The adjusted trial balance for Cowboy Company follows:

Prepare the closing journal entries & post-closing trial balance for Cowboy Company in good form.

1. Explain why the Credit Department (which evaluates whether a Company should extend credit to a Customer) should not also be responsible for order processing and/or invoicing inside a Company? Be specific.

2. Explain why members of the Purchasing Department that commit and issue purchase orders to vendors on behalf of the Company should also not be responsible for processing and payment of invoices from vendors. Be specific in your answer. Who inside of the Company should be responsible for processing and paying vendor invoices?

3. Electronic payments, today, are a common way for one Company to pay another for goods or services received from a supplier. Many firms also set up automatic payments for certain monthly recurring payments to some suppliers, for example, for payment of monthly utility, telephone, Internet charges for essential services required by a firm. For electronic payments going through the Company’s monthly bank statement, what type of controls do you recommend that a firm implement to ensure that such payments are properly supported by vendor invoices? Be specific in your answer as to whom should do what every month.

On January 8, the end of the first weekly pay period of the year, Regis Company's employees earned $24,760 of office salaries and $70,840 of sales salaries. Withholdings from the employees' salaries include FICA Social Security taxes at the rate of 6.2%, FICA Medicare taxes at the rate of 1.45%, $13,060 of federal income taxes, $1,440 of medical insurance deductions, and $820 of union dues. No employee earned more than $7,000 in this first period.

Required:
1.1 Calculate below the amounts for each of these four taxes of Regis Company. Regis’s state unemployment tax rate is 5.4% of the first $7,000 paid to each employee. The federal unemployment tax rate is 0.6%.
1.2 Prepare the journal entry to record Regis Company's January 8 employee payroll expenses and liabilities.
2. Prepare the journal entry to record Regis’s employer payroll taxes resulting from the January 8 payroll. Regis’s state unemployment tax rate is 5.4% of the first $7,000 paid to each employee. The federal unemployment tax rate is 0.6%.

Calculate below the amounts for each of these four taxes of Regis Company. Regis’s state unemployment tax rate is 5.4% of the first $7,000 paid to each employee. The federal unemployment tax rate is 0.6%. (Round your answers to 2 decimal places.)

• Record the employee payroll expenses and liabilities for the first weekly pay period of the year.

Note: Enter debits before credits.

Prepare the journal entry to record Regis’s employer payroll taxes resulting from the January 8 payroll. Regis’s state unemployment tax rate is 5.4% of the first $7,000 paid to each employee. The federal unemployment tax rate is 0.6%. (Round your answers to 2 decimal places.)

Journal entry worksheet

• Record the employer’s payroll expenses and liabilities for the first weekly pay period of the year.

Note: Enter debits before credits.

On January 1, 2012, the organizers of the Parsons Corporation obtained their charter and issued 10,000 shares of $1 par common stock for $4 per share. During 2012, the corporation earned $30,000 in cash revenue and paid $20,000 in cash expenses, not including income tax. The income tax rate was 30%, and the company's income tax expense was $3,000. The company declared and paid cash dividends totaling $2,000. Using the above information, prepare an income statement and a balance sheet for the Parsons Corporation.

The Draper Company Records these journal entries:

Purchase of equipment; signed a 5-year note payable $27

Accrued Wages Payable $12

Earned portion of Unearned Revenue $16

Required: Indicate the net effect of these journal entries on the following items. Indicate the dollar amount of the effect and the direction of the effect. (Example: $13 Increase, or $8 Decrease, or NO EFFECT)

a) Net Income $_______________ b) Total Assets $_______________ c) Total Liabilities $_______________

d) Retained Earnings $_______________ e) Total Equity $_______________ f) Working Capital $_______________

In your own words, please describe the following ratios and their use in a public trading company. (Ex: a diesel engine manufacturer).

Cash ratio

current ratio quick

ratio

accounts receivable turnover

days to collect receivables

inventory turnover

days to sell inventory

debt to equity

time interest earned

earnings per share

gross profit percent

profit margin

return on assets

return on common equity

Answer should be at least 2 pages long.

Astro Corporation was started with the issue of 5,200 shares of $10 par stock for cash on January 1, Year 1. The stock was issued at a market price of $16 per share. During Year 1, the company earned $69,950 in cash revenues and paid $46,867 for cash expenses. Also, a $4,000 cash dividend was paid to the stockholders.

Required

Prepare an income statement, statement of changes in stockholders’ equity, balance sheet, and statement of cash flows for Astro Corporation’s Year 1 fiscal year.

Just a short explanation will suffice

a. If permitted to choose between depreciating a cost over several years versus expensing it in a single year, which would you choose for your company? What factors might come into play in your recommendation?

b. Firms can reduce the taxes they pay in the U.S. by setting internal transfer prices so the "profit" is earned in countries with low tax rates or by selling themselves to an international firm. What are the ethical pros and cons of these practices?