Changes in Shareholders' Equity

On January 1, 2016, the Osgood Film Studios reported the following alphabetical list of shareholders' equity items:

During 2016, the company sold 4,400 shares of common stock for $13 per share and 350 shares of preferred stock for $127 per share. It also earned income of $94,000 and paid dividends of $7 per share on the preferred stock and $1.20 per share on the common stock outstanding at the end of 2016.

Required:

The following partially completed schedule will help you to organize the information for this exercise.

On January 1, 2016, Ballieu Company leases specialty equipment with an economic life of 8 years to Anderson Company. The lease contains the following terms and provisions:

The lessor calculates that the present value on January 1, 2016 of 8 annual payments in advance of $34,500 discounted at 11% is $197,070.76 (the $1 purchase option is ignored as immaterial).

Required:

8

9

Otto Co. borrows money on April 30, 2016, by promising to make four payments of $29,000 each on November 1, 2016; May 1, 2017; November 1, 2017; and May 1, 2018. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.)

a. How much money is Otto able to borrow if the interest rate is 4%, compounded semiannually?

b. How much money is Otto able to borrow if the interest rate is 8%, compounded semiannually?

c. How much money is Otto able to borrow if the interest rate is 10%, compounded semiannually?

Compute the amount that can be borrowed under each of the following circumstances: (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places.)

A promise to repay $93,000 five years from now at an interest rate of 9%.

An agreement made on February 1, 2016, to make three separate payments of $20,000 on February 1 of 2017, 2018, and 2019. The annual interest rate is 6%.

Use the following Income Statement and Balance Sheet of firm X to answers Questions (1) & (2)

Sales in 2017 are expected to grow at a rate of 9% with respect to the values of 2016. Assume the company pays out 55% of its net income.

1. Use the percent sales method to forecast the value of next year's stockholder's equity for firm X.

2. Use the percent sales to estimate the firm s net new financing for firm X.

For question 1 i know the answer is 2,931,366 and for question 2 i know the answer is -136,126. but how do i get those answers?

Problem 9-4A Accounts receivable transactions and bad debts adjustments LO C1, P2, P3

Liang Company began operations on January 1, 2016. During its first two years, the company completed a number of transactions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows.

2016

Sold $1,347,400 of merchandise (that had cost $975,400) on credit, terms n/30.

Wrote off $20,900 of uncollectible accounts receivable.

Received $665,400 cash in payment of accounts receivable.

In adjusting the accounts on December 31, the company estimated that 2.70% of accounts receivable will be uncollectible.

2017

Sold $1,532,600 of merchandise (that had cost $1,269,300) on credit, terms n/30.

Wrote off $27,500 of uncollectible accounts receivable.

Received $1,248,700 cash in payment of accounts receivable.

In adjusting the accounts on December 31, the company estimated that 2.70% of accounts receivable will be uncollectible.

  
Required:
Prepare journal entries to record Liang’s 2016 and 2017 summarized transactions and its year-end adjustments to record bad debts expense. (The company uses the perpetual inventory system and it applies the allowance method for its accounts receivable.) (Round your intermediate calculations to the nearest dollar amount.)

Question (5)

Molina Company had a $700 credit balance in Allowance for Doubtful Accounts at December 31, 2016, before the current year's provision for uncollectible accounts. An aging of the accounts receivable revealed the following:

                                                                                                              Estimated Percentage

                                                                                                                       Uncollectible                                                                                       

         Current Accounts                                            $120,000                 1%

         1–30 days past due                                              20,000                 3%

         31–60 days past due                                            10,000                 6%

         61–90 days past due                                            10,000               12%

         Over 90 days past due                                           8,000               30%

         Total Accounts Receivable                             $168,000

Instructions

(a)   Prepare the adjusting entry on December 31, 2016, to recognize bad debt expense.

(b)   Assume the same facts as above except that the Allowance for Doubtful Accounts account had a $500 debit balance before the current year's provision for uncollectible accounts. Prepare the adjusting entry for the current year's provision for uncollectible accounts.

(c)   Assume that the company has a policy of providing for bad debts at the rate of 1% of sales, that sales for 2016 were $550,000, and that Allowance for Doubtful Accounts had a $650 credit balance before adjustment. Prepare the adjusting entry for the current year's provision for bad debts.

Answer