Question: Suppose Acme Electronics, Inc., had sales of $

> On July 14, 2016, Salem Food Wholesale, Inc., sold $2,700 of inventory (cost is $1,050) on account to one of its customers. The terms were 2/10, n/30, FOB destination. On July 16, Salem Food Wholesale, Inc., paid freight charges of $115 related to the de

> The adjusting entries for the following adjustments were omitted at period-end: a. Prepaid rent expired, $1,300 b. Depreciation, $1,000 c. Employee salaries owed for Monday through Wednesday of a five-day workweek, $2,200 d. Supplies used during the peri

> Wu & Associates, Inc., completed the following transactions during March 2016, its frst month of operations:
Requirement 1. Using the steps outlined in the five-step transaction analysis, journalize the transactions of Wu & Associates, Inc. List tran

> The Poorboy Deli had $95,000 of total assets and $62,000 of total stockholders’ equityat December 31, 2016. At December 31, 2017, The Poorboy Deli had assets totaling$151,000 and stockholders’ equity totaling $105,000. After analyzing the data, answer th

> Journalize the following transactions for Inland Empire Supply, Inc., that occurred during the month of March.

> Journalize the adjusting entries for the following adjustments at March 31, the end of the accounting period, omitting explanations. a. Employee salaries owed for Monday through Thursday of a five-day workweek, $8,000 b. Unearned service revenue now earn

> Using the steps outlined in the five-step transaction analysis, record the following transactions in the general journal for Gulaine Plumbing, Inc. Explanations are not required.

>                                                  Assests = Liabilities + Stockholder’s Equity    &nbsp

> On October 15, 2016, Chandler’s Department Store purchased $3,900 of inventory on account from one of its suppliers. The terms were 2/15, n/45, FOB shipping point. On October 17, Chandler’s Department Store paid freight charges of $140 related to the del

> Calculate the missing amounts for each of the following Prepaid Insurance situations. For situation A, journalize the adjusting entry. Consider each situation separately.

> The following are six transactions for Aaron’s Auto Repair, Inc., during the month of February:
Requirement 1. Complete the following table. For each transaction shown, determine the accounts affected, the type of account, whether the account increas

> The analysis of Cunnington, Inc.’s first eight transactions follows. The business only soldstock once and paid no dividends.
1. Label each of the transactions in the preceding analysis with the correspondingletter of the description that best fits it

> The Inventory account for Kelly’s Florist, Inc., had a balance of $27,300 at the end of its fscal year. A physical count taken at year-end revealed that the value of inventory on hand amounted to $26,950. Requirements 1. Journalize the adjustment for in

> Suppose you started up your own landscaping business. A customer paid you $120 in advance to mow his or her lawn while he or she was on vacation. You also performed landscaping services for a local business, but the business hasn’t paid you the $390 fee

> Accounting has its own vocabulary and basic relationships. Match the accounting termsat the left with the corresponding phrase at the right. 1. Posting 2. Normal balance 3. Payable 4. Journal 5. Receivable 6. Chart of accounts 7. Debit 8. Trial ba

> Presented here are nine transactions and the analysis used to account for them. Evaluateeach of the suggested accounting treatments, and indicate whether it is true or false. 1. Received cash of $41,000 from the stockholders, who bought stock in the bus

> Use the data from S4-11 to calculate the gross profit percentage and the net income percentage for The Skate Shed, Inc., for 2016. Information S4-11: The accounting records for The Skate Shed, Inc., reflected the following amounts at the end of January 2

> After closing its accounts at July 31, 2016, Anderson Realty, Inc., had the following account balances:
Prepare Anderson Realty’s post-closing trial balance at July 31, 2016. List accounts in proper order.

> To the left of each account listed on the trial balance, indicate the financial statement that will include the account: income statement (IS), statement of retained earnings (RE), or balance sheet (BS).

> According to the Real World Accounting Video, _________ are important reports businessmanagers use in managing their business. a. balance sheets b. income statements c. both balance sheets and income statements

> According to the Real World Accounting Video, ABC Wines has a supply chain composed of its __________. a. landlords b. importers and distributors c. customers d. employees

> Use the data from S4-11 to prepare the classifed balance sheet for The Skate Shed, Inc., at January 31, 2016. Use the report format. Information S4-11: The accounting records for The Skate Shed, Inc., reflected the following amounts at the end of January

> According to the Real World Accounting Video, vendors generally sell merchandise expecting to be paid in _________________ days. a. 0 b. 30 c. 90 d. 180

> For the following series of journal entries, indicate whether each is an adjusting entry (ADJ) or a closing entry (CL).

