enter formulas in all cells that contain question marks.

For example, in cell B30 enter the formula "=B19".

Notes:

In the text, variances are always displayed as positive numbers. To accomplish this, you can use the ABS() function in Excel. For example, the formula in cell C31 would be "=ABS(E31−B31)".

Cells D31 through D39 and G31 through G39 already contain formulas to compute and display whether variances are Favorable or Unfavorable. Do not enter data or formulas into those cells—if you do, you will overwrite these formulas.

Check your worksheet by changing the revenue in cell D4 to $16.00; the cost of ingredients in cell D5 to $6.50; and the wages and salaries in cell B6 to $10,000. The activity variance for net operating income should now be $850 U and the spending variance for total expenses should be $410 U. If you do not get these answers, find the errors in your worksheet and correct them.

PLEASE SHOW FORMULAS ^^^^

Revise the data in your worksheet to reflect the results for the subsequent period as shown below:

Planning Budget 1,700 meals served

Actual Activity 1,800 meals served

a. What is the activity variance for revenue?

b. What is the spending variance for the cost of ingredients?

c. What is spending variance for wages and salaries?

d. What is spending variance for total expenses?

ABC Company had the following transactions during 2019:

May 1: Received $6000 cash in advance for services to be provided over the coming 10 months.

August 5: Sold Merchandise for $7560 including 8% sales tax.

September 1: Borrowed $20000 from FNB bank by issuing 6 months, 6% interest bearing note.

October 10: Sold merchandise on account for $6000 plus 10% sales tax.

December 31: Prepare the adjusting entry to record the service revenue earned.

December 31: Prepare the adjusting entry to record the accrued interest to FNB bank.

December 31: Remitted the sales taxes to the government.

Answer the below questions related to the above transactions:

1) The entry of May 1 transaction should include a: *

a) Service Revenue $6,000

b) Accounts Receivable $6,000

c) Account Payable $6,000

d) Unearned Service Revenue $6,000

2) The Sales Revenue amount of the August 5 transaction is: *

a) $560

b) $604.8

c) $7,000

d) $7,560

3) The entry of August 5 transaction will include: *

a) Debit Cash $7,000

b) Debit Cash $7,560

c) Debit Accounts Receivable $7,000

d) Debit Accounts Receivable $7,560

4) The entry of September 1 transaction is: *

a) Debit Cash and Credit Notes Payable of $20,000

b) Debit Cash and Credit Notes Payable of $21,200

c) Debit Cash and Credit Notes Payable of $15,000

d) Debit Cash and Credit Accounts Payable of $15,000

5) The entry of October 10 will include a credit of: *

a) Sales Revenue $6,000

b) Sales Revenue $6,600

c) Sales Taxes Payable $6,000

d) Sales Taxes Expense $600

6) The entry of October 10 will include a debit of: *

a) Accounts Receivable $6,000

b) Cash $6,000

c) Accounts Receivable $6,600

d) Cash $6,600

7) The earned amount of the service revenue on December 31 is" *

a) $3,500

b) $4,800

c) $4,500

d) $5,000

8) The remaining balance of the Unearned Service Revenue after December 31 is: *

a) Zero

b) 1,200

c) $3,000

d) $4,000

9) The accrued interest amount on December 31 on the borrowed amount from FNB Bank is: *

a) $300

b) $400

c) $500

d) None of the above

10) The amount of Taxes Payable remitted to the government on December 31 is: *

a) $560

b) $1,160

c) $1,720

d) $1,820

1. Gamebox, a seller of video-gaming systems, games and online gaming subscriptions, recently made available a coupon that allows its gaming subscription members to extend their subscriptions by three months at no charge. Subscribers need only to login to the website using their user name and password and provide the coupon code. Because this contract modification (from 12 months to 15 months) does not add distinct goods or services from the original contract, Gamebox need only make a cumulative catch-up adjustment.

True or False

2. Regarding ASC Topic 606 guidance for revenue recognition, which of the following statements is not true?

a. ASC Topic 606 is based on principles that are radically different from prior guidance.

b. The FASB was involved with deciding to create a single, unifying framework for revenue recognition.

c. A goal was to create a framework that could be applied to any industry and provide similar results for similar fact sets.

d. Prior to ASC Topic 606, U.S. GAAP related to revenue recognition was generally based on industry-specific guidance.

