On January 1, 2021, Eagle Company borrows $100,000 cash by signing a four-year, 7% installment note. The note requires four equal payments of $29,523, consisting of accrued interest and principal on December 31 of each year from 2021 through 2024. Prepare an amortization table for this installment note like the one in Exhibit 14.12.
> A manufacturing company reports the following for the period. 1. Prepare a schedule of cost of goods manufactured. 2. Compute gross profit.
> A manufacturer reports the following information at June 30. 1. Compute Work in Process Inventory at June 30. 2. Compute Finished Goods Inventory at June 30. 3. Compute cost of goods sold for June.
> Following are simplified job cost sheets for three custom jobs at the end of June for Custom Patios. All jobs were started in June. Overhead is applied with a predetermined rate based on direct labor cost. Jobs 102 and 103 were finished in June, and Job
> A manufacturer began operations on April 1 and reports the information below. All jobs are sold for 20% above cost. 1. Compute the May 31 balance in (a) Work in Process Inventory and (b) Finished Goods Inventory. 2. Compute gross profit for May.
> Tyler Corp. reports the following results for its first month of operations ended December 31. Overhead is applied using a predetermined overhead rate of 80% of direct materials cost. 1. Prepare an income statement for the month ended December 31. 2. Det
> Tasty Bakery applies overhead based on direct labor costs. The company reports the following costs for the year: direct materials, $650,000; direct labor, $3,000,000; and overhead applied, $1,800,000. 1. Determine the company’s predetermined overhead rat
> Key figures for Apple and Google follow. Required 1. Compute days’ payable outstanding for each company for the most recent two years. 2. For the current year, which company took more time to pay its suppliers?
> Lorenzo Company applies overhead to jobs on the basis of direct materials cost. At year-end, the Work in Process Inventory account shows the following. 1. Determine the predetermined overhead rate used (based on direct materials cost). 2. Only one job re
> Prepare journal entries to record transactions a through h. a. Raw materials purchased on credit, $90,000. b. Direct materials used, $36,500. Indirect materials used, $19,200. c. Direct labor used, $38,000. Indirect labor used, $12,000. (Record using Fac
> Shire Company’s predetermined overhead rate is based on direct labor cost. Management estimates the company will incur $747,500 of overhead costs and $575,000 of direct labor cost for the period. During March, Shire began and completed
> Telstar uses job order costing. The T-accounts below summarize its production activity for the year. 1. Compute the amount for each of the following. a. Direct materials used d. indirect labor used f. Cost of goods sold (before closing b. Indi
> Use information in Exercise 19-12 to prepare journal entries for the following events for the period. 1. Incurred other actual overhead costs (all paid in Cash). 2. Applied overhead to work in process.
> Use information in Exercise 19-12 to prepare journal entries for the following events for the period. 1. Direct labor used (recorded as factory wages payable). 2. Indirect labor used (recorded as factory wages payable).
> Use information in Exercise 19-12 to prepare journal entries for the following events for the period. 1. Raw materials purchases for cash. 3. Indirect materials used. 2. Direct materials used.
> Match each of the terms with the best definition a through d. 1. Cost accounting system 2. Target cost 3. Job 4. Process operation a. Production activities for a custom product. b. Mass production in a continuous flow of steps. c. A system that records m
> Use the following selected account balances of Delray Mfg. to prepare its schedule of cost of goods manufactured for the year ended December 31.
> For each of the following accounts for a manufacturing company, place a ✓ in the column indicating that it is included in selling expenses, general and administrative expenses, or the calculation of cost of goods manufactured. An accoun
> Comparative figures for Apple and Google follow. Required 1. Compute inventory turnover for each company for the most recent two years shown. 2. Compute days’ sales in inventory for each company for the three years shown. 3. Did the cur
> Refer to the data in Exercise 18-7. For each company, compute the total (1) prime costs and (2) conversion costs.
> Refer to the data in Exercise 18-7. For each company, prepare (1) an income statement and (2) the current assets section of the balance sheet.
> Using the following data from both Garcon Company and Pepper Company for the year ended December 31 to compute (1) the cost of goods manufactured and (2) the cost of goods sold for each company. Hint: Not all information is needed for the solution.
> Listed below are costs of services provided by an airline company. Consider the cost object to be a flight. Flight attendants and pilots are paid based on hours of flight time. Classify each cost as direct, indirect, selling, or general and administrativ
> Tech Pro offers instructional courses in website design. The company holds classes in a building that it owns. The cost object is an individual class. Classify each of Tech Pro’s costs below as direct or indirect. 1. Depreciation on classroom building 2
> Listed here are product costs for production of soccer balls. Classify each cost as either direct or indirect.
> In a recent annual report and related Global Responsibility Report, Starbucks provides information on company performance on several dimensions. Indicate whether the following items best fit into the financial (label your answer “Profit”), social (label
> Determine the missing amount for each separate situation involving manufacturing cost flows.