> According to the Real World Accounting Video, GAAP is the term used for _______________. a. Government Accredited Accounting Positions b. Generally Accepted Accounting Principles c. General and Accounting Procedures

> The accounting records for Audio Masters, Corp., contain the following amounts on April 30, 2016. The accounts appear in no particular order.
Prepare the trial balance for Audio Masters at April 30, 2016. List the accounts in proper order.

> According to the Real World Accounting Video, ________ is a profitability measure thatshows how much net income is earned on every dollar of sales. a. sales ratio b. expense ratio c. asset financing ratio d. profit margin ratio

> Action Powersports, Inc., a corporation, sells and services personal watercraft. Thebusiness experienced the following events. State whether each event (a) increased,(b) decreased, or (c) had no effect on the total assets of the business, and identify th

> According to the Real World Accounting Video, the objective of business is to createvalue. True or False?

> According to the Real World Accounting Video, a __________ is a profitability measure computed as net income/net sales. a. gross profit margin ratio b. profit margin ratio c. net income ratio d. net sales ratio

> The accounting records for The Skate Shed, Inc., reflected the following amounts at the end of January 2016:

> According to the Real World Accounting Video, the cost of merchandise inventory that the business has sold to customers is called _________________. a. inventory shrinkage b. cost of business c. cost of goods sold d. cost of inventory

> The following selected accounts and balances appear on the adjusted trial balance for Waverly, Inc., on July 31, 2016:
1. What is the net income or net loss? 2. What is the change in Retained Earnings? 3. Journalize the closing entries required.

> According to the Real World Accounting Video, the excess of sales revenue over cost of goods sold is called _______________. a. the sales margin or net sales b. the gross margin or gross profit c. net income or earnings after taxes

> After operating for a month, Rosa Anderson’s dental practice completed the following transactions during September:
Using the steps outlined in the five-step transaction analysis, record the transactions in the journal.

> According to the Real World Accounting Video, businesses take risks to earn a profit. Trueor false?

> As a manager of a department store, you must deal with a variety of business transactions. Place the letter of each of the following transactions next to the effect it has onthe accounting equation. a. Paid cash to the stockholders as a distribution of e

> Which financial statement would be most useful to answer each of the followingquestions? a. Does the corporation have enough resources to pay its short-term debts? b. What is the corporation’s policy toward “growing the company” versus distributing its w

> From the following list of accounts from the adjusted trial balance, identify each as an asset, liability, stockholders’ equity, revenue, or expense. Use the most detailed account type appropriate. Also, state whether each account is a permanent or a tem

> Which correctly represents the flow of information from one financial statement to another? a. Statement of retained earnings to the balance sheet b. Income statement to the statement of retained earnings c. Both a and b are correct. d. None of the above

> What are the objectives of the closing process? Which kind of accounts get closed? What is the only account affected by the closing process but not closed?

> Rosa Anderson opened a dental practice in Spokane, Washington as a corporation. The following transactions took place in August:
Using the steps outlined in the five-step transaction analysis, record the transactions in the journal.

> The entry to record the payment of $1,500 rent expense would be which of thefollowing?

> When it is time to prepare the financial statements, from where do the financial statement numbers come?

> Label each of the items listed with the abbreviation of the financial statement on which it appears. Items may appear on more than one statement. Income Statement (IS) Balance Sheet (BS) Statement of Retained Earnings (RE) ______ 1. Accounts Receivable _

> The income statement reports a. financial position for a specific period. b. results of operations on a specific date. c. financial position on a specific date. d. results of operations for a specific period

> Suppose Rocky Mountain, Inc., lost its entire inventory in a hurricane. Beginning inventory was $49,000, net purchases totaled $530,000, and sales came to $880,000. Rocky Mountain’s normal gross profit percentage is 42 percent. Use the gross profit metho

> If a company is having a harder time selling its products, even at discounted prices compared to last year, would this year’s inventory turnover rate be higher or lower than last year’s rate? What about the gross profit rate?

> Selected account balances for Maria’s Mocha at the end of the month are listed below in random order:
Identify or compute the following amounts for Maria’s Mocha: a. Total current assets b. Total current liabilities c. Book value of plant assets d.

> What situation might explain why a company’s gross profit percentage went down from 60 percent to 40 percent from one year to the next?

> This exercise is the first exercise in a sequence that begins an accounting cycle. The cycle is continued in Chapter 2 and completed in Chapter 3. Sensations Salon, Inc., was opened by SharmaineCrosswhite in her home and completed the following transacti

> Purpose: To help you understand the importance of cash flows in the operation of a small business. You have just received your year-end financial statements from your CPA and you notice one very disturbing item. The net income from your income statement

> Place the corresponding letter of the definition next to the term. ______ 1. Cost principle ______ 2. Business entity principle ______ 3. Generally Accepted Accounting Principles ______ 4. Reliability principle a. An organization that stands as a separa

> Which type of business organization is owned by its stockholders? a. Proprietorship b. Partnership c. Corporation d. All the above are owned by stockholders.

