Question: A $2,000,000 bond issue on

> Dillin Inc. reported the following on the company’s statement of cash flows in 20Y2 and 20Y1: Of the net cash flows used for investing activities, 60% was used for the purchase of property, plant, and equipment. a. Determine Dillin&ac

> Jones Industries received $800,000 from issuing shares of its common stock and $650,000 from issuing bonds. During the year, Jones Industries also paid dividends of $110,000. How are the effects of these transactions reported on the statement of cash flo

> IZ Corporation purchased land for $425,000. Later in the year, the company sold a different piece of land with a book value of $225,000 for $270,000. How are the effects of these transactions reported on the statement of cash flows?

> Obtain Alphabet Inc.’s (GOOG) most recent annual report on Form 10-K. The Form 10-K is a company’s annually required filing with the Securities and Exchange Commission (SEC). It includes the company’s financial statements and accompanying notes. The Form

> On December 1 of the current year, the following accounts and their balances appear in the ledger of Latte Corp., a coffee processor: At the annual stockholders’ meeting on March 31, the board of directors presented a plan for modernizi

> Pecan Theatre Inc. owns and operates movie theaters throughout Florida and Georgia. Pecan Theatre has declared the following annual dividends over a six-year period: 20Y1, $60,000; 20Y2, $80,000; 20Y3, $160,000; 20Y4, $160,000; 20Y5, $170,000; and 20Y6,

> Crazy Mountain Tours Co. is a travel agency. The nine transactions recorded by Crazy Mountain Tours during May 20Y2, its first month of operations, are indicated in the following T accounts: Indicate for each debit and each credit: (a) whether an asset

> The following selected accounts appear in the ledger of Parks Construction Inc. at the beginning of the current year: During the year, the corporation completed a number of transactions affecting the stockholders’ equity. They are sum

> Amazon.com, Inc. (AMZN) is one of the largest Internet retailers in the world. Walmart Inc. (WMT) is the largest retailer in the United States. Amazon and Walmart compete in similar markets; however, Walmart sells through both traditional retail stores a

> Truist Financial Corp (TFC) and Regions Financial Corporation (RF) are large regional banking companies. The net income and average common shares outstanding for both companies were reported in recent financial reports as follows (in millions): a. Determ

> Caterpillar Inc. (CAT) is the world’s leading manufacturer of construction and mining equipment. Three recent years of earnings and average common shares outstanding data for Caterpillar are as follows (in millions): a. Determine the

> Pacific Gas and Electric Company (PCG) is a large gas and electric utility operating in northern and central California. Three recent years of financial data for Pacific Gas and Electric are as follows (in millions): a. Determine the earnings per share f

> Bank of America Corporation (BAC) and Wells Fargo & Company (WFC) are two large financial services companies. The following data (in millions) were taken from a recent year’s financial statements for both companies: a. Compute the e

> Seventy-Two Inc., a developer of radiology equipment, has stock outstanding as follows: 80,000 shares of cumulative preferred 2% stock, $50 par and 200,000 shares of $10 par common. During its first four years of operations, the following amounts were di

> Specialty Auto Racing Inc. retails racing products for BMWs, Porsches, and Ferraris. The following accounts and their balances appear in the ledger of Specialty Auto Racing on July 31, the end of the current year: Stock shares authorized are: preferred s

> Mystic Lake Inc. bottles and distributes spring water. On July 9 of the current year, Mystic Lake reacquired 80,000 shares of its common stock at $44 per share. On September 22, Mystic Lake sold 55,000 of the reacquired shares at $52 per share. The remai

> Willey’s Grill & Restaurant Corporation wholesales ovens and ranges to restaurants throughout the Southwest. Willey’s Grill & Restaurant, which had 345,000 shares of common stock outstanding, declared a 3-for-1 stock split. a. What will be the number of

> The following selected transactions were completed during October of the current year: 1. Billed customers for fees earned, $88,500. 2. Purchased supplies on account, $3,000. 3. Received cash from customers on account, $66,275. 4. Paid creditors on accou

> The declaration, record, and payment dates in connection with a cash dividend of $1,525,000 on a corporation’s common stock are July 9, August 31, and October 1. Journalize the entries required on each date.

