Copyright © 2014 John Wiley & Sons, Inc. Weygandt, Financial Accounting, 9/e, Solutions Manual (For Instructor Use Only) 1-41
(a) RODD CONSULTING
Assets
Liabilities
Stockholders’ Equity
Date
Cash
+
Accounts
Receivable
+
Supplies
+
Equipment
=
Notes
Payable
+
Accounts
Payable
+
Common
Stock
+
Retained Earnings
Revenues
–
Expenses
–
Dividends
May 1
May 2
May 3
May 5
May 9
May 12
May 15
May 17
May 20
May 23
May 26
May 29
May 30
+$ 8,000
8,000
–800
7,200
7,200
–90
+ 7,110
+3,000
10,110
–700
9,410
9,410
–2,100
7,310
–500
6,810
+2,500
+ 9,310
+5,000
14,310
14,310
–150
$14,160
+
+
+
+
+
+
+
+
+
+
+
+$3,500
3,500
3,500
3,500
–2,500
1,000
1,000
1,000
$ 1,000
+
+
+
+
+
+
+
+$500
500
500
+050
500
500
500
500
500
500
500
500
$500
+
+
+
+
+
+$2,600
2,600
$2,600
=
=
=
=
=
=
=
=
=
=
=
=
=
+$5,000
5,000
5,000
$5,000
+
+$ 500
500
500
500
500
500
500
–500
–0–
+
+ –0–
–0–
+2,600
2,600
$2,600
+
+
+
+
+
+
+
+
+
+
+
+$8,000
8,000
8,000
8,000
8,000
8,000
8,000
8,000
8,000
8,000
8,000
8,000
8,000
$8,000
+
+
+
+
+
+
+
+
+
+
+
+$3,000
3,000
3,000
+3,500
6,500
6,500
6,500
6,500
6,500
6,500
$6,500
–
–
–
–
–
–
–
–
–
–
–
–
–$ 800
800
800
–90
890
890
890
890
–2,100
2,990
2,990
2,990
2,990
2,990
–150
$3,140
–
–
–
–
–
–
–
–
–$700
700
700
700
700
700
700
700
$700
(a)
(b)
(c)
(d)
(e)
(f)
(g)
$18,260
$18,260
PROBLEM 1-4B
PROBLEM 1-4B (Continued)
Key to Retained Earnings Column
(d) Dividends
(b) RODD CONSULTING
Income Statement
For the Month Ended May 31, 2015
Revenues
Service revenue ($3,000 + $3,500) ……………. $6,500
Expenses
Salaries and wages expense …………………… $2,100
Rent expense …………………………………………. 800
(c) RODD CONSULTING
Balance Sheet
May 31, 2015
Assets
Cash …………………………………………………………………….. $14,160
Accounts receivable ……………………………………………… 1,000
Supplies ……………………………………………………………….. 500
Liabilities and Stockholders’ Equity
Liabilities
Accounts payable …………………………………………… 2,600
Total liabilities …………………………..…………….. $ 7,600
Stockholders’ equity
Common stock ………………………………………………. 8,000
Retained earnings ($3,360 – $700) …………………… 2,660 10,660
Total liabilities and stockholders’ equity …… $18,260
PROBLEM 1-5B
(a)
Chico
Company
Harpo
Company
Groucho
Company
Zeppo
Company
(a)
$28,000
(d)
$44,000
(g)
$129,000
(j)
$ 50,000
(b)
95,000
(e)
38,000
(h)
80,000
(k)
240,000
(c)
7,000
(f)
6,000
(i)
408,000
(l)
445,000
(b) CHICO COMPANY
Retained Earnings Statement
For the Year Ended December 31, 2015
Retained earnings, January 1 ……………………….. $ 0
15,000
Less: Dividends ………………………………………….. 10,000
(c) The sequence of preparing financial statements is income statement,
retained earnings statement, and balance sheet. The interrelationship
BYP 1-1 FINANCIAL REPORTING PROBLEM
at September 25, 2010 were $75,183 million.