> The following chart shows how costs flow through a business as a product is manufactured. All boxes in the chart show cost amounts. Compute the cost amounts for the boxes that contain question marks.
> Refer to the information in Exercise 18-13 to prepare an income statement for Delray Mfg. (a manufacturer). Assume that its cost of goods manufactured is $534,300
> Key comparative figures for Apple and Google follow. Required 1. Compute the amount of gross margin and the gross margin ratio for the two years shown for each of these companies. 2. Which company earns more in gross margin for each dollar of net sales
> Indicate whether each decision is most likely to be made using managerial accounting information or financial accounting information.
> Use the financial data for Ronda Merchandising Inc. in Exercise 17-17A to prepare its December 31 yearend income statement. Ignore the earnings per share section.
> Refer to Simon Company’s financial information in Exercises 17-6 and 17-8. Additional information about the company follows. For both the current year and one year ago, compute the following ratios: (1) return on equityâ€
> Refer to Simon Company’s financial information in Exercises 17-6 and 17-8. For both the current year and one year ago, compute the following ratios: (1) profit margin ratio—percent rounded to one decimal; did profit margin improve or worsen in the curren
> Refer to the Simon Company information in Exercise 17-6. The company’s income statements for the current year and one year ago follow. Assume that all sales are on credit and then compute (1) days’ sales uncollected, (
> Refer to Simon Company’s balance sheets in Exercise 17-6. (1) Compute the current ratio for each of the three years. Did the current ratio improve or worsen over the three-year period? (2) Compute the acid-test ratio for each of the three years. Did the
> Simon Company’s year-end balance sheets follow. (1) Express the balance sheets in common-size percent’s. Round percent’s to one decimal. (2) Assuming annual sales have not changed in the last three ye
> Compute trend percent’s for the following accounts using 2017 as the base year. For each of the three accounts, state whether the situation as revealed by the trend percent’s appears to be favorable or unfavorable.
> Refer to information in Exercise 16-4. Use the direct method to prepare the operating activities section of Son ad’s statement of cash flows.
> Refer to the information in Exercise 16-12. Using the direct method, prepare the statement of cash flows for the year ended June 30, 2021. Hint: Prepaid Expenses and Wages Payable relate to Operating Expenses on the income statement.
> Key figures for the recent two years of both Apple and Google follow. Required 1. Compute current ratios for (a) Apple and (b) Google for the two years reported above. 2. In the current year, which company has the better ability to pay short-term obligat
> Complete the following spreadsheet in preparation of the statement of cash flows. (The statement of cash flows is not required.) Prepare the spreadsheet as in Exhibit 16A.1 under the indirect method. Identify the debits and credits in the Analysis of Cha
> A company reported average total assets of $1,240,000 in Year 1 and $1,510,000 in Year 2. Its net operating cash flow was $102,920 in Year 1 and $138,920 in Year 2. (1) Calculate its cash flow on total assets ratio for both years. (2) Did its cash flow o
> Use the following information to prepare a statement of cash flows for the current year using the indirect method.
> The following financial statements and additional information are reported. (1) Prepare a statement of cash flows using the indirect method for the year ended June 30, 2021. (2) Compute the company’s cash flow on total assets ratio for
> Use the following information to determine cash flows from financing activities. a. Net income was $35,000. b. Issued common stock for $64,000 cash. c. Paid cash dividend of $14,600. d. Paid $50,000 cash to settle a long-term notes payable at its $50,000
> The following information shows Car perk Company’s individual investments in securities during its current year, along with the December 31 fair values. a. Investment in Brava Company bonds: $420,500 cost; $457,000 fair value. Car perk intends to hold th
> Prepare journal entries to record the following transactions and events of Kodak Company. Year 1 Jan. 2 Purchased 30,000 shares of Greco Co. common stock for $411,000 cash. Greco has 90,000 shares of common stock outstanding, and its activities will be
> Refer to the information in Exercise 15-10. (1) After the fair value adjustment is made, prepare the assets section of Mars Co.’s December 31 classified balance sheet. Assume Mars plans to sell its stock investments within the next six months. (2) In whi
> Use the information in Exercise 14-12 to prepare the journal entries for Eagle to record the note’s issuance and each of the four payments.