> Alpha Sounds Corp., an electric guitar retailer, was organized by Michele Kirby, Paul Glenn, and Gretchen Northway. The charter authorized 1,000,000 shares of common stock with a par of $1. The following transactions affecting stockholders’ equity were c

> On May 15, Helena Carpet Inc., a carpet wholesaler, issued for cash 625,000 shares of no-par common stock (with a stated value of $2.25) at $5, and on June 30, it issued for cash 22,000 shares of preferred stock, $50 par at $62. a. Journalize the entries

> On January 22, Jefferson County Rocks Inc., a marble contractor, issued for cash 230,000 shares of $20 par common stock at $25, and on February 27, it issued for cash 12,000 shares of preferred stock, $8 par at $14. a. Journalize the entries for January

> On January 22, Zentric Corporation issued for cash 180,000 shares of no-par common stock at $12. On February 14, Zentric issued at par value 50,000 shares of preferred 2% stock, $50 par for cash. On August 30, Zentric issued for cash 20,000 shares of pre

> Zero Calories Company has 20,000 shares of cumulative preferred 1% stock, $50 par and 200,000 shares of $10 par common stock. The following amounts were distributed as dividends: 20Y1…………….$ 30,000 20Y2……………8,000 20Y3……………110,000 Determine the dividends

> Using the following accounts and balances, prepare the “Stockholders’ Equity” section of the balance sheet. Regarding the common stock, 500,000 shares are authorized, and 40,000 shares have been reacquired. Common Stock, $120 par……………………………………………..$48,00

> On May 27, Hydro Clothing Inc. reacquired 60,000 shares of its common stock at $8 per share. On August 3, Hydro Clothing sold 42,000 of the reacquired shares at $12 per share. On November 14, Hydro Clothing sold the remaining shares at $6 per share. Jour

> Alpine Energy Corporation has 1,200,000 shares of $10 par common stock outstanding. On August 2, Alpine Energy declared a 6% stock dividend to be issued October 8 to stockholders of record on September 15. The market price of the stock was $50 per share

> The declaration, record, and payment dates in connection with a cash dividend of $425,000 on a corporation’s common stock are October 1, November 7, and December 15. Journalize the entries required on each date.

> Birdy Consulting Co. has the following accounts in its ledger: Cash, Accounts Receivable, Supplies, Office Equipment, Accounts Payable, Common Stock, Retained Earnings, Dividends, Fees Earned, Rent Expense, Advertising Expense, Utilities Expense, and Mis

> Obtain Nike, Inc.’s most recent annual report on Form 10-K. The Form 10-K is a company’s annually required filing with the Securities and Exchange Commission (SEC). It includes the company's financial statements and accompanying notes. The Form 10-K can

> Rodgers Corporation produces and sells football equipment. On July 1, 20Y1, Rodgers issued $65,000,000 of 10-year, 12% bonds at a market (effective) interest rate of 10%, receiving cash of $73,100,469. Interest on the bonds is payable semiannually on Dec

> On July 1, 20Y1, Danzer Industries Inc. issued $60,000,000 of 10-year, 8% bonds at a market (effective) interest rate of 10%, receiving cash of $52,522,704. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the

> Campbell, Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $40,000,000 of 10-year, 10% bonds at a market (effective) interest rate of 9%, receiving cash of $42,601,480. Interest on the bonds is payable semiannually on December

> Campbell Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $40,000,000 of 10-year, 10% bonds at a market (effective) interest rate of 9%, receiving cash of $42,601,480. Interest on the bonds is payable semiannually on December 3

> Hilton Worldwide Holdings, Inc. (HLT) and Marriott International, Inc. (MAR) are two of the largest hotel operators in the world. Selected financial information from recent income statements for both companies follows (in millions): a. Compute the times

> Abercrombie & Fitch (ANF) is a leading, global specialty retailer of casual apparel. The income before income tax expense and interest expense for four recent years follow (in thousands): a. Compute the times interest earned ratio for each year. Roun

> The Clorox Company (CLX) and The Procter & Gamble Company (PG) produce and sell packaged consumer products around the world. Income and interest expense information from financial statements for a recent year follows (in millions): a. Compute the t

> Amazon.com, Inc. (AMZN) is one of the largest Internet retailers in the world. Walmart Inc. (WMT) is the largest retailer in the United States. Amazon and Walmart compete in similar markets; however, Walmart sells through both traditional retail stores a

> Thomson Co. produces and distributes semiconductors for use by computer manufacturers. Thomson issued $1,200,000 of 10-year, 8% bonds on May 1 of the current year at face value, with interest payable on May 1 and November 1. The fiscal year of the compan

> Indicate whether each of the following activities would be reported on the statement of cash flows as (a) an operating activity, (b) an investing activity, or (c) a financing activity: 1. Cash received by issuing common stock. 2. Cash received for fees

> United States Steel Corporation’s (X) 6.65% bonds due in 2037 were reported as selling for 102.8. Were the bonds selling at a premium or at a discount? Why is United States Steel able to sell its bonds at this price?

