Question: Cory Neece is planning to manage and

> The cash flows from operating activities are reported by the direct method on the statement of cash flows. Determine the following: a. If sales for the current year were $753,500 and accounts receivable decreased by $48,400 during the year, what was the

> List the errors you find in the following statement of cash flows. The cash balance at the beginning of the year was $240,000. All other amounts are correct, except the cash balance at the end of the year. Shasta Inc. Statement of Cash Flows For the

> Equipment acquired on January 8, 2013, at a cost of $140,000, has an estimated useful life of 16 years, has an estimated residual value of $8,000, and is depreciated by the straight-line method. a. What was the book value of the equipment at December 31,

> Iacouva Company reported the following on the company’s income statement for 2016 and 2015: a. Determine the number of times interest charges are earned for 2016 and 2015. Round to one decimal place. b. What conclusions can you draw?

> The investments of Charger Inc. include a single investment: 14,500 shares of Raiders Inc. common stock purchased on February 24, 2016, for $38 per share including brokerage commission. These shares were classified as trading securities. As of the Decemb

> Based upon the T accounts in Exercise 2-13, prepare the nine journal entries from which the postings were made. Journal entry explanations may be omitted.’ Exercise 2-13: Wyoming Tours Co. is a travel agency. The nine transactions rec

> Hawkeye Company’s balance sheet reported, under the equity method, its long-term investment in Raven Company for comparative years as follows: In addition, the 2017 Hawkeye Company income statement disclosed equity earnings in the Rav

> Huluduey Corporation’s comparative balance sheet for current assets and liabilities was as follows: Adjust net income of $160,000 for changes in operating assets and liabilities to arrive at net cash flow from operating activities.

> On January 6, 2016, Bulldog Co. purchased 34% of the outstanding stock of Gator Co. for $212,000. Gator Co. paid total dividends of $24,000 to all shareholders on June 30. Gator had a net loss of $56,000 for 2016. a. Journalize Bulldog’s purchase of the

> Selby’s Bike Co. is a wholesaler of motorcycle supplies. An aging of the company’s accounts receivable on December 31, 2016, and a historical analysis of the percentage of uncollectible accounts in each age category ar

> At a total cost of $6,300,000, Veravo Corporation acquired 210,000 shares of Strado Corp. common stock as a long-term investment. Veravo Corporation uses the equity method of accounting for this investment. Strado Corp. has 700,000 shares of common stock

> Diego Company has three employees—a consultant, a computer programmer, and an administrator. The following payroll information is available for each employee: * For hourly employees, overtime is paid for hours worked in excess of 40 h

> Occupational Products Inc., a wholesaler of office products, was organized on March 1 of the current year, with an authorization of 25,000 shares of preferred 2% stock, $100 par and 500,000 shares of $10 par common stock. The following selected transacti

> The income statement disclosed the following items for 2016: Balances of the current assets and current liability accounts changed between December 31, 2015, and December 31, 2016, as follows: a. Prepare the Cash Flows from Operating Activities secti

> The net income reported on the income statement for the current year was $320,000. Depreciation recorded on equipment and a building amounted to $96,000 for the year. Balances of the current asset and current liability accounts at the beginning and end o

> The net income reported on the income statement for the current year was $400,000. Depreciation recorded on store equipment for the year amounted to $16,000. Balances of the current asset and current liability accounts at the beginning and end of the yea

> United States Steel’s 7.375% bonds due in 2020 were reported as selling for 103.00. Were the bonds selling at a premium or at a discount? Why is United States Steel able to sell its bonds at this price?

> Bocelli Co. purchased $120,000 of 6%, 20-year Sanz County bonds on May 11, 2016, directly from the county, at their face amount plus accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, 2016, Bocelli Co. sold $30,0

> Alpenrose Corporation’s comparative balance sheet for current assets and liabilities was as follows: Adjust net income of $207,000 for changes in operating assets and liabilities to arrive at net cash flow from operating activities.

