Complete all steps in accounting cycle.

(LO 1, 2) AP

Laura Eddy opened Eddy's Carpet Cleaners on March 1, 2017. In March, the following transactions were completed:

Instructions

(a)  

Journalize and post the March transactions.

(b)  

Prepare a trial balance at March 31.

(c)  Journalize and post the following adjustments:

• 1.The truck has an estimated useful life of five years.
• 2.One twelfth of the insurance expired.
• 3.An inventory count shows $400 of supplies on hand at March 31.
• 4.Accrued but unpaid employee salaries were $500.
• 5.The note payable has a 4.5% annual interest rate.
• 6.Earned but unbilled fees at March 31 were $500.

(d)  

Prepare an adjusted trial balance.

(e)  

Prepare the income statement and statement of owner's equity for March, and a classified balance sheet at March 31, 2017. Of the note payable, $2,000 must be paid by March 1, 2018.

(f)  

Journalize and post the closing entries.

(g)  

Prepare a post-closing trial balance at March 31.

Problem 8-4A Preparing a bank reconciliation and recording adjustments P3 Images Missing The following information is available to reconcile Branch Company’s book balance of cash with its bank statement cash balance as of July 31, 2017. On July 31, the company’s Cash account has a $27,497 debit balance, but its July bank statement shows a $27,233 cash balance. Check No. 3031 for $1,482 and Check No. 3040 for $558 were outstanding on the June 30 bank reconciliation. Check No. 3040 is listed with the July canceled checks, but Check No. 3031 is not. Also, Check No. 3065 for $382 and Check No. 3069 for $2,281, both written in July, are not among the canceled checks on the July 31 statement. In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that Check No. 3056 for July rent expense was correctly written and drawn for $1,270 but was erroneously entered in the accounting records as $1,250. The July bank statement shows the bank collected $8,000 cash on a noninterest-bearing note for Branch, deducted a $45 collection expense, and credited the remainder to its account. Branch had not recorded this event before receiving the statement. The bank statement shows an $805 charge for a $795 NSF check plus a $10 NSF charge. The check had been received from a customer, Evan Shaw. Branch has not yet recorded this check as NSF. The July statement shows a $25 bank service charge. It has not yet been recorded in miscellaneous expenses because no previous notification had been received. Branch’s July 31 daily cash receipts of $11,514 were placed in the bank’s night depository on that date but do not appear on the July 31 bank statement. Check (1) Reconciled balance, $34,602; (2) Cr. Notes Receivable, $8,000 Required Prepare the bank reconciliation for this company as of July 31, 2017. Prepare the journal entries necessary to bring the company’s book balance of cash into conformity with the reconciled cash balance as of July 31, 2017.

For your main Discussion post, list at least one of each transaction related to all of the following business events:

1. Purchase of goods or services for cash
2. Providing services for cash
3. Providing services on account
4. Purchase of goods or services on account
5. Payment of a previously recorded expense
6. Receipt of a previously recorded revenue earned

Be sure to explain your logic in the analysis of your business transactions and do not repeat examples from the textbook. Also, list the type of source documents that may serve as evidence for each accounting transaction. Here is an example of a purchase of goods for cash:

My Company purchased $1,000 of supplies during the current accounting period; payment was made at the time of purchase. The source I would need is a sales receipt from the company from which I purchased the supplies.

Additionally, for each business transaction presented, answer these questions:

1. Which accounts are affected for each transaction?
2. How is each account affected (debit or credit, increase or decrease), specifically?

Problem 15-5A Long-term investment transactions; unrealized and realized gains and losses LO C2, P3, P4 [The following information applies to the questions displayed below.] Stoll Co.’s long-term available-for-sale portfolio at December 31, 2016, consists of the following. Available-for-Sale Securities Cost Fair Value 65,000 shares of Company A common stock $ 1,045,600 $ 930,000 40,000 shares of Company B common stock 350,750 340,000 40,000 shares of Company C common stock 1,381,500 1,329,875 Stoll enters into the following long-term investment transactions during year 2017. Jan. 29 Sold 20,000 shares of Company B common stock for $174,375 less a brokerage fee of $3,100. Apr. 17 Purchased 22,000 shares of Company W common stock for $475,000 plus a brokerage fee of $3,700. The shares represent a 30% ownership in Company W. July 6 Purchased 14,000 shares of Company X common stock for $261,125 plus a brokerage fee of $3,700. The shares represent a 12% ownership in Company X. Aug. 22 Purchased 100,000 shares of Company Y common stock for $650,000 plus a brokerage fee of $8,500. The shares represent a 51% ownership in Company Y. Nov. 13 Purchased 18,000 shares of Company Z common stock for $525,800 plus a brokerage fee of $6,500. The shares represent a 5% ownership in Company Z. Dec. 9 Sold 65,000 shares of Company A common stock for $1,030,500 less a brokerage fee of $4,100. The fair values of its investments at December 31, 2017, are: B, $170,750; C, $1,228,625; W, $390,500; X, $244,250; Y, $1,070,500; and Z, 565,600. Problem 15-5A Part 3 3. What amount of gains or losses on transactions relating to long-term investments in available-for-sale securities should Stoll report on its December 31, 2017, income statement?

