In: Finance
Glee Distribution markets CDs of the performing artist Unique. At the beginning of October, Glee had in beginning inventory 4,800 of Unique’s CDs with a unit cost of $7. During October, Glee made the following purchases of Unique’s CDs.
October 3 - 6,000 @ $8
October 9- 8,500 @ $9
October 19-7,000 @ $10
October 25-9500 @ $11
|
Determine the cost of goods available for sale. |
Determine (1) the ending inventory and (2) the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average-cost).
During October, 26,000 units were sold. Glee uses a periodic inventory system.
In: Accounting
Pearl Products Limited of Shenzhen, China, manufactures and distributes toys throughout South East Asia. Three cubic centimeters (cc) of solvent H300 are required to manufacture each unit of Supermix, one of the company’s products. The company is now planning raw materials needs for the third quarter, the quarter in which peak sales of Supermix occur. To keep production and sales moving smoothly, the company has the following inventory requirements:
a. The finished goods inventory on hand at the end of each month must be equal to 3,000 units of Supermix plus 25% of the next month’s sales. The finished goods inventory on June 30 is budgeted to be 19,250 units.
b. The raw materials inventory on hand at the end of each month must be equal to one-half of the following month’s production needs for raw materials. The raw materials inventory on June 30 is budgeted to be 84,000 cc of solvent H300.
c. The company maintains no work in process inventories.
A sales budget for Supermix for the last six months of the year follows.
| Budgeted Sales in Units |
|
| July | 65,000 |
| August | 70,000 |
| September | 80,000 |
| October | 60,000 |
| November | 50,000 |
| December | 40,000 |
In: Accounting
Oct.1: Purchased additional office supplies on account from
Paper Co., $850.
Oct.2: Paid Chicago times advertising bill for September,
$900.
Oct. 3: Sold a house to Helen Baker and collected a commission of
$7,300.
Oct. 6: Paid gas bill to Haffner Gas Co., $29.
Oct. 8: Collected commission from Tropic Developers for sale of
building lot on September 17, $10,000.
Oct. 12: Paid $530 to Long Realtors Assoc. to send employees to
realtors' workshop.
Oct. 15: Paid Rosie Petrillo, office secretary, $300.
Oct. 17: Sold a house to Gary Schneider and earned a commission of
$2,900. Commission to be received on November 10.
Oct. 18: Sold a building lot to Lombardi Builders and collected a
commission of $4,500.
Oct. 22: Sent a check to Heritage Charities for $65 to help sponsor
a local road race to aid the poor.
Oct. 24: Paid Hyundai North $620 for repairs to automobile due to
accident.
Oct. 28: James Sousa withdrew $2,200 from the business to pay
personal expenses.
Oct. 30: Paid Rosie Petrillo, office secretary, $300. Oct. 30: Paid
Comcast telephone bill, $480.
Oct. 30: Advertising bill from Chicago Times for October, $1,300.
The bill is to be paid on November 2.
1. Journalize transactions in a general journal (p.4) and post
to ledger accounts.
2. Prepare a trial balance in the first two columns of a blank,
fold-out worksheet located at the end of your textbook at the end
of your textbook and complete the worksheet using the following
data: a) One month's rent had expired. Paid 5 months' rent in
advance on September 1, $1,000. b) An inventory shows $130 of
office supplies remaining. c) Depreciation on office equipment,
$160. d) Depreciation on automobile, $210.
3. Prepare an October income statement, statement of owner's
equity, and balance sheet.
4. From the worksheet, journalize and post adjusting and closing
entries (p. 6 of journal).
5. Prepare a post-closing trial balance.
Please HELP!
Cash Ledger Ending Balance for October: 38,921
Debit . Credit
Worksheet: Trial Balance 73,395 73,395
Adjustments 1,390 1.390
Adj. Trial Balance 73,765 73,765
Income statement 5,014 14,700
Net Income . 9,686
Matching Totals . 14,700 14,700
Balance Sheet 68,751 . 59,065
Net Income . 9,686
Matching Totals 68,751 68,751
Statement of Owner's Equity
James Sousa, Capital Oct. 31 44,411
Balance Sheet 65,811
Post Closing Trial Balance Totals: 66,551
In: Accounting
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In: Accounting
Question 2: Partnerships
In 2008, Dan Baxter and Philip Jones set up a partnership to trade as organic greengrocers under the name Baxter and Co. They frequently purchase organic produce from Yvonne Botica, an elderly farmer. Orders are usually made on the firm’s letterhead, which has the words ‘ D Baxter and P Jones, trading as Baxter & Co’ printed in small type at the bottom.
On 31 August 2017, Philip retires from the partnership and ceases working in the business. Philip’s name is removed from the letterhead but no other notice is given to customers or the public about Philip’s retirement. In October 2017, Dan orders and receives $10,000 worth of goods from Yvonne. However, before the bill is paid Dan becomes insolvent. Yvonne decides to sue Philip as Dan’s partner.
