Question: On July 23 of the current year,

> Chance Innis did business as Roadrunner Hotshot, renting equipment to oil companies in North Dakota. Innis’s sister, Cammie Wold, operated the business. At a restaurant in Williston, Innis and Wold met with Louis Tornabeni, who orally agreed to provide I

> The Statute of Frauds. Michael Brannon filed a suit in an Ohio state court against Derrick and Nancy Edman, claiming breach of an alleged oral contract for the sale of certain real property in Akron. Brannon asserted that he had moved onto the property a

> Intoxication. After Kira had had several drinks one night, she sold Charlotte a diamond necklace worth thousands of dollars for one hundred dollars. The next day, Kira offered one hundred dollars to Charlotte for the return of the necklace. Charlotte ref

> Scott Caldwell worked for UniFirst Corporation under an employment agreement with an arbitration clause. The agreement provided that either party could avoid arbitration by seeking an injunction—but only the employer could obtain this relief without show

> McWane, Inc. v. Federal Trade Commission United States Court of Appeals, Eleventh Circuit, 783 F.3d 814 (2015). In the Language of the Court MARCUS, Circuit Judge: Pipe fittings join together pipes and help direct the flow of pressurized water in pipelin

> McCullough v. Allstate Property and Casualty Insurance Co. Alabama Court of Civil Appeals, 256 So.3d 103 (2018). Background and Facts; Allstate Property and Casualty Insurance Company issued a policy to Jerry McCullough, insuring his pickup truck. McCull

> Visit the Association of Certified Fraud Examiners website and open the “2016 Report to the Nations” (s3-us-west-2.amazonaws.com/acfepublic/2016-report-to-the-nations.pdf ). Read the two- page Executive Summary and fill in the following blanks. The media

> At December 31, Hovak Co.’s Allowance for Doubtful Accounts has an unadjusted debit balance of $3,400. Hovak prepares a schedule of its December 31 accounts receivable by age. Required 1. Compute the required balance of the Allowance fo

> Samsung is a leading global manufacturer that competes with Apple and Google. Key financial figures for Samsung follow. *Figures prepared in accordance with International Financial Reporting Standards as adopted by the Republic of Korea. Required 1. Wha

> Apple’s statement of cash flows in Appendix A describes changes in cash and cash equivalents for the year ended September 29, 2018. What total amount is provided (used) by investing activities? What amount is provided (used) by financing activities?

> Sherman Co. began operations in Year 1. During its first two years, the company completed several trans- actions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows. Year 1 a. Sold $685,

> a. Accounting b. Identifying c. Recording d. Communicating e. Governmental f. Artificial intelligence h. Recordkeeping (bookkeeping) g. Language of business 1. ______helps accountants by performing repetitive tasks such as entering invoice data. 2.

> Review the opening feature of this chapter that highlights Jean Liu and Didi Chuxing (or DiDi). The company plans to open a kiosk in the Ferry Building in San Francisco to sell shirts, hats, and other merchandise. Other retail outlets and expansion plans

> Determine whether each procedure described below is an internal control strength or weakness. 1. The same employee is in charge of recordkeeping and depositing cash receipts. 2. All large payments are made by electronic funds transfer (EFT). 3. Cash rece

> Selected accounts from Fair Trader Co.’s adjusted trial balance for the year ended December 31 follow. Prepare its income statement.

> Organize the class into teams. Each team must prepare a list of 10 internal controls a consumer could observe in a typical retail department store. When called upon, the team’s spokesperson must be prepared to share controls identified by the team that h

> Refer to Google’s balance sheet in Appendix A. Does it use the direct write-off method or allowance method in accounting for its accounts receivable? What is the realizable value of its receivables balance as of December 31, 2018?

