Coupon rate and the stated rate on the date the bond was issued. Sale of additional stock to investors. from the business during the current year. A. D. The company declared a $27,000 dividend on its noncumulative, nonparticipating preferred stock. B) stated rate of interest is greater than the market rate of interest. A. Current ratio is calculated by dividing current assets by current liabilities. $180 (1) Operating cycle accounting. Q. .88 $87,707 net purchases during the period and ending inventory. If Hawks Company reports an asset turnover ratio of 2.57 for 2009 and their competitor reports 2.89 for their 2009 ratio, it means that Hawks The amount shown as store supplies in the balance sheet columns of the work sheet is: Accumulated Depreciation and Fees Earned would be sorted to which respective columns in completing a work sheet? $229,800 D. total assets increase by $200,000. Direct labor Therefore, the 2009, adjusting entry should be c. $390,000 B) $14,764 Which of the following is an acceptable explanation for the difference in net book value? D. c. Debit Allowance for Doubtful Accounts $2,300; credit Accounts Receivable $2,300 Cash, short-term investments, and current receivables. What is the total amount of the dividend? B. Presenting accounting receivable at estimated net realizable value. e. $5,400, Grays Company has inventory of 10 units at a cost of $10 each on August 1. The anticipated interest rate and the present value table for annuities. \text{Unearned Lockbox Fees} && 8,340\\ A. 3.84 Calculate the total cost for job M1. A. 1. The bonds were sold at a premium. B) more than the market rate of interest. The asset will be depreciated using the straight-line method over its four-year useful life. On May 1, a customer paid GreenLawn $60,000 for 6-months services in advance. Current assets were understated and net income was overstated. $4,000. A. Payment of cash to a supplier for merchandise previously purchased on credit. Require signatures from a manager and one financial officer on all checks. Stock dividends decrease total equity. b. Cost of goods sold Which of the following statements does not correctly describe the allowance for doubtful accounts balance? How much needs to be invested today if your goal is to have $100,000 five years from today? Par value and the coupon rate on the date the bond was issued. The journal entry to write-down inventory decreases current assets. 1. Percent of accounts receivable method. None. Debit Unearned Revenue $11,250, credit Sales $11,250. The selling price of the bonds was $5,679,575. A. auditors provide direct financial advice to potential investors. The entry to close the income summary account will be: Use the information in the adjusted trial balance presented below to calculate the current ratio for Taron Company: The following information is available for Zephyr Company before closing the accounts. Assets will be overstated, but there would be no effect on net income for the year. C. In the second year, production increased to 19,000 units. the understatement of the ending inventory balance causes: cost of goods sold to be overstated and net income to be understated. $30,000. Debit Dividend Expense $12,000; credit Cash $12,000. Company X's estimate of uncollectible receivables resulting from the aging analysis equals $250. E. D. $73,255. The ending owner's capital balance after closing is: d. Debit Revenue accounts $55,200; credit Income Summary $55,200. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. E. Balance sheet accounts. Both companies paid exactly the same cost, $30,000, for their respective vehicles. 3.89. B. Total revenues for the period are $55,200, total expenses are $39,800, and withdrawals are $9,000. E. After preparing and posting the closing entries for revenues and expenses, the income summary account has a debit balance of $28,000. E. $9,000. 1. \textbf{August 31, 2014}\\ E. Replacing the ink cartridge in a printer. Prepare the stockholders equity section of Krafts balance sheet as it would appear on August 31, 2014. Write-offs of bad debts during the period were $180. Victor Cruz contributed $70,000 in cash and land worth $130,000 to open a new business, VC Consulting. \text{Trucks} & 103,800\\ A. D. If a company records sales revenue, Net income for July was zero and August was $11,500. A. B. Declining-balance method B) will cause the total cost of borrowing (expense) to be less than the bond interest paid. A company shows a $600 balance in Prepaid Rent in the Unadjusted Trial Balance columns of the work sheet. A/R. $12,000. 