Questions and Answers of Financial Accounting Tool

Jeters Company uses a periodic inventory system and reports the following for the month of June. Instructions a. Compute the cost of the ending inventory and the cost of goods sold under
Nona Hat Shop received a shipment of hats for which it paid the wholesaler $2,940. The price of the hats was $3,000, but Nona was given a $60 cash discount and required to pay freight charges of $75.
A company’s annual report provides various information about inventory.Instructions Answer the following questions based on the current year’s annual report available at Cisco’s
You have the following information for Van Gogh Inc. for the month ended October 31, 2022. Van Gogh uses a periodic method for inventory. a. Calculate (i) ending inventory, (ii) cost of goods
Abe Technologies provides maintenance service for computers and office equipment for companies throughout the Northeast. The sales manager is elated because she closed a $300,000, 3-year maintenance
In completing the engagement in Question 4 , Wilson pays no costs in March, $2,500 in April, and $2,200 in May (incurred in April). How much expense should the fi rm deduct from revenues in the month
Max Wilson, a lawyer, accepts a legal engagement in March, performs the work in April, and is paid in May. If Wilson’s law firm prepares monthly financial statements, when should it recognize
What are the five steps of the revenue recognition process?
Number the following steps of the revenue recognition process (from 1–5) to place in the correct order a. ________ Allocate the transaction price to the separate performance
What are the normal balances for the following accounts of Apple? (a) Accounts Receivable, (b) Accounts Payable, (c) Sales, (d) Selling, General, and Administrative Expenses.
The following is a list of terms or phrases discussed in the chapter. 1. Credit 2. Journal 3. Ledger 4. Chart of accounts 5. Posting 6. Account 7. Trial
Pamper Me Salon Inc.’s general ledger at April 30, 2022, included the following: Cash $5,000, Supplies $500, Equipment $24,000, Accounts Payable $2,100, Notes Payable $10,000, Unearned Service
Klean Sweep Company offers home cleaning service. Two recurring transactions for the company are billing customers for services performed and paying employee salaries. For example, on March 15 bills
Saira Morrow operates Dressage Riding Academy, Inc. The academy’s primary sources of revenue are riding fees and lesson fees, which are provided on a cash basis. Saira also boards horses for
Sprouts Corporation reported net cash provided by operating activities of $412,000, net cash used by investing activities of $250,000, and net cash provided by financing activities of $70,000. In
Suppose during 2022 that Cypress Semiconductor Corporation reported net cash provided by operating activities of $89,303,000, cash used in investing of $43,126,000, and cash used in financing of
Answer the following questions. a. Why is net cash provided by operating activities likely to be lower than reported net income during the growth phase? b. Why is net cash from investing
The T-accounts for Equipment and the related Accumulated Depreciation—Equipment for Goldstone Company at the end of 2022 are shown here. In addition, Goldstone’s income statement reported a
The net income for Mongan Co. for 2022 was $280,000. For 2022, depreciation on plant assets was $70,000, and the company incurred a loss on disposal of plant assets of $28,000. Compute net cash
Miguel, Inc. reported net income of $2.5 million in 2022. Depreciation for the year was $160,000, accounts receivable decreased $350,000, and accounts payable decreased $280,000. Compute net cash
The following T-account is a summary of the Cash account of Alixon Company. What amount of net cash provided (used) by financing activities should be reported in the statement of cash fl ows?
Sheen Company reported these income statement data for a 2-year period. Sheen Company uses a periodic inventory system. The inventories at January 1, 2021, and December 31, 2022, are correct.
Dowell Hardware reported cost of goods sold as follows.Dowell made two errors: 1. 2021 ending inventory was overstated by $2,000. 2. 2022 ending inventory was understated by
Inventory data for Jeters Company are presented in E6.7. Instructions a. Calculate the cost of the ending inventory and the cost of goods sold for each cost flow assumption, using a
Deere & Company is a global manufacturer and distributor of agricultural, construction, and forestry equipment. Suppose it reported the following information in its 2022 annual
The following information is available for Zoe’s Activewear Inc. for three recent fiscal years. Instructions a. Calculate the inventory turnover, days in inventory, and gross profit rate
Tascon Corporation sells coffee beans, which are sensitive to price fluctuations. The following inventory information is available for this product at December 31,
Each of these items must be considered in preparing a statement of cash flows for Irvin Co. for the year ended December 31, 2022. For each item, state how it should be shown in the statement of cash
Harbinger Inc. reported sales of $2 million for 2022. Accounts receivable decreased $150,000 and accounts payable increased $300,000. Compute cash receipts from customers, assuming that the
Based on its statement of cash flows, in what stage of the product life cycle is Apple?
