Auburn Company Worksheet (partial)
For the Month Ended April 30, 2020
Adjusted Trial Balance Income Statement Balance Sheet
Account Titles Dr. Cr. Dr. Cr. Dr. Cr.
Cash 10,000
Accounts Receivable 7,840
Prepaid Rent 2,280
Equipment 23,050
Accumulated Depreciation—Equip. 4,900
Notes Payable 5,700
Accounts Payable 4,920
Owner’s Capital 27,960
Owner’s Drawings 3,650
Service Revenue 15,590
Salaries and Wages Expense 10,840
Rent Expense 760
Depreciation Expense 650
Interest Expense 57
Interest Payable 57
Totals 59,127 59,127
Worksheet data for auburn company are presented, the owner did not make any additional investments in the business in April.
Prepare an income statement, an owner's equity statement, and a classified balance sheet.
Jerry J. Weygandt; Paul D. Kimmel; Donald E. Kieso. Accounting Principles, 13th Edition (Page 4-43). . Kindle Edition.
In: Accounting
On December 1, 2020, Lily Company had the account balances shown
below.
|
Debit |
Credit |
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| Cash | $5,000 | Accumulated Depreciation—Equipment | $1,100 | |||
| Accounts Receivable | 3,200 | Accounts Payable | 3,200 | |||
| Inventory | 2,700* | Owner’s Capital | 28,600 | |||
| Equipment | 22,000 | |||||
| $32,900 | $32,900 |
*(4,500 x $0.60)
The following transactions occurred during December:
| Dec. 3 | Purchased 4,400 units of inventory on account at a cost of $0.70 per unit. | |
| 5 | Sold 4,900 units of inventory on account for $0.86 per unit. (Lily sold 4,500 of the $0.60 units and 400 of the $0.70.) | |
| 7 | Granted the December 5 customer $198 credit for 200 units of inventory returned costing $132. These units were returned to inventory. | |
| 17 | Purchased 2,100 units of inventory for cash at $0.76 each. | |
| 22 | Sold 3,500 units of inventory on account for $0.91 per unit. (Lily sold 3,500 of the $0.70 units.) |
Adjustment data:
| 1. | Accrued salaries payable $700. | |
| 2. | Depreciation $240 per month. |
Journalize the December transactions and adjusting entries,
assuming Lily uses the perpetual inventory method.
(Credit account titles are automatically indented when
amount is entered. Do not indent manually. Record journal entries
in the order presented in the problem.)
In: Accounting
On December 1, 2020, Lily Company had the account balances shown
below.
|
Debit |
Credit |
|||||
| Cash | $5,000 | Accumulated Depreciation—Equipment | $1,100 | |||
| Accounts Receivable | 3,200 | Accounts Payable | 3,200 | |||
| Inventory | 2,700* | Owner’s Capital | 28,600 | |||
| Equipment | 22,000 | |||||
| $32,900 | $32,900 |
*(4,500 x $0.60)
The following transactions occurred during December:
| Dec. 3 | Purchased 4,400 units of inventory on account at a cost of $0.70 per unit. | |
| 5 | Sold 4,900 units of inventory on account for $0.86 per unit. (Lily sold 4,500 of the $0.60 units and 400 of the $0.70.) | |
| 7 | Granted the December 5 customer $198 credit for 200 units of inventory returned costing $132. These units were returned to inventory. | |
| 17 | Purchased 2,100 units of inventory for cash at $0.76 each. | |
| 22 | Sold 3,500 units of inventory on account for $0.91 per unit. (Lily sold 3,500 of the $0.70 units.) |
Adjustment data:
| 1. | Accrued salaries payable $700. | |
| 2. |
Depreciation $240 per month. |
Enter the December 1 balances in the ledger T-accounts and post the December transactions. (Post entries in the order of journal entries presented above.)
In: Accounting
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In: Accounting
On June 30, 2020, Oriole Company issued $4,180,000 face value of 13%, 20-year bonds at $4,494,460, a yield of 12%. Oriole uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31. Prepare the journal entries to record the following transactions. (Round answer to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) (1) The issuance of the bonds on June 30, 2020. (2) The payment of interest and the amortization of the premium on December 31, 2020. (3) The payment of interest and the amortization of the premium on June 30, 2021. (4) The payment of interest and the amortization of the premium on December 31, 2021.
Show the proper balance sheet presentation for the liability for bonds payable on the December 31, 2021, balance sheet.
Provide the answers to the following questions.
(1) What amount of interest expense is reported
for 2021? (Round answer to 0 decimal places, e.g.
38,548.)
| Interest expense reported for 2021 | $ |
(2) Will the bond interest expense reported in
2021 be the same as, greater than, or less than the amount that
would be reported if the straight-line method of amortization were
used?
| The bond interest expense
reported in 2021 will be
greater thanless thansame as the amount that would be reported if the straight-line method of amortization were used. |
(3) Determine the total cost of borrowing over the
life of the bond. (Round answer to 0 decimal places,
e.g. 38,548.)
| Total cost of borrowing over the life of the bond | $ |
(4) Will the total bond interest expense for the
life of the bond be greater than, the same as, or less than the
total interest expense if the straight-line method of amortization
were used?
| The total bond interest
expense for the life of the bond will be
greater thanless thanthe same as the total interest expense if the straight-line method of amortization were used. |
In: Accounting
On October 1, 2020, Pearl Equipment Company sold a
pecan-harvesting machine to Valco Brothers Farm, Inc. In lieu of a
cash payment Valco Brothers Farm gave Arden a 2-year, $171,200, 10%
note (a realistic rate of interest for a note of this type). The
note required interest to be paid annually on October 1. Pearl’s
financial statements are prepared on a calendar-year basis.