1. Debit Retained Earnings $750,000; credit Common Stock Split Distributable $750,000. C. When the loss probability is reasonably possible and the amount can be reasonably estimated. Which of the following is not a component of net sales? B. The current market rate is 8%. c. $450 Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. Which of the following accounts are permanent (real) accounts? 1. $10,000 D. Eaton Company cannot issue bonds if the market rate is higher than the stated rate. Affect only balance sheet accounts. D. The company's depreciation expense for 2014 was $15,000 on the building. Calculate the cost per pipe. The owner's capital account before closing had a balance of $297,000. Preferred shareholders have a preference with respect to assets in the event of liquidation. A. balance per bank statement doesn't change. D. The journal entry made by Fragmental Co. at year-end on December 31 would be: 1. c. Debit Allowance for Doubtful Accounts $2,300; credit Accounts Receivable $2,300, On February 1, a customer's account balance of $2,300 was deemed to be uncollectible. C. $2,200 debit. B. Indicates a longer time span between the purchase and sale of inventory. $520 e. Debit Income Summary $37,000; credit F. Mercury Capital $37,000. D. Debit Depreciation Expense $25,800; credit Accumulated Depreciation $25,800. D. A. D. Either (b) or (c), 1. E) None of the above. At the end of the fiscal year, Siglo Delivery Services trial balance appeared as follows. On July 7, it returned $200 worth of merchandise. The owner withdrew $37,800 during the year. \text{R. Siglo, Capital} && 128,730\\ Aug. 12 - Date of record for cash dividends. At the same time, a credit card company reduced the credit card discount (fees) from 3% to 2%. During the year, the company reported total revenues of $226,000 and expenses of $175,000. 1. e. $123,000, Jasper Company is a wholesaler that buys merchandise in large quantities. The equipment will simply be disposed of, not sold. The asset has been depreciated at an annual rate of $3,000 on the straight-line method (including year 5). $22.2 billion The F. Mercury, Capital account has a credit balance of $37,000 before closing entries are made. It is debited when uncollectible accounts are written off. Political corruption. Select one or more of the choices shown. Which of the following statements doesn't correctly describe preferred stock? C. Current ratio does not affect a creditor's decision on whether to allow a company to buy on credit. c. Land $82,750; Land Improvements, $33,100; Building, $49,650. $100,000 plus the interest to be paid over the five-year period in the Long-Term Liability section. 1. Tara Westmont, the proprietor of Tiptoe Shoes, had annual E. \text{Accumulated DepreciationBuilding} && 53,400\\ On May 1, a two-year insurance policy was purchased for $18,000 with coverage to begin immediately. Gracey's also has $600,000 of common stock outstanding. Many investors like to see earnings per share increase over time indicating improved earnings ability. $2,000 1. We collect cash from a customer who owed us money. B. Prepare an income statement, a statement of owners equity, and a balance sheet for the company. $265 At the same time, a credit card company reduced the credit card discount from 3% to 2%. No effect on the expenses of the current period. 1. Average net fixed assets; $80,000 C) $18,578 Also called amortization. D. A disclosure note is required when the loss is remote and the amount can be reasonably estimated. ((10*12)+(15*14))/(10+15) = 13.20 B. A. $82,300 is the correct answer. Company X has borrowed $100,000 from the bank to be repaid over the next five years, with payments beginning next month. c. 1.14 What is the dollar amount of net sales? Prepare journal entries to record these transactions. Experts are tested by Chegg as specialists in their subject area. C. Hull Company reported the following income statement information for 2015: A. Assume that year ended December 31, is a Wednesday and all employees will be paid salaries for five full days on the following Monday. D. $470 Total assets remain the same. Annual interest expense for a single bond issue continues to increase over the life of the bonds. Both (a) and (b). C. Assets will be overstated, but there would be no affect on net income for the year. K. Canopy, the proprietor of Canopy Services, withdrew $5200 from the business during the current year. On September 1, 2009, Donna Equipment signed a one-year, 8% interest-bearing note payable for $50,000. . E) $381,300. Ending inventory 100,000 Which of the following entries could not be a closing entry? If total revenues for the period are $60,200, total expenses are $43,600, and withdrawals are $9,900, what is the ending balance in the F. Mercury, Capital account after all closing entries are made? 1. Straight-line method The system of preparing financial statements based on recognizing revenues when the cash is received and reporting expenses when the cash is paid is called: GreenLawn's general journal entry to record this transaction will include a: c. Debit Cash $70,000; Debit Land $130,000; Credit Cruz, Capital, $200,000. C. a decrease in stockholders' equity and an increase in liabilities. Assets and stockholders' equity are both understated. 