> Key figures for the recent two years of both Apple and Google follow. Required 1. Compute profit margins for (a) Apple and (b) Google for the two years of data reported above. 2. In the prior year, which company is more successful on the basis of profit
> On January 1, 2021, Shay Company issues $700,000 of 10%, 15-year bonds. The bonds sell for $684,250. Six years later, on January 1, 2027, Shay retires these bonds by buying them on the open market for $731,500. All interest is accounted for and paid thro
> Quarto Co. issues bonds dated January 1, 2021, with a par value of $400,000. The bonds’ annual contract rate is 13%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issu
> Duval Co. issues four-year bonds with a $100,000 par value on January 1, 2021, at a price of $95,952. The annual contract rate is 7%, and interest is paid semiannually on June 30 and December 31. 1. Prepare a straight-line amortization table like Exhibit
> Dobbs Company issues 5%, two-year bonds, on December 31, 2021, with a par value of $200,000 and semiannual interest payments. Use the following bond amortization table and prepare journal entries to record (a) the issuance of bonds on December 31, 2021;
> Tango Company issues bonds with a par value of $180,000 on January 1, 2021. The bonds’ annual contract rate is 8%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuan
> Brussels Enterprises issues bonds at par dated January 1, 2021, that have a $3,400,000 par value, mature in four years, and pay 9% interest semiannually on June 30 and December 31. 1. Record the entry for the issuance of bonds for cash on January 1. 2. R
> National Motors Company advertised three alternatives for a 25-month lease on a new Tahoe: (1) zero dollars down and a lease payment of $1,750 per month for 25 months, (2) $5,000 down and $1,500 per month for 25 months, or (3) $38,500 down and no payment
> On January 1, Harbor (lessee) signs a five-year lease for equipment that is accounted for as a finance lease. The lease requires five $10,000 lease payments (the first at the beginning of the lease and the remaining four at December 31 of Years 1, 2, 3,
> Quarto Co. issues bonds dated January 1, 2021, with a par value of $400,000. The bonds’ annual contract rate is 13%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issu
> Stanford issues bonds dated January 1, 2021, with a par value of $500,000. The bonds’ annual contract rate is 9%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuanc
> Apple offers device service and repair through its AppleCare program. Assumed data follow. Required 1. Compute time charge per hour of direct labor (in $). 2. Compute materials markup per dollar of direct material cost (in %). 3. Use time and materials p
> Current year information for Samsung and Google follows. Required 1. Compute the cash conversion cycle for both Samsung and Google for the current year. 2. Which company, Samsung or Google, was more effective at managing cash in the current year?
> Bran Company issues bonds with a par value of $800,000. The bonds mature in 10 years and pay 6% annual interest in semiannual payments. The annual market rate for the bonds is 8%. 1. Compute the price of the bonds as of their issue date. 2. Prepare the j
> On January 1, $30,000 cash is borrowed from a bank in return for a 12% installment note with 36 monthly payments of $996 each. (1) Prepare an amortization table for the first three months of this installment note. (2) Record the entry for issuance of the
> Green Foods currently has $200,000 of equity and is planning an $80,000 expansion to meet increasing demand for its product. The company currently earns $50,000 in net income, and the expansion will yield $25,000 in additional income before any interest
> Tuscan Inc. had a retained earnings balance of $60,000 at December 31 of the prior year. In the current year, Tuscan reported the following results. Calculate the retained earnings balance at December 31 of the current year. Reported net income of $100,0
> Prepare a classified balance sheet for Tucson Co. for the year ended December 31 using the following data.
> The stockholders’ equity section of TVX Company on February 4 follows. On February 5, the directors declare a 20% stock dividend distributable on February 28 to the February 15 stockholders of record. The stock’s marke
> Refer to the information in Exercise 13-8. Assume that instead of distributing a stock dividend, Sharper did a 3-for-1 stock split. After the split, (1) prepare the updated stockholders’ equity section and (2) compute the number of shares outstanding. Hi
> On June 30, Sharper Corporation’s stockholders’ equity section of its balance sheet appears as follows before any stock dividend or split. Sharper declares and immediately distributes a 50% stock dividend. After the di
> For each dividend and stock split issued, determine the impact—increase, decrease, or no effect—on total assets, total liabilities, and total equity.
> Analyze each transaction from Exercise 13-4 by showing its effect on the accounting equation—specifically, identify the accounts and amounts (including + or −) for each transaction
> Samsung’s service and repair program competes with Apple’s AppleCare. Assumed data follow. Required 1. For both Samsung and Apple, compute time charge per hour of direct labor (in $). 2. For both Samsung and Apple, com
> Indicate which activities of Stockton Corporation violated the rights of a stockholder who owned one share of common stock. 1. Did not allow the stockholder to sell the stock to her brother. 2. Rejected the stockholder’s request to be put in charge of it
> Alex Corporation reports the following components of stockholders’ equity at December 31 of the prior year. During the current year, the following transactions affected its stockholders’ equity accounts. Jan. 2 Purchas
> Prepare a statement of stockholders’ equity for Hulu Inc. for the year ended December 31 using the following data. Beginning balances of $300 for Common Stock, $9,700 for Paid-In Capital in Excess of Par, and $20,000 for Retained Earnings. Reported net
> The following information is from Amos Company for the current year ended December 31. Prepare a statement of retained earnings for Amos Company for the current year. Retained earnings at December 31 of the prior year (before discovery of an error) was $
> Prepare a statement of retained earnings for Tidal Co. for the current year ended December 31 using the following data.