> Net Zero Products, a wholesaler of sustainable raw materials, prepares the following aging of receivables analysis. (1) Estimate the balance of the Allowance for Doubtful Accounts using the aging of accounts receivable method. (2) Prepare the adjusting e

> The following transactions are from Ohlm Company. Year 1 Dec. 16 Accepted a $10,800, 60-day, 8% note in granting Danny Todd a time extension on his past-due account receivable. 31 Made an adjusting entry to record the accrued interest on the Todd note. Y

> Barga Co.’s net sales for Year 1 and Year 2 are $730,000 and $1,095,000, respectively. Its year-end balances of accounts receivable follow: Year 1, $65,000; and Year 2, $123,000. a. Compute its days’ sales uncollected at the end of each year. b. Did days

> Assume you are a business consultant. The owner of a company sends you an e-mail expressing concern that the company is not taking advantage of its discounts offered by vendors. The company currently uses the gross method of recording purchases. The owne

> Refer to the information in QS 5-11 and assume the perpetual inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on the LIFO method.

> Wright Company’s Cash account shows a $27,500 debit balance and its bank statement shows $25,800 on deposit at the close of business on May 31. Prepare its bank reconciliation using the following information. a. The May 31 bank statement lists $100 in ba

> Refer to the information in QS 5-11 and assume the perpetual inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on the FIFO method.

> Refer to the information in QS 5-11 and assume the periodic inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on specific identification. Of the units sold, eight are from the December 7 purchase and

> A car dealer acquires a used car for $14,000, with terms FOB shipping point. Compute total inventory costs assigned to the used car if additional costs include $250 for transportation-in. $150 for advertising. $300 for shipping insurance. $1,250 for sa

> Nagy Company makes a lump-sum purchase of several assets on January 1 at a total cash price of $1,800,000. The estimated market values of the purchased assets are building, $890,000; land, $427,200; land improvements, $249,200; and five trucks, $213,600.

> Key figures for Samsung follow. 1. Compute Samsung’s accounts receivable turnover for the current year. 2. In the current year, does Samsung’s accounts receivable turnover underperform or outperform the industry (assum

> For a through g, indicate whether its amount (1) affects the bank or book side of a bank reconciliation, (2) is an addition or a subtraction in a bank reconciliation, and (3) requires an adjusting journal entry.

> Using information from Exercise 7-9, determine the impact of the December 31, February 1, and June 5 transactions on the accounting equation. For each transaction, indicate whether there would be an increase, decrease, or no effect, for Assets, Liabiliti

> 1. Brooks Agency set up a petty cash fund for $150. At the end of the current period, the fund contained $28 and had the following receipts: entertainment, $70; postage, $30; and printing, $22. Prepare journal entries to record (a) establishment of the f

> Harriet Knox, Ralph Patton, and Marcia Diamond work for a family physician, Dr. Gwen Conrad, who is in private practice. Dr. Conrad is knowledgeable about office management practices and has segregated the cash receipt duties as follows. Knox opens the m

> Record the journal entry for Sales and for Cash Over and Short for each of the following separate situations. a. The cash register’s record shows $420 of cash sales, but the count of cash in the register is $430. b. The cash register’s record shows $980

> Classify each of the following items as assets, liabilities, or equity. 1. Land 2. Common stock 3. Equipment 4. Accounts payable 5. Accounts receivable 6. Supplies

> Identify each of the following statements as either true or false. a. A guideline for safeguarding cash is that all cash receipts be deposited monthly or yearly. b. A voucher system of control is a control system exclusively for cash receipts. c. A guide

> Vail Company recorded the following transactions during November. 1. Open a general ledger having T-accounts for Accounts Receivable, Sales, and Sales Returns and Allowances. Also open an accounts receivable subsidiary ledger having a T-account for each

> Levine Company uses the perpetual inventory system. Prepare journal entries to record the following credit card transactions of Levine Company. Apr. 8 Sold merchandise for $8,400 (that had cost $6,000) and accepted the customer’s Suntrust Bank Card. Sunt

> Selected ledger account balances for Business Solutions follow. Required 1. Assume that Business Solutions does not acquire additional office equipment or computer equipment in 2021. Compute amounts for the year ended December 31, 2021, for Depreciation

> Assume that Echoing Green makes an investment in Sustain Inc., a sustainability consulting firm. The company purchases 200 shares of Sustain stock for $15,500 cash. Sustain has 500 shares of common stock outstanding, and Echoing Green will be able to sig

> Refer to Google’s financial statements in GOOGLE become especially critical? 3. Why should responsibility for related transactions be divided among different departments or individuals? 4. Why should the person who keeps the records of an asset Appendi

> Visit an area of your college that serves the student community with either products or services. Some examples are food services, libraries, and bookstores. Identify and describe between four and eight internal controls being implemented.