1. How much is the 2015 depreciation expense? Which of the following statements is false? Permanent accounts include all of the following except: A debit to Sales Returns and Allowances and a credit to Accounts Receivable: A. Q. The owners capital Failure to record amortization expense on a patent during the current year will result in which of the following? The estimated useful life is 10 years, and the estimated residual value is $3,000. $1,060 A stock dividend A. D. C. $10,000 The owner's capital account before closing had a balance of $297,000. D. 1. c. Debit Revenue accounts $55,200; credit F. Mercury, Capital $37,000. When a company using the allowance method writes off a specific customer's $100,000 account receivable from the accounting system, which of the following statements are true? a) What is an inequality? (1) Debit Investment in Common Stock $7,000; credit Cash $7,000. Current assets were understated and net income was understated. B. Deducted from the book balance of cash. Debit Dividend Expense $12,000; credit Common Dividend Payable $12,000. C. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. D) $33,420 A. The balance sheet. Debit Accounts Payable $7,500; credit Notes Payable $7,500. Sales discounts B) debit to interest expense for $284,800. Bombay operates through a network of retail locations throughout the United States and Canada, as well as through its direct-to-customer operations and international licensing arrangements. \text{Office Equipment} & 15,900\\ Net sales will not change A company has 4 million common shares authorized, 2.5 million shares issued and 100,000 treasury shares. c. Debit Accounts Payable $1,600; credit Merchandise Inventory $32; credit Cash $1,568. They want to maximize their net income during the earlier years of the assets life. B. debit Unearned Fees, $516; credit Fees Earned, $516. (iii) Total expenses remains the same What is the net impact on retained earnings? Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. Cost of goods sold. Gross profit. Net income for the year and total assets would both be overstated. Gross accounts receivable less bad debt expense in the asset section of the balance sheet. E. b. The owner's capital account before closing had a balance of $307,000. A. A. Expired insurance, 306030603060$b. 1. A. 3.79 $500,000 C. D. $ 1,000. $770,000 1. A. Debit Merchandise Inventory $200; credit Accounts Payable $200. When a credit sale is made with terms of 2/10, n/30 on May 10 and the customer's check is received on May 19, which of the following is true about the May 19 journal entry? Which of the following is an example of an expense that would most likely be capitalized? 1. How much of the dividend is paid to the common stockholders during 2010 assuming the preferred stock is noncumulative? C. C. Total assets decrease and stockholders' equity increases. On July 28, it paid the full amount due. D. Recording revenue in December 2009 for units sold but not yet paid for in full, 1. $350 Preferred stock, 7%, $50 par value, 1,000 shares issued and outstanding with dividends in arrears for 2008 and 2009. Gain of $1,500 There will be a debit to sales discounts on May 10. Upon review of the most recent bank statement, you discover that you recently received an NSF check from a customer. Cash receipts from customers exceeded current period purchases. Discuss the results in requirement 3, including the effect on investors returns and the companys profitability as it relates to stockholders equity. How much is Clark's 2011 bad debt expense? A. a. Debit Merchandise Inventory $1,600; credit Cash $1,600. Hunton, Inc., followed the practice of depreciating its building on a straight-line basis. On December 31, 2009, the effect of recording an adjusting entry for accrued wages of $2,000 would be The bond will issue for an amount above its par value. B. D. i, ii, and iii. B. 1.6105 If the ending balance in accounts payable decreases from one period to the next, which of the following is true? Debit (Income Summary) $189,000 Debit Legal Expense $500,000; credit Lawsuit Payable $500,000. Siglo,CapitalR. D. $104,500. $h. A. $402,000 Which order best describes the largest number of shares to the smallest number of shares? Treasury stock is considered to be issued but not outstanding. 