> Match each corporate characteristic 1 through 8 with the description that best relates to it. 1. Owner authority and control 2. Ease of formation 3. Transferability of ownership 4. Ability to raise large capital amounts 5. Duration of life 6. Owner liabi
> Selected accounts from the Pearson, Gomez, and Lott Partnership adjusted trial balance for the year ended December 31 follow. Prepare a classified balance sheet.
> Mike and Rachel form M&R Partnership. Mike invests $40,000 cash and Rachel invests $60,000 cash. The partners agree to share income as follows: Mike gets a salary allowance of $5,000 per year and Rachel gets a salary allowance of $9,000 per year; both ge
> On March 1, Eckert and Kelley formed a partnership. Eckert contributed $82,500 cash, and Kelley contributed land valued at $60,000 and a building valued at $100,000. The partnership also took Kelley’s $92,500 long term note payable associated with the la
> Ramer and Knox began a partnership by investing $60,000 and $90,000, respectively. The partners agreed to share net income and loss by giving annual salary allowances of $50,000 to Ramer and $40,000 to Knox, 10% interest allowances on their investments,
> Google wants to develop a laptop to compete with Apple’s MacBook Pro. Google believes the price of this model must be no more than Apple’s price of $1,199 per unit to be competitive. Google expects to sell 20,000 units
> Ramer and Knox began a partnership by investing $60,000 and $90,000, respectively. During its first year, the partnership earned $160,000. Prepare calculations showing how the $160,000 income is allocated under each separate plan for sharing income and l
> Steffi and Leigh form a partnership. Steffi invests $1,000 cash, $2,000 of supplies, inventory with a market value of $3,000, and machinery with a market value of $4,000. Prepare the partnership’s journal entry to record Steffi’s investment.
> Moss and Barber organize a partnership on January 1. Moss’s initial net investment is $75,000, consisting of cash ($17,500), equipment ($82,500), and a note payable reflecting a bank loan for the new business ($25,000). Barber’s initial investment is cas
> For each separate case, indicate which type of organization should be formed. a. Sharif, Henry, and Kori want to start a tech firm. They are deciding between an S corporation and a C corporation. The founders want limited liability, but they also want to
> Rugged Sports Enterprises LP is organized as a limited partnership consisting of two individual partners: Hockey LP and Football LP. Compute partner return on equity for each limited partnership (and the total) for the year using the following data from
> Assume that the Turner, Roth, and Lowe partnership of Exercise 12-13 is a limited partnership. Turner and Roth are general partners. Lowe is a limited partner, meaning any remaining deficiency in Lowe’s capital account is covered by Turner and Roth. Dete
> Turner, Roth, and Lowe are partners who share income and loss in a 1:4:5 ratio (in percent’s: Turner, 10%; Roth, 40%; and Lowe, 50%). The partners decide to liquidate the partnership. Immediately before liquidation, the partnership balance sheet shows to
> Biz Partnership allows partner Mandy to sell her $100,000 equity in the partnership to Brittney. Brittney pays Mandy $85,000. Record the partnership’s journal entry for the sale of Mandy’s interest to Brittney on September 30.
> Determine whether each characteristic describes a general partnership (GP), limited liability company (LLC), both, or neither. a. Must pay a business (corporate) income tax. b. When the business cannot pay its debts, creditors can take the owners’ person
> Stark Company has five employees. Employees paid by the hour earn $10 per hour for the regular 40-hour workweek and $15 per hour beyond the 40 hours per week. Hourly employees are paid every two weeks, but salaried employees are paid monthly on the last
> AA 26-1 Apple invested $10,495 in the current year to expand its manufacturing capacity. Assume that these assets have a 10-year life and generate net cash flows of $3,000 per year, and that Apple requires a 7% return on its investments. (Apple $s in mil
> Riya Co. purchases a machine for $105,000 on January 1, 2021. Straight-line depreciation is taken each year for four years assuming a seven-year life and no salvage value. The machine is sold on July 1, 2025, during its fifth year of service. Prepare ent
> Refer to the information in Exercise 9-14 to complete the following requirements. a. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 4.5% of total accounts receivable to estimate uncollectible, instead of the aging o
> Warner Company’s year-end unadjusted trial balance shows accounts receivable of $99,000, allowance for doubtful accounts of $600 (credit), and sales of $140,000. Uncollectible are estimated to be 1% of sales. Prepare the December 31 year-end adjusting en
> Use the following accounts with normal balances to prepare Boscov Company’s classified balance sheet as of December 31
> Using the information in Exercise 8-12, prepare any necessary journal entries that Del Gato Clinic must record as a result of preparing the bank reconciliation.
