared as evidenced by the $500
Retained earnings
PROBLEM 3.7B
AHUNA, INC. (concluded)
Trial Balance
Cash
AHUNA, INC.
March 31, 2015
Accounts receivable
Cooking supplies
Capital stock
Dividends payable
Dividends
Accounts payable

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