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PROBLEM 3-5B
(a), (c) & (e)
Cash No. 101
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
8
10
12
20
22
25
29
Balance
J1
J1
J1
J1
J1
J1
J1
1,200
3,400
650
1,400
4,500
500
1,750
4,880
3,480
4,680
8,080
3,580
3,080
1,330
1,980
Accounts Receivable No. 112
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
10
27
Balance
J1
J1
4,100
1,200
3,520
2,320
6,420
Supplies No. 126
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
17
30
Balance
Adjusting
J1
J1
1,200
1,900
2,000
3,200
1,300
Equipment No. 153
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
15
Balance
J1
3,000
15,000
18,000
PROBLEM 3-5B (Continued)
Accumulated Depreciation—Equipment No. 154
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
30
Balance
Adjusting
J1
100
1,500
1,600
Accounts Payable No. 201
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
15
17
20
Balance
J1
J1
J1
4,500
3,000
1,200
3,400
6,400
7,600
3,100
Unearned Service Revenue No. 209
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
29
30
Balance
Adjusting
J1
J1
1,450
650
1,400
2,050
600
Salaries and Wages Payable No. 212
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
8
30
Balance
Adjusting
J1
J1
500
300
500
0
300
Common Stock No. 311
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
Balance
10,000
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 1
Balance
8,600
PROBLEM 3-5B (Continued)
Service Revenue No. 407
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 12
27
30
Adjusting
J1
J1
J1
3,400
4,100
1,450
3,400
7,500
8,950
Depreciation Expense No. 615
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 30
Adjusting
J1
100
100
Supplies Expense No. 631
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 30
Adjusting
J1
1,900
1,900
Salaries and Wages Expense No. 726
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 8
25
30
Adjusting
J1
J1
J1
900
1,750
300
900
2,650
2,950
Rent Expense No. 729
Date
Explanation
Ref.
Debit
Credit
Balance
Sept. 22
J1
500
500
PROBLEM 3-5B (Continued)
(b) General Journal
J1
Date
Account Titles
Ref.
Debit
Credit
Sept. 8
Salaries and Wages Payable ................
Salaries and Wages Expense ...............
Cash ................................................
212
726
101
500
900
1,400
10
Cash .......................................................
Accounts Receivable .....................
101
112
1,200
1,200
12
Cash .......................................................
Service Revenue ............................
101
407
3,400
3,400
15
Equipment .............................................
Accounts Payable ..........................
153
201
3,000
3,000
17
Supplies .................................................
Accounts Payable ..........................
126
201
1,200
1,200
20
Accounts Payable ................................
Cash ................................................
201
101
4,500
4,500
22
Rent Expense ........................................
Cash ................................................
729
101
500
500
25
Salaries and Wages Expense ...............
Cash ................................................
726
101
1,750
1,750
27
Accounts Receivable ............................
Service Revenue ............................
112
407
4,100
4,100
29
Cash .......................................................
Unearned Service Revenue .............
101
209
650
650
PROBLEM 3-5B (Continued)
(d) & (f) PERCY EQUIPMENT REPAIR
Trial Balances
September 30, 2015
Before
Adjustment
After
Adjustment
Dr.
Cr.
Dr.
Cr.
Cash ...........................................
Accounts Receivable ................
Supplies .....................................
Equipment ..................................
Accumulated Depreciation—
Equipment ...............................
Accounts Payable .....................
Unearned Service Revenue ......
Salaries and Wages Payable ....
Common Stock
Retained Earnings .....................
Service Revenue ........................
Depreciation Expense ...............
Supplies Expense ......................
Salaries and Wages Expense ...
Rent Expense ............................
$ 1,980
6,420
3,200
18,000
2,650
500
$32,750
$ 1,500
3,100
2,050
-0-
10,000
8,600
7,500
$32,750
$ 1,980
6,420
1,300
18,000
100
1,900
2,950
500
$33,150
$ 1,600
3,100
600
300
10,000
8,600
8,950
$33,150
(e) 1. Sept. 30 Supplies Expense ........................ 631 1,900
Supplies ($3,200 – $1,300) ...... 126 1,900
2. 30 Salaries and Wages Expense ..... 726 300
Salaries and Wages
Payable ................................ 212 300
PROBLEM 3-5B (Continued)
(g) PERCY EQUIPMENT REPAIR
Income Statement
For the Month Ended September 30, 2015
Revenues
Service revenue ................................................. $8,950
Expenses
Salaries and wages expense ............................ $2,950
Supplies expense .............................................. 1,900
PERCY EQUIPMENT REPAIR
Retained Earnings Statement
For the Month Ended September 30, 2015
Retained Earnings, September 1 ............................................ $8,600
PROBLEM 3-5B (Continued)
PERCY EQUIPMENT REPAIR
Balance Sheet
September 30, 2015
Assets
Cash ....................................................................... $ 1,980
Accounts receivable ............................................. 6,420
Supplies ................................................................ 1,300
Equipment ............................................................. $18,000
Less: Accumulated depreciation—
Liabilities and Stockholders’ Equity
Liabilities
Accounts payable ........................................ $ 3,100
Unearned service revenue ........................... 600
Stockholders’ equity
Common stock .............................................. $10,000
BYP 3-1 FINANCIAL REPORTING PROBLEM
(a) Items that may result in adjusting entries for prepayments are:
1. Other current assets (per balance sheet).
(b) Accrual adjusting entries were probably made for accounts payable
accrued expenses, and income taxes payable.
(c) Apple’s net income increased substantially since 2009. Its net income
BYP 3-2 COMPARATIVE ANALYSIS PROBLEM
PepsiCo
Coca-Cola
(a)
Net increase (decrease) in property,
plant, and equipment (net) from 2010
to 2011.
$ 640,000,000
$ 212,000,000
(b)
Increase (decrease) in selling, general,
and administrative expenses
from 2010 to 2011.
$ 2,331,000,000
$ 4,282,000,000
(c)
Increase (decrease) in long-term debt
(obligations) from 2010 to 2011.
$ 569,000,000
$ 385,000,000
(d)
Increase (decrease) in net income
from 2010 to 2011.
$ 124,000,000
$3,225,000,000
(e)
Increase (decrease) in cash
and cash equivalents from 2010 to
2011.
($1,876,000,000
$4,286,000,000
BYP 3-3 COMPARATIVE ANALYSIS PROBLEM
1.
Amazon
Wal-Mart
(a)
Increase (decrease) in interest
expense, from 2009 to 2011.
$31,000,000
$(19,000,000)
(b)
Increase (decrease) in net income
from 2009 to 2011.
$ (271,000,000)
$ 1,504,000,000
(c)
Increase (decrease) in cash from
operations from 2010 to 2011.
($408,000,000
$ 612,000,000
2. Cash flow from operations is the difference between cash receipts
expense reduces a company’s net income, but does not affect cash
accounts payable.