During 2022, Slivowitz Company exchanged $1,700,000 of its common stock for land. Indicate how the transaction would be reported on a statement of cash fl ows, if at all.
The financial statements of Louis Vuitton are presented in Appendix F. The complete annual report, including the notes to its financial statements, is available at the company’s
Meenen Corporation has the following accounts at December 31, 2022 (in euros): Share Capital—Ordinary, €10 par, 5,000 shares issued, €50,000; Share Premium—Ordinary €10,000; Retained
On January 1, 2022, Tacoma Corporation had these stockholders’ equity accounts. Common Stock ($10 par value, 70,000 shares issued and outstanding) .................... $700,000 Paid-in
Spahn Company manufactures backpacks. During 2022, Spahn issued bonds at 10% interest and used the cash proceeds to purchase treasury stock. The following financial information is available for Spahn
On January 1, 2022, Kimbel Inc. had these stockholders’ equity balances. Common Stock, $1 par (2,000,000 shares authorized, 600,000 shares issued and outstanding).....................$
Layes Corporation has been authorized to issue 20,000 shares of $100 par value, 7%, noncumulative preferred stock and 1,000,000 shares of no-par common stock. The corporation assigned a $5 stated
The ledger of Waite Corporation at December 31, 2022, after the books have been closed, contains the following stockholders’ equity accounts. Preferred Stock (10,000 shares
On December 31, 2021, Jons Company had 1,300,000 shares of $5 par common stock issued and outstanding. At December 31, 2021, stockholders’ equity had the amounts listed here. Common
The stockholders’ equity accounts of Cyrus Corporation on January 1, 2022, were as follows. Preferred Stock (7%, $100 par noncumulative, 5,000 shares authorized)................$
Tidal Corporation was organized on January 1, 2022. It is authorized to issue 20,000 shares of 6%, $50 par value preferred stock and 500,000 shares of no-par common stock with a stated value of $1
On January 1, 2022, Lenne Corporation had $1,200,000 of common stock outstand ing that was issued at par and retained earnings of $750,000. The company issued 30,000 shares of common stock at par
Cabo Company has $1,000,000 in assets and $1,000,000 in stockholders’ equity, with 40,000 shares outstanding the entire year. It has a return on assets of 10%. During 2021, it had net income of
Kojak Corporation decided to issue common stock and used the $300,000 proceeds to redeem all of its outstanding bonds on January 1, 2022. The following information is available for the company for
Suppose the following financial information is available for Walgreen Company.Instructions Calculate the payout ratio and return on common stockholders’ equity for 2022 and 2021. Comment on your
The following financial information is available for Flintlock Corporation. Instructions Calculate the payout ratio and return on common stockholders’ equity for 2022 and 2021. Comment on
The following accounts appear in the ledger of Paisan Inc. after the books are closed at December 31, 2022. Instructions Prepare the stockholders’ equity section at December 31, assuming
The following stockholders’ equity accounts, arranged alphabetically, are in the ledger of Ryder Corporation at December 31, 2022. Common Stock ($2 stated
On January 1, 2022, the ledger of Romada Company contained these liability accounts. Accounts Payable....................$42,500 Sales Taxes Payable....................6,600 Unearned
Waite Corporation issued a $50,000, 10%, 10-year installment note payable on January 1, 2022. Payments of $8,137 are made each January 1, beginning January 1, 2023. Instructions a. What
Yancey Co. receives $300,000 when it issues a $300,000, 10%, mortgage note payable to finance the construction of a building at December 31, 2022. The terms provide for annual installment payments of
Woode Corporation issued $400,000, 7%, 20-year bonds on January 1, 2022, for $360,727. This price resulted in an effective-interest rate of 8% on the bonds. Interest is payable annually on January 1.