(c) Apple had accounts payable totaling $14,632 million on September 24,
(d) Apple reports net sales for three consecutive years as follows:
2009 $108,249 million
(e) From 2010 to 2011, Apple’s net income increased $11,909 million from
BYP 1-2 COMPARATIVE ANALYSIS PROBLEM
(a)
(in millions)
PepsiCo
Coca-Cola
1.
Total assets
$72,882
$79,974
2.
Accounts receivable (net)
$6,912
$4,920
3.
Net sales
$66,504
$46,542
4.
Net income
$6,462
$8,634
(b) Coca-Cola’s total assets were approximately 10% greater than
PepsiCo’s total assets, but PepsiCo’s net sales were 43% greater than
Coca-Cola’s net income is 34% greater than PepsiCo’s. It appears that
BYP 1-3 COMPARATIVE ANALYSIS PROBLEM
(a)
(in millions)
Amazon
Wal-Mart
1.
Total assets
$25,278
$193,406
2.
Accounts receivable (net)
$2,571
$5,937
3.
Net sales
$42,000
$443,854
4.
Net income
$631
$15,699
(b) Wal-Mart’s total assets were approximately 765% greater than
Amazon’s total assets, and Wal–Mart’s net sales were over 10 times
greater than Amazon’s net sales. Wal–Mart’s accounts receivable were
Wal-Mart’s net income was 25 times greater than Amazon’s. It appears
BYP 1-4 REAL–WORLD FOCUS
(a) The field is normally divided into three broad areas: auditing, financial/
tax, and management accounting.
(b) The skills required in these areas:
People skills, sales skills, communication skills, analytical skills, ability
(c) The skills required in these areas differ as follows:
Auditing
Financial
and Tax
Management
Accounting
People skills
Medium
Medium
Medium
Sales skills
Medium
Medium
Low
Communication skills
Medium
Medium
High
Analytical skills
High
Very High
High
Ability to synthesize
Medium
Low
High
Creative ability
Low
Medium
Medium
Initiative
Medium
Medium
Medium
Computer skills
High
High
Very High
(d) Some key job options in accounting:
Audit: Work in audit involves checking accounting ledgers and
financial statements within corporations and government. This work is
Budget Analysis: Budget analysts are responsible for developing and
managing an organization’s financial plans. There are plentiful jobs in
negotiations involved in the work.
BYP 1-4 (Continued)
Financial: Financial accountants prepare financial statements based
and finance.
Management Accounting: Management accountants work in companies
and participate in decisions about capital budgeting and line of
business analysis. Major functions include cost analysis, analysis of
Tax: Tax accountants prepare corporate and personal income tax
statements and formulate tax strategies involving issues such as
financial choice, how to best treat a merger or acquisition, deferral of
BYP 1-5 DECISION–MAKING ACROSS THE ORGANIZATION
(a) The estimate of the $6,100 loss was based on the difference between
(b) The balance sheet at March 31 is as follows:
CHIP-SHOT DRIVING RANGE COMPANY
Balance Sheet
March 31, 2015
Assets
Cash …………………………………………………………………… $18,900
Buildings ……………………………………………………………. 8,000
Liabilities and Stockholders’ Equity
Liabilities
Accounts payable ($150 + $100) ……………………. $ 250
Stockholders’ equity
capital investments by the stockholders.
BYP 1-5 (Continued)
(c) Actual net income for March can be determined by adding dividends
to the change in stockholders’ equity during the month as shown
below:
Stockholders’ equity, March 31, per balance sheet …………. $27,450
Stockholders’ equity, March 1 ……………………………………….. 25,000
(d) Revenues earned can be determined by adding expenses incurred
during the month to net income. March expenses were Rent, $1,000;
Wages, $400; Advertising, $750; and Utilities, $100 for a total of $2,250.
Beginning cash balance …………………………………. $25,000
Less: Cash payments
Caddy shack ………………………………….. $8,000
Golf balls and clubs ………………………… 800
Rent ………………………………………………. 1,000