> Kalyagin Investments acquired $220,000 of Jerris Corp., 7% bonds at their face amount on October 1, 2016. The bonds pay interest on October 1 and April 1. On April 1, 2017, Kalyagin sold $80,000 of Jerris Corp. bonds at 103. Journalize the entries to rec

> On its income statement for a recent year, United Continental Holdings, Inc., the parent company of United Airlines, reported a net loss of $723 million from operations. On its statement of cash flows, it reported $935 million of cash flows from operatin

> The Commercial Division of Tidewater Inc. provided the following information on its cash flow from operations: The manager of the Commercial Division provided the accompanying memo with this report: From: Senior Vice President, Commercial Division. I a

> Dillip Lachgar is the president and majority shareholder of Argon Inc., a small retail store chain. Recently, Dillip submitted a loan application for Argon Inc. to Compound Bank. It called for a $600,000, 9%, 10-year loan to help finance the construction

> Solar Industries develops and produces high-efficiency solar panels. The company has an outstanding $10,000,000, 30-year, 10% bond issue dated July 1, 2011. The bond issue is due June 30, 2040. Some bond indentures require the corporation issuing the bon

> Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2016, were as follows: a. Issued 15,000 shares of $20 par common stock at $30, receiving cash. b. Issued 4,000 shares of $80 par preferred 5% stock at $100

> Selected transactions completed by Kornett Company during its first fiscal year ended December 31, 2016, were as follows: Jan. 3. Issued a check to establish a petty cash fund of $4,500. Feb. 26. Replenished the petty cash fund, based on the following su

> On July 16, 1998, Wyatt Corp. purchased 40 acres of land for $350,000. The land has been held for a future plant site until the current date, December 31, 2016. On December 18, 2016, TexoPete Inc. purchased 40 acres of land for $2,000,000 to be used for

> The following stock exchange data for Microsoft Corporation were taken from the Yahoo! Finance Web site on November 29, 2013: a. If you owned 500 shares of Mircosoft, what amount would you receive as a quarterly dividend? b. Compute the percentage incr

> Epstein Engineering Inc. began operations on January 5, 2016, with the issuance of 500,000 shares of $80 par common stock. The sole stockholders of Epstein Engineering Inc. are Barb Abrams and Dr. Amber Epstein, who organized Epstein Engineering Inc. wit

> Rodgers Corporation produces and sells football equipment. On July 1, 2016, Rodgers Corporation 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 semiann

> General Electric Capital, a division of General Electric, uses long-term debt extensively. In a recent year, GE Capital issued $11 billion in long-term debt to investors, then within days filed legal documents to prepare for another $50 billion long-term

> Motion Designs Inc. has paid quarterly cash dividends since 2005. These dividends have steadily increased from $0.05 per share to the latest dividend declaration of $0.50 per share. The board of directors would like to continue this trend and is hesitant

> For several years, Xtreme Co.’s sales have been on a “cash only” basis. On January 1, 2013, however, Xtreme Co. began offering credit on terms of n/30. The amount of the adjusting entry to record the

> Anstead Co. is experiencing a decrease in sales and operating income for the fiscal year ending October 31, 2016. Ryan Frazier, controller of Anstead Co., has suggested that all orders received before the end of the fiscal year be shipped by midnight, Oc

> The general merchandise retail industry has a number of segments represented by the following companies: For a recent year, the following cost of merchandise sold and beginning and ending inventories have been provided from corporate annual reports (in

> The following table shows the revenues and average net fixed assets for a recent fiscal year for three different companies from three different industries: retailing, manufacturing, and communications. a. For each company, determine the fixed asset tur

> Apple Inc. designs, manufactures, and markets personal computers and related personal computing and communicating solutions for sale primarily to education, creative, consumer, and business customers. Substantially all of the company’s

> Tuttle Construction Co. specializes in building replicas of historic houses. Tim Newman, president of Tuttle Construction, is considering the purchase of various items of equipment on July 1, 2014, for $400,000. The equipment would have a useful life of

> Costco Wholesale Corporation operates membership warehouses that sell a variety of branded and private label products. Headquartered in Issaquah, Washington, it also sells merchandise online in the United States (Costco.com) and in Canada (Costco.ca). Fo

> Best Buy is a specialty retailer of consumer electronics, including personal computers, entertainment software, and appliances. Best Buy operates retail stores in addition to the Best Buy, Media Play, On Cue, and Magnolia Hi-Fi Web sites. For two recent

> Blake Knudson owns and operates Grab Bag Delivery Services. On January 1, 2015, Retained Earnings had a balance of $918,000. During the year, no additional common stock was issued, and $15,000 of dividends were paid. For the year ended December 31, 2015,

