Lagman Corporation purchased land for $310,000. Later in the year, the company sold a different piece of land with a book value of $114,000 for $81,000. How are the effects of these transactions reported on the statement of cash flows?
> Apple Inc. designs, manufactures, and markets personal computers and related software. Apple also manufactures and distributes music players (iPod) and mobile phones (iPhone) along with related accessories and services, including online distribution of t
> Autumn Designs & Decorators issued a 120-day, 5% note for $93,000, dated April 13 to Zebra Furniture Company on account. a. Determine the due date of the note. b. Determine the maturity value of the note. c. Journalize the entries to record the following
> Using the data presented in Exercise 8-18, journalize the entry or entries that should be made by the company. Data from Exercise 8-18: 1. Cash balance according to the company’s records at July 31, $49,910. 2. Cash balance according to the bank stateme
> The following data were accumulated for use in reconciling the bank account of Nakajima Co. for July: 1. Cash balance according to the company’s records at July 31, $49,910. 2. Cash balance according to the bank statement at July 31, $48,250. 3. Checks o
> Balance sheet data for Kwan Company on December 31, the end of two recent fiscal years, follow: Prepare a comparative balance sheet for both years, stating each asset as a percent of total assets and each liability and stockholders’ eq
> Which of the reconciling items listed in Exercise 8-16 require an entry in the company’s accounts? Data from Exercise 8-16: 1. Bank service charges, $90. 2. Check of a customer returned by bank to company because of insufficient funds, $520. 3. Check fo
> 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 company’
> A building with a cost of $1,200,000 has an estimated residual value of $250,000, 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 t
> Jackie Fox owns and operates Platinum Transport Co. During the past year, Jackie incurred the following costs related to an 18-wheel truck: 1. Changed engine oil. 2. Installed a television in the sleeping compartment of the truck. 3. Installed a wind def
> The actual cash received from cash sales was $66,670, and the amount indicated by the cash register total was $66,341. Journalize the entry to record the cash receipts and cash sales.
> The actual cash received from cash sales was $25,538, and the amount indicated by the cash register total was $25,670. Journalize the entry to record the cash receipts and cash sales.
> Assume that the social security tax rate is 6% and the Medicare tax rate is 1.5%. In the following summary of data for a payroll period, some amounts have been intentionally omitted: Earnings: 1. At regular rate ………………………………… ? 2. At overtime rate ………………
> A storage tank acquired at the beginning of the fiscal year at a cost of $61,000 has an estimated residual value of $9,000 and an estimated useful life of 20 years. Determine the following: (a) The amount of annual depreciation by the straight-line metho
> A computer system acquired on January 1 at a cost of $35,000 has an estimated useful life of five years. Assuming that it will have no residual value, determine the depreciation for each of the first two years (a) By the straight-line method and (b) By t
> A refrigerator used by a wholesale warehouse has a cost of $66,700, an estimated residual value of $5,100, and an estimated useful life of 14 years. What is the amount of the annual depreciation computed by the straight-line method?
> The following items may appear on a bank statement: 1. Bank correction of an error from recording a $7,400 deposit as $4,700 2. EFT payment 3. Note collected for company 4. Service charge Using the following format, indicate whether each item would appea
> A diesel-powered tractor with a cost of $136,700 and estimated residual value of $14,500 is expected to have a useful operating life of 18,800 hours. During November, the tractor was operated 160 hours. Determine the depreciation for the month.
> At the end of the current year, the accounts receivable account has a debit balance of $2,700,000 and sales for the year total $32,400,000. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the following assumptio
> Capstone Solutions Company, a computer consulting firm, has decided to write off the $45,800 balance of an account owed by a customer, Philadelphia Inc. Journalize the entry to record the write-off, assuming that (a) The direct write-off method is used a
> Journalize the following transactions in the accounts of Arizona Interiors Company, a restaurant supply company that uses the allowance method of accounting for uncollectible receivables: May 1. Sold merchandise on account to Taiwan Palace Co., $25,800.
