Rayborn Company obtains $20,000 in cash by signing a 9%, 6-month, $20,000 note payable to First Bank on July 1. Rayborn’s fiscal year ends on September 30. What information should be reported for the note payable in the annual financial statements?
> The ledger of Waite Corporation at December 31, 2017, after the books have been closed, contains the following stockholders’ equity accounts. Preferred Stock (10,000 shares issued) $1,000,000 Common Stock (300,000 shares issued) 1,500,000 Paid-
> On October 1, 2016, Kristal Corp. issued $700,000, 5%, 10-year bonds at face value. The bonds were dated October 1, 2016, and pay interest annually on October 1. Financial statements are prepared annually on December 31. Instructions (a) Prepare the jour
> The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to its financial statements, are also provided in Appendix F. Instructions Use the compa
> The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to its financial statements, are also provided in Appendix F. Instructions Use the compa
> The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to its financial statements, are also provided in Appendix F. Instructions Use the compa
> A On July 31, 2017, Keeds Company had a cash balance per books of $6,140. The statement from Dakota State Bank on that date showed a balance of $7,690.80. A comparison of the bank statement with the Cash account revealed the following facts. 1. The bank
> The stockholders’ equity section of Lachlin Corporation’s balance sheet at December 31 is presented here. Instructions From a review of the stockholders’ equity section, answer the following question
> Operating data for Joshua Corporation are presented below. Instructions Prepare a schedule showing a vertical analysis for 2017 and 2016. 2017 2016 Sales revenue Cost of goods sold Selling expenses Administrative expenses $800,000 $600,000 520,000 4
> Distinguish between long-term investments and property, plant, and equipment.
> The current sections of Sunn Inc.’s balance sheets at December 31, 2016 and 2017, are presented here. Sunn’s net income for 2017 was $153,000. Depreciation expense was $27,000. Instructions Prepare the net cash provided by operatin
> Grouper Company provides you with the following balance sheet information as of December 31, 2017. In addition, Grouper reported net income for 2017 of $16,000, income tax expense of $3,200, and interest expense of $1,300. (a) Compute the current ratio
> Hoyle Corporation has issued 100,000 shares of $5 par value common stock. It was authorized 500,000 shares. The paid-in capital in excess of par value on the common stock is $263,000.The corporation has reacquired 7,000 shares at a cost of $46,000 and is
> The March 29, 2012, edition of the Wall Street Journal Online contains an article by Miguel Bustillo entitled, “Best Buy Forced to Rethink Big Box.” The article explains how the 1,100 giant stores, which enabled Best B
> Marriott Corporation split into two companies: Host Marriott Corporation and Marriott International. Host Marriott retained ownership of the corporation’s vast hotel and other properties, while Marriott International, rather than owning
> Hechinger Co. and Home Depot are two home improvement retailers. Compared to Hechinger, founded in the early 1900s, Home Depot is a relative newcomer. But in recent years, while Home Depot was reporting large increases in net income, Hechinger was report
> On January 1, 2017, Bryce Inc. changed from the LIFO method of inventory pricing to the FIFO method. Explain how this change in accounting principle should be treated in the company’s financial statements.
> The following control procedures are used in Keaton Company for over-the-counter cash receipts. 1. Each store manager is responsible for interviewing applicants for cashier jobs. They are hired if they seem honest and trustworthy. 2. All over-the-counter
> (a) Your roommate says, “Sales taxes are reported as an expense in the income statement.” Do you agree? Explain. (b) Leiana’s Cafe has cash proceeds from sales of $8,550. This amount includes $550 of sales taxes. Give the entry to record the proceeds.
> Moosier Inc. has been in operation for 3 years and uses the FIFO method of pricing inventory. During the fourth year, Moosier changes to the average-cost method for all its inventory. How will Moosier report this change?
> Distinguish among the three activities reported in the statement of cash flows.
> You are provided with the following information for Lazuris Enterprises, effective as of its April 30, 2017, year-end. Accounts payable……………………………………………………$ 834 Accounts receivable……………………………………………………810 Accumulated depreciation—equipment………….….…......…
> Nona Jaymes believes a corporation must be incorporated in the state in which its headquarters office is located. Is Nona correct? Explain.
