In teams, select a public company that interests you. Obtain the company’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 obtained either (a) from the investor relations section of the company’s website or (b) by using the company search feature of the SEC’s EDGAR database service found at www.sec.gov/edgar/searchedgar/companysearch.html. 1. Based on the information in the company’s most recent annual report, answer the following questions: a. How much long-term debt does the company report at the end of the most recent year presented? b. Does the company have any bonds outstanding at the end of the most recent year? If so, read the supporting notes to the financial statements and determine: (1) The contract rate of interest on the bond issue(s). (2) The discount or premium on the bond issue(s). (3) The due date of the bond issue(s). (4) The total amount of any bonds that will mature within one year of the balance sheet date. 2. Based on your answers to the questions in requirement 1, evaluate the company’s debt position.
> Summary operating data for Custom Wire & Tubing Company during the year ended April 30, 20Y2, are as follows: cost of goods sold, $6,100,000; administrative expenses, $740,000; interest expense, $25,000; rent revenue, $60,000; sales, $9,332,500; and sell
> The following data were extracted from the accounting records of Harkins Company for the year ended April 30, 20Y8: Estimated returns of current year sales …………………………………………… $ 11,600 Inventory, May 1, 20Y7 …………………………………………………………………… 380,000 Inventory, A
> The following income statement for Curbstone Company was prepared for the year ended August 31, 20Y5: a. Identify the errors in the income statement. b. Prepare a corrected income statement. Curbstone Company Income Statement For the Year Ended Aug
> Statz Company had sales of $1,800,000 and related cost of goods sold of $1,150,000 for its first year of operations ending December 31, 20Y1. Statz provides customers a refund for any returned or damaged merchandise. At the end of 20Y1, Statz Company est
> Determine the amount to be paid in full settlement of each of the following invoices, assuming that credit for returns and allowances was received prior to payment and that all invoices were paid within the discount period: Merchandise Invoice Amoun
> The following were selected from among the transactions completed by Strong Retail Group during August of the current year: a. Journalize the August transactions using the gross method of recording sales discounts. b. Journalize the August transactions u
> The debits and credits for five related transactions, (1) through (5), are presented in the following T accounts. Assume the credit terms were 2/10, n/30. a. Describe each transaction. b. What was the invoice amount of the merchandise that was returned
> The following data were extracted from the accounting records of Sacajawea Mercantile Co. for the year ended June 30, 20Y4: a. Journalize the June 30, 20Y4, adjusting entry for estimated sales discounts. b. How would sales and accounts receivable be re
> Staley Inc. reported the following data: Net income ……………………………………………………….……………. $396,200 Depreciation expense …………………………………………………………… 61,250 Loss on disposal of equipment ……………………………………………… 27,600 Increase in accounts receivable ……………………………………………… 9,00
> The following were selected from among the transactions completed by Essex Company during March of the current year: Journalize the March transactions using the gross method of recording sales discounts. Mar. 2. Sold merchandise on account to Parsl
> Schofield Co. sold merchandise on account to Bernard Retail Inc. for $15,000, terms 2/10, n/30. The cost of the merchandise sold was $8,000. Assuming Schofield Co. uses the gross method of recording sales discounts, journalize the entries to record (a) t
> On December 28, 20Y3, Silverman Enterprises sold $18,500 of merchandise to Beasley Co. with terms 2/10, n/30. The cost of the goods sold was $11,200. On December 31, 20Y3, Silverman prepared its adjusting entries, yearly financial statements, and closing
> Based on the data presented in Exercise 5-27, journalize the closing entries. Exercise 5-27: On March 31, 20Y9, the balances of the accounts appearing in the ledger of Royal Furnishings Company, a furniture store, are as follows: $ 170,000 Invento
> Based on the data in Exercise 4-22, prepare the closing entries for Alert Security Services Co. Exercise 4-22: Alert Security Services Co. offers security services to business clients. Complete the following end-of-period spreadsheet for Alert Security
> Based on the data in Exercise 4-21, prepare the adjusting entries for Alert Security Services Co. Exercise 4-21: Alert Security Services Co. offers security services to business clients. The trial balance for Alert Security Services has been prepared o