> Shunda Corporation wholesales parts to appliance manufacturers. On January 1, Shunda issued $20,000,000 of 5-year, 10% bonds at a market (effective) interest rate of 8%, receiving cash of $21,622,179. Interest is payable semiannually. Shunda’s fiscal yea

> Pinder Co. produces and sells high-quality video equipment. To finance its operations, Pinder issued $25,000,000 of 5-year, 7% bonds, with interest payable semiannually, at a market (effective) interest rate of 9%. Determine the present value of the bond

> Hoover Corp., a wholesaler of music equipment, issued $10,000,000 of 20-year, 5% callable bonds on March 1, 20Y2, at their face amount, with interest payable on March 1 and September 1. The fiscal year of the company is the calendar year. Journalize the

> Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley issued $20,000,000 of 5-year, 9% bonds at a market (effective) interest rate of 8%, receiving cash of $20,811,010. Interest is payable semiannually on Apri

> On the first day of its fiscal year, Chin Company issued $15,000,000 of 5-year, 6% bonds to finance its operations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective) interes

> If you asked your broker to purchase for you a 11% bond when the market interest rate for such bonds was 12%, would you expect to pay more or less than the face amount for the bond? Explain.

> On the first day of the fiscal year, a company issues a $2,500,000, 8%, 5-year bond that pays semiannual interest of $100,000 ($2,500,000 × 8% × ½), receiving cash of $2,300,000. Journalize the bond issuance.

> Averill Products Inc. reported the following on the company’s income statement in 20Y8 and 20Y9: Answer: a. Times Interest Earned = / 20Y8: /= 12.0 20Y9: / 13.6 b. The times interest earned ratio has increased from 12.0 in

> The following selected transactions were completed by Cota Delivery Service during July: 1. Received cash in exchange for common stock, $50,000. 2. Purchased supplies for cash, $1,800. 3. Paid rent for July, $4,500. 4. Paid advertising expense, $1,200. 5

> Using the bond from Basic Exercise 11-4, journalize the first interest payment and the amortization of the related bond premium.

> On the first day of the fiscal year, a company issues a $6,000,000, 6%, 5-year bond that pays semiannual interest of $180,000 ($6,000,000 × 6% × ½), receiving cash of $6,300,000. Journalize the bond issuance.

> Using the bond from Basic Exercise 11-2, journalize the first interest payment and the amortization of the related bond discount.

> Obtain Starbucks Corporation’s most recent annual report on Form 10-K. The Form 10-K is a company’s annually required filing with the Securities and Exchange Commission (SEC). It includes the company’s financial statements and accompanying notes. The For

> Corwin LTD is a business supply company in Phoenix, Arizona. Corwin’s current liabilities consist almost entirely of accounts payables to its suppliers (vendors). In an effort to better understand its accounts payable and supplier relationships, manageme

> The following information about the weekly payroll was obtained from the records of Saine Co.: Tax rates assumed: Social security, 6% Medicare, 1.5% State unemployment (employer only), 5.4% Federal unemployment (employer only), 0.8% Instructions 1. Assu

> The following items were selected from among the transactions completed by Sherwood Co. during the current year: Mar. 1. Purchased merchandise on account from Kirkwood Co., $215,000, terms n/30. 31. Issued a 30-day, 6% note for $215,000 to Kirkwood Co.,

> The following information about the weekly payroll was obtained from the records of Boltz Co.: Instructions 1. Assuming that the payroll related to the first full week of the year and was paid on January 7, journalize the following entries: a. January 7

> Amazon.com, Inc. (AMZN) is one of the largest Internet retailers in the world. Best Buy, Co. Inc. (BBY) is a leading retailer of consumer electronics and media products in the United States. Amazon and Best Buy compete in similar markets; however, Best B

