Revenue and cash receipts journals; accounts receivable subsidiary and general ledgers

Transactions related to revenue and cash receipts completed by Crowne Business Services Co. during the period April 2–30 are as follows:

Required:

1. Insert the following balances in the general ledger as of April 1:

After completing the recording of the transactions in the journals in part 3, total each of the columns of the special journals, and post the individual entries and totals to the general ledger. Insert account balances after the last posting. When posting to the general ledger, post in chronological order. However, if there is more than one entry on the same date, be sure to post transactions from the revenue journal before posting transactions from the cash receipts journal.

If an amount box does not require an entry, leave it blank. In CNOW, Journal pages begin with “J”, Cash Receipts begin with “CR” and Revenue Journal begins with “R”. For example journal/ Cash Receipts/ Revenue Journal, page 1/36/40 respectively. POST. REF. is simply J1, CR36, and R40.

2. Insert the following balances in the accounts receivable subsidiary ledger as of April 1:

After completing the recording of the transactions in the journals in part 3, post to the accounts receivable subsidiary ledger, in chronological order and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customer's account before recording a cash receipt.

If an amount box does not require an entry, leave it blank. In CNOW, Journal pages begin with “J”, Cash Receipts begin with “CR” and Revenue Journal begins with “R”. For example journal/ Cash Receipts/ Revenue Journal, page 1/36/40 respectively. POST. REF. is simply J1, CR36, and R40.

3. Prepare a single-column revenue journal (p. 40) and a cash receipts journal (p. 36). Use the following column headings for the cash receipts journal: Fees Earned Cr., Accounts Receivable Cr., and Cash Dr. The Fees Earned column is used to record cash fees.

4. Using the two special journals and the two-column general journal (p. 1), journalize the transactions for April. Post to the accounts receivable subsidiary ledger, and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customer’s account before recording a cash receipt.

5. Total each of the columns of the special journals and post the individual entries and totals to the general ledger. Insert account balances after the last posting.

If an amount box does not require an entry, leave it blank.

Does the sum of the customer balances agree with the accounts receivable controlling account in the general ledger?
   

7. Would an automated system omit postings to a controlling account as performed in part (5) for Accounts Receivable?

Revenue and cash receipts journals; accounts receivable subsidiary and general ledgers

Transactions related to revenue and cash receipts completed by Crowne Business Services Co. during the period April 2–30 are as follows:

Required:

1. Insert the following balances in the general ledger as of April 1:

After completing the recording of the transactions in the journals in part 3, total each of the columns of the special journals, and post the individual entries and totals to the general ledger. Insert account balances after the last posting. When posting to the general ledger, post in chronological order. However, if there is more than one entry on the same date, be sure to post transactions from the revenue journal before posting transactions from the cash receipts journal.

If an amount box does not require an entry, leave it blank. In CNOW, Journal pages begin with “J”, Cash Receipts begin with “CR” and Cash Receipts begins with “R”. For example journal/ Cash Receipts/ Cash Receipts, page 1/36/40 respectively. POST. REF. is simply J1, CR36, and R40.

2. Insert the following balances in the accounts receivable subsidiary ledger as of April 1:

After completing the recording of the transactions in the journals in part 3, post to the accounts receivable subsidiary ledger in chronological order, and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customer's account before recording a cash receipt. If an amount box does not require an entry, leave it blank. In CNOW, Journal pages begin with “J”, Cash Receipts begin with “CR” and Cash Receipts begins with “R”. For example journal/ Cash Receipts/ Cash Receipts, page 1/36/40 respectively. POST. REF. is simply J1, CR36, and R40.

3. Prepare a single-column revenue journal (p. 40) and a cash receipts journal (p. 36). Use the following column headings for the cash receipts journal: Fees Earned Cr., Accounts Receivable Cr., and Cash Dr. The Fees Earned column is used to record cash fees.

4. Using the two special journals and the two-column general journal (p. 1), journalize the transactions for April. Post to the accounts receivable subsidiary ledger, and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customer’s account before recording a cash receipt.

5. Total each of the columns of the special journals and post the individual entries and totals to the general ledger. Insert account balances after the last posting.

If an amount box does not require an entry, leave it blank.

6. What is the sum of the customer balances?
$

Does the sum of the customer balances agree with the accounts receivable controlling account in the general ledger?
   