> Journalize the following transactions, using the allowance method of accounting for uncollectible receivables: Apr. 15. Received $1,800 from Joe Brown and wrote off the remainder owed of $2,700 as uncollectible. Aug. 7. Reinstated the account of Joe Brow
> Financial data for Abrams Company follow: For Year Ended December 31 Cash on December 31 ……………… $ 54,270 Cash flow from operations ………. (97,200) a. Compute the ratio of cash to monthly cash expenses. b. Interpret the results computed in (a).
> Journalize the necessary entries for each of the following: a. Issued a check to establish a petty cash fund of $1,270. b. The amount of cash in the petty cash fund is $160. Issued a check to replenish the fund, based on the following summary of petty ca
> Journalize the necessary entries for each of the following: a. Issued a check to establish a petty cash fund of $1,410. b. The amount of cash in the petty cash fund is $440. Issued a check to replenish the fund, based on the following summary of petty ca
> A company reports the following: Cost of merchandise sold ………………. $558,000 Average merchandise inventory ………… 45,000 Determine (a) the inventory turnover and (b) the number of days’ sales in inventory. Round to one decimal place.
> A company reports the following: Sales ………………………………………………….. $6,862,000 Average accounts receivable (net) ………………. 365,000 Determine (a) the accounts receivable turnover and (b) the number of days’ sales in receivables. Round to one decimal place.
> How does the accounting for a dividend received differ for equity investments of less than 20% ownership and equity investments of between 20%–50% ownership?
> A company reports the following: Sales …………………………………………………….. $1,460,000 Average accounts receivable (net) ………………… 100,000 Determine (a) the accounts receivable turnover and (b) the number of days’ sales in receivables. Round to one decimal place.
> The following items are reported on a company’s balance sheet: Cash ………………………………… $320,000 Marketable securities …………… 170,000 Accounts receivable (net) …….. 140,000 Inventory ………………………….. 450,000 Accounts payable ……………….. 300,000 Determine (a) the curre
> The following items are reported on a company’s balance sheet: Cash ………………………………. $120,000 Marketable securities …………. 40,000 Accounts receivable (net) ….… 50,000 Inventory ………………………….. 90,000 Accounts payable ………………. 150,000 Determine (a) the current ra
> Income statement information for Ivanoff Corporation follows: Sales …………………………………… $1,400,000 Cost of merchandise sold …………… 812,000 Gross profit ……………………………… 588,000 Prepare a vertical analysis of the income statement for Ivanoff Corporation.
> Income statement information for Turay Corporation follows: Sales …………………..………….. $200,000 Cost of merchandise sold …….. 140,000 Gross profit …………………………. 60,000 Prepare a vertical analysis of the income statement for Turay Corporation.
> A company reports the following: Net income …………………………………………….. $640,000 Preferred dividends …………………………………... $82,000 Shares of common stock outstanding ……………. 60,000 Market price per share of common stock ……… $120.90 a. Determine the company’s earnings
> A company reports the following: Net income …………………………………………….. $460,000 Preferred dividends ………………………………….. $40,000 Shares of common stock outstanding ………….. 150,000 Market price per share of common stock ………. $40.60 a. Determine the company’s earnings
> A company reports the following: Net income …………………………………………….. $ 500,000 Preferred dividends ……………………………………… 25,000 Average stockholders’ equity …………………….. 3,125,000 Average common stockholders’ equity ………. 1,900,000 Determine (a) the return on stockhol
> The comparative accounts payable and long-term debt balances for a company follow: Based on this information, what is the amount and percentage of increase or decrease that would be shown on a balance sheet with horizontal analysis?
> A company reports the following: Net income ……………………………………… $ 750,000 Preferred dividends …………………………….. 150,000 Average stockholders’ equity …………….. 5,000,000 Average common stockholders’ equity … 3,750,000 Determine (a) the return on stockholders’ equit
> Journalize the following transactions, using the direct write-off method of accounting for uncollectible receivables: Oct. 2. Received $1,140 from Elita Ramirez and wrote off the remainder owed of $2,570 as uncollectible. Dec. 20. Reinstated the account
> A company reports the following income statement and balance sheet information for the current year: Net income …………………. $ 502,100 Interest expense …………….. 113,500 Average total assets ……. 3,800,000 Determine the return on total assets. Round percentage
> A company reports the following income statement and balance sheet information for the current year: Net income …………………….. $ 110,000 Interest expense …………………. 77,000 Average total assets …………. 1,700,000 Determine the return on total assets. Round percent
> A company reports the following: Sales ………………………….. $5,580,000 Average total assets ……….. 3,100,000 Determine the asset turnover ratio. Round to one decimal place.
