Questions from Financial Reporting

Q: The following information was extracted from Citigroup, Inc.’s 2009

The following information was extracted from Citigroup, Inc.’s 2009 annual report. From letter to shareholders: Financial Strength While Citi started the year as a TARP institution...

Q: In November and December 2017, Gee Company, a newly organized

In November and December 2017, Gee Company, a newly organized magazine publisher, received $36,000 for 1,000 three-year subscriptions at $12 per year, starting with the January 2018 issue of the magaz...

Q: Todd Corporation wrote off $100,000 of obsolete inventory at

Todd Corporation wrote off $100,000 of obsolete inventory at December 31, 2017. What effect did this write-off have on the company’s December 31, 2017, current and quick ratios?

Q: On December 31, 2017, Vale Company had an unadjusted credit

On December 31, 2017, Vale Company had an unadjusted credit balance of $1,000 in its Allowance for uncollectible accounts. An analysis of Vale’s trade accounts receivable at that dat...

Q: Jerry’s Jellies sells one- and two-year mail-order

Jerry’s Jellies sells one- and two-year mail-order subscriptions for its jelly-of-the-month business. Subscriptions are collected in advance and credited to sales. An analysis of the...

Q: Barnard Bike Shop sells a bicycle to a customer for $750

Barnard Bike Shop sells a bicycle to a customer for $750. The bicycle comes with free annual tune-ups for three years. The charge for tune-ups sold separately is $60. Barnard uses the residual approac...

Q: Barnard Bike Shop sells a bicycle to a customer for $600

Barnard Bike Shop sells a bicycle to a customer for $600. Barnard offers to sell three tune-ups over the next three years for a total price of $150. The customer decides to purchase the tune ups and p...

Q: Smith, Inc., produces and sells clothing to department stores.

Smith, Inc., produces and sells clothing to department stores. Its supply arrangement with Leftwich Department Stores calls for Smith to purchase from Leftwich each month in-store advertising at a cos...

Q: Dale Golf Course, Inc., operates golf courses in South Carolina

Dale Golf Course, Inc., operates golf courses in South Carolina. A round of golf at one of Dale’s courses costs $75. Dale also sells one-year season passes, good for unlimited rounds of golf for a sin...

Q: Latter Corporation received an order from Murray, Inc. for electronic

Latter Corporation received an order from Murray, Inc. for electronic components. Because Murray is struggling financially, Latter called the company and said it will get ready to fulfill the order, b...