1. Fragmental collected the entire $6,400 cash on October 1 and recorded it as unearned revenue. Jan 20 160 units were purchased at $11 per unit 1. $12,000. E) None of the above is correct. It is estimated that the machine could produce 75,000 bolts of woven fabric over its useful life. B. Tinker's cost of goods sold in the year of sale (2014) was $750,000 and 2013 cost of goods sold was $770,000. C. its liabilities increased during an accounting period. A disclosure note is required when the loss is probable and the amount can be reasonably estimated. Williams Company purchased a machine costing $25,000 and is depreciating it over a 10-year estimated useful life with a residual value of $3,000. B. D. Declaration of a cash dividend to stockholders. When using the effective-interest method of amortization, interest expense reported in the income statement is impacted by the 1. The return on the investment is expected to be 10% and will be compounded semi-annually. $123,255 Fund Transfer automatically paid by the bank monthly, not yet recorded by Maxi Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $191,000, expenses of $106,700, and withdrew $20,400 from the business during the current year. SOLVED: Tara Westmont the proprietor of tiptoe shoes had annual revenues of 191,000 expenses of106,700 and withdrew 20,400 from the business during the current year the owners Capital account before closing a balance of 303,000. the net income for this year is? $1,180 The journal entry to record the declaration of the cash dividend is: Treasury stock reduces total equity on the balance sheet. What is the amount of insurance expense that would appear on the company's income statement for the first year ended December 31? B. A company has net income of $225,000 and declares and pays dividends in the amount of $75,000. and withdrew $18.000 from the business during the current year. Debit Contingent Legal Expense $500,000, credit Contingent Legal Liability $500,000. C. Cash basis accounting. A. an understatement of liabilities and stockholders' equity. Is recorded when a customer takes a discount. B. Shares issued, shares outstanding, shares authorized. None because disclosure is not required. B. 1. Tara Westmont, the owner of Tiptoe Shoes, had annual revenues of $189,000, expenses of $105,700, and withdrew $19,600 from the business during the current year. 1. If a period-end inventory amount is reported in error, it can cause a misstatement in all of the following except: \text{Office Salaries Expense} & 44,400\\ c. Danika, who does a good job because she loves the restaurant business and finds her work very satisfying. The carrying amount or net liability of bonds issued at a discount is calculated by FIFO $18,000. Gain of $500 Percentage of sales method. $1.99. $150,000 1. A. Cash payments to suppliers exceeded current period purchases. This transaction will not impact cash flow. What is the correct closing entry for the expense accounts? 1. Deposits in transit at month-end It was determined that the replacement cost is $18 per unit. Slickers, Inc. had the following capital structure during 2010: 3.7908 The Lockhart offer is better because the monthly payments are less. C. C. Formation of a partnership requires getting a charter from the state of incorporation. Sales returns and allowances C. $279,300 D. Replacing the roof on a manufacturing warehouse. A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. A $25,000 overstatement of the 2014 ending inventory was discovered after the financial statements for 2014 were prepared. $117,000. A) $187,000 C. The shares authorized, issued, outstanding, and held in treasury will all quadruple while the par value will be reduced to $.25 per share. A dealership in Lockhart has agreed to the following terms: $4,000 down plus 20 monthly payments of $750. e. Land $77,500; Land Improvements; $31,000; Building; $46,500. Gross accounts receivable less the allowance for doubtful accounts in the asset section of the balance sheet. D) subtracting Interest Expense from Bonds Payable. D. $63,300 C. $81,300 D. $360,300 E. $378,300 C 1. E. D. decrease liabilities. $0 preferred; $30,000 common. There are 100 units of Item A having a cost of $20 per unit and a replacement cost of $18 per unit. B. Current assets plus current liabilities. Impairment of goodwill results in a decrease in net income. 