> On the basis of the following data, (a) journalize the adjusting entries at June 30, the end of the current fiscal year, and (b) journalize the reversing entries on July 1, the first day of the following year: 1. Wages are uniformly $66,000 for a five-da
> On the basis of the following data, (a) journalize the adjusting entries at December 31, the end of the current fiscal year, and (b) journalize the reversing entries on January 1, the first day of the following year: 1. Sales salaries are uniformly $11,7
> The unadjusted and adjusted trial balances for American Leaf Company on October 31, 20Y2, follow: Journalize the five entries that adjusted the accounts at October 31, 20Y2. None of the accounts were affected by more than one adjusting entry. Ameri
> If the net income for the current year had been $196,400 in Exercise 3-23, what would have been the correct net income if the proper adjusting entries had been made? Exercise 3-23: The accountant for Healthy Life Company, a medical services consulting
> For a recent year, the balance sheet for The Campbell Soup Company (CPB) includes accrued expenses of $604 million. The income before taxes for Campbell for the year was $849 million. a. Assume the adjusting entry for $604 million of accrued expenses was
> For a recent period, the balance sheet for Costco Wholesale Corporation (COST) reported accrued expenses of $3,498 million. For the same period, Costco reported income before income taxes of $3,619 million. Assume that the adjusting entry for $3,498 mill
> J. C. Penney Company, Inc. (JCP) and Macy’s, Inc. (M) are large department store chains in the United States. Information from recent annual reports for both companies is as follows (in millions): a. Determine the daysâ€
> When preparing the financial statements for the month ended January 31, accrued salaries owed to employees for January 30 and 31 were overlooked. The accrued salaries were included in the first salary payment in February. Indicate which items will be err
> The adjusting entry for accrued wages was omitted at July 31, the end of the current year. Indicate which items will be in error, because of the omission, on (a) the income statement for the current year and (b) the balance sheet as of July 31. Also indi
> We-Sell Realty was organized as a corporation on August 1, 20Y7, by the issuance of common stock of $15,000. We-Sell Realty is owned and operated by Omar Farah, the sole stockholder. The following statements for We-Sell Realty were prepared after its fir
> Huluduey Corporation’s comparative balance sheet for current assets and liabilities was as follows: Adjust net income of $75,800 for changes in operating assets and liabilities to arrive at net cash flow from operating activities.
> At March 31, the end of the first month of operations, the usual adjusting entry transferring prepaid insurance expired to an expense account is omitted. Which items will be incorrectly stated, because of the error, on (a) the income statement for March
> The supplies and supplies expense accounts at December 31, after adjusting entries have been posted at the end of the first year of operations, are shown in the following T accounts: Determine the amount of supplies purchased during the year. Suppl
> The Kroger Company (KR), a grocery store chain, recently had a price-earnings ratio of 13.7, while the average price-earnings ratio in the grocery store industry was 22.5. What might explain this difference?
> Is it necessary for a business to use the same method of computing depreciation (a) for all classes of its depreciable assets and (b) for financial statement purposes and in determining income taxes?
> Using the following data, how should the inventory be valued under lower of cost or market? Original cost ……………………………………………………………………… $1,350 Estimated selling price ………………………………………………………… 1,475 Selling expenses ……………………………………………………………………. 180
> Name three accounts that would normally appear in the chart of accounts of a retail business but would not appear in the chart of accounts of a service business.
> Checking accounts are one of the most common forms of deposits for banks. Assume that Surety Storage has a checking account at Ada Savings Bank. What type of account (asset, liability, stockholders’ equity, revenue, expense, dividends) does the account b
> The financial statements are interrelated. (a). What item of financial or operating data appears on both the income statement and the statement of stockholders’ equity? (b). What item appears on both the balance sheet and the statement of stockholders’
> Which step of the accounting cycle is optional?