Assuming Valco Brothers Farm fulfills all the terms of the note,
prepare the necessary journal entries for Pearl Equipment Company
for the entire term of the note. Assume that reversing entries are
not made on January 1, 2021 and January 1, 2022.
(Record journal entries in the order presented in the
problem. If no entry is required, select "No Entry" for the account
titles and enter 0 for the amounts. Credit account titles are
automatically indented when the amount is entered. Do not indent
manually.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
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10/1/2012/31/2010/1/2112/31/2110/1/22 |
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10/1/2012/31/2010/1/2112/31/2110/1/22 |
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10/1/2012/31/2010/1/2112/31/2110/1/22 |
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10/1/2012/31/2010/1/2112/31/2110/1/22 |
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10/1/2012/31/2010/1/2112/31/2110/1/22 |
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(To record the collection of interest) |
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(To record the collection of the note) |
show work and explain
In: Accounting
| Merriweather Company, a publicly-held firm, is completing its 10-K report for fiscal 2020. Merriweather considers that it is involved in five separate lines of business. | |||||||||||
| The following information is available, from which Merriweather must determine which segments are reportable and what that disclosure should look like. use 10% test (what that disclosure should look like?) | |||||||||||
| Line of business | Total revenue | Operating Profit or (loss) | Identifiable assets | ||||||||
| Children's wear | 120,000,000 | 30,000,000 | 167,000,000 | ||||||||
| Women's wear | 20,000,000 | 3,000,000 | 52,000,000 | ||||||||
| Men's wear | 46,000,000 | 2,000,000 | 145,000,000 | ||||||||
| Outerwear | 18,000,000 | (1,050,000) | 45,000,000 | ||||||||
| Foot wear | 22,000,000 | (9,600,000) | 140,000,000 | ||||||||
| Total | 226,000,000 | 24,350,000 | 549,000,000 | ||||||||
In: Accounting
Clorox and General Mills 2020 Ratios and DuPont Analysis.
|
Company |
Clorox |
General Mills |
|
Profit Margin |
13.97% |
12.37% |
|
Days Sales Outstanding |
35.19 |
33.44 |
|
Inventory Turnover |
14.80 |
12.36 |
|
Fixed Assets Turnover |
6.09 |
4.92 |
|
Total Assets Turnover |
1.08 |
0.57 |
|
Return on Equity (@ Market Value) |
3.56% |
5.74% |
1.
Which of the following statements about equity multiplier (EM) is INCORRECT?
a.Clorox’s EM indicates that it has more financial leverage than General Mills
b.Adding debt can increase a company’s ROE but will also increase its risk
c.General Mills has a higher proportion of debt than Clorox
d.General Mills’ EM is 0.81
e.The higher a company’s equity multiplier is, the more debt the company has relative to its equity
2.Referring to the DuPont analysis you completed, which of the following statements is INCORRECT?
a.TATO can be increased by increasing fixed assets turnover (FATO) and inventory turnover
b.General Mills has lower return on assets (ROA) than Clorox
c.General Mills has a better ROE than Clorox
d.General Mills’ DuPont analysis indicates that is better than Clorox on every ratio: ROE, PM, TATO and EM
e.Clorox has a slightly higher DSO than General Mills and could lower this by collecting its receivables faster.
3.Which of the following statements about cash flows is INCORRECT?
a.An increase in liabilities will increase cash flow
b.If positive, Free Cash Flow represents the amount of cash that could be withdrawn from a firm without harming its ability to operate and to produce future cash flows
c.The Statement of Cash Flows includes dividends and other financing activities, whereas Free Cash Flow does not
d.The cash flow from “Plant, Property and Equipment” on the Statement of Cash Flows is the same value as CapEx in the free cash flow calculation
e.An increase in CapEx will increase free cash flow
4.Other things held constant, which of the following alternatives would DECREASE a company's cash flow for the current year?
a.Accrue taxes payable
b.Decrease DSO, without affecting sales
c.Issue common stock
d.Decrease long-term debt
e.Increase inventory turnover, without affecting sales
5.If you were an investor in a firm, which of the following would you view NEGATIVELY? In all cases, assume that other things are held constant.
a.The firm’s Profit Margin is 10.5%, whereas the industry average is 10.0%
b.The company’s Times Interest Earned (TIE) is 2x, whereas the industry average is 4x
c.The firm’s DSO (days sales outstanding) is 40 days, whereas the industry average is 45 days
d.The firm’s Return on Equity is 13.0%, whereas the industry average is 12.0%
e.The firm’s FATO is 2.5x, whereas the industry average is 2.0x
6.If a business sells merchandise on credit, what is the impact on current assets and current ratio at the time the sale occurs if the sale is profitable? Assume that the current ratio is 2.0 before the sale.
a.Current assets increase and current ratio increases
b.Current assets increase and current ratio stays the same
c.Current assets increase and current ratio decreases
d.Current assets stay the same and current ratio decreases
e.Current assets stay the same and current ratio stays the same
In: Finance
Exercise 18-19 On June 3, 2020, Teal Company sold to Ann Mount merchandise having a sales price of $8,700 (cost $7,830) with terms of n/60, f.o.b. shipping point. Teal estimates that merchandise with a sales value of $870 will be returned. An invoice totaling $100 was received by Mount on June 8 from Olympic Transport Service for the freight cost. Upon receipt of the goods, on June 8, Mount returned to Teal $400 of merchandise containing flaws. Teal estimates the returned items are expected to be resold at a profit. The freight on the returned merchandise was $23, paid by Teal on June 8. On July 16, the company received a check for the balance due from Mount.
Prepare journal entries for Teal Company to record all the events in June and July. (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.)
In: Accounting
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In: Accounting