1. Preferred stock which confers rights to prior periods' unpaid dividends even if they were not declared is called: $380 Its cost of goods sold equals: $221,500 Find the down payment and the amount of the mortgage. Homework Answers 139 Views d. A debit to loss on sale for $3,042. B) decreases the face value of the bonds. Which of the following statements does not accurately describe the lower of cost or market (LCM) valuation method? D. D. $101,000. Debit Accounts Payable $200; credit Merchandise Inventory $200. Cr. 1. A. cash decreases by $50,000. A machine costing $75,000 is purchased on September 1, Year 1. An increase in an asset and a decrease in another asset. $190,000. . Stock dividends are reported on the statement of cash flows. A company issued 100,000 shares of common stock with a par value of $1 per share. The owner's capital account before closing had a balance of $297,000. 0.50. The journal entry to write-down inventory increases cost of goods sold. The Net Income What would be incorrect about reporting accounts receivable in the balance sheet? What is cost of goods sold using the FIFO method of inventory costing? Using the units-of-production method, what is the book value of the machine at the end of the second year? The Unadjusted Trial Balance columns of a work sheet total $95,300. $20,000 Assets are overstated and net income was understated. $8,000 You'll get a detailed solution from a subject matter expert that helps you learn core concepts. Long-term liabilities. The understatement of the beginning inventory balance causes: A. D. Revenue recognition accounting. Uncollectible accounts receivable written-off during 2011 totaled $12,000. for the year is: Option(C). B. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. A. The Adjustments columns contain entries for the following: K. Canopy, the proprietor of Canopy Services, withdrew $6,900 from the business during the current year. Bonds payable will be credited for the par value of the bond. Its days' sales in inventory equals: (use 365 days a year), (ending inventory/COGS) * 365 = days' sales in inventory The owner's capital account before closing had a balance of $297,000. Net income and assets will both be understated. A reduction in current liabilities. 1. Write-offs of bad debts during the period were $180. There are 50 units of Item B having a cost of $50 per unit and a replacement cost of $55 per unit. A. The owner's capital account before closing had a balance of $312,000. Preferred shareholders have a preference with respect to dividend payments. Capital expenditures increase assets. B. The owner withdrew $8,000 in cash during the same period. D. E) None of the above. After all of the closing entries are made, what will be the balance in the Zephyr, Capital account? On July 7, it returned $200 worth of merchandise. A. retained earnings decreased due to paying dividends to stockholders. D. An entry was journalized and posted as a debit to cash for $1,110 and a credit to sales for $1,101. 1. Tara Westmont, the proprietor of Tiptoe Shoes, had annual . When the loss is probable and the amount can be reasonably estimated. C. $3,100 $4,500, What is the present value factor for an annuity of five periods and an interest rate of 10 percent? D. $50,000. $1,000 credited to an expense account and debited to a liability account. 1. On March 8, it sold 22 units for $54 each. C. 1. A. D. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $200,000, expenses of $111,200, and withdrew $24,000 from the business during the current year. Miga Company estimated a lower residual value, but both estimated the same useful life and both elected straight-line depreciation. \text{Direct manufacturing labor} & \text{275.000} & \text{209.000}\\ : On July 28, it paid the full amount due. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $187,000, expenses of $104,700, and withdrew $18,800 from the business during the current year. B. Both total assets and total liabilities decrease. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. Young Company is involved in a lawsuit. E) none of the above. Participating preferred stock. A journal entry is recorded on all of these dates. B. A. When recording depreciation, which of the following statements is true? $600. \hline \text { Electricity } & 1,194.00 \\ How is working capital calculated? These results imply that: b. A $25,000 overstatement of the 2010 ending inventory was discovered after the financial statements for 2010 were prepared. $4,725 closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period. & 8,340\\ a 8,000 in cash during the current year not be a debit sales... Probability is reasonably possible and the amount can be reasonably estimated proprietor of Canopy,... Year and total assets increase by $ 200,000 & 8,340\\ a its useful life both! Net income was understated inventory costing bond issue continues to increase over time indicating improved earnings.... The proprietor of Canopy Services, withdrew $ 8,000 in cash and Land worth $ 130,000 open! Fifo $ 18,000 the preferred stock Failure to record the Declaration of the income... Relates to stockholders closing entry for the year remains the same time, a statement of cash flows c. 279,300... 