7. Would an automated system omit postings to a controlling account as performed in step 5 for Accounts Receivable?

Exercise 13-11 - TOPIC - Non-Financial and Current Liabilities

Martinez Limited began operations on January 2, 2019. The company employs 6 individuals who work 8-hour days and are paid hourly. Each employee earns 12 paid vacation days and 7 paid sick days annually. Vacation days may be taken after January 15 of the year following the year in which they are earned. Sick days may be taken as soon as they are earned; unused sick days accumulate. Additional information is as follows:

Martinez Limited has chosen to accrue the cost of compensated absences at rates of pay in effect during the period when they are earned and to accrue sick pay when it is earned. For the purpose of this question, ignore any tax, CPP, and EI deductions when making payments to the employees.

A.) Prepare the journal entries to record the transactions related to vacation entitlement during 2019 and 2020.

B.) Prepare the journal entries to record the transactions related to sick days during 2019 and 2020.

C.) Calculate the amounts of any liability for vacation pay and sick days that should be reported on the SFP at December 31, 2019, and 2020.

D.)Prepare the journal entries to record the transactions related to sick days during 2019 and 2020 assuming the entitlement to sick days did not accumulate.

E.) Calculate the amounts of any liability for vacation pay and sick days that should be reported on the statement of financial position at December 31, 2019, and 2020 assuming the entitlement to sick days did not accumulate.

Tara’s Treasures Inc. is a publicly traded company that develops, manufactures, and distributes professional quality exercise equipment. The firm was established in 1965 in Burlington, Vermont and went public in 1975. Sales were initially from only the Northeast region of the United States, but since going public the company has grown significantly and now supplies exercise equipment in all fifty states. In 2015 the company reported a market capitalization of $950 million. Recently, the company has decided to enter the INTERNATIONAL Market in order to enhance their growth potential. Tara’s Treasures, Inc.’s CFO, has been with Tara’s Treasures, Inc. for 20 years and has held the position of CFO for the past 5 years. Your Role: Assume that you are the Financial Accounting Controller for Tara’s Treasures, Inc. You report directly to the CFO. Recently, the CFO came to you with an article that he found on CFO.com that deals with adoption of International Financial Reporting Standards (IFRS). The CFO wants to know more about the implications of IFRS adoption. Specifically, he has asked you do some research and find answers to the following questions: 1. What are the primary benefits of IFRS adoption for US firms in general? Describe at least three benefits. 2. What are the primary costs of IFRS adoption for US firms in general? Describe at least three costs. 3. The CFO does not understand how IFRS differs from current US GAAP. Briefly describe the differences between GAAP and IFRS and in support of your analysis include two areas of Tara’s Treasures financial statements that could be reported differently under IFRS. 4. Based on your research, do you think that Tara’s Treasures should be in favor of or opposed to IFRS adoption and is there any plans they should be making to prepare for the consequences.

Suppose that an insurance company sells a policy whose losses are distributed exponentially with mean $1500. Further suppose that the company sells a large number of claims. An actuary wishes to analyze the performance of the product and takes a random sample of 100 policies for which there was a claim filed from this population.

a. What are the mean and variance of an individual insurance policy?

b. What are the mean and variance of the total claim amount T of these 100 selected policies?

c. What are the mean and variance of the average claim amount ?̅ = ?/100 of these 100 policies?

d. Calculate the approximate probability that the total claim amount T from the sample is between $160,000 and $170,000?

e. Calculate the approximate probability that the average claim ?̅ from the sample exceeds $1700.

f. What average claim amount will 18.67% of sample means exceed based on the information above?

Tom earned $50,000 as self employed carpenter. He is single, lives alone, and has been purchasing his health insurance through the marketplace as required under the affordable care act. Tom comes in to have his 2018 taxes prepared in January of 2019, and tells you that he heard that the individual mandate has been repealed, and that he cancelled his health insurance coverage in March of 2018, as he is healthy and no longer wished to pay the premium . based on your knowledge of TCJA, what is the month that Tom would no longer pay a penalty for not having health insurance coverage? January 2018 the legislation is retroactive to January 2017 January 2019 January 2020

Use the following information from separate companies a through d:

  
1a. Compute times interest earned.

Options for the row under numerator and denominator: accounts receivable, cost of goods sold, currents assets, current liabilities, income before interest and taxes, interest expense, net income, net sales.

1b. Which company indicates the strongest ability to pay interest expense as it comes due?

Company A, b, c, or d?

Cascade Company was started on January 1, Year 1, when it acquired $160,000 cash from the owners. During Year 1, the company earned cash revenues of $90,400 and incurred cash expenses of $62,500. The company also paid cash distributions of $7,000. Required Prepare a Year 1 income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows under each of the following assumptions. (Consider each assumption separately.)

c. Cascade is a corporation. It issued 11,000 shares of $9 par common stock for $160,000 cash to start the business.

Complete this question by entering your answers in the tabs below.

• Inc Stmt
• Stmt of Changes
• Bal Sheet
• Cash Flows