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Comments: 1 . This is an example that illustrates accounting capturing organization history on an event - by - event basis. This means that whenever
Comments:
This is an example that illustrates accounting capturing organization history on an eventbyevent
basis. This means that whenever an event happens, the accounting system records the event.
The lectures have a brief review of the accounting cycle. The text has three chapters, pages
through that describes the accounting cycle.
For the exam, you will want to be able to
a Given an event, provide the journal entry.
b Given a journal entry, describe the effect on the assets, liabilities, shareholders equity,
revenues, and expenses.
Here are some check figures:
Net Income is $
Total Assets are $
Total Liabilities are $
Shareholders Equity is $
Problem statement:
Bobs Chocolate Chips and More, a bakery specializing in gourmet pizza and chocolate chip cookies,
started business October The following transactions occurred during the month.
a Common stock of $ was sold at par to start the business.
b Equipment, consisting of mixers and ovens, was acquired October for $ cash. The equipment
is expected to last five years and can be sold at that time for $ Management uses the straightline
method to calculate depreciation expense.
c Ingredients costing $ were purchased on account during the month and all but $ was paid
for by the end of the month.
d Rent is $ a month. October, November, and Decembers rent was paid October
e A payment of $ for utilities was made during the month.
f Sixty percent of the ingredients purchased in part c were prepared and sold for $ on account;
$ was collected on accounts receivable during the month.
g Wages of $ were paid during the month. Moreover, wages for the last three days of the month
amounted to $ and will be paid during the first week of November.
h Borrowed $ as a Note Payable from the bank for additional working capital requirements, and
$ was repaid by monthend. Interest on the unpaid loan balance amounted to $ at the end of
October and was paid on November
Required:
Prepared the journal entries and adjusting entries.
Prepare the income statement for October.
Prepare the balance sheet as of October This is an example that illustrates accounting capturing organization history on an eventbyevent
basis. This means that whenever an event happens, the accounting system records the event.
The lectures have a brief review of the accounting cycle. The text has three chapters, pages
through that describes the accounting cycle.
For the exam, you will want to be able to
a Given an event, provide the journal entry.
b Given a journal entry, describe the effect on the assets, liabilities, shareholders' equity,
revenues, and expenses.
Here are some check figures:
Net Income is $
Total Assets are $
Total Liabilities are $
Shareholders' Equity is $
Problem statement:
Bob's Chocolate Chips and More, a bakery specializing in gourmet pizza and chocolate chip cookies,
started business October The following transactions occurred during the month.
a Common stock of $ was sold at par to start the business.
b Equipment, consisting of mixers and ovens, was acquired October for $ cash. The equipment
is expected to last five years and can be sold at that time for $ Management uses the straightline
method to calculate depreciation expense.
c Ingredients costing $ were purchased on account during the month and all but $ was paid
for by the end of the month.
d Rent is $ a month. October, November, and December's rent was paid October
e A payment of $ for utilities was made during the month.
f Sixty percent of the ingredients purchased in part c were prepared and sold for $ on account;
$ was collected on accounts receivable during the month.
g Wages of $ were paid during the month. Moreover, wages for the last three days of the month
amounted to $ and will be paid during the first week of November.
h Borrowed $ as a Note Payable from the bank for additional working capital requirements, and
$ was repaid by monthend. Interest on the unpaid loan balance amounted to $ at the end of
October and was paid on November
Required:
Prepared the journal entries and adjusting entries.
Prepare the income statement for October.
Prepare the balance sheet as of October
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