PRINCE Company has the following opening account balances in its general and subsidiary ledgers on March 1^st, 2020. The Company uses the periodic inventory system. All accounts have normal debit and credit balances.

                             General Ledger

The following transactions take place in the month of March 2020.

Jan 1           Purchased merchandise from Heaven Trade $3,500, FOB shipping point, 2/15, n/45.

   1           Paid 12-month fire insurance $7,200, covering year 2020.

   3           Received checks for $4,500 from Westly N.R. and paid $350 to Quick Delivery for the freight on merchandised purchased on January 1^st.

   5           Sent a credit memo of $200 to Fortune D.C. for the allowance granted on unsatisfied merchandise.

   8           Sold merchandise of $3,600 to Zooick, terms FOB destination, 1/8, n/15. The relevant delivery charge, $400, was paid.

   9           Sent a check of $4,900, after a 2% discount, to Heaven Trade. Also, paid DeeBeeDee in full.

   9           Received payment in full from Apple Green and Fortune D.C..

  12          Paid rent of $2,500 for January.

13          Sold merchandise on account to Apple Green $1,900 and Westly N. R. $900, terms 1/8, n/20.

15          Paid Heaven Trade for the Jan.1 purchase.

16          Purchased merchandise on account from DeeBeeDee $15,000, terms 5/5, n/30.

17          Paid $600 cash for office supplies.

18          Returned $1,000 of inferior quality merchandise to DeeBeeDee and receive credit.

20          Cash sales totaled $17,500.

22          Received payment from Apple Green and Zooick.

22          Paid Brothers Inc. $15,300, no discount taken. Also paid DeeBeeDee.

25         Paid salaries of $8,300.

26         Sold merchandise to SunWing, $16,800, terms 1/EOM, n/30.

31          Received from Zooick a down payment of $10,000 for merchandise specifically ordered to its request.

Other information available on January 31^st, 2020

1. A count showed supplies on hand was $1,200.
2. Out of the $3,000 prepaid insurance on January 1^st, $300 was expired.
3. Depreciation expense for the month totaled $225.
4. Ending inventory was $29,000, out of which $1,200 was found to be not sellable anymore. The management decided to recognize a loss separately.
5. Utility bill of $1,350 was received but not yet paid. A separate payable account is used.

Required:

1. Journalize the March transactions in the general journal, no need to provide explanations to the entries. Use additional accounts when necessary.

(30.5 marks)

2. Prepare the Income Statement for the month ended March 31^st, 2020, the Statement of Financial Position as of that date.

(19.5 marks)

PRINCE Company has the following opening account balances in its general and subsidiary ledgers on March 1^st, 2020. The Company uses the periodic inventory system. All accounts have normal debit and credit balances.

                             General Ledger

The following transactions take place in the month of March 2020.

Jan 1           Purchased merchandise from Heaven Trade $3,500, FOB shipping point, 2/15, n/45.

   1           Paid 12-month fire insurance $7,200, covering year 2020.

   3           Received checks for $4,500 from Westly N.R. and paid $350 to Quick Delivery for the freight on merchandised purchased on January 1^st.

   5           Sent a credit memo of $200 to Fortune D.C. for the allowance granted on unsatisfied merchandise.

   8           Sold merchandise of $3,600 to Zooick, terms FOB destination, 1/8, n/15. The relevant delivery charge, $400, was paid.

   9           Sent a check of $4,900, after a 2% discount, to Heaven Trade. Also, paid DeeBeeDee in full.

   9           Received payment in full from Apple Green and Fortune D.C..

  12          Paid rent of $2,500 for January.

13          Sold merchandise on account to Apple Green $1,900 and Westly N. R. $900, terms 1/8, n/20.

15          Paid Heaven Trade for the Jan.1 purchase.

16          Purchased merchandise on account from DeeBeeDee $15,000, terms 5/5, n/30.

17          Paid $600 cash for office supplies.

18          Returned $1,000 of inferior quality merchandise to DeeBeeDee and receive credit.

20          Cash sales totaled $17,500.

22          Received payment from Apple Green and Zooick.

22          Paid Brothers Inc. $15,300, no discount taken. Also paid DeeBeeDee.

25         Paid salaries of $8,300.

26         Sold merchandise to SunWing, $16,800, terms 1/EOM, n/30.

31          Received from Zooick a down payment of $10,000 for merchandise specifically ordered to its request.

Other information available on January 31^st, 2020

1. A count showed supplies on hand was $1,200.
2. Out of the $3,000 prepaid insurance on January 1^st, $300 was expired.
3. Depreciation expense for the month totaled $225.
4. Ending inventory was $29,000, out of which $1,200 was found to be not sellable anymore. The management decided to recognize a loss separately.
5. Utility bill of $1,350 was received but not yet paid. A separate payable account is used.

Required:

Prepare the Income Statement for the month ended March 31st, 2020, the Statement of Financial Position as of that date.

There no adjusted trial balance.