> Liang Company began operations in Year 1. During its first two years, the company completed a number of transactions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows. Year 1 a. Sold $

> Comparative figures for Apple and Google follow. Required 1. Compute the accounts receivable turnover for the two most recent years for (a) Apple and (b) Google. 2. Which company more quickly collects its accounts receivable in the current year?

> While reviewing the March 31, 2021, balance sheet of Business Solutions, Santana Rey notes that the business has built a large cash balance of $68,057. Its most recent bank money market statement shows that the funds are earning an annualized return of 0

> Organic Food Co.’s Cash account shows a $5,500 debit balance and its bank statement shows $5,160 on deposit at the close of business on August 31. Prepare a bank reconciliation using the following information. a. August 31 cash receipts of $1,240 were pl

> On December 31, Jarden Co.’s Allowance for Doubtful Accounts has an unadjusted credit balance of $14,500. Jarden prepares a schedule of its December 31 accounts receivable by age. Required 1. Compute the required balance of the Allowanc

> Indicate which statements are true and which are false. 1. Separation of recordkeeping for assets from the custody over assets helps reduce fraud. 2. The primary objective of internal control procedures is to safeguard the business against theft from gov

> Prepare journal entries to record the following transactions of Namco. April 1 Accepted a $5,000, 90-day, 4% note from Travis in granting a time extension on his past-due account receivable. June 30 Travis dishonored his note.

> On April 1 of Year 1, Respawn accepted a $10,000, 12-month, 8% note from a customer in granting a time extension on his past-due account receivable. Respawn’s year-end is December 31. Compute interest revenue recorded by Respawn in Year 1 and Year 2.

> Analyze each of the following transactions by showing the effects on the accounting equation— specifically, identify the accounts and amounts (including + or −) for each transaction. a. The company provides $20,000 of services on credit. b. The company e

> Access the July 28, 2016, 10-K filing (for year-end June 30, 2016) of Microsoft (ticker: MSFT) at SEC.gov. Review its note 4, “Investments.” Required 1. How does the “cost-basis” total amount for its investments as of June 30, 2016, compare to the prior

> On January 1, Manning Co. purchases and installs a new machine costing $324,000 with a five-year life and an estimated $30,000 salvage value. Management estimates the machine will produce 1,470,000 units of product during its life. Actual production of u

> On December 1, Daw Co. accepts a $10,000, 45-day, 6% note from a customer. (1) Prepare the year-end adjusting entry to record accrued interest revenue on December 31. (2) Prepare the entry required on the note’s maturity date assuming it is honored.

> Samsung’s statement of cash flows in Appendix A reports the change in cash and equivalents for the year ended December 31, 2018. Identify the cash generated (or used) by operating activities, by investing activities, and by financing activities.

> Determine the maturity date and compute interest for each note.

> Many commercials include comments similar to the following: “We accept VISA” or “We do not accept American Express.” Conduct your own research by contacting at least five companies via interviews, phone calls, or the Internet to determine the reason(s) c

> Nichole Mustard and Credit Karma are introduced in the chapter’s opening feature. Assume that they are considering two options. Plan A. The company would begin selling access to a premium version of its website. The new online customers would use their

> In addition, its unadjusted trial balance includes the following items. At December 31, Hawke Company reports the following results for its calendar year. Required 1. Prepare the adjusting entry to record bad debts under each separate assumption. a. Bad

> Onslow Co. purchased a used machine for $178,000 cash on January 2. On January 3, Onslow paid $2,840 to wire electricity to the machine. Onslow paid an additional $1,160 on January 4 to secure the machine for operation. The machine will be used for six y

> Each member of a team is to participate in estimating uncollectibles using the aging schedule and percents shown in Problem 7-3A. The division of labor is up to the team. Your goal is to accurately complete this task as soon as possible. After estimating