> Does every adjusting entry have an effect on determining the amount of net income for a period? Explain.
> A summary of cash flows for Parker Consulting Group for the year ended January 31, 2014, follows: Cash receipts: Cash received from customers …………………………….. $1,200,000 Cash received from issuing common stock ………………… 90,000 Cash payments: Cash paid for op
> Who is responsible for freight when the terms of sale are (a) FOB shipping point, (b) FOB destination?
> The wages payable and wages expense accounts at August 31, after adjusting entries have been posted at the end of the first month of operations, are shown in the following T accounts: Determine the amount of wages paid during the month. Wages Payab
> During the month, Gates Labs Co. has a substantial number of transactions affecting each of the following accounts. State for each account whether it is likely to have (a) debit entries only, (b) credit entries only, or (c) both debit and credit entries.
> The following table summarizes the rules of debit and credit. For each of the items a through l, indicate whether the proper answer is a debit or a credit. Increase Decrease Normal Balance Balance sheet accounts: Asset (a) Credit (b) Liability Stock
> Classify the following items as (a) accrued revenue, (b) accrued expense, (c) unearned revenue, or (d) prepaid expense: 1. A two-year premium paid on insurance policy. 2. Fees earned but not yet received. 3. Fees received but not yet earned. 4. Salary ow
> Why is it important to periodically take a physical inventory when using a perpetual inventory system?
> What is the principal disadvantage of the direct method of reporting cash flows from operating activities?
> The financial statements for Nike, Inc. (NKE), are presented in Appendix E at the end of the text. The following additional information is available (in thousands): Accounts receivable at May 31, 2015 ………………………………………………… $ 3,358 Inventories at May 31, 2
> In teams, select a public company that interests you. Obtain the company’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 financia
> Head Donuts Inc. is a retailer of designer headphones, earphones, and hands-free audio devices. Polly Ester, the company president, is reviewing the company’s financial statements after the close of the fiscal year and is troubled that earnings decreased
> The accountant for Healthy Life Company, a medical services consulting firm, mistakenly omitted adjusting entries for (a) unearned revenue earned during the year ($34,900) and (b) accrued wages ($12,770). Indicate the effect of each error, considered ind
> In teams, select a public company that interests you. Obtain the company’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 financia
> In teams, select a public company that interests you. Obtain the company’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 financia
> In teams, select a public company that interests you. Obtain the company’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 financia
> In teams, select a public company that interests you and is a business that requires inventory. Obtain the company’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
> The following is an excerpt from a conversation between Mark Loomis and Krista Huff. Mark is debating whether to buy a stereo system from Tru-Sound Systems, a locally owned electronics store, or Wholesale Stereo, an online electronics company. Mark: Kris
> Rustic Furniture Co. is owned and operated by Cam Pfeifer. The following is an excerpt from a conversation between Cam Pfeifer and Mitzi Wheeler, the chief accountant for Rustic Furniture Co.: Cam: Mitzi, I’ve got a question about this recent balance she
> Suzi Nomro operates Watercraft Supply Company, an online boat parts distributorship that is in its third year of operation. The following income statement was prepared for the year ended October 31, 20Y3. Suzi is considering a proposal to increase net
> Assume that you are planning to purchase a 55-inch LED, LCD flat-screen television. In groups of three or four, determine the lowest cost for the television, considering the available alternatives and the advantages and disadvantages of each alternative.
> In teams, select a public company that interests you. Obtain the company’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 financia
> Each of the following items is shown on the financial statements of Exxon Mobil Corporation (XOM): 1. Accounts payable 2. Cash equivalents 3. Crude oil inventory 4. Equipment 5. Exploration expenses 6. Income taxes payable 7. Investments 8. Long-term deb
> On April 18, 20Y7, 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
> 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.,
> In teams, access a recent annual report of Zynga (ZNGA) and Wal-Mart (WMT). 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. Th
> Delta Air Lines, Inc. (DAL) is a major passenger airline headquartered in the United States. Most Delta passengers purchase their tickets several weeks prior to taking the trip and use a credit card such as VISA or American Express to pay for their ticke
> Lisa Duncan, a junior in college, has been seeking ways to earn extra spending money. As an active sports enthusiast, Lisa plays tennis regularly at the Phoenix Tennis Club, where her family has a membership. The president of the club recently approached
> On January 1, 20Y5, Dr. Marcie Cousins established Health-Wise Medical, a medical practice organized as a corporation. The following conversation occurred the following August between Dr. Cousins and a former medical school classmate, Dr. Avi Abu, at an
> State College requires students to pay tuition each term before classes begin. Students who have not paid their tuition are not allowed to enroll or to attend classes. What journal entry do you think State College would use to record the receipt of the s
> Your friend, Daniel Nat, recently began work as the lead accountant for Asheville Company. Dan prepared the following balance sheet for December 31, 20Y5: Asheville Company Balance Sheet December 31, 20Y5 Assets Land. . . . . . . . . . . . . . . . . . .
> Daryl Kirby opened Squid Realty Co. on January 1, 20Y3. 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
> Margie Johnson is a staff accountant at ToolEx Company, a manufacturer of tools and equipment. The company is under pressure from investors to increase earnings, and the president of the company expects the Accounting Department to “make this happen.” Ma
> For the fiscal year, sales were $46,680,000 and the cost of goods sold was $28,000,000. a. What was the amount of gross profit? b. If total operating expenses were $5,000,000, could you determine net income? c. Is Customer Refunds Payable an asset, liabi
> On July 1, 20Y1, Livingston Corporation, a wholesaler of manufacturing equipment, issued $46,000,000 of 20-year, 10% bonds at a market (effective) interest rate of 11%, receiving cash of $42,309,236. Interest on the bonds is payable semiannually on Decem
> On July 1, 20Y1, Livingston Corporation, a wholesaler of manufacturing equipment, issued $46,000,000 of 20-year, 10% bonds at a market (effective) interest rate of 11%, receiving cash of $42,309,236. Interest on the bonds is payable semiannually on Decem
> Selected data on inventory, purchases, and sales for Jaffe Co. and Coronado Co. are as follows: Instructions: 1. Determine the estimated cost of the inventory of Jaffe Co. on February 28 by the retail method, presenting details of the computations. 2.
> The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are shown in Problem 6-1B. Problem 6-1B: The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as
> The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are shown in Problem 6-1B. Problem 6-1B: The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as
> Selected transactions for Essex Company during July of the current year are listed in Problem 5-3B. Problem 5-3B: The following were selected from among the transactions completed by Essex Company during July of the current year: Instructions: Journa
> Selected transactions for Niles Co. during March of the current year are listed in Problem 5-1B. Problem 5-1B: The following selected transactions were completed by Niles Co. during March of the current year: Instructions: Journalize the entries to r
> The following selected transactions were completed during April between Swan Company and Bird Company: Instructions: Journalize the April transactions for (1) Swan Company and (2) Bird Company. Apr. 2. Swan Company sold merchandise on account to Bi
> Selected transactions during April between Swan Company and Bird Company are listed in Problem 5-4B. Problem 5-4B: The following selected transactions were completed during April between Swan Company and Bird Company: Instructions: Journalize the ent
> The Signage Company specializes in the maintenance and repair of signs, such as billboards. On March 31, 20Y6, the accountant for The Signage Company prepared the trial balances shown at the top of the following page. Instructions: Journalize the seven
> Identify the errors in the following trial balance. All accounts have normal balances. Ensemble Co. Unadjusted Trial Balance For the Year Ending December 31, 20Y8 Debit Balances Credit Balances Cash 42,900 ...... Accounts Receivable. 123,500 Prepaid
> Valley Realty acts as an agent in buying, selling, renting, and managing real estate. The unadjusted trial balance on July 31, 20Y8, follows: The following business transactions were completed by Valley Realty during August 20Y8: Enter the following
> The financial statements at the end of Atlas Realty’s first month of operations follow: Instructions: By analyzing the interrelationships among the four financial statements, determine the proper amounts for (a) through (r). Atl
> Tech Support Services has the following unadjusted trial balance as of January 31, 20Y5: The debit and credit totals are not equal as a result of the following errors: a. The cash entered on the trial balance was overstated by $8,000. b. A cash receipt
> On April 1, 20Y8, Maria Adams established Custom Realty. Maria completed the following transactions during the month of April: a. Opened a business bank account with a deposit of $24,000 in exchange for common stock. b. Paid rent on office and equipment
> Crazy Mountain Outfitters Co., an outfitter store for fishing treks, prepared the following unadjusted trial balance at the end of its first year of operations: For preparing the adjusting entries, the following data were assembled: •
> The following information about the payroll for the week ended December 30 was obtained from the records of Saine Co.: Tax rates assumed: Social security, …………â€
> Ken Jones, an architect, organized Jones Architects on April 1, 20Y2. During the month, Jones Architects completed the following transactions: a. Transferred cash from a personal bank account to an account to be used for the business in exchange for comm
> Selected transactions completed by Primo Discount Corporation during the current fiscal year are as follows: Instructions: Journalize the transactions. 9. Split the common stock 3 for 1 and reduced the par from $75 to $25 per share. After the split
> The following selected accounts appear in the ledger of Parks Construction Inc. at the beginning of the current year: Preferred 2% Stock, $100 par (100,000 shares authorized, 80,000 shares issued) …$ 8,000,000 Paid-In Capital in Excess of Par—Preferred
> Campbell, Inc. produces and sells outdoor equipment. On July 1, 20Y1. Campbell issued $30,000,000 of 10-year, 10% bonds at a market (effective) interest rate of 9%, receiving cash of $31,951,110. Interest on the bonds is payable semiannually on December
> An accountant prepared the following post-closing trial balance: Prepare a corrected post-closing trial balance. Assume that all accounts have normal balances and that the amounts shown are correct. Security Services Co. Post-Closing Trlal Balance
> On July 1, 20Y1, Danzer Industries Inc. issued $40,000,000 of 10-year, 7% bonds at a market (effective) interest rate of 8%, receiving cash of $37,282,062. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the c
> Campbell Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $30,000,000 of 10-year, 10% bonds at a market (effective) interest rate of 9%, receiving cash of $31,951,110. Interest on the bonds is payable semiannually on December 3
> On July 1, 20Y1, Danzer Industries Inc. issued $50,000,000 of 10-year, 8% bonds at a market (effective) interest rate of 10%, receiving cash of $43,768,920. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the
> The following information about the payroll for the week ended December 30 was obtained from the records of Boltz Co.: Tax rates assumed: Instructions: 1. Assuming that the payroll for the last week of the year is to be paid on December 31, journaliz
> The following items were selected from among the transactions completed by Sherwood Co. during the current year: Instructions: 1. Journalize the transactions. 2. Journalize the adjusting entry for each of the following accrued expenses at the end of th
> The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining balance method of depreciation is used. Instructions: Journalize
> Water Closet Co. wholesales bathroom fixtures. During the current year ending December 31, Water Closet received the following notes: Instructions: 1. Determine for each note (a) the due date and (b) the amount of interest due at maturity, identifying
> Call Systems Company, a telephone service and supply company, has just completed its fourth year of operations. The direct write-off method of recording bad debt expense has been used during the entire period. Because of substantial increases in sales vo
> The following transactions were completed by Irvine Company during the current fiscal year ended December 31: Instructions: 1. Record the January 1 credit balance of $26,000 in a T account for Allowance for Doubtful Accounts. 2. Journalize the transact
