Romero started his own consulting firm, Romero Company, on July 1, 2018. The trial balance at July 31 is shown below.
|
ROMERO COMPANY |
||||
|
Trial Balance |
||||
|
July 31, 2018 |
||||
|
Debit |
Credit |
|||
|
Cash |
23,150 |
|||
|
Accounts receivable |
5,000 |
|||
|
Supplies |
4,000 |
|||
|
Prepaid insurance |
3,000 |
|||
|
Equipment |
13,000 |
|||
|
Notes payable |
15,000 |
|||
|
Accounts payable |
7,500 |
|||
|
Unearned service revenue |
4,000 |
|||
|
Owner’s capital |
18,750 |
|||
|
Service revenue |
12,900 |
|||
|
Salaries and wages expense |
7,000 |
|||
|
Rent expense |
3,000 |
|||
|
$ 58,150 |
$ 58,150 |
|||
Other data:
1. Supplies on hand at July 31 are $750.
2. A utility bill for $350 has not been recorded and will not be paid until next month.
3. The insurance policy is for a year.
4. $1,200 of unearned service revenue remain unearned.
5. Romero company pays its employees total salaries of $7,250 every Monday for the preceding 5-day week (Monday through Friday). On Monday July 30, employees were paid for the week ending July 27. All employees worked the last 2 days of the month of July 2018.
6. The equipment is being depreciated over a 5-year life with no salvage value.
7. Invoices representing $3,200 of services performed during the month have not been recorded as of July 31.
8. Romero company borrowed $15,000 by signing a 7.3%, two-year note on July 11th, 2018.
Instructions
a. Prepare the adjusting entries for the month of July.
b. Prepare the Classified Balance sheet at Dec. 31, 2018.
In: Accounting
Romero started his own consulting firm, Romero Company, on July 1, 2018. The trial balance at July 31 is shown below.
|
ROMERO COMPANY |
||||
|
Trial Balance |
||||
|
July 31, 2018 |
||||
|
Debit |
Credit |
|||
|
Cash |
23,150 |
|||
|
Accounts receivable |
5,000 |
|||
|
Supplies |
4,000 |
|||
|
Prepaid insurance |
3,000 |
|||
|
Equipment |
13,000 |
|||
|
Notes payable |
15,000 |
|||
|
Accounts payable |
7,500 |
|||
|
Unearned service revenue |
4,000 |
|||
|
Owner’s capital |
18,750 |
|||
|
Service revenue |
12,900 |
|||
|
Salaries and wages expense |
7,000 |
|||
|
Rent expense |
3,000 |
|||
|
$ 58,150 |
$ 58,150 |
|||
Other data:
1. Supplies on hand at July 31 are $750.
2. A utility bill for $350 has not been recorded and will not be paid until next month.
3. The insurance policy is for a year.
4. $1,200 of unearned service revenue remain unearned.
5. Romero company pays its employees total salaries of $7,250 every Monday for the preceding 5-day week (Monday through Friday). On Monday July 30, employees were paid for the week ending July 27. All employees worked the last 2 days of the month of July 2018.
6. The equipment is being depreciated over a 5-year life with no salvage value.
7. Invoices representing $3,200 of services performed during the month have not been recorded as of July 31.
8. Romero company borrowed $15,000 by signing a 7.3%, two-year note on July 11th, 2018.
Instructions
a. Prepare the adjusting entries for the month of July.
b. Prepare the Classified Balance sheet at Dec. 31, 2018.
In: Accounting
Romero started his own consulting firm, Romero Company, on July 1, 2018. The trial balance at July 31 is shown below.
|
ROMERO COMPANY |
||||
|
Trial Balance |
||||
|
July 31, 2018 |
||||
|
Debit |
Credit |
|||
|
Cash |
23,150 |
|||
|
Accounts receivable |
5,000 |
|||
|
Supplies |
4,000 |
|||
|
Prepaid insurance |
3,000 |
|||
|
Equipment |
13,000 |
|||
|
Notes payable |
15,000 |
|||
|
Accounts payable |
7,500 |
|||
|
Unearned service revenue |
4,000 |
|||
|
Owner’s capital |
18,750 |
|||
|
Service revenue |
12,900 |
|||
|
Salaries and wages expense |
7,000 |
|||
|
Rent expense |
3,000 |
|||
|
$ 58,150 |
$ 58,150 |
|||
Other data:
1. Supplies on hand at July 31 are $750.
2. A utility bill for $350 has not been recorded and will not be paid until next month.
3. The insurance policy is for a year.
4. $1,200 of unearned service revenue remain unearned.
5. Romero company pays its employees total salaries of $7,250 every Monday for the preceding 5-day week (Monday through Friday). On Monday July 30, employees were paid for the week ending July 27. All employees worked the last 2 days of the month of July 2018.
