Question: Brown Freightway provides freight service. The

> This case addresses the long-term assets of Columbia Sportswear. The majority of these assets consist of property and equipment and intangible assets. In the text, you learned how most long-term tangible assets used in business are capitalized and deprec

> Northern Electric owed Estimated Warranty Payable of $1,700 at the end of 2015. During 2016, Northern Electric made sales of $180,000 and expects product warranties to cost the company 3 percent of the sales. During 2016, Northern Electric paid $4,300 fo

> What is management fraud? What is employee fraud? Give some examples of each.

> Luca Hanson owns Luca’s Limousine, which operates a fleet of limousines and shuttle buses. Upon reviewing the most recent financial statements, he became confused over the recent decline in net income. He called his accountant and asked for an explanatio

> When a company makes an expenditure, it can either capitalize or expense the cost, depending on the nature of the expenditure. What does it mean to capitalize an expenditure? What determines whether an expenditure can be capitalized?

> This problem continues our accounting for Fitness Equipment Doctor, Inc., from Chapter 7. During 2016, Fitness Equipment Doctor made the following purchases: • On March 3, Fitness Equipment Doctor, Inc., purchased equipment for $3,600 cash. The equipmen

> Let’s look at Dick’s Sporting Goods (Dicks) some more. Think about Dick’s. What assets did Dick’s need to operate? Return to Dick’s Annual Report (see the Continuing Financial Statement Analysis Problem in Chapter 2 for instructions on how to access the

> This exercise continues our accounting for Sensations Salon, Inc., from previous chapters. In this exercise, we will account for the annual depreciation expense for Sensations Salon, Inc. In the Continuing Exercise in Chapter 2, we learned that Sensation

> Refer to the preceding Small Business Analysis case. Prepare an e-mail to the owner of Hastings & Associates, Inc., explaining the situation with the returned check and the charge that the bank applied to your account for processing the returned check. A

> You’re pretty excited about your cash balance at the end of the month because this was the month you were going to take the big bonus from the business and make a down payment on a new house. You were waiting on a big check to come in from a client who h

> For each of the following, indicate whether the item is an adjustment to the bank balance or the book balance: ______ 1. Bank service charge ______ 2. Deposit in transit ______ 3. Bank collection of amount due from customer ______ 4. Interest revenue on

> The document that identifies and explains all differences between the company’s record of cash and the bank’s record of that cash is the a. bank reconciliation. b. electronic fund transfer. c. bank collection. d. bank statement

> 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 on

> What is the difference between a current liability for an uncertain amount and a contingent liability? Give an example of each and demonstrate how they differ in respect of the difference that you identified in the first part of this question.

> This case will address the accounts receivable reflected on Columbia Sportswear’s Balance sheet. We will once again refer to the annual report for Columbia Sportswear located in Appendix A in order to answer some questions related to Columbia Sportswear’

> Susan Casey is the controller of Casey’s Collectibles. The business uses the accrual method of accounting and recognizes sales revenue in the period in which the sale is made. As a result, the Accounts Receivable balance at year end was $86,370, which wa

> Which duties should be segregated in the purchasing process? Why? That is, what could go wrong if two or more of those duties are not segregated?

> In this problem, we continue our accounting for Fitness Equipment Doctor, Inc., from Chapter 5. Refer to the Continuing Problem in Chapters 4 and 5. Assume that all 15 of the treadmills Fitness Equipment Doctor, Inc., sold in July were sold on account fo

> Let’s continue our examination of Dick’s Sporting Goods (Dick’s). Return to Dick’s Annual Report (see the Continuing Financial Statement Analysis Problem in Chapter 2 for instructions on how to access the Annual Report). Now answer the following question

> In this exercise, we continue our accounting for Sensations Salon, Inc., from Chapter 5. Refer to the Continuing Exercise from Chapter 5. On June 15, Sensations Salon, Inc., sold 7 bottles of shampoo to Chelsie Hobart for $196 on account. On July 18, Sen

> Record the following petty cash transactions of Wilson Supply in the journal; explanations are not required.