> Hibbett Sports, Inc. (HIBB) is a sporting goods retailer with locations primarily in the Southeast, Southwest, and Midwest United States. Dick’s Sporting Goods, Inc. (DKS) is a leading full-line retailer of sporting equipment and appare

> Captivating Inc. is a motivational consulting business. At the end of its accounting period, May 31, 20Y2, Captivating Inc. has assets of $2,450,000 and liabilities of $1,180,000. Using the accounting equation and considering each case independently, det

> Neiman Marcus Group (NMG) is one of the largest luxury fashion retailers in the world. Kohl’s Corporation (KSS) sells moderately priced private and national branded products through more than 1,100 department stores located throughout t

> The Hershey Company (HSY) is the largest producer of chocolate in North America under the Hershey’s and Reese’s brand names. The following balance sheet information is provided at the end of three recent years (in thou

> Abercrombie & Fitch Co. (ANF) and The Gap, Inc. (GPS) are two U.S. apparel retailers. The current assets and current liabilities for each company from recent balance sheets are as follows (in thousands): a. Compute the working capital for each comp

> General Motors Corporation (GM) reported $7.8 billion of product warranties in the “Current liabilities” section of a recent balance sheet. How would costs of repairing a defective product be recorded?

> A business issued a 90-day, 6% note for $80,000 to a creditor on account. Journalize the entries to record (a) the issuance of the note and (b) the payment of the note at maturity, including interest.

> Bennett Enterprises issues a $600,000, 120-day, 4% note to Spectrum Industries for merchandise inventory. a. Journalize Bennett Enterprises’ entries to record: 1. The issuance of the note. 2. The payment of the note at maturity. b. Journalize Spectrum In

> Bon Nebo Co. sold 40,000 annual subscriptions of Bjorn for $60 during December 20Y5. These new subscribers will receive monthly issues, beginning in January 20Y6. In addition, the business had taxable income of $920,000 during the first calendar quarter

> Fosters Manufacturing Co. warrants its products for one year. The estimated product warranty is 2% of sales. Assume that sales were $1,800,000 for January. On February 7, a customer received warranty repairs requiring $375 of parts and $140 of labor. a.

> In a recent year’s financial statements, Procter & Gamble (PG) showed an unfunded pension liability of $5,622 million and a periodic pension cost of $139 million. Explain the meaning of the $5,622 million unfunded pension liability and the $139 million p

> Widmer Company had gross wages of $350,000 during the week ended June 17. The amount of wages subject to social security tax was $350,000, while the amount of wages subject to federal and state unemployment taxes was $52,500. Tax rates are as follows: Th

> eCatalog Services Company performed services in October for a specific customer, for a fee of $7,890. Payment was received the following November. (a) Was the revenue earned in October or November? (b) What accounts should be debited and credited in (1)

> Using the following data for A-One Travel Service as well as the statement of stockholders’ equity from Basic Exercise 1-5, prepare a balance sheet as of August 31, 20Y6:

> The payroll register for D. Salah Company for the week ended May 18 indicated the following: The salaries were all subject to the 6.0% social security tax and the 1.5% Medicare tax. In addition, state and federal unemployment taxes were computed at the r

> According to a summary of the payroll of Mountain Streaming Co., $120,000 was subject to the 6.0% social security tax and the 1.5% Medicare tax. Also, $30,000 was subject to state and federal unemployment taxes. a. Determine the employer’s payroll taxes,

> K. Mello Company has three employees—a consultant, a computer programmer, and an administrator. The following payroll information is available for each employee: For the current pay period, the computer programmer worked 46 hours and th

> An employee earns $25 per hour and 1.5 times that rate for all hours in excess of 40 hours per week. If the employee worked 52 hours during the week, determine the employee’s (a) gross pay and (b) net pay for the week. Assume that the social security tax

> PepsiCo, Inc. (PEP) reported the following information about its long-term debt in the notes to a recent financial statement (in millions): a. How much of the long-term debt was disclosed as a current liability on the current year’s D

> Regling Company provides its employees vacation benefits and a defined benefit pension plan. Employees earned vacation pay of $25,000 for the period. The pension formula determined a pension cost of $139,250. Only $105,000 was contributed to the pension

> The payroll register of Heritage Co. indicates $4,800 of social security withheld and $1,200 of Medicare tax withheld on total salaries of $80,000 for the period. Earnings of $14,000 are subject to state and federal unemployment compensation taxes at the

> The payroll register of Heritage Co. indicates $4,800 of social security withheld and $1,200 of Medicare tax withheld on total salaries of $80,000 for the period. Federal withholding for the period totaled $17,540. Retirement savings withheld from employ

> Lindsey Vater’s weekly gross earnings for the week ended March 9 were $1,200, and her federal income tax withholding was $193.44. Assuming the social security tax rate is 6% and Medicare tax is 1.5% of all earnings, what is Lindsey’s net pay?