> On January 1, ProTech Co. pays a lump-sum amount of $1,550,000 for land, Building A, Building B, and Land Improvements B. Building A has no value and will be demolished. Building B will be an office and is appraised at $482,800, with a useful life of 15

> At December 31, Ingleton Company reports the following results for the year. In addition, its unadjusted trial balance includes the following items. Required 1. Prepare the adjusting entry to record bad debts under each separate assumption. a. Bad debts

> Use Apple’s financial statements in Appendix A to answer the following. 1. What is the amount of Apple’s accounts receivable as of September 29, 2018? 2. Compute Apple’s accounts receivable turnover as of September 29, 2018. 3. Apple’s most liquid assets

> Access eBay’s January 30, 2019, filing of its 10-K report for the year ended December 31, 2018, at SEC.gov. Required 1. What is the amount of eBay’s net accounts receivable at December 31, 2018, and at December 31, 2017? 2. “Financial Statement Schedule

> At year-end December 31, Chan Company estimates its bad debts as 1% of its annual credit sales of $487,500. Chan records its bad debts expense for that estimate. On the following February 1, Chan decides that the $580 account of P. Park is uncollectible

> As the accountant for Pure-Air Distributing, you attend a sales managers’ meeting devoted to a discussion of credit policies. At the meeting, you report that bad debts expense is estimated to be $59,000 and accounts receivable at year-end amount to $1,75

> Anton Blair is the manager of a medium-size company. A few years ago, Blair persuaded the owner to base a part of his compensation on the net income the company earns each year. Each December he estimates year-end financial figures in anticipation of the

> Refer to Samsung’s December 31, 2018, Samsung report its accounts receivable, titled as “Trade receivables,” as a current or noncurrent asset?

> Refer to Samsung’s financial statements in Appendix A. What is the amount of Samsung’s accounts receivable, titled as “Trade receivables,” on its December 31, 2018, balance sheet?

> Refer to Samsung’s balance sheet in Appendix A. How does its cash (titled “Cash and cash equivalents”) compare with its other current assets (in both amount and percent) as of December 31, 2018? Compare and assess its cash at December 31, 2018, with its

> The following data are for Rocky Company. (a) Compute Rocky’s accounts receivable turnover. (b) If its competitor, Dixon, has an accounts receivable turnover of 7.5, which company appears to be doing a better job of managing its recei

> Assume that you are Jolee Company’s accountant. Company owner Mary Jolee has reviewed the 2020 financial statements you prepared and questions the $6,000 loss reported on the sale of its investment in Kemper Co. common stock. Jolee acquired 50,000 shares

> Complete the following table by filling in missing amounts.

> Santana Rey, owner of Business Solutions, realizes that she needs to begin accounting for bad debts expense. Assume that Business Solutions has total revenues of $44,000 during the first three months of 2021 and that the Accounts Receivable balance on Ma

> The following transactions are from Springer Company. Year 1 Nov. 1 Accepted a $4,800, 90-day, 8% note in granting Steve Julian a time extension on his past-due account receivable. Dec. 31 Made an adjusting entry to record the accrued interest on the Jul

> Archer Co. completed the following transactions and uses a perpetual inventory system. Aug. 4 Sold $3,700 of merchandise on credit (that had cost $2,000) to McKenzie Carpenter, terms n∕10. 10 Sold $5,200 of merchandise (that had cost $2,800) to customers

> Robotix Co. purchases a patent for $20,000 on January 1. The patent is good for 18 years, after which anyone can use the patent technology. However, Robotix plans to sell products using that patent technology for only 5 years. Prepare the intangible asse

> Mayfair Co. completed the following transactions and uses a perpetual inventory system. June 4 sold $650 of merchandise on credit (that had cost $400) to Natara Morris, terms n∕15. 5 Sold $6,900 of merchandise (that had cost $4,200) to customers who used

> The following information is from the annual financial statements of Raheem Company. (1) Compute its accounts receivable turnover for Year 2 and Year 3. (2) Assuming its competitor has a turnover of 11, is Raheem performing better or worse at collecting