> You’ve been asked by your boss to write a brief description of the control activities that should be a part of the development of a strong internal control system in your office. You know that the office is small in terms of personnel, which does create

> You’re having a tough time figuring out why your actual cash is always coming up less than the amount the general ledger says should be there. You would hate to think that any of your employees would be stealing from you because they have all been with y

> Indicate by letters the type of fraud committed: Check tampering (CT) Cash register scheme (CR) Expense scheme (E) Bribe (B) Fraudulent financial reporting (F) Here is an example: CT Employee writes a fraudulent check, making it payable to herself. ____

> Peterson purchased land having a current market value of $110,000, a building with a market value of $88,000, and equipment with a market value of $22,000. Journalize the lump-sum purchase of the three assets purchased for a total cost of $210,000 in exc

> Which of the following is necessary for fraud to occur? a. Rationalization b. Perceived opportunity c. Perceived pressure d. All three are necessary

> Find the Columbia Sportswear Company Annual Report located in Appendix A and go to the section titled “Design and Evaluation of Internal Control Over Financial Reporting” in Item 9A starting on page 694. Now access the 2014 Annual Report for Under Armour

> The annual report of Columbia Sportswear in Appendix A contains much more information than what is reported in the financial statements and related footnotes. In this case, you will explore other information presented in the annual report in order to det

> Roberto needed a summer job and was lucky enough to land a position as a ticket collector at a local amusement park. On his first day, he was assigned to work alongside Suzanne, who had worked at the park for the past two summers. Suzanne explained to Ro

> Can ethics be taught in the college classroom? Why or why not?

> You just finished a telephone conversation with one of your clients, who has decided to expand her business by beginning to offer some merchandise for sale. Previously, the company had only been a consulting business, but now it has an opportunity to sel

> It’s the end of the year, and your warehouse manager just finished taking a physical count of the inventory on hand. Because you are utilizing the perpetual inventory method with a relatively sophisticated inventory software program, you expect that the

> Hasse Landscaping would like to assign the oldest costs of inventory items to its ending inventory. Which inventory costing method should Hasse Landscaping choose?

> 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 continues our examination of the financial statements of Columbia Sportswear. In addition to the income statement (statement of operations) and the balance sheet of Columbia Sportswear in Appendix A, you will also be investigating the notes to

> Which depreciation method usually produces the most depreciation expense in the first year? a. Straight-line b. Double-declining-balance c. Units-of-production d. All produce the same amount of depreciation for the first year.

> Susan Hopkins recently went to work for RJ Enterprises as the accounting manager. At the end of the year, Bill Harrison, the CEO, called Susan into his office for a meeting. Mr. Harrison explained to Susan that RJ Enterprises was in the midst of obtainin

> This continues our accounting for Fitness Equipment Doctor, Inc. As stated in the Continuing Problem in Chapter 4, Fitness Equipment Doctor, Inc., began selling gym equipment in June. For this problem, we will focus on the purchases and sales of treadmil

> 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 Sensations Salon, Inc., exercise begun in Chapter 1. Consider the June transactions for Sensations Salon presented in Chapter 4. (Cost data has been removed from the sale transactions.)
Requirements 1. Prepare perpetual i

> The following is selected data for Patina Industries:
Requirements 1. Calculate the return on assets (ROA) and the fixed asset turnover ratio for Patina Industries for 2015 and 2016. Round your answers to two decimal places. 2. Have the ratios impro

> O’Malley Resources, Inc., balance sheet includes three assets: Natural Gas, Oil, and Coal Reserves. Suppose O’Malley Resources, Inc., paid $1,700,000 cash for the right to work a mine with an estimated 75,000 tons of coal. Assume the company paid $64,500

> The Log Cabin Cafe acquired Hungry Boy Diners. The financial records of Hungry Boy Diners included:
Requirements 1. Make the journal entry to record The Log Cabin Cafe’s purchase of Hungry Boy Diners for $325,000 cash, including any goodwill. 2. How

> Ferguson Industries had a piece of equipment that cost $49,000 and had accumulated depreciation of $45,000. Requirement 1. Record the disposition of the equipment assuming the following independent situations: a. Ferguson discarded the equipment receiv

> Osborne Organic Foods, Inc., has the following information for the years ending December 31, 2016 and 2015:
Requirements 1. Compute the rate of inventory turnover for Osborne Organic Foods, Inc., for the years ended December 31, 2016 and 2015. Round

> On January 4, 2016, Crux Systems, Inc., paid $281,200 for equipment used in manufacturing automotive supplies. In addition to the basic purchase price, the company paid $2,800 transportation charges; $1,100 insurance for the equipment while in transit; $

> What is depreciation, and why is it used in accounting?