> On January 26, Nyree Co. borrowed cash from Conrad Bank by issuing a 45-day note with a face amount of $300,000. a. Determine the proceeds of the note, assuming the note carries an interest rate of 6%. b. Determine the proceeds of the note, assuming th

> McIntyre Company adheres to a policy of depositing all cash receipts in a bank account and making all payments by check. The cash account as of December 31 has a credit balance of $1,850, and there is no undeposited cash on hand. (a) Assuming no errors

> Inject Solutions, LLC is a provider of finished plastic molding injection products to different industries. Inject Solutions works primarily with customers in the automobile, medical devices, and consumer toy manufacturing industries. With a fleet of 13

> Obtain McDonald’s most recent annual report on Form 10-K. The Form 10-K is a company’s annually required filing with the Securities and Exchange Commission (SEC). It includes the company’s financial statements and accompanying notes. The Form 10-K can be

> Data related to the acquisition of timber rights and intangible assets during the current year ended December 31 are as follows: a. Timber rights on a tract of land were purchased for $1,600,000 on February 22. The stand of timber is estimated at 5,000,0

> The following transactions and adjusting entries were completed by Legacy Furniture Co. during a 3-year period. All are related to the use of delivery equipment. The double-declining-balance method of depreciation is used. Year 1 Jan. 4. Purchased a us

> Dexter Industries purchased packaging equipment on January 8 for $81,900. The equipment was expected to have a useful life of 3 years, or 20,000 operating hours, and a residual value of $4,500. The equipment was used for 7,600 hours during Year 1, 6,000

> Alaska Air Group (ALK), Delta Air Lines (DAL), and Southwest Airlines (LUV) reported the following financial information (in millions) in a recent year: a. Determine the fixed asset turnover ratio for each airline. Round to one decimal place. b. Based

> Amazon.com, Inc. (AMZN) is the world’s leading Internet retailer of merchandise and media. Amazon also designs and sells electronic products, such as e-readers. Netflix, Inc. (NFLX) is one of the world’s leading Intern

> The following table shows the sales and average book value of fixed assets for three different companies from three different industries for a recent year: a. For each company, determine the fixed asset turnover ratio. Round to one decimal place. b. Ex

> FedEx Corporation (FDX) and United Parcel Service, Inc. (UPS) compete in the package delivery business. The major fixed assets for each business include aircraft, sorting and handling facilities, delivery vehicles, and information technology. The sales a

> Verizon Communications Inc. (VZ) is a major telecommunications company in the United States. Two recent balance sheets for Verizon disclosed the following information regarding fixed assets: Verizon’s revenue for the year was $131,868 m

> Do the terms debit and credit signify increase or decrease or can they signify either? Explain.

> Apple Inc. (AAPL) designs, manufactures, and markets personal computers and related software. Apple also manufactures and distributes music players (iPod), mobile phones (iPhone), and smart watches (Apple Watch) along with related accessories and service

> Equipment acquired on January 6 at a cost of $425,000 has an estimated useful life of 20 years and an estimated residual value of $35,000. a. What was the annual amount of depreciation for Years 1–3 using the straight-line method of depreciation? b. What

> A building with a cost of $2,200,000 has an estimated residual value of $85,000, has an estimated useful life of 40 years, and is depreciated by the straight-line method. (a) What is the amount of the annual depreciation? (b) What is the book value at th

> A Kubota tractor acquired on January 8 at a cost of $90,000 has an estimated useful life of 10 years. Assuming that it will have no residual value, determine the depreciation for each of the first 2 years (a) by the straight-line method and (b) by the do

> A diesel-powered tractor with a cost of $115,000 and an estimated residual value of $10,000 is expected to have a useful operating life of 28,000 hours. During April, the tractor was operated 160 hours. Determine the depreciation for the month.