> A company reports the following: Sales ……………………….. $6,480,000 Average total assets ……… 2,400,000 Determine the asset turnover ratio. Round to one decimal place.
> A company reports the following: Income before income tax expense ………… $4,300,000 Interest expense ……………………………………….. 600,000 Determine the times interest earned ratio. Round to one decimal place.
> A company reports the following: Income before income tax expense ………. $6,000,000 Interest expense ……………………………………… 300,000 Determine the times interest earned ratio. Round to one decimal place.
> The following information was taken from Jacobus Company’s balance sheet: Fixed assets (net) ……………………… $630,000 Long-term liabilities …………………… 140,000 Total liabilities …………………………… 957,000 Total stockholders’ equity …………… 290,000 Determine the company’s
> The following information was taken from Tyson Company’s balance sheet: Fixed assets (net) ………………….. $ 774,000 Long-term liabilities ……………….. 430,000 Total liabilities ……………………… 1,218,000 Total stockholders’ equity ……….. 580,000 Determine the company’s (
> A company reports the following: Cost of merchandise sold ………………… $680,400 Average merchandise inventory ……………. 94,500 Determine (a) the inventory turnover and (b) the number of days’ sales in inventory. Round to one decimal place.
> The comparative temporary investments and inventory balances of a company follow: Based on this information, what is the amount and percentage of increase or decrease that would be shown on a balance sheet with horizontal analysis?
> Journalize the following transactions, using the direct write-off method of accounting for uncollectible receivables: Apr. 15. Received $1,800 from Joe Brown and wrote off the remainder owed of $2,700 as uncollectible. Aug. 7. Reinstated the account of J
> Yeoman Inc. reported the following data: Net income ……………………………………. $170,000 Depreciation expense ………………………… 29,000 Loss on disposal of equipment ……………. 11,850 Increase in accounts receivable ………….. 10,490 Increase in accounts payable ……………….. 5,430 Prep
> Featherstone Inc. reported the following data: Net income ……………………….……… $296,000 Depreciation expense …………………… 113,100 Gain on disposal of equipment …….… 58,200 Decrease in accounts receivable …….. 71,300 Decrease in accounts payable ………… 27,100 Prepare
> Paneous Corporation’s comparative balance sheet for current assets and liabilities was as follows: Adjust net income of $351,000 for changes in operating assets and liabilities to arrive at net cash flows from operating activities.
> Jasneet Corporation’s comparative balance sheet for current assets and liabilities was as follows: Adjust net income of $185,000 for changes in operating assets and liabilities to arrive at net cash flows from operating activities.
> Eastlund Corporation’s accumulated depreciation—equipment account increased by $6,320, while $2,450 of patent amortization was recognized between balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. I
> Nadal Corporation’s accumulated depreciation—furniture account increased by $17,720, while $3,800 of patent amortization was recognized between balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In
> Identify whether each of the following would be reported as an operating, investing, or financing activity on the statement of cash flows: a. Payment of dividends to common stockholders b. Purchase of equipment c. Payment for selling expenses d. Collecti
> Garfunkel Inc. reported the following on the company’s statement of cash flows in Year 2 and Year 1: Eighty percent of the net cash flows used for investing activities was used to replace existing capacity. a. Determine Garfunkelâ
> Burkhalter Inc. reported the following on the company’s statement of cash flows in Year 2 and Year 1: Seventy percent of the net cash flows used for investing activities was used to replace existing capacity. a. Determine Burkhalter&ac
> 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
> Cosmat Inc. reported net income of $128,000 for 20Y9. The liability and equity accounts from the company’s comparative balance sheet are as follows: During the year, the company retired bonds payable at their face amount, declared divi
> Takaki Inc. reported net income of $53,000 for 20Y7. The liability and equity accounts from the company’s comparative balance sheet are as follows: During the year, the company declared dividends of $4,000 and issued 1,000 shares of co
> PQR Corporation purchased land for $295,000. Later in the year, the company sold a different piece of land with a book value of $148,000 for $177,000. How are the effects of these transactions reported on the statement of cash flows?
> On January 1, 20Y5, Valuation Allowance for Available-for-Sale Investments had a zero balance. On December 31, 20Y5, the cost of the available-for-sale securities was $43,290, and the fair value was $39,120. Journalize the adjusting entry to record the u
> On January 1, 20Y9, Valuation Allowance for Trading Investments had a zero balance. On December 31, 20Y9, the cost of the trading securities portfolio was $72,600, and the fair value was $79,100. Journalize the December 31, 20Y9, adjusting entry to recor
> On January 1, 20Y3, Valuation Allowance for Trading Investments had a zero balance. On December 31, 20Y3, the cost of the trading securities portfolio was $346,000, and the fair value was $309,000. Journalize the December 31, 20Y3, adjusting entry to rec
> Journalize the entries to record the following selected bond investment transactions for Marr Products: a. Purchased for cash $180,000 of Hotline Inc. 5% bonds at 100 plus accrued interest of $1,500. b. Received first semiannual interest payment. c. Sold
> Journalize the entries to record the following selected bond investment transactions for Beacon Trust: a. Purchased for cash $420,000 of Vasquez City 6% bonds at 100 plus accrued interest of $6,300. b. Received first semiannual interest payment. c. Sold
> On January 2, 20Y4, Whitworth Company acquired 40% of the outstanding stock of Aloof Company for $340,000. For the year ended December 31, 20Y4, Aloof Company earned income of $180,000 and paid dividends of $10,000. On January 31 20Y5, Whitworth Company
> On January 2, 20Y7, Mikedes Company acquired 30% of the outstanding stock of Violet Company for $720,000. For the year ended December 31, 20Y7, Violet Company earned income of $190,000 and paid dividends of $40,000. On January 31, 20Y8, Mikedes Company s
> 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
> On September 12, 3,000 shares of Denver Company’s common stock are acquired at a price of $40 per share plus a $300 brokerage commission. On October 15, an $0.80-pershare dividend was received on the Denver Company stock. On November 10, 1,600 shares of
> On October 23, Brynner Company had a market price of $60 per share of common stock. For the previous year, Brynner paid an annual dividend of $0.90 per share. Compute the dividend yield for Brynner Company.
> On June 30, Rae Corporation had a market price of $100 per share of common stock. For the previous year, Rae paid an annual dividend of $8.00 per share. Compute the dividend yield for Rae Corporation.
> On January 1, 20Y7, Valuation Allowance for Available-for-Sale Investments had a zero balance. On December 31, 20Y7, the cost of the available-for-sale securities was $19,040, and the fair value was $22,870. Journalize the adjusting entry to record the u
> On January 23, 15,000 shares of Aurora Company’s common stock are acquired at a price of $25 per share plus a $150 brokerage commission. On April 12, a $0.50-per-share dividend was received on the Aurora Company stock. On June 10, 6,000 shares of the Aur
> On the first day of the fiscal year, a company issues an $8,600,000, 11%, five-year bond that pays semiannual interest of $473,000 ($8,600,000 × 11% × ½), receiving cash of $8,932,035. Journalize the bond issuance.
> Using the bond from Practice Exercise 14-3B, journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. Data from Exercise 14-3B: On the first day of the fiscal year, a company issues a $4,200,0
> Using the bond from Practice Exercise 14-3A, journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. Data from Practice Exercise 14-3A: On the first day of the fiscal year, a company issues a
> On the first day of the fiscal year, a company issues a $4,200,000, 10%, five-year bond that pays semiannual interest of $210,000 ($4,200,000 x 10% x ½), receiving cash of $4,041,710. Journalize the entry to record the issuance of the bonds.