> The comparative financial statements of Appleway Flowers, Inc., for 2016, 2015, and 2014 include the following selected data:
Requirements 1. Compute these ratios for 2016 and 2015: a. Quick ratio b. Current ratio c. Accounts receivable turnover; as

> Casey’s Marine Supply, Inc., lost its entire inventory in a hurricane that occurred on March 31, 2016. Over the past five years, gross profit has averaged 35 percent of net sales. The company’s records reveal the following data for the month of March:

> Record the following transactions in the journal of Sounds on Wheels, Inc. Explanations are not required. Use a 360-day year for interest computations and round to the nearest dollar.

> Savemore Supply, Co., shows the following financial statement data for 2014, 2015, and 2016
Prior to issuing the 2016 statements, auditors found that the ending inventory for 2014 was overstated by $4,000 and that the ending inventory for 2016 was un

> Zenith Manufacturing incurred the following costs in acquiring land, making land improvements, and constructing and furnishing a new building.
Zenith Manufacturing depreciates buildings over 35 years, land improvements over 15 years, and furniture ov

> The KJ Auto Sales, Inc., received the following notes during 2016:
Requirements 1. Identifying each note by number, compute the total interest on each note over the note term using a 360-day year, and determine the due date and maturity value of eac

> Due to a nationwide recession, Computer World, Inc.’s merchandise inventory is gathering dust. It is now October 31, 2016, and the $66,800 that Freeze It Corp., paid for its ending inventory is $2,300 higher than current replacement cost. Before any adju

> The following is selected data for Armada Industries:
Requirements 1. Calculate the return on assets (ROA) and the fixed asset turnover ratio for Armada Industries for 2015 and 2016. Round your answers to two decimal places. 2. Have the ratios impro

> Checker Flag Auto Parts, Inc., completed the following selected transactions during 2016:
Requirements 1. Open T-accounts for Allowance for Uncollectible Accounts and Bad Debt Expense. These accounts have beginning balances of $1,100 (cr.) and 0, re

> Make the necessary journal entries arising from Greenacres Auto Center’s bank reconciliation presented next. Date each entry May 31 and include an explanation with each entry.

> Titan Truck Parts, Inc., uses the LIFO inventory method and values its inventory using the lower-of-cost-or-market (LCM) rule. Titan Truck Parts, Inc., has the following account balances at December 31, 2016, prior to releasing the financial statements f

> Touchstone Resources, Inc.’s balance sheet includes three assets: Natural Gas, Oil, and Coal Reserves. Suppose Touchstone Resources, Inc., paid $2,100,000 in cash for the right to work a mine with an estimated 100,000 tons of coal. Assume the company pai

> On August 31, Regence Restaurant Equipment, Inc., had a $9,200 debit balance in Accounts Receivable. During September, Regence Restaurant Equipment, Inc., had the following transactions: • Sales of $53,000, all on credit; ignore cost of goods sold • C

> Monitor Industries, Inc., completed the following inventory transactions during the month of March:
Requirements 1. Without resorting to calculations, determine which inventory method will result in Monitor Industries, Inc., paying the lowest income

> Tico’s Restaurants acquired Dave’s Diner. The financial records of Dave’s Diner included:
Requirements 1. Make the journal entry to record Tico’s Restaurants’ purchase of Dave’s Diner for $380,000 cash, including any goodwill. 2. How should Tico’s R

> The March bank statement of Sparky’s Sub Shop just arrived from Inland Bank.
To prepare the bank reconciliation, you gather the following additional data: a. The following checks are outstanding on March 31: Check....................................