Answer the following questions. Refer to relevant provisions (including subsections) in the Partnerships Act 1908 to support your answers. (a) Is Philip liable to Yvonne for the debt incurred by Dan? In addition to relevant legislation, refer to a case to support your answer.
(b) What steps should Philip have taken when he retired to ensure he would not be liable for post-retirement partnership debts?
(c) Whether Philip could be liable for holding out to Yvonne.
In: Accounting
The following selected transactions relate to investment
activities of Ornamental Insulation Corporation during 2018. The
company buys debt securities, not intending to profit from
short-term differences in price and not necessarily to hold debt
securities to maturity, but to have them available for sale when
circumstances warrant. Ornamental’s fiscal year ends on December
31. No investments were held by Ornamental on December 31,
2017.
| Mar. | 31 | Acquired 6% Distribution Transformers Corporation bonds costing $580,000 at face value. | ||
| Sep. | 1 | Acquired $1,170,000 of American Instruments’ 8% bonds at face value. | ||
| Sep. | 30 | Received semiannual interest payment on the Distribution Transformers bonds. | ||
| Oct. | 2 | Sold the Distribution Transformers bonds for $623,000. | ||
| Nov. | 1 | Purchased $1,590,000 of M&D Corporation 4% bonds costing at face value. | ||
| Dec. | 31 | Recorded any necessary adjusting entry(s) relating to the investments. The market prices of the investments are: |
| American Instruments bonds | $ | 1,102,000 | |
| M&D Corporation bonds | $ | 1,670,000 | |
(Hint: Interest must be accrued.)
Required:
1. Prepare the appropriate journal entry for each
transaction or event during 2018, as well as any adjusting entries
necessary at year end. For any sales, prepare entries to update the
fair-value adjustment, record any reclassification adjustment, and
record the sale.
2. Indicate any amounts that Ornamental Insulation
would report in its 2018 income statement, 2018 statement of
comprehensive income, and 12/31/2018 balance sheet as a result of
these investments.
Prepare the appropriate journal entry for each transaction or event during 2018, as well as any adjusting entries necessary at year end. For any sales, prepare entries to update the fair-value adjustment, record any reclassification adjustment, and record the sale. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
| No | Date | General Journal | Debit | Credit |
|---|---|---|---|---|
| 1 | March 31, 2018 | Investment in Distribution Transformers bonds | 580,000 | |
| Cash | 580,000 | |||
| 2 | September 01, 2018 | Investment in American Instruments bonds | 1,170,000 | |
| Cash | 1,170,000 | |||
| 3 | September 30, 2018 | Cash | 17,400 | |
| Interest revenue | 17,400 | |||
| 4 | October 02, 2018 | Fair value adjustment | ????? | |
| Unrealized holding gain—OCI | ???? | |||
| 5 | October 02, 2018 | No Transaction Recorded | ???? | |
Indicate any amounts that Ornamental Insulation would report in its 2018 income statement, 2018 statement of comprehensive income, and 12/31/2018 balance sheet as a result of these investments. (Amounts to be deducted should be indicated with a minus sign.)
|
In: Accounting
A chemical manufacturer is setting up capacity in Europe and North America for the next three years. The annual demand for each market is 1 million Kilograms (kg) and is likely to stay at that level. The two choices under consideration are building 2 million units of capacity in North America (Option 1) or building 1 million units of capacity in each of the two locations (Option2). Building two plants will insure an additional one time cost of 1.5 million. The variable cost of production in North America (for either a large or a small plant) is currently $5/kg, where the cost in Europe is 4 euro/kg. The current exchange rate is 1 euro for the U.S. $1.20. Over each of the next three years, the dollar is expected to strengthen by 6%, with a probability of 0.6, or weaken by 4%, with a probability of 0.4. Assume a discount factor of 8%. What should the chemical manufacturer do? Provide two options’ NPVs.
In: Finance
The account balances appearing on the trial balance were taken from the general ledger of Ahmed's Copy Shop at October 31. Additional information for the month of October which has not yet been recorded in the accounts is as follows:
(a) A physical count of supplies indicates $300 on hand at October 31.
(b) The amount of insurance that expired in the month of October was $200.
(c) Depreciation on equipment for October was $400.
(d) Rent owed on the copy shop for the month of October was $600 but will not be paid until November.
|
Account title |
Trial Balance |
|
|
Debit |
Credit |
|
|
Cash |
1,000 |
|
|
Supplies |
1,100 |
|
|
Prepaid insurance |
2,200 |
|
|
Equipment |
24,000 |
|
|
Accumulated Depreciation |
4,500 |
|
|
Accounts payable |
2,400 |
|
|
Notes payable |
4,000 |
|
|
Ahmed’s capital |
15,300 |
|
|
Ahmed’s drawings |
2,400 |
|
|
Copy revenue |
4,900 |
|
|
Utilities expense |
400 |
|
|
Total |
31,100 |
31,100 |
Required:
(a) Prepare the adjusting entries required at October 31 for the transactions above.