> The records of Parker Company indicate a July 31, 2016 cash balance of $10,400, which includes undeposited receipts for July 30 and 31. The cash balance on the bank statement as of July 31 is $10,575. This balance includes a note of $2,250 plus $150 inte

> Doris Tidwell and Jo Yost are both cash register clerks for Fuller’s Organic Markets. Tom Ward is the store manager for Fuller’s Organic Markets. The following is an excerpt of a conversation between Doris and Jo: Doris: Jo, how long have you been workin

> Golden Eagle Company began operations in 2016 by selling a single product. Data on purchases and sales for the year were as follows: On January 4, 2017, the president of the company, Connie Kilmer, asked for your advice on costing the 32,000-unit phys

> At the end of the current month, Gil Frank prepared a trial balance for College App Services. The credit side of the trial balance exceeds the debit side by a significant amount. Gil has decided to add the difference to the balance of the miscellaneous e

> The now defunct Enron Corporation, once headquartered in Houston, Texas, provided products and services for natural gas, electricity, and communications to wholesale and retail customers. Enron’s operations were conducted through a vari

> Tiffany Co. is a high-end jewelry retailer, while Amazon.com uses its e-commerce services, features, and technologies to sell its products through the Internet. Recent balance sheet inventory disclosures for Tiffany and Amazon.com (in millons) are as fol

> Dell Inc. and Hewlett-Packard Development Company, L.P. (HP) are both manufacturers of computer equipment and peripherals. However, the two companies follow two different strategies. Dell follows primarily a build-to-order strategy, where the consumer or

> The increasing complexity of the current business and regulatory environment has created an increased demand for accountants who can analyze business transactions and interpret their effects on the financial statements. In addition, a basic ability to an

> Your sister operates Watercraft Supply Company, an online boat parts distributorship that is in its third year of operation. The following income statement was recently prepared for the year ended October 31, 2016: Your sister is considering a proposal

> Classify the following items as (1) prepaid expense, (2) unearned revenue, (3) accrued revenue, or (4) accrued expense: a. Cash received for use of land next month b. Fees earned but not received c. Rent expense owed but not yet paid d. Supplies on han

> Assume that you recently accepted a position with Five Star National Bank & Trust as an assistant loan officer. As one of your first duties, you have been assigned the responsibility of evaluating a loan request for $300,000 from West Gate Auto Co.,

> On April 18, 2016, Bontanica Company, a garden retailer, purchased $9,800 of seed, terms 2/10, n/30, from Whitetail Seed Co. Even though the discount period had expired, Shelby Davey subtracted the discount of $196 when he processed the documents for pay

> In groups of three or four, compare the balance sheets of two different companies, and present to the class a summary of the similarities and differences of the two companies. You may obtain the balance sheets you need from one of the following sources:

> Picasso Graphics is a graphics arts design consulting firm. Pablo Taylor, its treasurer and vice president of finance, has prepared a classified balance sheet as of July 31, 2016, the end of its fiscal year. This balance sheet will be submitted with Pica

> Daryl Kirby opened Squid Realty Co. on January 1, 2015. At the end of the first year, the business needed additional capital. On behalf of Squid Realty Co., Daryl applied to Ocean National Bank for a loan of $375,000. Based on Squid Realty Co.’s financia

> TearLab Corp. is a health care company that specializes in developing diagnostic devices for eye disease. TearLab reported the following data (in thousands) for three recent years: 1. Determine the monthly cash expenses for Year 3, Year 2, and Year 1.

> Select a public corporation you are familiar with or which interests you. Using the Internet, develop a short (1 to 2 pages) profile of the corporation. Include in your profile the following information: 1. Name of the corporation. 2. State of incorporat

> You hold a 25% common stock interest in You-OwnIt, a family-owned construction equipment company. Your sister, who is the manager, has proposed an expansion of plant facilities at an expected cost of $26,000,000. Two alternative plans have been suggested

> The unadjusted trial balance that you prepared for PS Music at the end of Chapter 2 should appear as follows: The data needed to determine adjustments are as follows: a. During July, PS Music provided guest disc jockeys for KXMD for a total of 115 hour