On December 1, 2015 John Trap created a new travel agency, Trap Adventures, Inc. providing exclusive adventure trips. The following transactions occurred during December 2015. (NOTE: There are no beginning balances – this is a new company.) Dec 1 John Trap invested $60,000 cash in the company for common stock. 2 Purchase office equipment for $17,500 cash. 2 The company rented furnished office space by paying $18,000 cash for the first six months (December 2015 - May 2016) rent. 3 The company purchased $1,500 of office supplies on account. 10 The company paid $3,600 cash for the premium on a 12-month insurance policy. 14 The company paid $10,750 cash for two weeks' salaries earned by employees. 24 The company collected $54,000 cash on commissions from airlines on tickets obtained for customers. 28 The company paid $12,125 cash for two weeks' salaries earned by employees. 29 The company paid $350 cash for minor repairs to the company's computer. 30 The company paid $450 cash for this month's telephone bill. 30 Dividends of $3,000 cash were paid. Final Project Requirements Using the spreadsheet found here and information above, complete the following: Adjustment Data: One month's insurance coverage has expired. The company occupied the office space for the month of December. At the end of the month, $600 of office supplies are still available. Create journal entries to record the transactions that occurred during the month of December. (Completed in Unit 3) Prepare an unadjusted trial balance (Completed in Unit 3) Create adjusting journal entries at the end of the year, December 31 based on the adjustment data. Prepare an adjusted trial balance. Prepare an income statement, statement of stockholders' equity, and classified balance sheet. Create closing journal entries to close all temporary accounts. Prepare post-closing trial balance. In addition, answer TWO of the questions below in 1-2 fully developed paragraphs. A fully developed paragraph should have a major point with 3 to 5 support sentences. One or two sentences is not acceptable or does not discuss the question. Be sure to show what you know!!! Trap Adventures, Inc. is looking for an accountant. In your own words, explain to Trap's hiring team the role of accountant and accounting within business. Provide examples of the expectations of the accountant. Discuss the financial position of Trap Adventures, Inc. using the following ratios: Current ratio Return on equity: For each ratio, provide the calculation and an explanation of the meaning. Is this a positive or negative result for the Trap Adventures, Inc.? Using Trap Adventures, Inc.'s income statement, evaluate the operations for the month of December. Complete a common-size income statement using sales as the base number. What is the largest percentage? What is the smallest percentage? What recommendations could be made to increase Trap's net income? Currently, Trap Adventures, Inc. does not own any loans or bank notes (long-term liabilities). What would happen if Trap decides to obtain a bank loan for $25,000 to fund daily operations? How would this transaction impact the financial statements - which accounts would be affected? What is the debt to equity ratio? What does the debt to equity ratio represent

On January 1, 2019, Sharon Matthews established Tri-City Realty, which completed the following transactions during the month:

Required:

The amounts of the assets and liabilities of Nordic Travel Agency at December 31, 2019, the end of the year, and its revenue and expenses for the year follow. The capital of Ian Eisele, owner, was $650,000 on January 1, 2019, the beginning of the year. During the year, Ian withdrew $36,000.

Rosewood Guitar, Inc. is preparing it cash receipts schedule for the 1^stquarter ending 20x1.  In doing so, its budget director prepared the following budgeted sales schedule:

Addition Information:

• Sales for the prior November and December 200x0 were $150,000 and $165,000, respectively.
• 55% of sales are for cash, the remaining 45% are credit sales.
  • Credit sales are collected as follows:
    • 15% in the month of sale
    • 65% in the month following the sale, and the remaining
    • 15% in the second month following the sale.
• The company estimates that the remainder of credit sales will be uncollectible.

Required

1. Prepare a cash receipts schedule for the first quarter of 20x1. (Please show your detailed schedule)
2. What is the total amount of uncollected accounts receivable for the 3-month period, January, February and March?
3. Briefly, provide the definition for the term “budgetary slack.”  Why does, budgetary slack occur?
4. What is the primary indication that “budgetary slack” is occurring?

Activity Availability, Capacity Used, Unused Capacity

Corazon Manufacturing Company has a purchasing department staffed by five purchasing agents. Each agent is paid $30,000 per year and is able to process 3,000 purchase orders. Last year, 13,350 purchase orders were processed by the five agents.

Required:

1. Calculate the activity rate per purchase order.

$ per purchase order

2. Calculate, in terms of purchase orders, the:

3. Calculate the dollar cost of:

4. Express total activity availability in terms of activity capacity used and unused capacity. Express total activity availability in terms of activity capacity used and unused capacity.
Purchase orders

Dollars cost

5. What if one of the purchasing agents agreed to work half time for $15,000?

a. How many purchase orders could be processed by four and a half purchasing agents?

purchase orders

b. What would unused capacity be in purchase orders?

purchase orders

Flounder Company, which is subject to a 40% income tax rate, projected its income before taxes for next year as shown here:

1) If Flounder wants $7,650,000 in pretax earning, what is the required level of sales, in dollars?