> Go to the Columbia Sportswear Company Annual Report located in Appendix A and find the Consolidated Balance Sheets on page 663. Now access the 2014 Annual Report for Under Armour, Inc. To do this from the Internet, go to the company’s Web page at http://

> Each chapter will have a financial statement case that will focus on material contained in that chapter. You will be asked questions and will then refer to Appendix A at the end of the book where you will find the annual report for Columbia Sportswear Co

> During April, Bargain Hardware made sales of $42,300 and ended the month with inventories totaling $5,400. Cost of Goods Sold was $21,900. Total operating expenses were $10,800. How much net income did Bargain Hardware earn for the month? a. $4,200 b. $2

> The introduction to this chapter suggests that the chapter will explore the answers to some questions about inventory. Did you get the answers to those questions? Specifically, a. why does inventory need to be counted? b. what would happen if the count w

> You received a letter from one of your good customers complaining about the shipment of your product she just received. Football season is approaching, and the customer had ordered a large shipment of regulation-size footballs. Instead, she received yout

> The end of the year is approaching. You’re going to meet with your CPA next week to do some end-of-the-year tax planning, so in preparation for that meeting, you look at your last month’s income statement. You know that you’ve had a pretty good year, whi

> The following characteristics are related to either periodic inventory or perpetual inventory systems. 1. A physical count of goods on hand at year-end is required. 2. Inventory records are continuously updated. 3. Purchases of inventory are recorded in

> Lisa Hill and her husband Mike were the owners of LM Enterprises, Inc. They applied for a small business loan, and the bank requested the most recent business financial statements. When Lisa compiled the balance sheet, she noticed that the business’s ass

> Which account does a merchandiser use that a service company does not use? a. Cost of goods sold b. Inventory c. Sales revenue d. All of the above

> Find the Columbia Sportswear Company Annual Report located in Appendix A, and go to the financial statements starting on page 663. Now access the 2014 Annual Report for Under Armour, Inc., from the Internet. For instructions on how to access the report o

> This case uses both the income statement (statement of operations) and the balance sheet of Columbia Sportswear in Appendix A at the end of the book. Requirements 1. What income statement format does Columbia Sportswear use? How can you tell? 2. Calcula

> Rob Peterson works as a salesperson at Consolidated Systems, Inc. In addition to a base monthly salary, Rob receives a commission based on the amount of sales that he makes during the month. Rob was hoping to have enough money for a down payment on a new

> What accounts will appear on the financial statements of a merchandiser that will not appear on those of a service-oriented company?

> Let’s look at Dick’s Sporting Goods (Dick’s) some more. Think about Dick’s. Think about accountants reporting what Dick’s has, where it got its money, and what it has been doing to create value. Is Dick’s earning net income or loss? What resources did Di

> In this problem, we continue the accounting for Fitness Equipment Doctor, Inc., from Chapter 3. On June 1, Fitness Equipment Doctor, Inc., expanded its business and began selling and installing gym equipment. The post-closing trial balance for Fitness Eq

> You have received a letter from a disgruntled client concerning this year’s tax return that your firm recently completed for his or her company. The client’s business is in the second year of operations, and you remembered that it seemed to be much more

> It’s the end of the month, and cash flow has been a little slow, as it usually is during this time of the accounting period. It just seems to be a little slower this month. You know that Wednesday the 31st is payday, which always requires a large cash ou

> Match the accounting term with the corresponding defnition. ____ 1. Accrual-basis accounting ____ 2. Matching principle ____ 3. Revenue recognition principle ____ 4. Fiscal year a. Any consecutive 12-month period b. Records the impact of a business eve

> The text states that accounting is the “language of business.” What does this mean? Why isit important to know the language?

> The revenue recognition principle says a. divide time into equal periods to measure net income or net loss properly. b. record revenue only after you have earned it. c. match revenues and expenses in order to compute net income. d. record revenue only wh

> Go to the Columbia Sportswear Company Annual Report located in Appendix A. Now access the 2014 Annual Report for Under Armour, Inc. For instructions on how to access the reportonline, see the Industry Analysis in Chapter 1. Requirement 1. By reviewing t

> Purpose: To help familiarize you with the financial reporting of a real company in order to further your understanding of the chapter material. This case will help you to better understand the effect of adjusting journal entries on the financial statemen

> Jilian Carter was preparing the adjusting journal entries for Jilian’s Java, a business that uses the accrual basis of accounting, in order to prepare the adjusted trial balance and financial statements. She knew that $610 of salaries related to the curr

> If XYZ Consulting performs a consulting service and bills the customer on June 28 and receives payment from the customer on July 19, on what date would revenue be recorded if a. XYZ uses the cash basis of accounting? b. XYZ uses the accrual basis of acco