3. Which of the following statements is not true regarding transactions involving intellectual property?

a. A transaction involving intellectual property can represent a sale or a license.

b. The revenue recognition approach depends on whether the transaction is considered a sale or a license.

c. If a contract is considered a license, the firm must determine if the license is a distinct performance obligation.

d. If the customer’s right to use the intellectual property is not limited, the contract is considered a license.

4. Which of the following statements is not applicable to revenue recognition guidance under ASC Topic 606?

a. Disaggregated revenues are to be disclosed in a note to the financial statements.

b. The standard applies a minimum number of categories that must be provided.

c. Revenue may be disaggregated by geographic region.

d. Firms must disaggregate revenues into categories that depict how revenue is affected by economic factors.

5. Under ASC Topic 606, which of the following statements is not true regarding the use of practical expedients in applying the revenue recognition model?

a. One expedient is to use a portfolio approach to numerous contracts with similar characteristics.

b. A firm can file an application to use a practical expedient on a large contract if it is under severe time pressure.

c. A firm is not required to adjust the transaction price for a significant financing component if at the contract inception, the period between the payment and the transfer of goods or services is expected to be a year or less.

d. Determining the use of an expedient is dependent on whether there would not be a material difference in the financial statements from a more vigorous application of the standard.

Saira Morrow operates Dressage Riding Academy, Inc. The academy's primary sources of revenue are riding fees and lesson fees, which are provided on a cash basis. Saira also boards horses for owners, who are billed monthly for boarding fees. In a few cases, boarders pay in advance of expected use. For its revenue transactions, the academy maintains these accounts: Cash, Accounts Receivable, Unearned Service Revenue, and Service Revenue.

The academy owns 10 horses, a stable, a riding corral, riding equipment, and office equipment. These assets are accounted for in the following accounts: Horses, Buildings, and Equipment.

The academy employs stable helpers and an office employee, who receive weekly salaries. At the end of each month, the mail usually brings bills for advertising, utilities, and veterinary service. Other expenses include feed for the horses and insurance. For its expenses, the academy maintains the following accounts: Supplies, Prepaid Insurance, Accounts Payable, Salaries and Wages Expense, Advertising Expense, Utilities Expense, Maintenance and Repairs Expense, Supplies Expense, and Insurance Expense.

Saira's sole source of personal income is dividends from the academy. Thus, the corporation declares and pays periodic dividends. To account for stockholders' equity in the business and dividends, two accounts are maintained: Common Stock and Dividends.

During the first month of operations, an inexperienced bookkeeper was employed. Saira asks you to review the following eight entries of the 50 entries made during the month. In each case, the explanation for the entry is correct.

Instructions

(a)  

For each journal entry that is correct, so state. For each journal entry that is incorrect, prepare the entry that should have been made by the bookkeeper.

1. The following selected accounts appeared in the unadjusted trial balance of Hawthorne Industries: -

Additional data:

1. One-half of the revenue received in advance has been earned by December 31, 2019
2. The prepaid insurance represents three years premium on a policy providing coverage starting September 1, 2019
3. Since the last payday, employees have earned an additional $2,500 which has not yet been paid or recorded
4. The equipment has an estimated life of 10 years and no expected value at the end of its life
5. Services performed but unbilled and uncollected at year end amounted to $6,500
6. The prepaid rent relates to one-half of the year beginning on October 1, 2019

Prepare the necessary year-end adjusting entries as of December 31, 2019.

2. The unadjusted trial balance and information regarding adjusting entries for Becky’s Carpets, Inc., is given below. Prepare the financial statements for Becky’s Carpet Inc., after making the necessary adjustments

Becky’s Carpets, Inc.,

Unadjusted Trial Balance

December 31, 2019

Adjusting entry information:

1. Salaries earned but unpaid at the end of the year, $1,500
2. Insurance expired, 700
3. Depreciation expense, 800
4. Unearned service revenue earned during the year, $1,500
5. The inventory of supplies at year end was $3,400

3. Galarus company had the following trial balance as of December 31, 2019

Galarus Company

Trial Balance

December 31, 2019

Additional information:

1. Supplies used during the month, $450
2. Prepaid insurance expired during the month, $300
3. Depreciation on equipment for the month, $550
4. Unearned service revenue earned during the month, $2,200
5. Accrued salary expense at the end of the month, $650

Based on the trial balance and the additional data, prepare financial statements for the year ended December 31, 2019

Terry Dactal has compiled the financial information displayed below. Which of the following is Terry’s net worth?