> Pine Company had the following assets on January 1, 2017. During 2017, each of the assets was removed from service. The machinery was retired on January 1. The forklift was sold on June 30 for $12,000. The truck was discarded on December 31. Instruction
> Condensed balance sheet and income statement data for Jergan Corporation are presented here. Additional information: 1. The market price of Jergan’s common stock was $7.00, $7.50, and $8.50 for 2015, 2016, and 2017, respectively. 2. Yo
> The income statement of Munsun Company is presented here. Additional information: 1. Accounts receivable decreased $380,000 during the year, and inventory decreased $300,000. 2. Prepaid expenses increased $150,000 during the year. 3. Accounts payable to
> On December 31, 2016, Jons Company had 1,300,000 shares of $5 par common stock issued and outstanding. At December 31, 2016, stockholders’ equity had the amounts listed here. Common Stock $6,500,000 Additional Paid-in Capital 1,800,000 Retain
> A The following section is taken from Hardesty’s balance sheet at December 31, 2016. Current liabilities Interest payable $ 40,000 Long-term liabilities Bonds payable (8%, due January 1, 2020) 500,000 Interest is payable annually on January 1. Th
> Ned Douglas owns Ned’s Blankets. Ned asks you to explain how he should treat the following reconciling items when reconciling the company’s bank account. 1. Outstanding checks. 2. A deposit in transit. 3. The bank charged to our account a check written b
> Some product development expenditures are recorded as development expenses and others as development costs. Explain the difference between these accounts and how a company decides which classification is appropriate.
> The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to its financial statements, are also provided in Appendix F. Instructions Use the compa
> Overton Co. had the following transactions during the current period. Mar. 2 Issued 5,000 shares of $1 par value ordinary shares to attorneys in payment of a bill for $30,000 for services performed in helping the company to incorporate. June 12 Issued 60
> On June 1, Marchon Company Ltd. borrows $60,000 from Acme Bank on a 6-month, $60,000, 8% note. The note matures on December 1. Instructions (a) Prepare the entry on June 1. (b) Prepare the adjusting entry on June 30. (c) Prepare the entry at maturity (De
> Suppose the following items were taken from the December 31, 2017, assets section of the Boeing Company balance sheet. (All dollars are in millions.) Instructions Prepare the assets section of a classified balance sheet, listing the current assets in or
> Here is financial information for Glitter Inc. Instructions Prepare a schedule showing a horizontal analysis for 2017, using 2016 as the base year. December 31, 2017 December 31, 2016 $ 90,000 350,000 65,000 90,000 $106,000 Current assets Plant asse
> Sosa Company reported net income of $190,000 for 2017. Sosa also reported depreciation expense of $35,000 and a loss of $5,000 on the disposal of plant assets. The comparative balance sheets show an increase in accounts receivable of $15,000 for the year
> Penland Corporation is authorized to issue both preferred and common stock. The par value of the preferred is $50. During the first year of operations, the company had the following events and transactions pertaining to its preferred stock. Feb. 1 Issued
> a. Smiley Corporation issues $300,000 of bonds for $315,000. (a) Prepare the journal entry to record the issuance of the bonds, and (b) show how the bonds would be reported on the balance sheet at the date of issuance. b. Farmland Corporation issued $400
> The condensed financial statements of Murawski Company for the years 2016 and 2017 are presented as follows. (Amounts in thousands.) Compute the following ratios for 2017 and 2016. (a) Current ratio. (b) Inventory turnover. (Inventory on 12/31/15 was $3
> The financial statements of Columbia Sportswear Company are presented in Appendix B. Financial statements of VF Corporation are presented in Appendix C. Instructions Answer the following questions for each company. (a) What is the balance in cash and cas
> Gary Theater is in the Hoosier Mall. A cashier’s booth is located near the entrance to the theater. Two cashiers are employed. One works from 1:00 to 5:00 P. M., the other from 5:00 to 9:00 P . M. Each cashier is bonded. The cashiers receive cash from cu
> Moskow Corporation issued the following statement of cash flows for 2017. (a) Compute free cash flow for Moskow Corporation. (b) Explain why free cash flow often provides better information than “Net cash provided by operating activiti
> a. Sparks Corporation has 3,000 shares of 8%, $100 par value preferred stock outstanding at December 31, 2017. At December 31, 2017, the company declared a $105,000 cash dividend. Determine the dividend paid to preferred stockholders and common stockhold
> The financial statements of Amazon.com, Inc. are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions for accessing and using the companies’ complete annual reports, including the notes to the f
> Amazon.com, Inc.’s financial statements are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions (a) Based on the information contained in these financial statements, compute free cash flow for
> The financial statements of Amazon.com, Inc. are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions (a) Based on the information in these financial statements, compute the 2014 return on commo
> The financial statements of Columbia Sportswear Company are presented in Appendix B. Financial statements of VF Corporation are presented in Appendix C. Assume Columbia’s weighted-average number of shares outstanding was 227,514,000, and VF’s was 56,997,
> The financial statements of Amazon.com, Inc. are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions (a) Based on the information contained in these financial statements, compute the current ra
> The financial statements of Columbia Sportswear Company are presented in Appendix B. Financial statements of VF Corporation are presented in Appendix C. Instructions for accessing and using the companies’ complete annual reports, including the notes to t
> Classify each item as an operating, investing, or financing activity. Assume all items involve cash unless there is information to the contrary. (a) Purchase of equipment. (b) Sale of building. (c) Redemption of bonds. (d) Cash received from sale of good
> a. On January 1, 2017, Salt Creek Country Club purchased a new riding mower for $15,000. The mower is expected to have a 10-year life with a $1,000 salvage value. What journal entry would Salt Creek make on December 31, 2017, if it uses straight-line dep
> What questions about cash are answered by the statement of cash flows?