2) If Flounder’s net assets are $61,200,000, what amount of revenue must be achieved for Flounder to earn a 10% after-tax return on assets?

3) If Flounder wants after-tax earnings of 30% of sales, what is the required level of sales in dollars and in units?

Problem 15-3A Recording, adjusting, and reporting long-term available-for-sale securities LO P3 [The following information applies to the questions displayed below.] Grass Security, which began operations in 2017, invests in long-term available-for-sale securities. Following is a series of transactions and events determining its long-term investment activity. 2017 Jan. 20 Purchased 1,500 shares of Johnson & Johnson at $21.00 per share plus a $290 commission. Feb. 9 Purchased 1,700 shares of Sony at $46.70 per share plus a $275 commission. June 12 Purchased 2,000 shares of Mattel at $27.50 per share plus a $245 commission. Dec. 31 Per share fair values for stocks in the portfolio are Johnson & Johnson, $22.00; Mattel, $31.40; and Sony, $38.50. 2018 Apr. 15 Sold 1,500 shares of Johnson & Johnson at $24.00 per share less a $575 commission. July 5 Sold 2,000 shares of Mattel at $24.40 per share less a $285 commission. July 22 Purchased 1,100 shares of Sara Lee at $23.00 per share plus a $530 commission. Aug. 19 Purchased 1,400 shares of Eastman Kodak at $17.50 per share plus a $248 commission. Dec. 31 Per share fair values for stocks in the portfolio are: Kodak, $19.75; Sara Lee, $20.50; and Sony, $35.50. 2019 Feb. 27 Purchased 2,900 shares of Microsoft at $67.50 per share plus a $575 commission. June 21 Sold 1,700 shares of Sony at $48.50 per share less a(n) $930 commission. June 30 Purchased 1,900 shares of Black & Decker at $36.50 per share plus a $485 commission. Aug. 3 Sold 1,100 shares of Sara Lee at $16.75 per share less a $485 commission. Nov. 1 Sold 1,400 shares of Eastman Kodak at $23.25 per share less a(n) $675 commission. Dec. 31 Per share fair values for stocks in the portfolio are: Black & Decker, $39.50; and Microsoft, $69.50. Problem 15-3A Part 3 3. Complete the following table that summarizes (a) the realized gains and losses and (b) the unrealized gains or losses for the portfolio of long-term available-for-sale securities at each year-end. (Do not round your intermediate calculations. Losses should be indicated by a minus sign. )

Polaski Company manufactures and sells a single product called a Ret. Operating at capacity, the company can produce and sell 40,000 Rets per year. Costs associated with this level of production and sales are given below:

The Rets normally sell for $56 each. Fixed manufacturing overhead is $200,000 per year within the range of 30,000 through 40,000 Rets per year.

Required:

1. Assume that due to a recession, Polaski Company expects to sell only 30,000 Rets through regular channels next year. A large retail chain has offered to purchase 10,000 Rets if Polaski is willing to accept a 16% discount off the regular price. There would be no sales commissions on this order; thus, variable selling expenses would be slashed by 75%. However, Polaski Company would have to purchase a special machine to engrave the retail chain’s name on the 10,000 units. This machine would cost $20,000. Polaski Company has no assurance that the retail chain will purchase additional units in the future. What is the financial advantage (disadvantage) of accepting the special order? (Round your intermediate calculations to 2 decimal places.)

2. Refer to the original data. Assume again that Polaski Company expects to sell only 30,000 Rets through regular channels next year. The U.S. Army would like to make a one-time-only purchase of 10,000 Rets. The Army would pay a fixed fee of $1.60 per Ret, and it would reimburse Polaski Company for all costs of production (variable and fixed) associated with the units. Because the army would pick up the Rets with its own trucks, there would be no variable selling expenses associated with this order. What is the financial advantage (disadvantage) of accepting the U.S. Army's special order?

3. Assume the same situation as described in (2) above, except that the company expects to sell 40,000 Rets through regular channels next year. Thus, accepting the U.S. Army’s order would require giving up regular sales of 10,000 Rets. Given this new information, what is the financial advantage (disadvantage) of accepting the U.S. Army's special order?

Discuss the reasons for documentation in both accounting information systems, IT, and in auditing (flowcharts, DFDs etc.). Focus on DFDs (data flow diagrams), System flowcharts, and Document flowcharts. Questions to be Addressed 1. What is the purpose of documentation or documenting Accounting Information Systems? 2. Why do you need to understand documentation? 3. What documentation techniques are used to document accounting information systems? 4. What are data flow diagrams, flowcharts, and business process diagrams (we will cover business processes and business process diagrams in Week 4)? A. How are they alike and different? B. How are they prepared?