QUESTION 2

Which of the following is Terry's cash surplus/deficit?

1 points   

QUESTION 3

If Terry had a solvency ratio of 42% the previous year, which of the following statements is correct?

1. Which of the following questions would not be studied by a microeconomist but would be studied by a macroeconomist?

1. Why do national economies grow?
2. What percentage of consumer income is spent on entertainment?
3. What happens to worker productivity when the job shifts to a 4-day workweek?
4. How is the electric industry harmed by the passage of new clean air legislation?

2. Exhibit 2-1 production possibilities curve data
consumption goods capital goods

10 0

9 1

7 2

4 3

0 4

According to the information, the opportunity cost of producing 3 units of capital is:

1. 3 units of consumption goods.
2. 4 units of consumption goods.
3. 6 units of consumption goods.
4. 7 units of consumption goods.
   
   3. Exhibit 2-3 production possibilities curve data
   Capital goods           0      10      20      30      40
   Consumer goods   200    180   140      80       0
   According to the data given in Exhibit 2-3, the production of 140 units of consumer goods and 10 units of capital goods:
   A) Is possible but it would be inefficient.
   B) May be a result of unemployment.
   C) May be a result of unused natural resources.
   D) All of the above.
   E) none of the above.

-In 2018, Cindy is married and files a joint return. She operates a sole proprietorship in which she materially participates. Her proprietorship generates a gross income of $225,000 and deductions of $525,000, resulting in a loss of $300,000. What is Cindy’s excess business loss for the year? a. $-0-.b. $30,000.c. $250,000.d. $280,000.e. None of the above.

-In 2018, Theo, a single taxpayer operates a sole proprietorship in which materially participates. His proprietorship generates a gross income of $320,000 and deductions of $600,000, resulting in a loss of $280,000. The large deductions are due to the acquisition of equipment and the use of immediate expense and additional first-year depreciation to deduct all of the acquisitions. What is Theo’s excess business loss for the year? a. $-0-. b. $30,000. c. $250,000. d. $280,000 e. None of the above

-During the year, Sophie (a self-employed marketing consultant) went from Omaha to Lima (Peru) on business. She spent four days on business, two days on travel, and four days on vacation. Disregarding the vacation costs, Sophie’s expenses are: Airfare $3,000 Lodging 800 Meals 600 Entertainment 400 Sophie’s deductible expenses are: a. $4,300. b. $2,900. c. $2,800. d. $2,500

-In 2018, Cindy is married and files a joint return. She operates a sole proprietorship in which she materially participates. Her proprietorship generates a gross income of $225,000 and deductions of $525,000, resulting in a loss of $300,000. What is Cindy’s excess business loss for the year? a. $-0-.b. $30,000.c. $250,000.d. $280,000.e. None of the above.

-In 2018, Theo, a single taxpayer operates a sole proprietorship in which materially participates. His proprietorship generates a gross income of $320,000 and deductions of $600,000, resulting in a loss of $280,000. The large deductions are due to the acquisition of equipment and the use of immediate expense and additional first-year depreciation to deduct all of the acquisitions. What is Theo’s excess business loss for the year? a. $-0-. b. $30,000. c. $250,000. d. $280,000 e. None of the above

-During the year, Sophie (a self-employed marketing consultant) went from Omaha to Lima (Peru) on business. She spent four days on business, two days on travel, and four days on vacation. Disregarding the vacation costs, Sophie’s expenses are: Airfare $3,000 Lodging 800 Meals 600 Entertainment 400 Sophie’s deductible expenses are: a. $4,300. b. $2,900. c. $2,800. d. $2,500

Given the following relative weights of importance for the major components of the Consumer Price Index or CPI:

I recommend developing a spreadsheet that addresses the quantitative aspects of parts b and c below. Print a copy and submit the hard copy to me in class along with your answers to the following questions.

What is the CPI and what does it measure?

What is the annual rate of inflation in 2017 as measured by the CPI?

What was your inflation rate in 2017? Please indicated why it differs from the answer in Part (b) above.