Woode Corporation issued $400,000, 7%, 20-year bonds on January 1, 2022, for $360,727. This price resulted in an effective-interest rate of 8% on the bonds. Interest is payable annually on January 1.
Motley Company issued $300,000, 8%, 15-year bonds on December 31, 2021, for $288,000. Interest is payable annually on December 31. Motley uses the straight-line method to amortize bond premium or
Sehr Company issued $500,000, 6%, 30-year bonds on January 1, 2022, at 103. Interest is payable annually on January 1. Sehr uses straight-line amortization for bond premium or
The following are terms or phrases that were introduced in the chapter. 1. Bond certifi cate. 2. Premium (on a bond). 3. Discount (on a bond). 4. Times interest earned. 5.
Underwood Boutique reported the following financial data for 2022 and 2021. Instructions a. Calculate the current ratio for Underwood Boutique for 2022 and 2021. b. Suppose that at the
Suppose 3M Company reported the following financial data for 2022 and 2021 (in millions). Instructions a. Calculate the current ratio for 3M for 2022 and 2021. b. Suppose that at the
Suppose McDonald’s 2022 financial statements contain the following selected data (in millions).Instructions Compute the following values and provide a brief interpretation of each. a.
Sanchez, Inc. reports the following liabilities (in thousands) on its December 31, 2022, balance sheet and notes to the financial statements. Instructions a. Identify which of the above
The following situations are independent of each other. Instructions For each situation, prepare the appropriate journal entry for the redemption of the bonds. a. Mikhail Corporation
Kale Company issued $350,000 of 8%, 20-year bonds on January 1, 2022, at face value. Interest is payable annually on January 1. Instructions Prepare the journal entries to record the
Assume that the following are independent situations recently reported in the Wall Street Journal. 1. General Electric (GE) 7% bonds, maturing January 28, 2023, were issued at 111.12. 2.
Mobbe Company issued $500,000, 15-year, 7% bonds at 96. Instructions a. Prepare the journal entry to record the sale of these bonds on January 1, 2022. b. Suppose the remaining
Arroyo Company issued $600,000, 10-year, 6% bonds at 103. Instructions a. Prepare the journal entry to record the sale of these bonds on January 1, 2022. b. Suppose the remaining
On August 1, 2022, Gonzaga Corporation issued $600,000, 7%, 10-year bonds at face value. Interest is payable annually on August 1. Gonzaga’s year-end is December 31. Instructions Prepare
Cassini Company Ltd. publishes a monthly sports magazine, Fishing Preview. Subscriptions to the magazine cost $28 per year. During November 2022, Cassini sells 6,300 subscriptions for cash, beginning
Dan Noll’s gross earnings for the week were $1,780, his federal income tax withholding was $303, and his FICA total was $136. There were no state income taxes. Instructions Instructions.a.
During the month of March, Munster Company’s employees earned wages of $64,000. With holdings related to these wages were $4,896 for FICA, $7,500 for federal income tax, $3,100 for state income
In performing accounting services for small businesses, you encounter the following situations pertaining to cash sales. 1. Cerviq Company enters sales and sales taxes separately on its cash
Kelly Jones and Tami Crawford borrowed $15,000 on a 7-month, 8% note from Gem State Bank to open their business, JC’s Coffee House. The money was borrowed on June 1, 2022, and the note matures
Under what circumstances will the return on assets and the return on common stockholders’ equity be equal?
Explain the circumstances under which debt financing will increase the return on common stockholders’ equity.
What was the cost of Apple’s treasury stock acquired in fiscal year 2017?