> This problem continues the accounting process for Fitness Equipment Doctor, Inc., from the continuing problem in Chapter 2. The trial balance for Fitness Equipment Doctor, Inc., at April 30, 2016, should look like this:
During May, the following tran

> Let’s look at Dick’s Sporting Goods (Dick’s) some more. Think about Dick’s. Think about accountants reporting what Dick’s has, where it got its money, and what it has been doing to create value. Is Dick’s earning net income or loss? What resources did Di

> This exercise continues the accounting process for Sensations Salon, Inc., from the continuing exercise in Chapter 2. Refer to the T-accounts and the trial balance that you prepared for Sensations Salon, Inc., at May 31, 2016. Requirements 1. Open these

> Brava Landscaping, Inc., completed the following transactions during its first month of operations for January 2016: a. Gabrielle Brava invested $8,500 cash and a truck valued at $16,000 to start Brava Landscaping, Inc.; the business issued common stock

> Consider the situation presented in the Small Business Analysis. Your client had two concerns thatshe asked you about. The first one is that she was concerned that her Cash balance had a creditbalance instead of a debit balance. And even after the correc

> Let’s look at Dick’s Sporting Goods (Dick’s), the largest retailer of sporting goods in the United States. Think about Dick’s, all its stakeholders, what products it sells, and how and where it sells its products. Think about all the employees who work f

> You’re sitting in your CPA office late on a Friday afternoon when you get an e-mail from aclient. You know that she has been working on setting up a new accounting system in her officefor a new business that she just started. You figured this would event

> Match the accounting terms at the left with the corresponding definitions at the right. 1. Account 2. Assets business. 3. Stockholders’ Equity 4. Expenses 5. Liabilities 6. Revenues 7. Transactions a. Any economic event that has a financial impact on th

> Which sequence of actions correctly summarizes the accounting process? a. Prepare a trial balance, journalize transactions, post to the accounts. b. Journalize transactions, post to the accounts, prepare a trial balance. c. Post to the accounts, jou

> Go to the Columbia Sportswear Company Annual Report located in Appendix A. Now access the 2014 Annual Report for Under Armour, Inc. For instructions on how to access the report online, see the Industry Analysis in Chapter 1. Requirements Answer these qu

> Although we do not have access to the journals used by Columbia Sportswear, we can still understand various business transactions on the financial statements in Columbia Sportswear’s annual report. Refer to the Columbia Sportswear income statements, “Sta

> Lynne Jamison was recording the daily transactions of Liberty Physical Therapy, Inc., into the accounting records so she could prepare financial statements and apply for a bank loan. Some of the business expenses were higher than she expected, and Lynne

> The order in which assets were listed and described in the text is the order in which you will see them listed on the balance sheet. What is the organizing principle behind the order in which assets are listed?

> Let’s look at Dick’s Sporting Goods (Dick’s) some more. Think about Dick’s. Think about accountants reporting what Dick’s has, where Dick’s got its money, and what Dick’s has been doing to create value. Is Dick’s earning net income or loss? What resource

> This exercise continues with the business of Sensations Salon, Inc., begun in the continuing exercise in Chapter 1. Instead of entering the transactions in the accounting equation as you did in Chapter 1, now you will account for Sensations Salon, Inc.’s

> You just received an e-mail from a potential new client who contacted you from your Web site. This client has indicated that he or she is planning to start a new business. The client is concerned about legal liability as well as taxation and is questioni

> What is the statute of limitations for transactions involving: a. Fraud (e.g., failure to file a tax return) b. Disallowance of tax deduction items c. The omission of rental income that is greater than 25% of the taxpayer’s reported gross income

> Kathleen owns 500 shares of Buda Corporation common stock which was purchased on March 20, 1999, for $48,000. On October 10 of the current year, she receives a distribution of 500 stock rights. Each stock right has a $20 FMV and the FMV of the Buda commo

> Why did the Supreme Court rule in the Corn Products case that a gain due to the sale of futures contracts is ordinary income instead of capital gain?

> USA Corporation hired Jesse to install a computer system for the company and paid him $8,000 for the work. USA soon realized that there were problems with the system and asked Jesse to refund the payment. At the end of the year the dispute had not been r

> Which of the following would likely be a constructive dividend? a. An unreasonable salary paid to a shareholder. b. An unreasonable salary paid to the daughter of a shareholder. c. A sale of a corporation’s asset to a shareholder at fair market value.

> The PDQ Partnership earned ordinary income of $150,000 in 2017. The partnership has three equal partners, Pete, Donald, and Quint. Quint, who is single, uses the standard deduction, and has other income of $15,000 (not connected with the partnership) in