Here are the financial results for Springer’s corporation in 2020: Sales were $45,000, cost of goods sold was $36,000, the company’s assets depreciated by $5,000 and the company paid $500 in interest.

Also, for 2020 net fixed assets were $29,000 while current assets were $10,000 and current liabilities were $5,500.

These are the values for 2019: net fixed assets = $25,500, current assets = $8,800 and current liabilities = $5,000. The tax rate is 35%.

1. What is net income for 2020?
2. What is the operating cash flow for 2020?
3. What is the cash flow from assets for 2020? How do you interpret this result?
4. What is the cash flow to shareholders?

Here are the financial results for Jerry’s corporation in 2020: Sales were $45,000, cost of goods sold was $36,000, the company’s assets depreciated by $5,000 and the company paid $500 in interest.

Also, for 2020 net fixed assets were $29,000 while current assets were $10,000 and current liabilities were $5,500.

These are the values for 2019: net fixed assets = $25,500, current assets = $8,800 and current liabilities = $5,000. The tax rate is 35%.

Required:

1. What is net income for 2020?
2. What is the operating cash flow for 2020?
3. What is the cash flow from assets for 2020? How do you interpret this result?
4. What is the cash flow to shareholders?

It is September 2020 and you are considering a significant event that affects one of your audit clients, Falafel-tech Enterprises. The auditor’s report for Falafel-tech Enterprises for the year ended 30 June 2020 was signed on 30 August 2020. The financial report has not yet been issued to shareholders.

You have just discovered that one of Falafel-tech Enterprises’ major debtors at 30 June 2020 went into liquidation on 15 August 2020. The bankruptcy was the result of ongoing financial difficulties.

Required:

Explain what you should do in this situation. In your answer, identify how this should be treated in the financial report, and who this situation should be discussed with.

X Enterprises owns a professional ice hockey team, the Rockford Penguins. The company sells season tickets for its upcoming 2020-2021 season and receives $816,000 cash. The season starts November 1 and ends on April 30, with five home games occurring monthly over the six-month hockey season. Assume that McKinnon Enterprises' fiscal year ends on December 31.

Required: 1) Prepare journal entries to record all transactions and adjustments necessary through 2020-2021 hockey season.

2)Indicate how the season tickets will be reported on the income statement of 2020, the balance sheet at the end of 2020 and the statement of cash flows of 2020.

Jack's Electric sold $4,495,000, 13%, 10-year bonds on January 1, 2020. The bonds were dated January 1, 2020, and paid interest on January 1. The bonds were sold at 98.

Prepare the journal entry to record the issuance of the bonds on January 1, 2020.

At December 31, 2020, $7,500 of the Discount on Bonds Payable account has been amortized. Show the balance sheet presentation of the long-term liability at December 31, 2020.

On January 1, 2022, when the carrying value of the bonds was $4,420,100, the company redeemed the bonds at 102. Record the redemption of the bonds assuming that interest for the period has already been paid.

As at December 31, 2020, Riverbed Inc. has the following balances: Cash in bank, $102,000; Investment in preferred shares (retractable, purchased by Riverbed within 90 days of maturity date), $114,000; Investment in common shares (to be sold within 30 days), $90,000; and Cash (legally restricted for an upcoming long-term debt retirement), $233,000.

1.Determine the December 31, 2020 cash and cash equivalents amount for the 2020 statement of cash flows under IFRS.

Cash and Cash Equivalents $_______

2.Determine the December 31, 2020 cash and cash equivalents amount for the 2020 statement of cash flows under ASPE.

Cash and Cash Equivalents $_______

On January 1, 2020, Sharp Company purchased $50,000 of Sox Company 6% bonds, at a time when the market rate was 5%. The bonds mature on December 31, 2024, and pay interest annually on December 31. Sharp plans to and has the ability to hold the bonds until maturity. Assume that Sharp uses the effective interest method to amortize any premium or discount on investments in bonds. At December 31, 2020, the bonds are quoted at 98. a. Prepare the entry for the purchase of the debt investment on January 1, 2020. b. Prepare the entry for the receipt of interest on December 31, 2020. c. Record the entry to adjust the investment to fair value on December 31, 2020, if applicable

At January 1, 2020, the credit balance of Cheyenne Corp.’s Allowance for Doubtful Accounts was $406,500. During 2020, the bad debt expense entry was based on a percentage of net credit sales. Net sales for 2020 were $80 million, of which 89% were on account. Based on the information available at the time, the 2020 bad debt expense was estimated to be 0.80% of net credit sales. During 2020, uncollectible receivables amounting to $500,000 were written off against the allowance for doubtful accounts. The company has estimated that at December 31, 2020, based on a review of the aged accounts receivable, the allowance for doubtful accounts would be properly measured at $525,500.

Prepare a schedule calculating the balance in Cheyenne Corp.’s Allowance for Doubtful Accounts at December 31, 2020.

Prepare any necessary journal entry at year end to adjust the allowance for doubtful accounts to the required balance. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)