> On November 30, Petrov Co. has $128,700 of accounts receivable and uses the perpetual inventory sys- tem. (1) Prepare journal entries to record the following transactions. (2) Which transaction would most likely require a note to the financial statements

> Prepare journal entries to record the following transactions of Ridge Company. Mar. 21 Accepted a $9,500, 180-day, 8% note from Tamara Jackson in granting a time extension on her past-due account receivable. Sep. 17 Jackson dishonored her note. Dec. 31 A

> Following are selected data from Samsung, Apple, and Google. Required 1. Compute Samsung’s return on total assets for the two most recent years. 2. For the current year, is Samsung’s return on total assets better or wo

> Prepare journal entries to record transactions for Vitalo Company. Nov. 1 Accepted a $6,000, 180-day, 8% note from Kelly White in granting a time extension on her past-due account receivable. Dec. 31 Adjusted the year-end accounts for the accrued interes

> Refer to the information in Exercise 7-17 and prepare the journal entries for the following year for Danica Company. Jan. 27 Received Lee’s payment for principal and interest on the note dated December 13. Mar. 3 Accepted a $5,000, 10%, 90-day note in

> Use the information in Problem 1-3B to prepare the statement of retained earnings for Audi Company for the current year ended December 31.

> BioWare’s year-end unadjusted trial balance shows accounts receivable of $17,000 and sales of $150,000. Uncollectibles are estimated to be 2% of sales. Prepare the December 31 year-end adjusting entry for uncollectibles using the percent of sales method.

> The records of Alaska Company provide the following information for the year ended December 31. Required 1. Use the retail inventory method to estimate the company’s year-end inventory at cost. 2. A year-end physical inventory at retail

> Selected accounts from Bennett Co.’s adjusted trial balance for the year ended December 31 follow. Prepare a classified balance sheet. Note: Allowance for doubtful accounts is subtracted from accounts receivable on the companyâ&#1

> Prepare journal entries for the following transactions of Danica Company. Dec. 13 Accepted a $9,500, 45-day, 8% note in granting Miranda Lee a time extension on her past-due account receivable. 31 Prepared an adjusting entry to record the accrued intere

> Prepare Garzon Company’s journal entries to record the following transactions for the current year. Jan.1 Purchases 6% bonds (as a held-to-maturity investment) issued by PBS at a cost of $40,000, which is the par value. July.1 Receives first semiannual p

> At December 31, Folgeys Coffee Company reports the following results for its calendar year. Its year-end unadjusted trial balance includes the following items. 1. Prepare the adjusting entry to record bad debts expense assuming uncollectibles are estimat

> Following is a list of credit customers along with their amounts owed and the days past due at December 31. Following that list are five classifications of accounts receivable and estimated bad debts percent for each class. 1. Create an aging of accounts

> Refer to the information in Exercise 7-13 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 uncollectibles, instead of the aging

> Daley Company prepared the following aging of receivables analysis at December 31. a. Estimate the balance of the Allowance for Doubtful Accounts using aging of accounts receivable. b. Prepare the adjusting entry to record bad debts expense using the est

> Mazie Supply Co. uses the percent of accounts receivable method. On December 31, it has outstanding accounts receivable of $55,000, and it estimates that 2% will be uncollectible. Prepare the year-end adjusting entry to record bad debts expense under the

> 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. Uncollectibles are estimated to be 1% of sales. Prepare the December 31 year-end adjusting e

> Use Apple’s financial statements in Appendix A to answer the following. 1. Compute Apple’s return on total assets for the years ended September 29, 2018, and September 30, 2017. 2. Is the change in Appleâ€&#

> QP Corp. sold 4,000 units of its product at $50 per unit during the year and incurred operating expenses of $5 per unit in selling the units. It began the year with 700 units in inventory and made successive purchases of its product as follows. Required

> Refer to Google’s recent balance sheet in Appendix A. What is the book value of its total net property and equipment assets at December 31, 2018?

> On December 31 of Swift Co.’s first year, $50,000 of accounts receivable was not yet collected. Swift estimated that $2,000 of its accounts receivable was uncollectible and recorded the year-end adjusting entry. 1. Compute the realizable value of account