Question

In: Accounting

Question #6.3: For each of the following independent cases: a) Record the transaction using the accounting...

Question #6.3: For each of the following independent cases:

a) Record the transaction using the accounting equation. Be specific about account names & $ amounts.

b) Indicate the effect of each transaction on the Statement of Cash Flow (SCF). Specify which section(s) of the SCF the transaction affects and in what direction. If there is no effect on the SCF, write “no effect”.

  1. Sold merchandize that has a cost of $28,000 for $35,000. The customer promised to pay the full amount at the end of the coming month.

Accounting Equation

Statement of Cash Flow

Solutions

Expert Solution

1. Accounting Equation :
Balance Sheet Income Statement
Total Assets = Total Liabilities and Equity Revenue - Expenses = Profit
Inventory + Accounts Receivable = Liabilities + Stockholders' Equity Sales - Cost of Goods Sold = Profit
                      -28,000 +                          35,000 =              -   +                            7,000        35,000 -                       28,000 =        7,000
                                                                     7,000 =                                                   7,000                                                  7,000 =        7,000
2. Statement of Cash Flows
The ultimate impact on cash flows will be Nil. The transaction will have some impact within the items of cash flow from operating activities, however the net impact will be Nil as shown below :
Cash flow from Operating Activities
Net Profit before Tax                            7,000
Less : Inc in AR                        -35,000
Add : Inc in Inventory                          28,000
Net Cash flow                                  -  

Related Solutions

Question #6.2: For each of the following independent cases: a) Record the transaction using the accounting...
Question #6.2: For each of the following independent cases: a) Record the transaction using the accounting equation. Be specific about account names & $ amounts. b) Indicate the effect of each transaction on the Statement of Cash Flow (SCF). Specify which section(s) of the SCF the transaction affects and in what direction. If there is no effect on the SCF, write “no effect”. Paid $13,000 to suppliers for earlier purchases made on account Accounting Equation Statement of Cash Flow
Question #6: For each of the following independent cases: a) Record the transaction using the accounting...
Question #6: For each of the following independent cases: a) Record the transaction using the accounting equation. Be specific about account names & $ amounts. b) Indicate the effect of each transaction on the Statement of Cash Flow (SCF). Specify which section(s) of the SCF the transaction affects and in what direction. If there is no effect on the SCF, write “no effect”. Recognized $41,000 of salaries & wages expenses. Paid $34,000 cash. The remainder is to be paid in...
For each transaction, (1) analyze the transaction using the accounting equation, (2) record the transaction in...
For each transaction, (1) analyze the transaction using the accounting equation, (2) record the transaction in journal entry form, and (3) post the entry using T-accounts to represent ledger accounts. Use the following (partial) chart of accounts—account numbers in parentheses: Cash (101); Accounts Receivable (106); Office Supplies (124); Trucks (153); Equipment (167); Accounts Payable (201); Unearned Landscaping Revenue (236); D. Tyler, Capital (301); D. Tyler, Withdrawals (302); Landscaping Revenue (403); Wages Expense (601), and Landscaping Expense (696). On May 15,...
For each transaction, (1) analyze the transaction using the accounting equation, (2) record the transaction in...
For each transaction, (1) analyze the transaction using the accounting equation, (2) record the transaction in journal entry form, and (3) post the entry using T-accounts to represent ledger accounts. Use the following (partial) chart of accounts—account numbers in parentheses: Cash (101); Accounts Receivable (106); Office Supplies (124); Trucks (153); Equipment (167); Accounts Payable (201); Unearned Landscaping Revenue (236); Common Stock (307); Dividends (319); Landscaping Revenue (403); Wages Expense (601), and Landscaping Expense (696). On May 15, DeShawn Tyler opens...
For each transaction, (1) analyze the transaction using the accounting equation, (2) record the transaction in...
For each transaction, (1) analyze the transaction using the accounting equation, (2) record the transaction in journal entry form, and (3) post the entry using T-accounts to represent ledger accounts. Use the following (partial) chart of accounts—account numbers in parentheses: Cash (101); Accounts Receivable (106); Office Supplies (124); Trucks (153); Equipment (167); Accounts Payable (201); Unearned Landscaping Revenue (236); D. Tyler, Capital (301); D. Tyler, Withdrawals (302); Landscaping Revenue (403); Wages Expense (601), and Landscaping Expense (696). On May 15,...
Question 8 For each of the following independent situations and from the information below record the...
Question 8 For each of the following independent situations and from the information below record the adjusting entry (and only the adjusting entry – do not record the original transaction or opening balance) in the General Journal, being as precise with your account titles as possible, e.g. not using “supplies” but “supplies expense” or “supplies on hand”. Please ignore GST. All calculations are to be worked out on a monthly (not daily) basis. Note: alternative versions of some of the...
26. Solve each of the following independent cases using the present value tables: The following actual...
26. Solve each of the following independent cases using the present value tables: The following actual contracts signed by athletes: a. $28,000,000 contract, payable at $2,000,000 per year for 14 years. b. $31,500,000 contract, payable at $1,575,000 per year for 20 years. c. $24,000,000 contract, payable at $2,400,000 per year for 10 years. Determine the present value of each contract and indicate (with explanation) which contract you would prefer to have. Assume an 8% interest rate.
Question 1 (20 Marks) Each of the following independent cases describes a situation with a proposed...
Question 1 Each of the following independent cases describes a situation with a proposed tax treatment. For each case indicate whether the treatment is correct, justify your conclusion. Case A: In 1980, Brenda Carter bought a 400-acre parcel of land for $ 300,000. She was going to build a home on the property. However, in 2017, she received an offer of $ 800,000 for 150 acres of the property. Because these 150 acres of land were waterfront and had better road...
Determine taxable income in each of the following independent cases. In all cases, the company was...
Determine taxable income in each of the following independent cases. In all cases, the company was very profitable in all years prior to 2017 and it had retained earnings of $1,000,000 at the end of 2017. In 2018, Company A has taxable income of $60,000 prior to consideration of any net operating loss. In 2017, the Company incurred a net operating loss of $10,000. They did not elect to waive the carryback period. Determine 2018 taxable income. In 2018, Company...
Record each transaction in the journal. Be sure to record the date in each entry. Explanations...
Record each transaction in the journal. Be sure to record the date in each entry. Explanations are not required. 2. Post the transactions to the​ T-accounts, using transaction dates as posting references. Label the ending balance of each account Bal. 3. Prepare the trial balance of Wortham ServicesWortham Services​, ​Inc., at OctoberOctober 31 of the current year. 4. MarkMark WorthamWortham​, the​ manager, asks you how much in total resources the business has to work​ with, how much it​ owes, and...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT