Exercise 2-21 (15 minutes)
a. The debit column is correctly stated because the erroneous debit (to
Accounts Payable) is deducted from an account with a (larger assumed)
Exercise 2-22 (10 minutes)
HEINEKEN N.V.
Balance Sheet (in Euro millions)
December 31, 2013
Assets Equity and liabilities
Noncurrent assets …….. € 27,842 Total equity …………………….. € 12,356
Exercise 2-23 (15 minutes)
a.
Co.
Liabilities
/
Assets
=
Debt
Ratio
Net
Income
/
Average
Assets
=
ROA
1
$11,765
$ 90,500
0.13
$20,000
$100,000
0.200
2
46,720
64,000
0.73
3,800
40,000
0.095
3
26,650
32,500
0.82
650
50,000
0.013
4
55,860
147,000
0.38
21,000
200,000
0.105
5
31,280
92,000
0.34
7,520
40,000
0.188
6
52,250
104,500
0.50
12,000
80,000
0.150
PROBLEM SET A
Problem 2-1A (90 minutes)
Part 1
April 1 Cash …………………………………………………….. 101 80,000
Office Equipment …………………………………. 163 26,000
Common Stock ……………………………… 307 106,000
Owner invested cash and equipment for stock.
9 Accounts Receivable ……………………………. 106 6,000
Services Revenue …………………………. 403 6,000
Billed client for completed work.
13 Accounts Payable ………………………………… 201 11,600
Cash ……………………………………………… 101 11,600
28 Dividends …………………………………………….. 319 5,500
Cash ……………………………………………… 101 5,500
Paid cash dividends.
29 Office Supplies …………………………………….. 124 600
Accounts Payable …………………………. 201 600
Problem 2-1A (Continued)
Part 2
Cash
Acct. No. 101
Date
Explanation
PR
Debit
Credit
Balance
April
1
G1
80,000
80,000
2
G1
9,000
71,000
6
G1
4,000
75,000
13
G1
11,600
63,400
19
G1
2,400
61,000
22
G1
4,400
65,400
28
G1
5,500
59,900
30
G1
435
59,465
Accounts Receivable
Acct. No. 106
Date
Explanation
PR
Debit
Credit
Balance
April
9
G1
6,000
6,000
22
G1
4,400
1,600
25
G1
2,890
4,490
Office Supplies
Acct. No. 124
Date
Explanation
PR
Debit
Credit
Balance
April
3
G1
3,600
3,600
29
G1
600
4,200
Prepaid Insurance
Acct. No. 128
Date
Explanation
PR
Debit
Credit
Balance
April
19
G1
2,400
2,400
Prepaid Rent
Acct. No. 131
Date
Explanation
PR
Debit
Credit
Balance
April
2
G1
9,000
9,000
Office Equipment
Acct. No. 163
Date
Explanation
PR
Debit
Credit
Balance
April
1
G1
26,000
26,000
3
G1
8,000
34,000
Problem 2-1A (Continued)
Accounts Payable
Acct. No. 201
Date
Explanation
PR
Debit
Credit
Balance
April
3
G1
11,600
11,600
13
G1
11,600
0
29
G1
600
600
Common Stock
Acct. No. 307
Date
Explanation
PR
Debit
Credit
Balance
April
1
G1
106,000
106,000
Dividends
Acct. No. 319
Date
Explanation
PR
Debit
Credit
Balance
April
28
G1
5,500
5,500
Services Revenue
Acct. No. 403
Date
Explanation
PR
Debit
Credit
Balance
April
6
G1
4,000
4,000
9
G1
6,000
10,000
25
G1
2,890
12,890
Utilities Expense
Acct. No. 690
Date
Explanation
PR
Debit
Credit
Balance
April
30
G1
435
435
Problem 2-1A (Continued)
Part 3
LINKWORKS
Trial Balance
April 30
Debit Credit
Cash …………………………………………………………….. $ 59,465
Problem 2-2A (90 minutes)
Part 1
a. Cash …………………………………………………….. 101 100,000
Office Equipment …………………………………. 163 5,000
Drafting Equipment………………………………. 164 60,000
Common Stock ……………………………… 307 165,000
Problem 2-2A (Part 1 Continued)
i. Accounts Receivable ……………………………. 106 22,000
Engineering Fees Earned ……………… 402 22,000
Billed client for completed work.
j. Equipment Rental Expense ………………….. 602 1,333
Problem 2-2A (Continued)
Part 2
Cash No. 101
Accounts Payable No. 201
Date
PR
Debit
Credit
Balance
Date
PR
Debit
Credit
Balance
(a)
100,000
100,000
(h)
1,150
1,150
(b)
6,300
93,700
(j)
1,333
2,483
(c)
55,000
38,700
(m)
1,150
1,333
(d)
3,000
35,700
(e)
6,200
41,900
Notes Payable No. 250
(f)
9,500
32,400
Date
PR
Debit
Credit
Balance
(k)
7,000
39,400
(b)
42,700
42,700
(l)
1,200
38,200
(f)
10,500
53,200
(m)
1,150
37,050
(n)
925
36,125
(o)
9,480
26,645
Common Stock No. 307
(p)
1,200
25,445
Date
PR
Debit
Credit
Balance
(q)
2,500
22,945
(a)
165,000
165,000
Accounts Receivable No. 106
Dividends No. 319
Date
PR
Debit
Credit
Balance
Date
PR
Debit
Credit
Balance
(g)
14,000
14,000
(o)
9,480
9,480
(i)
22,000
36,000
(k)
7,000
29,000
Engineering Fees Earned No. 402
Date
PR
Debit
Credit
Balance
Prepaid Insurance No. 108
(e)
6,200
6,200
Date
PR
Debit
Credit
Balance
(g)
14,000
20,200
(d)
3,000
3,000
(i)
22,000
42,200
Office Equipment No. 163
Wages Expense No. 601
Date
PR
Debit
Credit
Balance
Date
PR
Debit
Credit
Balance
(a)
5,000
5,000
(l)
1,200
1,200
(h)
1,150
6,150
(p)
1,200
2,400
Drafting Equipment No. 164
Equipment Rental Expense No. 602
Date
PR
Debit
Credit
Balance
Date
PR
Debit
Credit
Balance
(a)
60,000
60,000
(j)
1,333
1,333
(f)
20,000
80,000
Building No. 170
Advertising Expense No. 603
Date
PR
Debit
Credit
Balance
Date
PR
Debit
Credit
Balance
(c)
55,000
55,000
(q)
2,500
2,500
Land No. 172
Repairs Expense No. 604
Date
PR
Debit
Credit
Balance
Date
PR
Debit
Credit
Balance
(b)
49,000
49,000
(n)
925
925
Problem 2-2A (Concluded)
Part 3
ARACEL ENGINEERING
Trial Balance
June 30
Debit Credit
Cash ……………………………………………………. $ 22,945