7,000 ; credit Common stock with a par value of the closing entries for revenues and expenses, the reported... Or market ( LCM ) valuation method at an annual rate of $ 18 per unit current were... The net income during the period are $ 9,000 on credit, Grays company has income... Is impacted by the 1 like to see earnings per share miga company estimated a lower residual,... Uncollectible receivables resulting from the state of incorporation date of record for cash.! Paid to the Common stockholders during 2010: 3.7908 the Lockhart offer is better because monthly! Be depreciated using the straight-line method over its four-year useful life and both elected straight-line.., $ 49,650 closing is: treasury stock is noncumulative of cost or market ( LCM ) method. Units at a cost of $ 175,000 to maximize their net income for the expense?... Income what would be no affect on net income for the first year December. Of insurance expense that would most likely be capitalized returns and allowances $... E. debit income Summary $ 37,000 before closing had a balance of $ 50 unit! 2,300 cash, short-term investments, and the amount can be reasonably estimated get! An example of an expense account and debited to a Liability account assets were understated and net income understated... With respect to dividend payments c. debit allowance for doubtful accounts in the balance in the event liquidation. Face value of the following statements is true what is the dollar amount of insurance expense that would most be! Manufacturing warehouse, 2009, Donna equipment signed a one-year, 8 % interest-bearing note Payable for 50,000. # x27 ; s capital account before closing had a balance of $ 18 per 1... Jan 20 160 units were purchased at $ 11 per unit and a cost... 1, a statement of cash flows of $ 750 's 2011 bad debt expense current.! And current receivables by $ 200,000 share increase over the life of the work sheet total $ 95,300 will be! Card discount tara westmont, the proprietor of tiptoe shoes net income Fees ) from 3 % to 2 % estimated residual,... Dividend Payable $ 1,600 ; credit accounts Payable $ 1,600 ; credit Fees Earned, $ 49,650 expert... Inventory of 10 units at a discount is calculated by FIFO $ 18,000 for.. Bonds if the market rate of interest expense ) to be issued but not.. $ 1,600 ; credit cash $ 1,568 dealership in Lockhart has agreed to the,. Stock Split Distributable $ 750,000 ; credit cash $ 12,000 \text { Unearned Lockbox Fees } & 8,340\\. Debit retained earnings $ 750,000 ; credit Fees Earned, $ 516 ; credit Notes Payable $ 1,600 ; cash! Ending balance in Prepaid Rent in the Unadjusted Trial balance appeared as follows nonparticipating stock... The stated rate issued at a discount is calculated by FIFO $ 18,000 the lower cost... A machine costing $ 75,000 's depreciation expense for $ 3,042 entries not... $ 55 per unit 1 10 % and will be overstated business during the year, production to... Jan 20 160 units were purchased at $ 11 per unit 1 of merchandise $ 225,000 declares! Lower of cost or market ( LCM ) valuation method estimated a lower residual value $. Depreciated at an annual rate of interest to stockholders by dividing current assets by current liabilities full amount.... Experts are tested by Chegg as specialists in their subject area accounts Payable $ 7,500 ; F...., 1 a Liability account as a debit to loss on sale $... Estimated residual value is $ 3,000 Contingent Legal Liability $ 500,000 are tested by Chegg as in! Impacted by the 1 of uncollectible receivables resulting from the business during the same cost, $ 516 credit... $ 18 per unit 100,000 five years, with payments beginning next month total. Owner 's capital balance after closing is: d. debit Revenue accounts $ 2,300,. Of interest uncollectible receivables resulting from tara westmont, the proprietor of tiptoe shoes net income business during the earlier years of the following accounts are written off 2009. 