Ratzlaff Company issues (in euros) €2 million, 10-year, 8% bonds at 97, with interest payable annually on January 1. Instructions a. Prepare the journal entry to record the sale of these
On January 1, 2020, Picard Corporation issued $3,000,000, 5-year, 8% bonds at 97. The bonds pay interest annually on January 1. By January 1, 2022, the market rate of interest for bonds of risk
Bond or debt securities pay a stated rate of interest. This rate of interest is dependent on the risk associated with the investment. Also, bond prices change when the risks associated with those
Aimes Corporation’s balance sheet at December 31, 2021, is presented below.During 2022, the following transactions occurred. Aimes uses a perpetual inventory system. 1. Aimes paid $2,500
Suppose the amounts presented here are basic financial information (in millions) from the 2022 annual reports of Nike and adidas. Instructions Calculate the accounts receivable turnover and
On January 1, 2022, Harvee Company had Accounts Receivable of $54,200 and Allowance for Doubtful Accounts of $3,700. Harvee Company prepares fi nancial statements annually. During the year, the
At December 31, 2022, the trial balance of Malone Company contained the following amounts before adjustment. Instructions a. Prepare the adjusting entry at December 31, 2022, to record bad
Here is information related to Morgane Company for 2022. Total credit sales........................$1,500,000 Accounts receivable at December..........31 840,000 Bad debts are written
Presented below is an aging schedule for Bryan Company at December 31, 2021. At December 31, 2021, the unadjusted balance in Allowance for Doubtful Accounts is a credit of
At December 31, 2021, Suisse Imports reported this information on its balance sheet. Accounts receivable........................$600,000 Less: Allowance for doubtful
You are comparing two companies in the same industry. You have determined that Gore Corp. depreciates its plant assets over a 40-year life, whereas Ross Corp. depreciates its plant assets over a
Suppose in 2022 that Campbell Soup Company reported average total assets of $6,265 million, net sales of $7,586 million, and net income of $736 million. What was Campbell Soup’s return on assets?
Kwik Taxi Service uses the units-of-activity method in computing depreciation on its taxicabs. Each cab is expected to be driven 150,000 miles. Taxi 10 cost $27,500 and is expected to have a salvage
What does Apple use as the estimated useful life on its buildings? On its machinery and equipment?
Suppose Nike, Inc. reported the following plant assets and intangible assets for the year ended May 31, 2022 (in millions): other plant assets $965.8, land $221.6, patents and trademarks (at cost)
Suppose in its 2022 annual report that McDonald’s Corporation reports beginning total assets of $28.46 billion, ending total assets of $30.22 billion, net sales of $22.74 billion, and net income of
Abner Company purchases a patent for $156,000 on January 2, 2022. Its estimated useful life is 6 years. a. Prepare the journal entry to record amortization expense for the first year. b.
Antone Company sells offi ce equipment on July 31, 2022, for $21,000 cash. The offi ce equipment originally cost $72,000 and as of January 1, 2022, had accumulated depreciation of $42,000.
On January 1, 2022, the Hermann Company general ledger shows Equipment $36,000 and Accumulated Depreciation $13,600. The depreciation resulted from using the straight-line method with a useful life
Ivy Company purchased land and a building on January 1, 2022. Management’s best estimate of the value of the land was $100,000 and of the building $250,000. However, management told the accounting
Gordon Chemicals Company acquires a delivery truck at a cost of $31,000 on January 1, 2022. The truck is expected to have a salvage value of $4,000 at the end of its 4-year useful life. Compute
a. On January 1, 2022, Salt Creek Country Club purchased a new riding mower for $15,000. The mower is expected to have a 10-year life with a $1,000 salvage value. What journal entry would Salt Creek
Dotsin Corporation issues $400,000 of 9%, 5-year bonds on January 1, 2022, at 104. If Dotsin uses the effective-interest method in amortizing the premium, will the annual interest expense increase or
Robbins Corporation issues $200,000 of 6%, 5-year bonds on January 1, 2022, at 103. Assuming that the straight-line method is used to amortize the premium, what is the total amount of interest
Anglo Corporation has a current ratio of 1.1:1. Jon has always been told that a corporation’s current ratio should exceed 2.0:1. The company maintains that its ratio is low because it has a minimal
Assume that Acorn Inc. sold bonds with a face value of $100,000 for $104,000. Was the market interest rate equal to, less than, or greater than the bonds’ contractual interest rate? Explain.

Showing 1100 - 1200 of 1343