> On the first day of the fiscal year, a company issues a $1,800,000, 6%, five-year bond that pays semiannual interest of $54,000 ($1,800,000 x 6% x ½), receiving cash of $1,725,151. Journalize the entry to record the issuance of the bonds.
> Marriott International, Inc., and Hyatt Hotels Corporation are two major owners and managers of lodging and resort properties in the United States. Abstracted income statement information for the two companies is as follows for a recent year (in millions
> The first day of the fiscal year, a company issues a $700,000, 6%, 10-year bond that pays semiannual interest of $21,000 ($700,000 x 6% x ½ year), receiving cash of $700,000. Journalize the entries to record (a) The issuance of the bonds, (b) The first i
> The first day of the fiscal year, a company issues a $3,500,000, 5%, 10-year bond that pays semiannual interest of $87,500 ($3,500,000 x 5% x ½ year), receiving cash of $3,500,000. Journalize the entries to record (a) The issuance of the bonds, (b) The f
> Vatican Co. is considering the following alternative financing plans: Income tax is estimated at 40% of income. Determine the earnings per share of common stock, assuming that income before bond interest and income tax is $3,000,000.
> Mahmood Products Inc. reported the following on the company’s income statement in two recent years: a. Determine the times interest earned ratio for the current year and the prior year. Round to one decimal place. b. Is the times inter
> Sprout Company reported the following on the company’s income statement in two recent years: a. Determine the times interest earned ratio for the current year and the prior year. Round to one decimal place. b. Is the times interest ear
> On the first day of the fiscal year, a company issues $35,000, 5%, eight-year installment notes that have annual payments of $5,415. The first note payment consists of $1,750 of interest and $3,665 of principal repayment. a. Journalize the entry to recor
> On the first day of the fiscal year, a company issues $89,000, 6%, five-year installment notes that have annual payments of $21,128. The first note payment consists of $5,340 of interest and $15,788 of principal repayment. a. Journalize the entry to reco
> A $1,900,000 bond issue on which there is an unamortized premium of $101,264 is redeemed for $1,979,000. Journalize the redemption of the bonds.
> A $2,300,000 bond issue on which there is an unamortized discount of $107,500 is redeemed for $2,231,000. Journalize the redemption of the bonds.
> Using the bond from Practice Exercise 14-5B, journalize the first interest payment and the amortization of the related bond premium. Round to the nearest dollar. Data from Practice Exercise 14-5B: On the first day of the fiscal year, a company issues a
> The condensed income statements through income from operations for Amazon.com, Inc., Best Buy, Inc., and Walmart Inc., for a recent fiscal year follow (in millions): 1. Prepare comparative common-sized income statements for each company. Round percentag
> 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
> Desert Trading Company has issued $100 million worth of long-term bonds at a fixed rate of 7%. The firm then enters into an interest rate swap where it pays LIBOR and receives a fixed 6% on notional principal of $100 million. What is the firm’s effective
> A manager is holding a $1 million bond portfolio with a modified duration of 8 years. She would like to hedge the risk of the portfolio by short-selling Treasury bonds. The modified duration of T-bonds is 10 years. How many dollars’ worth of T-bonds shou
> Farmer Brown grows Number 1 red corn and would like to hedge the value of the coming harvest. However, the futures contract is traded on the Number 2 yellow grade of corn. Suppose that yellow corn typically sells for 90% of the price of red corn. If he g
> a. The spot price of the British pound is currently $1.50. If the risk-free interest rate on 1-year government bonds is 1% in the United States and 2% in the United Kingdom, what must be the forward price of the pound for delivery one year from now? b. H
> Suppose that the spot price of the euro is currently $1.10. The 1-year futures price is $1.15. Is the interest rate higher in the United States or the euro zone?
> a. A single-stock futures contract on a non-dividend-paying stock with current price $150 has a maturity of 1 year. If the T-bill rate is 3%, what should the futures price be? b. What should the futures price be if the maturity of the contract is 3 years
> What is the difference in cash flow between short-selling an asset and entering a short futures position?