> Refer to the data for Star Line Equipment, Inc., in P5-48B. However, assume Star Equipment, Inc., uses the average cost method. Data from P5-48B: Star Equipment, Inc., sells hand-held engine analyzers to automotive service shops. Star Equipment, Inc., s

> Cooper Industries had a piece of equipment that cost $29,000 and had accumulated depreciation of $23,000. Requirement 1. Record the disposition of the equipment assuming the following independent situations: a. Cooper discarded the equipment, receiving

> The May cash records of Van Brunt Coffee, Inc., follow:
Van Brunt Coffee, Inc.’s Cash account shows the balance of $6,191 on May 31. On May 31, Van Brunt Coffee, Inc., received the following bank statement:
Additional data for the bank reconcilia

> Star Equipment, Inc., sells hand-held engine analyzers to automotive service shops. Star Equipment, Inc., started April with an inventory of 75 units that cost a total of $10,500. During the month, Star Equipment, Inc., purchased and sold merchandise on

> On its books, Nile Valley Company’s Cash account shows an ending balance of $950. The bank statement for the current period shows a $22 service charge and an NSF check for $140. A $220 deposit is in transit, and outstanding checks total $380. What is Nil

> On January 3, 2016, Grey Enterprises, Inc., paid $280,600 for equipment used in manufacturing automotive supplies. In addition to the basic purchase price, the company paid $500 transportation charges, $300 insurance for the equipment while in transit, $

> The comparative financial statements of O’Doherty’s Irish Grille for 2016, 2015, and 2014 include the following selected data:
Requirements 1. Compute these ratios for 2016 and 2015: a. Quick ratio b. Current ratio c. Accounts receivable turnover; a

> Pugliese Whole Foods, Inc., has the following information for the years ending December 31, 2016 and 2015:
Requirements 1. Compute the rate of inventory turnover for Pugliese Whole Foods, Inc., for the years ended December 31, 2016 and 2015. Round t

> Regal Freightway provides freight service. The company’s balance sheet includes Land, Buildings, and Motor-Carrier Equipment. Regal Freightway uses a separate accumulated depreciation account for each depreciable asset. During 2016, Regal Freightway comp

> Record the following transactions in the journal of Redmond Printing Supply, Inc. Explanations are not required. Use a 360-day year for interest computations and round to the nearest dollar.

> Fessler Enterprises, Inc., lost its entire inventory in a hurricane that occurred on May 31, 2016. Over the past five years, gross profit has averaged 39 percent of net sales. The company’s records reveal the following data for the month of May:
Requ

> Arrow Manufacturing incurred the following costs in acquiring land, making land improvements, and constructing and furnishing a new building
Arrow Manufacturing depreciates buildings over 40 years, land improvements over 20 years, and furniture over

> Titan Truck, Inc., received the following notes during 2016:
Requirements 1. Identifying each note by number, compute the total interest on each note over the note term using a 360-day year, and determine the due date and maturity value of each note

> Build Right Supply, Co., shows the following financial statement data for 2014, 2015, and 2016. Prior to issuing the 2016 statements, auditors found the ending inventory for 2014 was understated by $1,000 and that the ending inventory for 2016 was overst

> The following is selected data for Nelson Equipment, Inc., for the current year:
Requirement 1. Calculate the return on assets (ROA) and the fixed asset turnover ratio for Nelson Equipment for the current year. Round your answers to two decimal plac

> Why does the allowance method of accounting for bad debts conform to GAAP while the direct write-off method does not?

> Reliable Auto Parts, Inc., completed the following selected transactions during 2016:
Requirements 1. Open T-accounts for Allowance for Uncollectible Accounts and Bad Debt Expense. These accounts have beginning balances of $2,300 (cr.) and 0, respec

> Due to a nationwide recession, Liquidation Universe, Inc.’s merchandise inventory is gathering dust. It is now November 30, 2016, and the $162,750 that Liquidation Universe, Inc., paid for its ending inventory is $3,125 higher than current replacement co

> At the end of 2016, Zepher Corp., had total assets of $331,500 and total liabilities of $164,300. Included in the assets were property, plant, and equipment with a cost of $237,600 and accumulated depreciation of $114,800. Also included in the assets wer

> On October 31, Ames Athletic Equipment, Inc., had a $2,400 debit balance in Accounts Receivable. During November, Ames Athletic Equipment, Inc., had the following transactions: • Sales of $49,000, all on credit. Ignore cost of goods sold • Collections on