> The transactions completed by PS Music during June 2016 were described at the end of Chapter 1. The following transactions were completed during July, the second month of the business’s operations: July 1. Peyton Smith made an additiona

> Be-The-One is a motivational consulting business. At the end of its accounting period, December 31, 2015, Be-The-One has assets of $395,000 and liabilities of $97,000. Using the accounting equation, determine the following amounts: a. Stockholders’ equit

> Peyton Smith enjoys listening to all types of music and owns countless CDs. Over the years, Peyton has gained a local reputation for knowledge of music from classical to rap and the ability to put together sets of recordings that appeal to all ages. Duri

> The unadjusted trial balance of PS Music as of July 31, 2016, along with the adjustment data for the two months ended July 31, 2016, are shown in Chapter 3. Based upon the adjustment data, the following adjusted trial balance was prepared: Instructions

> The following equity investment transactions were completed by Chung Company in 2016: Mar. 4. Purchased 4,000 shares of Jas Company for a price of $50 per share plus a brokerage commission of $100. May 12. Received a quarterly dividend of $0.75 per share

> On March 4, Breen Corporation acquired 7,500 shares of the 200,000 outstanding shares of Melton Co. common stock at $40 plus commission charges of $175. On June 15, a cash dividend of $2.10 per share was received. On October 12, 3,000 shares were sold at

> On April 1, 2016, Rizzo Company purchased $80,000 of 4.5%, 20-year Energizer Company bonds at their face amount plus one month’s accrued interest. The bonds pay interest on March 1 and September 1. On November 1, 2016, Rizzo Company sold $30,000 of the E

> List any errors you can find in the following partial balance sheet: Napa Vino Company Balance Sheet December 31, 2016 Assets Current assets: Cash $ 78,500 $ 300,000 Notes receivable Less interest receivable 4,500 $1,200,000 11,500 295,500 Accounts

> During 2016, the accountant discovered that the physical inventory at the end of 2015 had been understated by $42,750. Instead of correcting the error, however, the accountant assumed that the error would balance out (correct itself) in 2016. Are there a

> Equipment acquired on January 6, 2013, at a cost of $425,000, has an estimated useful life of 16 years and an estimated residual value of $65,000 a. What was the annual amount of depreciation for the years 2013, 2014, and 2015 using the straight-line met

> Parilo Company acquired $170,000 of Makofske Co., 5% bonds on May 1, 2016, at their face amount. Interest is paid semiannually on May 1 and November 1. On November 1, 2016, Parilo Company sold $50,000 of the bonds for 96. Journalize entries to record the

> Lerner Corporation wholesales repair products to equipment manufacturers. On April 1, 2016, Lerner Corporation issued $12,000,000 of five-year, 8% bonds at a market (effective) interest rate of 6%, receiving cash of $13,023,576. Interest is payable semia

> On February 10, 15,000 shares of Sting Company are acquired at a price of $25 per share plus a $150 brokerage commission. On April 12, a $0.40-per-share dividend was received on the Sting Company stock. On May 29, 6,000 shares of the Sting Company stock

> On February 22, Kountry Repair Service extended an offer of $200,000 for land that had been priced for sale at $250,000. On April 3, Kountry Repair Service accepted the seller’s counteroffer of $230,000. On September 15, the land was assessed at a value

> On the first day of its fiscal year, Pretender Company issued $18,500,000 of five-year, 10% bonds to finance its operations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective

> Bamboo Consulting is a consulting firm owned and operated by Lisa Gooch. The following end-of-period spreadsheet was prepared for the year ended July 31, 2016: Based on the preceding spreadsheet, prepare an income statement, retained earnings statement

> On April 20, Gallatin County Rocks Inc., a marble contractor, issued for cash 75,000 shares of $45 par common stock at $54, and on August 7, it issued for cash 20,000 shares of preferred stock, $10 par at $12. a. Journalize the entries for April 20 and A

> Assume the same facts as in Exercise 9-25, except that the book value of the press traded in is $108,500. Exercise 9-25: A printing press priced at a fair market value of $275,000 is acquired in a transaction that has commercial substance by trading i

> The current assets and current liabilities for Apple Inc. and Dell, Inc., are as follows at the end of a recent fiscal period: *These represent prepaid expense and other non-quick current assets. a. Determine the quick ratio for both companies. (Round