6. The equipment is being depreciated over a 5-year life with no salvage value.
7. Invoices representing $3,200 of services performed during the month have not been recorded as of July 31.
8. Romero company borrowed $15,000 by signing a 7.3%, two-year note on July 11th, 2018.
Instructions
a. Prepare the adjusting entries for the month of July.
b. Prepare the Classified Balance sheet at Dec. 31, 2018.
In: Accounting
|
Alsup Consulting sometimes performs services for which it receives payment at the conclusion of the engagement, up to six months after services commence. Alsup recognizes service revenue for financial reporting purposes when the services are performed. For tax purposes, revenue is reported when fees are collected. Service revenue, collections, and pretax accounting income for 2015–2018 are as follows:
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There are no differences between accounting income and taxable income other than the temporary difference described above. The enacted tax rate for each year is 40%. |
|
(Hint: You may find it helpful to prepare a schedule that shows the balances in service revenue receivable at December 31, 2015–2018.) |
| Required: |
| 1. |
Prepare the appropriate journal entry to record Alsup's 2016 income taxes, Alsup’s 2017 income taxes and Alsup’s 2018 income taxes. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in thousands.)
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In: Accounting
Melton Products uses standard costing. It allocates manufacutring overhead (both variable and fixed) to products on the basis of standard direct manufacturing labor hours (DLH). Melton develops its manufacturing overbead rate from teh current annual budget. THe manufacturing overhead budget for 2018 is based on budgeted output of 720,000 units requiring 3,600,000 DLH. The company is able to schedule production uniformly throughout the year. A total of 66,000 output unuits requiring 315,000 DLH was produced during May 2018. Budgeted hours allowed per unit of output is 5 hours. Allocated total MOH for May is $396,000.
The actual costs, compared with the annual budget and 1/12 of the annual budget are as follows:
ANNUAL MANUFCATURING OVERHEAD BUDGET 2018
| Total Amount | Per output unit | per DLH input unit | Monthly MOH Budget May 2018 | Actual MOH Costs for May 2018 | |
| Variable MOH | |||||
| Indirect Labor | $900,000 | $1.25 | $0.25 | $75,000 | $75,000 |
| Supplies | $1,224,000 | $1.70 | $0.34 | $102,000 | $111,000 |
| Fixed MOH | |||||
| Supervision | $648,000 | $0.90 |
$0.18 |
$54,000 | $51,000 |
| Utilities | $540,000 | $0.75 | $0.15 | $45,000 | $54,000 |
| Depreciation | $1,008,000 | $1.40 | $0.28 | $84,000 | $84,000 |
| Total | $4,320,000 | $6.00 | $1.20 | $360,000 | $375,000 |
Required:
Compute the following variances:
1. The variable manufacutring overhead spending variance
2. The variable manufacutring overhead efficiency variance
3. The fixed manufacturing overhead spending variance
4. The fixed manufacturing overhead volume variance
Please show your work.
In: Accounting
Problem 19-1 The following information is available for Metlock Corporation for 2017. 1. Depreciation reported on the tax return exceeded depreciation reported on the income statement by $130,000. This difference will reverse in equal amounts of $32,500 over the years 2018–2021. 2. Interest received on municipal bonds was $10,100. 3. Rent collected in advance on January 1, 2017, totaled $60,900 for a 3-year period. Of this amount, $40,600 was reported as unearned at December 31, 2017, for book purposes. 4. The tax rates are 40% for 2017 and 35% for 2018 and subsequent years. 5. Income taxes of $314,000 are due per the tax return for 2017. 6. No deferred taxes existed at the beginning of 2017. Compute taxable income for 2017. Taxable income for 2017 $ Compute pretax financial income for 2017. Pretax financial income for 2017 $ Prepare the journal entries to record income tax expense, deferred income taxes, and income taxes payable for 2017 and 2018. Assume taxable income was $942,000 in 2018. (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.) Date Account Titles and Explanation Debit Credit 2017 2018 Prepare the income tax expense section of the income statement for 2017, beginning with “Income before income taxes.” (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Metlock Corporation Income Statement (Partial) $ $ $
In: Accounting
In: Accounting
On January 1, 2015, a machine was purchased for $109,800. The machine has an estimated salvage value of $7,320 and an estimated useful life of 5 years. The machine can operate for 122,000 hours before it needs to be replaced. The company closed its books on December 31 and operates the machine as follows: 2015, 24,400 hrs; 2016, 30,500 hrs; 2017, 18,300 hrs; 2018, 36,600 hrs; and 2019, 12,200 hrs.
Part 1
New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is partially correct.
