Exacto Hospital’s preadjusted trial balance at December 31, 20X1, included the following accounts, among others:

Acct. No.

107 Prepaid insurance $ 5,760

108 Prepaid rent 2,700

109 Prepaid interest 3,600

202 Notes payable 80,000

203 Accrued interest payable -0-

204 Accrued salaries and wages payable -0-

250 Bonds payable 400,000

601 Salaries and wages expense 755,200

604 Insurance expense -0-

606 Rent expense -0-

608 Interest expense -0-

The following additional information is available:

1. A three-year insurance premium was prepaid on January 1, 20X1.

2. One year’s rent was paid in advance on June 1, 20X1.

3. On December 1, 20X1, an $80,000, 9 percent, six-month loan

was obtained from a local bank. Interest was prepaid.

4. Unpaid salaries and wages at December 31, 20X1, totaled $68,700.

5. On October 1, 20X1, $400,000 of 6 percent, ten-year bonds

were issued at face value. Interest on these bonds is payable

annually on October 1, beginning October 1, 20X2.

Prepare, in general journal form, the necessary adjusting entries for December 31, 20X1.

Case Defence sells smartphone cases and uses the perpetual inventory system. The following is information on the purchases and sales of “defender box” cases. On October 1, case Defence had 28 units with a unit cost of $22.

Procedures   Sales

Date Units Unit Cost Units Unit Price    Oct. 3   18 23

Oct. 6 23 $58

Oct. 12 28 25

Oct. 19 28 $58

Oct. 23 38 27

Oct. 30 33 $58

. 31 23 28

Required:

1. Calculate the dollar value of cost of goods sold and ending inventory for the month of October using the following methods. a. FIFO b. Moving weighted average. Round all unit costs to two decimal places and round all other numbers to the nearest dollar.

2. Using the calculations in Part 1, complete the following table:

FIFO Moving weighted avg.

Sales……………………………..

Cost of goods sold…………

Gross profit…………………….

3. Does using FIFO or moving weighted average produce a. A higher gross profit? b. A higher ending inventory balance?

4. Calculate the gross profit percentage for FIFO and moving weighted average for the month of October. Round to the nearest percentage.

              On January 1, 2019, Jameel Company engaged Galadari Engineering Company to construct

              a special purpose machinery.Construction began immediately and completed on October 1 ,2019.

              To help finance construction , on January 1, 2019 Otaibi issued a $500,000, 3 year 12% note payable

               at Emirates Bank on which interest is payable every December 31. $375,000 of the proceeds of the

               note was paid to Galadari on January 1, 2019.The reminder of the proceeds was temporarily   

              invested in short- term marketable securities (trading securities) at 10% until October 1.

              On October1, Jameel made a final $125,000 payment to Galadari. Other than the note to Emirates

              Bank, Jameel’s only outstanding liability on December 31, 2019 is a 40,000 ,8% 6 year note-

               -payable,dated January 1, 2016 on which interest is payble each December 31.

              Required:

1. Calculate the interest revenue, weighted -average accumulated expenditures, avoidable interest        and total interest cost to be capitalized during 2019. (round all computations to the nearest dollar).
   
2. Prepare journal entrres needed on the books of Jameel Company at each of the following dates.

1. January 1, 2019
2. October 1, 2019
3. December 31, 2019

The following facts relate to gift cards sold by Sunbru Coffee Company during 2018. Sunbru’s fiscal year ends on December 31.

(a.) In October 2018, sold $3,500 of gift cards, and redeemed $550 of those gift cards.

(b.) In November 2018, sold $4,500 of gift cards, and redeemed $1,450 of October gift cards and $750 of November gift cards.

(c.) In December 2018, sold $3,500 of gift cards, and redeemed $250 of October gift cards, $2,500 of November gift cards, and $450 of December gift cards.

(d.) Sunbru views a gift card to be “broken” (with a remote probability of redemption) two months after the end of the month in which it is sold. Thus, an unredeemed gift card sold at any time during July would be viewed as broken as of September 30.

Required:
1. Prepare all journal entries appropriate to be recorded only during the month of December 2018 relevant to gift card sales, gift card redemptions, and gift card breakage.
2. Determine the balance of the deferred revenue liability to be reported in the December 31, 2018, balance sheet. Prepare the relevant T-account information to support your answer.

Financial Statements and Closing Entries

The Gorman Group is a financial planning services firm owned and operated by Nicole Gorman. As of October 31, 2018, the end of the fiscal year, the accountant for The Gorman Group prepared an end-of-period spreadsheet, part of which follows:

1-Journalize the entries that were required to close the accounts at October 31. For a compound transaction, if a box does not require an entry, leave it blank.

1)         On October 1, 20X1, Kelly Company leased a boat from Grant Company. The lease is noncancelable and requires five equal annual payments of $50,000 each. The lease payments are due each October 1, beginning October 1, 20X1. The boat is recorded on Grant’s books at $207,542, which is equal to its fair value. Grant expects that the boat’s residual value at the end of the lease term will be $10,000, but it is not guaranteed by Kelly. However, Kelly has an option to purchase the boat for $10,000 at the end of the lease term. At the inception of the lease, the boat has a remaining economic life of six years with a $2,500 estimated salvage value at the end of its life. Both firms use the straight-line method of amortization and have December 31 year-ends for financial reporting purposes. The interest rate used by Grant Company to calculate the annual lease payment is 12%, and known by Kelly. Collection of the lease payments is reasonably predictable by Grant.  