> Mid Valley Sporting Goods, Inc., uses the LIFO inventory method and values its inventory using the lower-of-cost-or-market (LCM) rule. Mid Valley Sporting Goods, Inc., has the following account balances at December 31, 2016, prior to releasing the financ

> Mirabeau Mining paid $582,000 for the right to extract mineral assets from a 400,000-ton mineral deposit. In addition to the purchase price, Mirabeau Mining also paid a $1,600 filing fee; a $4,400 license fee to the state of Colorado; and $52,000 for a g

> The December bank statement of Charly’s Burger Haven, Inc., just arrived from United Bank.
To prepare the bank reconciliation, you gather the following additional data: a. The following checks are outstanding at December 31: Check...................

> MAC Industries, Inc., completed the following inventory transactions during the month of July:
Requirements 1. Without resorting to calculations, determine which inventory method will result in MAC Industries, Inc., paying the lowest income taxes. 2

> Raferty Corp., aggressively acquires other companies. Assume that Raferty Corp., purchased Lucas Inc., for $1,200,000 cash. The market value of Lucas Inc.’s assets is $2,300,000, and it has liabilities with a market value of $1,250,000. Requirements 1.

> The September cash records of Povich Industrial, Inc., follow:
Povich Industrial’s Cash account shows the balance of $5,941 on September 30. On September 30, Povich Industrial, Inc., received the following bank statement:
Additional data for the

> Janson, Corp., maintains a petty cash fund of $225. On July 31, the fund holds $14 cash and petty cash tickets for office supplies, $172, and delivery expense, $32. Requirements 1. Make the journal entry to replenish the petty cash fund. 2. Janson, Cor

> Refer to the data for Inland Equipment Sales, Inc., in P5-40A. However, assume Inland Equipment Sales, Inc., uses the average cost method. Data from P5-40A: Inland Equipment Sales, Inc., sells hand-held engine analyzers to automotive service shops. Inla

> Part 1. Millennium Printing manufactures high-speed printers. On January 1 of year 1, Millennium Printing recently paid $400,000 for a patent on a new laser printer. Although it gives legal protection for 20 years, the patent is expected to provide a com

> Tri-State Equipment reported the following items on July 31, 2016 (last year’s amounts also given as needed):
Requirements 1. Compute Tri-State Equipment’s (a) quick ratio, (b) current ratio, and (c) accounts receivable turnover for 2016. 2. Evaluat

> Inland Equipment Sales, Inc., sells hand-held engine analyzers to automotive service shops. Inland Equipment Sales, Inc., started November with an inventory of 55 units that cost a total of $8,470. During the month, Inland Equipment Sales, Inc., purchase

> Mesa Transport is a large trucking company. Mesa Transport uses the unit’s of-production (UOP) method to depreciate its trucks. In 2013, Mesa Transport acquired a Mack truck costing $330,000 with a useful life of 10 years or 900,000 miles. Estimated resi

> Consider the following data:
Requirements 1. Calculate the quick assets and the quick ratio for each company. 2. Calculate the current ratio for each company. 3. Which of the companies should be concerned about its liquidity?

> Julia’s Jungle, Inc., has the following information as of August 31, 2016:
Requirements 1. Compute the rate of inventory turnover for Julia’s Jungle, Inc., for the year ended August 31, 2016. Round the result to two decimal places. 2. The rate of in

> Assume that Branson Corporation’s comparative balance sheet reported these amounts:
Requirement 1. Assume that on January 1, 2016, Branson sold 1/8 of its plant and equipment for $60,500 in cash. Journalize this transaction for Branson.

> Jitterz Coffee Supply, Inc., sells on account. When a customer account becomes four months old, Jitterz Coffee Supply, Inc., converts the account to a note receivable. During 2016, Jitterz Coffee Supply, Inc., completed these transactions:
Requiremen

> Tune Time, Inc. sells and installs audio equipment. During a recent fire that occurred at its warehouse, Tune Time, Inc.’s entire inventory was destroyed. Tune Time, Inc.’s accounting records reflect the following information.
Requirement 1. Use the