Compute the annual depreciation charges over the machine’s life assuming a December 31 year-end for each of the following depreciation methods. (Round answers to 0 decimal places, e.g. 45,892.)
| (1) | Straight-line Method |
$ |
||
| (2) | Activity Method | |||
| Year | ||||
| 2015 |
$ |
|||
| 2016 |
$ |
|||
| 2017 |
$ |
|||
| 2018 |
$ |
|||
| 2019 |
$ |
|||
| (3) | Sum-of-the-Years'-Digits Method | |||
| Year | ||||
| 2015 |
$ |
|||
| 2016 |
$ |
|||
| 2017 |
$ |
|||
| 2018 |
$ |
|||
| 2019 |
$ |
|||
| (4) | Double-Declining-Balance Method | |||
| Year | ||||
| 2015 |
$ |
|||
| 2016 |
$ |
|||
| 2017 |
$ |
|||
| 2018 |
$ |
|||
| 2019 |
$ |
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Part 2
Assume a fiscal year-end of September 30. Compute the annual depreciation charges over the asset’s life applying each of the following methods. (Round answers to 0 decimal places, e.g. 45,892.)
|
Year |
Straight-line Method |
Sum-of-the-years'-digits method |
Double-declining-balance method |
|||
| 2015 |
$ |
$ |
$ |
|||
| 2016 | ||||||
| 2017 | ||||||
| 2018 | ||||||
| 2019 | ||||||
| 2020 |
eTextbook and Media
In: Accounting
On December 31, 2016, Akron, Inc. purchased 5 Percent of Zip Company's common shares on the open market in exchange for $15,500. On December 31, 2017, Akron, Inc., acquires an additional 25 percent of Zip Company's outstanding common stock for $95,000.
During the next two years, the following information is available for Zip Company:
| Income | Dividends Declared | Common
Stock Fair Value (12/31) |
|
| 2016 | $325,000 | ||
| 2017 | $82,000 | $7,400 | 380,000 |
| 2018 | 94,000 | 14,800 | 477,000 |
At December 31, 2017, Zip reports a net book value of $294,000. Akron attributed any excess of its 30 percent share of Zip's fair over book value to its share of Zip's franchise agreements. The franchise agreements had a remaining life of 10 years at December 31, 2017.
a. Assume Akron applies the equity method to its Investment in Zip account:
1. What amount of equity income should Akron report for 2018?
2. On Akron's December 31, 2018, balance sheet, what amount is reported for the Investment in Zip account?
b. Assume Akron uses fair-value accounting for its Investment in Zip account:
1. What amount of income from its investment in Zip should Akron report for 2018?
2. On Akron's December 31, 2018, balance sheet, what amount is reported for the Investment in Zip account?
| a1 | equity income | $ |
| a2 | investment in Zip account | $ |
| b1 | reported income | $ |
| b2 | investment in Zip account | $ |
In: Accounting
| Just Dew It Corporation reports the following balance sheet information for 2017 and 2018. |
| JUST DEW IT CORPORATION 2017 and 2018 Balance Sheets |
|||||
| Assets | Liabilities and Owners' Equity | ||||
| 2017 | 2018 | 2017 | 2018 | ||
| Current assets | Current liabilities | ||||
| Cash | $ 10,150 | $ 10,350 | Accounts payable | $ 74,500 | $ 61,250 |
| Accounts receivable | 27,100 | 27,250 | Notes payable | 48,500 | 49,250 |
| Inventory | 62,900 | 63,500 | Total |
$ 123,000 |
$ 110,500 |
| Total |
$ 100,150 |
$ 101,100 |
Long-term debt | $ 59,400 | $ 64,900 |
| Owners' equity | |||||
| Common stock and paid-in surplus | $ 80,000 | $ 80,000 | |||
| Fixed assets | Retained earnings |
171,750 |
192,700 |
||
| Net plant and equipment | $ 334,000 | $ 347,000 | Total | $ 251,750 | $ 272,700 |
| Total assets |
$ 434,150 |
$ 448,100 |
Total liabilities and owners' equity |
$ 434,150 |
$ 448,100 |
| Based on the balance sheets given for Just Dew It, calculate the following financial ratios for the year 2017. |
| a. | Current ratio |
| b. | Quick ratio |
| c. | Cash ratio |
| d. | NWC to total assets ratio |
| e. | Debt-equity ratio and equity multiplier |
| f. | Total debt ratio and long-term debt ratio |
| Based on the balance sheets given for Just Dew It, calculate the following financial ratios for the year 2018. |
| a. | Current ratio |
| b. | Quick ratio |
| c. | Cash ratio |
| d. | NWC to total assets ratio |
| e. | Debt-equity ratio and equity multiplier |
| f. | Total debt ratio and long-term debt ratio |
In: Finance