(b) Prepare the adjusted trial balance for the month ended October 31.
The account balances appearing on the trial balance were taken from the general ledger of Ahmed's Copy Shop at October 31. Additional information for the month of October which has not yet been recorded in the accounts is as follows:
(a) A physical count of supplies indicates $300 on hand at October 31.
(b) The amount of insurance that expired in the month of October was $200.
(c) Depreciation on equipment for October was $400.
(d) Rent owed on the copy shop for the month of October was $600 but will not be paid until November.
|
Account title |
Trial Balance |
|
|
Debit |
Credit |
|
|
Cash |
1,000 |
|
|
Supplies |
1,100 |
|
|
Prepaid insurance |
2,200 |
|
|
Equipment |
24,000 |
|
|
Accumulated Depreciation |
4,500 |
|
|
Accounts payable |
2,400 |
|
|
Notes payable |
4,000 |
|
|
Ahmed’s capital |
15,300 |
|
|
Ahmed’s drawings |
2,400 |
|
|
Copy revenue |
4,900 |
|
|
Utilities expense |
400 |
|
|
Total |
31,100 |
31,100 |
Required:
(a) Prepare the adjusting entries required at October 31 for the transactions above.
(b) Prepare the adjusted trial balance for the month ended October 31.
In: Accounting
Accounting 2140 – Comprehensive Problem
On October 1, 2019, Santana Rey launched a computer services company called Business Solutions, which provides consulting services, computer system installations, and custom program development. Rey adopts the calendar year for reporting purposes and expects to prepare the company’s first set of financial statements on December 31, 2019. After the success of the company’s first two months, Santana Rey continues to operate Business Solutions. The November 30, 2019, unadjusted trial balance of Business Solutions (reflecting its transactions for October and November of 2019) follows.
No. Account Title
Debit Credit
101 Cash
$
38,764
106 Accounts receivable
12,618
126 Computer supplies
2,545
128 Prepaid insurance
131 Prepaid rent
1,980
3,220
163 Office equipment
8,700
164 Accumulated depreciation—Office equipment
$
0
167 Computer equipment
20,800
168 Accumulated depreciation—Computer equipment
0
201 Accounts payable
0
210 Wages payable
0
236 Unearned computer services revenue
0
307 Common stock
318 Retained earnings
71,000
0
319 Dividends
6,500
403 Computer services revenue
29,774
612 Depreciation expense—Office equipment
0
613 Depreciation expense—Computer equipment
0
623 Wages expense
2,300
637 Insurance expense
0
640 Rent expense
0
652 Computer supplies expense
655 Advertising expense
0
1,688
676 Mileage expense
674
677 Miscellaneous expenses
210
684 Repairs expense—Computer
775
T otals
$
100,774
$
100,774
Business Solutions had the following transactions and events in December 2019.
Dec. 2 Paid $945 cash to Hillside Mall for Business Solutions’ share of mall advertising costs.
3 Paid $410 cash for minor repairs to the company’s computer.
4 Received $4,550 cash from Alex’s Engineering Co. for the receivable from November.
10 Paid cash to Lyn Addie for six days of work at the rate of $105 per day.
14 Notified by Alex’s Engineering Co. that Business Solutions’ bid of $7,500 on a proposed project has been accepted. Alex’s paid a $1,700 cash advance to Business Solutions.
15 Purchased $1,700 of computer supplies on credit from Harris Office Products.
16 Sent a reminder to Gomez Co. to pay the fee for services recorded on November 8.
20 Completed a project for Liu Corporation and received $5,725 cash.
22-26 Took the week off for the holidays.
28 Received $3,900 cash from Gomez Co. on its receivable.
29 Reimbursed S. Rey for business automobile mileage (600 miles at $0.30 per mile).
31 The company paid $1,200 cash in dividends.
|
The following additional facts are collected for use in making adjusting entries prior to preparing financial statements for the company’s first three months. |
The December 31 inventory count of computer supplies shows $620 still available.
Three months have expired since the 12-month insurance premium was paid in advance.
As of December 31, Lyn Addie has not been paid for four days of work at $105 per day.
The computer system, acquired on October 1, is expected to have a four-year life with no
salvage value.
The office equipment, acquired on October 1, is expected to have a five-year life with no
salvage value.
Three of the four months' prepaid rent have expired.
Required:
1. Prepare journal entries to record each of the December
transactions and events for Business Solutions.
2-a. Prepare adjusting entries to reflect a through f.
2-b. Post the journal entries to record each of the December
transactions, adjusting entries to the accounts in the
ledger.
3. Prepare an adjusted trial balance as of December 31, 2019.
4. Prepare an income statement for the three months ended December
31, 2019.
5. Prepare a statement of retained earnings for the three months
ended December 31, 2019.
6. Prepare a balance sheet as of December 31, 2019.
7. Record and post the necessary closing entries as of December 31,
2019.
8. Prepare a post-closing trial balance as of December 31,
2019.
In: Accounting