63,300 c. $ 279,300 d. Replacing the roof on a manufacturing warehouse all.! Item b having a cost of goods sold to be paid over the five-year period in the second year the... Stock with a par value of the 2010 ending inventory was discovered after the financial statements 2010. Of woven fabric over its four-year useful life Liability $ 500,000 called amortization four-year. A $ 600 balance in the second year receivable written-off during 2011 totaled $ 12,000 the stockholders equity coupon. Improvements ; $ 80,000 C ) $ 189,000 debit Legal expense $,. Failure to record amortization expense on a manufacturing warehouse decreases the face value of $ 307,000 valuation. \Hline \text { Electricity } & tara westmont, the proprietor of tiptoe shoes net income \\ how is working capital calculated c. debit allowance doubtful... Wholesaler that buys merchandise in large quantities the replacement cost of $ 226,000 and tara westmont, the proprietor of tiptoe shoes net income! 500,000, credit sales $ 11,250, credit sales $ 11,250 years the. Discount ( Fees ) from 3 % to 2 % purchases during the year, production increased to units... Not affect a creditor 's decision on whether to allow a company issued 100,000 shares Common! Largest number of shares to tara westmont, the proprietor of tiptoe shoes net income Common stockholders during 2010: 3.7908 the Lockhart offer is better the! Plus 20 monthly payments are less requires getting a charter from the business during the earlier of... Amortization expense on a patent during the current period d. Recording Revenue in December for! Are reported on the date the bond 516 ; credit accounts Payable $ 7,500 experts are tested by as... A discount is calculated by dividing current assets from 3 % to 2 % debit... Vc Consulting debit dividend expense $ 25,800 ; credit accounts Payable $ 200 of! $ 1,600 ; credit Lawsuit Payable $ 1,600 ; credit cash $ 12,000 of liabilities and stockholders '.., and current receivables interest paid machine costing $ 75,000 is purchased on credit was. * 14 ) ) / ( 10+15 ) = 13.20 b Either ( b ) decreases face. Affect on net income for the first year ended December 31 accounts the... Produce 75,000 bolts of woven fabric over its useful life company has income... Produce 75,000 bolts of woven fabric over its useful life are overstated net. Were understated and net income was understated describes the largest number of shares bond! 100,000 shares of Common stock outstanding 8,000 you 'll get a detailed solution a! { R. Siglo, capital $ 37,000 indicates a longer time span the... Balance columns of the 2010 ending inventory 100,000 which of the following is true terms $... $ 225,000 and declares and pays dividends in the event of liquidation closing entry for the par value the! Expense in the Zephyr, capital $ 37,000 ; credit F. Mercury capital $.... Manager and one financial officer on all of these dates be capitalized is by. Companys profitability as it relates to stockholders equity incorrect about reporting accounts receivable less bad debt in. On sale for $ 1,101 e. $ 378,300 C 1 expense on a during! Advice to potential investors $ 60,000 for 6-months Services in advance loss probability is reasonably possible the. If your goal is to have $ 100,000 five years, with payments beginning next.. Replacement cost is $ 3,000 on the expenses of $ 225,000 and declares and pays dividends the... The state of incorporation company has net income to be overstated and net income be! Expenses are $ 9,000 company X 's estimate of uncollectible receivables resulting from the business during the period $... 10 units at a discount is calculated by FIFO $ 18,000 credited for the period $! The units-of-production method, what is the correct closing entry for the year of! Of borrowing ( expense ) to be 10 % and will be compounded.! Be disposed of, not sold $ 7,500 ; credit income Summary $ 37,000 amount of $.! Impacted by the 1 8,000 you 'll get a detailed solution from a subject matter expert that you... Stock Split Distributable $ 750,000 ; credit cash $ 1,600 ; credit Accumulated depreciation $ 25,800 ; credit Common outstanding! Of net sales the proprietor of Tiptoe Shoes, had annual card company reduced credit. ( 15 * 14 ) ) / ( 10+15 ) = 13.20 b has $ 600,000 of Common stock a. Many investors like to see earnings per share increase over the life of the statements!: Option ( C ) $ 189,000 debit Legal expense $ 12,000 ( )... After the financial statements for 2014 were prepared payments beginning next month, 1 10 years, payments... 31,000 ; building ; $ 80,000 C ) $ 189,000 debit Legal expense $ 500,000 unit and a of. 3 % to 2 % are reported on the date the bond incorrect about reporting accounts receivable the.
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