Question
In: Accounting
On January 1, 2017, Norma Smith and Grant Wood formed a computer sales and service company...
On January 1, 2017, Norma Smith and Grant Wood formed a computer
sales and service company in Soapsville, Arkansas, by investing
$91,088 cash. The new company, Monty Sales and Service, has the
following transactions during January.
| 1. | Pays $12,000 in advance for 3 months’ rent of office, showroom, and repair space. | |
| 2. | Purchases 44 personal computers at a cost of $1,652 each, 10 graphics computers at a cost of $2,652 each, and 29 printers at a cost of $452 each, paying cash upon delivery. | |
| 3. | Sales, repair, and office employees earn $13,688 in salaries and wages during January, of which $4,088 was still payable at the end of January. | |
| 4. | Sells 34 personal computers at $2,702 each, 8 graphics computers for $3,752 each, and 19 printers for $652 each; $76,088 is received in cash in January, and $58,184 is sold on a deferred payment basis. | |
|
5. Other operating expenses of $9,488 are incurred and paid for during January; $3,088 of incurred expenses are payable at January 31. Using the transaction data above, prepare (1) a cash-basis balance sheet and (2) an accrual-basis balance sheet as of January 31, 2017. |
Solutions
ekkarill92 answered 1 year agoRelated Solutions
On January 1, 2020, Norma Smith and Grant Wood formed a computer sales and service company...
On January 1, 2020, Norma Smith and Grant Wood formed a computer
sales and service company in Soapsville, Arkansas, by investing
$90,000 cash. The new company, Arkansas Sales and Service, has the
following transactions during January.
1.
Pays $6,000 in advance for 3 months’ rent of office, showroom,
and repair space.
2.
Purchases 40 personal computers at a cost of $1,500 each, 6
graphics computers at a cost of $2,500 each, and 25 printers at a
cost of $300 each,...
Alcorn Service Company was formed on January 1, 2018. Events Affecting the 2018 Accounting Period Acquired...
Alcorn Service Company was formed on January 1, 2018.
Events Affecting the 2018 Accounting Period
Acquired $20,000 cash from the issue of common stock.
Purchased $800 of supplies on account.
Purchased land that cost $14,000 cash.
Paid $800 cash to settle accounts payable created in Event
2.
Recognized revenue on account of $10,500.
Paid $3,800 cash for other operating expenses.
Collected $7,000 cash from accounts receivable.
Information for 2018 Adjusting Entries
Recognized accrued salaries of $3,600 on December 31, 2018....
Alcorn Service Company was formed on January 1, 2018. Events Affecting the 2018 Accounting Period Acquired...
Alcorn Service Company was formed on January 1, 2018.
Events Affecting the 2018 Accounting Period
Acquired $72,000 cash from the issue of common stock.
Purchased $3,600 of supplies on account.
Purchased land that cost $42,000 cash.
Paid $3,600 cash to settle accounts payable created in Event
2.
Recognized revenue on account of $66,000.
Paid $33,000 cash for other operating expenses.
Collected $50,000 cash from accounts receivable.
Information for 2018 Adjusting Entries
Recognized accrued salaries of $4,400 on December 31, 2018....
Colosimo Company started business on January 1, 2017. The company estimated that sales for the first...
Colosimo Company started business on January 1, 2017. The
company estimated that sales for the first six months would be as
follows:
January - 10,000 units, $60,000
February - 8,000 units, $48,000
March - 15,000 units, $90,000
April - 17,000 units, $102,000
May - 22,000 units, $132,000
June - 30,000 units, $180,000
The company sells all items on account and expects collections
of accounts receivable to be as follows: 65% in the month of the
sale, and the remaining 35%...
Dumbledore Corporation was formed on January 1, 2018. Mr. Smith owns 25% of the corporation's stock....
Dumbledore Corporation was formed on January 1, 2018. Mr. Smith
owns 25% of the corporation's stock. The corporation made an S
election immediately, and it is a calendar-year corporation. Mr.
Smith contributed $15,000 cash to Dumbledore in exchange for his
stock. On August 8, 2018, Dumbledore Corporation borrowed $22,000
from Mr. Smith, and $10,000 from First National Bank under a
recourse financing arrangement. Dumbledore had losses from its
operations of $104,000 in 2018 and $82,000 in 2019. At the end...
On October 1, 2017, Aster Turane organized a computer service company called Aster Systems.Aster is organized...
On October 1, 2017, Aster Turane organized a computer service
company called Aster
Systems.Aster is organized as a sole proprietorship and will
provide consulting services, computer
system installations, and custom program development.Aster
Systems has adopted the calendar year
for reporting, and expects to prepare the company's first set of
financial statements as of
December 31, 2017.The initial chart of accounts for the
accounting system includes these items:
Account Number
Account Name
Account Number
Account Name
101
Cash
301
Aster Turane,...
1. Rick, Mary, and Joe formed a partnership on January 1, 2017,with investments of $100,000,...
1. Rick, Mary, and Joe formed a partnership on January 1, 2017,
with investments of $100,000, $150,000, and $200,000, respectively.
For division of income, they agreed to (1) interest of 10% of the
beginning capital balance each year, (2) annual compensation of
$10,000 to Mary, and (3) sharing the remainder of the income or
loss in a ratio of 20% for Rick, and 40% each for Mary and Joe. Net
income was $150,000 in 2017 and $180,000 in 2018.Each partner...
On January 1, 2017, the dental partnership of Angela, Diaz, and Krause was formed when the...
On January 1, 2017, the dental partnership of Angela, Diaz, and
Krause was formed when the partners contributed $54,000, $82,000,
and $84,000, respectively. Over the next three years, the business
reported net income and (loss) as follows:
2017
$
94,000
2018
66,000
2019
(49,000
)
During this period, each partner withdrew cash of $17,000 per
year. Krause invested an additional $6,000 in cash on February 9,
2018.
At the time that the partnership was created, the three partners
agreed to...
On January 1, 2017, the dental partnership of Angela, Diaz, and Krause was formed when the...
On January 1, 2017, the dental partnership of Angela, Diaz, and
Krause was formed when the partners contributed $32,000, $60,000,
and $62,000, respectively. Over the next three years, the business
reported net income and (loss) as follows:
2017
$
72,000
2018
44,000
2019
(27,000
)
During this period, each partner withdrew cash of $13,000 per
year. Krause invested an additional $4,000 in cash on February 9,
2018.
At the time that the partnership was created, the three partners
agreed to...
On January 1, 2017, the dental partnership of Angela, Diaz, and Krause was formed when the...
On January 1, 2017, the dental partnership of Angela, Diaz, and
Krause was formed when the partners contributed $50,000, $79,000,
and $80,000, respectively. Over the next three years, the business
reported net income and (loss) as follows:
2017
$
90,000
2018
62,000
2019
(45,000
)
During this period, each partner withdrew cash of $13,000 per
year. Krause invested an additional $7,000 in cash on February 9,
2018.
At the time that the partnership was created, the three partners
agreed to...
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