Required:

Complete the following table for Grant’s and Kelly’s December 31, 20X1 income statements:

Be sure to show and clearly label all calculations.

Glacier Products Inc. is a wholesaler of rock climbing gear. The company began operations on January 1, Year 1. The following transactions relate to securities acquired by Glacier Products Inc., which has a fiscal year ending on December 31:

Required:

1. Journalize the entries to record the preceding transactions. For a compound transaction, if an amount box does not require an entry, leave it blank. In your computations, round per share amounts to two decimal places.

2. Prepare the investment-related asset and stockholders’ equity balance sheet presentation for Glacier Products Inc. on December 31, Year 2, assuming that the Retained Earnings balance on December 31, Year 2, is $518,000.

1. Sales-Related and Purchase-Related Transactions for Seller and Buyer Using Perpetual Inventory System

   The following selected transactions were completed during August between Summit Company and Beartooth Co.:

   Aug. 1.	Summit Company sold merchandise on account to Beartooth Co., $46,300, terms FOB destination, 2/15, n/eom. The cost of the goods sold was $27,290.
   2.	Summit Company paid freight of $1,175 for delivery of merchandise sold to Beartooth Co. on August 1.
   5.	Summit Company sold merchandise on account to Beartooth Co., $61,850, terms FOB shipping point, n/eom. The cost of the goods sold was $38,280.
   9.	Beartooth Co. paid freight of $2,080 on August 5 purchase from Summit Company.
   15.	Summit Company sold merchandise on account to Beartooth Co., $59,900, terms FOB shipping point, 1/10, n/30. Summit paid freight of $1,635, which was added to the invoice. The cost of the goods sold was $32,850.
   16.	Beartooth Co. paid Summit Company for purchase of August 1.
   25.	Beartooth Co. paid Summit Company on account for purchase of August 15.
   31.	Beartooth Co. paid Summit Company on account for purchase of August 5.

   Required:

   1. Journalize the August transactions for Beartooth Co. (the buyer).

   Date	Account	Debit	Credit
   Aug. 1		fill in the blank 2
   			fill in the blank 4

   Date	Account	Debit	Credit
   Aug. 5		fill in the blank 6
   			fill in the blank 8

   Date	Account	Debit	Credit
   Aug. 9		fill in the blank 10
   			fill in the blank 12

   Date	Account	Debit	Credit
   Aug. 15		fill in the blank 14
   			fill in the blank 16

   Date	Account	Debit	Credit
   Aug. 16		fill in the blank 18
   			fill in the blank 20

   Date	Account	Debit	Credit
   Aug. 25		fill in the blank 22
   			fill in the blank 24

   Date	Account	Debit	Credit
   Aug. 31		fill in the blank 26
   			fill in the blank 28

   2. Journalize the August transactions for Summit Company (the seller).

   Date	Account	Debit	Credit
   Aug. 1		fill in the blank 30
   			fill in the blank 32

   Date	Account	Debit	Credit
   Aug. 1		fill in the blank 34
   			fill in the blank 36

   Date	Account	Debit	Credit
   Aug. 2		fill in the blank 38
   			fill in the blank 40

   Date	Account	Debit	Credit
   Aug. 5		fill in the blank 42
   			fill in the blank 44

   Date	Account	Debit	Credit
   Aug. 5		fill in the blank 46
   			fill in the blank 48

   Date	Account	Debit	Credit
   Aug. 15		fill in the blank 50
   			fill in the blank 52

   Date	Account	Debit	Credit
   Aug. 15		fill in the blank 54
   			fill in the blank 56

   Date	Account	Debit	Credit
   Aug. 15		fill in the blank 58
   			fill in the blank 60

   Date	Account	Debit	Credit
   Aug. 16		fill in the blank 62
   			fill in the blank 64

   Date	Account	Debit	Credit
   Aug. 25		fill in the blank 66
   			fill in the blank 68

   Date	Account	Debit	Credit
   Aug. 31		fill in the blank 70
   			fill in the blank 72

Sales-Related and Purchase-Related Transactions Using Periodic Inventory System

The following were selected from among the transactions completed by Essex Company during July of the current year:

Required:

Journalize the entries to record the transactions of Essex Company for July using the periodic inventory system. If an amount box does not require an entry, leave it blank.

The controller of Bridgeport Housewares Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budgetinformation:

The company expects to sell about 10% of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month following the sale and the remainder the following month (second month following sale). Depreciation, insurance, and property tax expense represent $10,000 of the estimated monthly manufacturing costs. The annual insurance premium is paid in January, and the annual property taxes are paid in December. Of the remainder of the manufacturing costs, 80% are expected to be paid in the month in which they are incurred and the balance in the following month.

Current assets as of September 1 include cash of $45,000, marketable securities of $64,000, and accounts receivable of $132,500 ($104,000 from July sales and $28,500 from August sales). Sales on account for July and August were $95,000 and $104,000, respectively. Current liabilities as of September 1 include $10,000 of accounts payable incurred in August for manufacturing costs. All selling and administrative expenses are paid in cash in the period they are incurred. An estimated income tax payment of $17,000 will be made in October. Bridgeport’s regular quarterly dividend of $10,000 is expected to be declared in October and paid in November. Management desires to maintain a minimum cash balance of $44,000.

Required:

1. Prepare a monthly cash budget and supporting schedules for September, October, and November. Input all amounts as positive values except overall cash decrease and deficiency which should be indicated with a minus sign. Assume 360 days per year for interest calculations.