> The series of seven transactions recorded in the following T accounts were related to a sale to a customer on account and the receipt of the amount owed. Briefly describe each transaction. CASH NOTES RECEIVABLE (7) 61,509 (5) 60,000 (6) 60,000 ACCOU

> The following data (in thousands) were taken from recent annual reports of Apple Inc., a manufacturer of personal computers and related products, and American Greetings Corporation, a manufacturer and distributor of greeting cards and related products:

> Based on the data in Exercise 12-1, what factors other than earnings per share should be considered in evaluating these alternative financing plans? Exercise 12-1: Domanico Co., which produces and sells biking equipment, is financed as follows: Incom

> Paragon Tech Company, a communications equipment manufacturer, recently fell victim to a fraud scheme developed by one of its employees. To understand the scheme, it is necessary to review Paragon Tech’s procedures for the purchase of services. The purch

> The following selected transactions were taken from the records of Shipway Company for the first year of its operations ending December 31, 2016: Apr. 13. Wrote off account of Dean Sheppard, $8,450. May 15. Received $500 as partial payment on the $7,100

> On January 1, the first day of the fiscal year, a company issues a $500,000, 5%, 10-year bond that pays semiannual interest of $12,500 ($500,000 × 5% × ½ year), receiving cash of $500,000. Journalize the entries to record (a) the issuance of the bonds, (

> The payroll registers for Proctor Company for the week ended February 14 indicated the following: In addition, state and federal unemployment taxes were calculated at the rate of 5.4% and 0.8%, respectively, on $270,000 of salaries. a. Journalize the e

> Assume that the business in Exercise 6-9 maintains a perpetual inventory system. Determine the cost of merchandise sold for each sale and the inventory balance after each sale, assuming the first-in, first-out method. Present the data in the form illustr

> Bon Nebo Co. sold 25,000 annual subscriptions of Bjorn 20XX for $85 during December 2016. These new subscribers will receive monthly issues, beginning in January 2017. In addition, the business had taxable income of $840,000 during the first calendar qua

> Journalize entries for the following related transactions of South Coast Heating & Air Company: a. Purchased $48,000 of merchandise from Atlas Co. on account, terms 1/10, n/30. b. Paid the amount owed on the invoice within the discount period. c. Discove

> Elliptical Consulting is a consulting firm owned and operated by Jayson Neese. The following end-of-period spreadsheet was prepared for the year ended June 30, 2016: Based on the preceding spreadsheet, prepare an income statement, retained earnings sta

> Journalize the following transactions in the accounts of Dining Interiors Company, a restaurant supply company that uses the allowance method of accounting for uncollectible receivables: Apr. 2. Sold merchandise on account to Peking Palace Co., $41,900.

> The following table shows the revenue and average net fixed assets (in millions) for a recent fiscal year for Best Buy and RadioShack: a. Compute the fixed asset turnover for each company. Round to two decimal places. b. Which company uses its fixed as

> MGM Resorts International owns and operates hotels and casinos including the MGM Grand and the Bellagio in Las Vegas, Nevada. As of a recent year, MGM reported accounts receivable of $592,937,000 and allowance for doubtful accounts of $101,207,000 Johnso

> Identify each of the following reconciling items as: (a). an addition to the cash balance according to the bank statement, (b). a deduction from the cash balance according to the bank statement, (c). an addition to the cash balance according to the co

> Journalize the entries for the following transactions: a. Sold merchandise for cash, $30,000. The cost of the merchandise sold was $18,000. b. Sold merchandise on account, $258,000. The cost of the merchandise sold was $154,800. c. Sold merchandise to cu

> Prepare a journal entry for the purchase of office equipment on October 27 for $32,750, paying $6,550 cash and the remainder on account.

> Journalize the following transactions in the accounts of Midwest Medical Co., a medical equipment company that uses the direct write-off method of accounting for uncollectible receivables: Feb. 3. Sold merchandise on account to Dr. Jill Hall, $17,340. Th

> Jardine 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, Misce

> Verizon Communications 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 Year 2 was $115,846 million. As

> The units of an item available for sale during the year were as follows: There are 220 units of the item in the physical inventory at December 31. The periodic inventory system is used. Determine the inventory cost by (a). the first-in, first-out meth