> What is revaluation of plant assets? When should revaluation be applied?
> State whether each of the following statements is true or false. _______1. Convertible bonds are also known as callable bonds. _______2. The market rate is the rate investors demand for loaning funds. _______3. Semiannual interest payments on bonds are e
> (a) Your friend G. C. Jones cannot understand how the characteristic of corporate management is both an advantage and a disadvantage. Clarify this problem for G. C. (b) Identify and explain two other disadvantages of a corporation.
> Hogan Inc. reported 2016 earnings per share of $3.26 and had no discontinued operations. In 2017, earnings per share on income from continuing operations was $2.99, and earnings per share on net income was $3.49. Do you consider this trend to be favorabl
> At December 31, 2017, Arnold Corporation reported the following plant assets. During 2018, the following selected cash transactions occurred. Apr.1 Purchased land for $2,200,000. May 1 Sold equipment that cost $600,000 when purchased on January 1, 2011.
> What are some common types of receivables other than accounts receivable or notes receivable?
> The comparative statements of Wahlberg Company are presented here. All sales were on account. Net cash provided by operating activities for 2017 was $220,000. Capital expenditures were $136,000, and cash dividends were $70,000. Instructions Compute the
> The following account balances relate to the stockholders’ equity accounts of Molder Corp. at year-end. A small stock dividend was declared and issued in 2017. The market price of the shares was $8,800. Cash dividends were $20,000 in b
> The stockholders’ equity accounts of Cyrus Corporation on January 1, 2017, were as follows. Preferred Stock (7%, $100 par noncumulative, 5,000 shares authorized) $ 300,000 Common Stock ($4 stated value, 300,000 shares authorized) 1,000,000 Paid-in C
> At December 31, 2016, Suisse Imports reported this information on its balance sheet. Instructions (a) Prepare the journal entries to record each of these fi ve transactions. Assume that no cash discounts were taken on the collections of accounts receiva
> Ehler Corporation sells rock-climbing products and also operates an indoor climbing facility for climbing enthusiasts. During the last part of 2017, Ehler had the following transactions related to notes payable. Sept.1 Issued a $12,000 note to Pippen to
> On May 15, Wild Quest Clothiers borrowed some money on a 4-month note to provide cash during the slow season of the year. The interest rate on the note was 8%. At the time the note was due, the amount of interest owed was $480. Instructions (a) Determine
> Trayer Corporation has income from continuing operations of $290,000 for the year ended December 31, 2017. It also has the following items (before considering income taxes). 1. An unrealized loss of $80,000 on available-for-sale securities. 2. A gain of
> An analysis of comparative balance sheets, the current year’s income statement, and the general ledger accounts of Hailey Corp. uncovered the following items. Assume all items involve cash unless there is information to the contrary. (a) Payment of inter
> Sagan Co. had these transactions during the current period. June 12 Issued 80,000 shares of $1 par value common stock for cash of $300,000. July 11 Issued 3,000 shares of $100 par value preferred stock for cash at $106 per share. Nov. 28 Purchased 2,000
> a. Beauty Island Corporation began operations on April 1 by issuing 55,000 shares of $5 par value common stock for cash at $13 per share. In addition, Beauty Island issued 1,000 shares of $1 par value preferred stock for $6 per share. Journalize the issu
> a. PK Photography reported net income of $100,000 for 2017. Included in the income statement were depreciation expense of $6,300, patent amortization expense of $4,000, and a gain on disposal of plant assets of $3,600. PK’s comparative
> What term is commonly used under IFRS in reference to the balance sheet?
> Peete Company identifies the following items for possible inclusion in the physical inventory. Indicate whether each item should be included or excluded from the inventory taking. (a) 900 units of inventory shipped on consignment by Peete to another comp
> The financial statements of Columbia Sportswear Company are presented in Appendix B. Financial statements of VF Corporation are presented in Appendix C. Instructions (a) Based on the information in the financial statements, determine each of the followin
> a. Mantle Company has been in business several years. At the end of the current year, the unadjusted trial balance shows: Accounts Receivable $ 310,000 Dr. Sales Revenue 2,200,000 Cr. Allowance for Doubtful Accounts 5,700 Cr. Bad de
> Columbia Sportswear Company’s financial statements are presented in Appendix B. Financial statements of VF Corporation are presented in Appendix C. Instructions (a) Based on the information contained in these financial statements, compute free cash flow
> The financial statements of Columbia Sportswear Company are presented in Appendix B. Financial statements of VF Corporation are presented in Appendix C. Instructions (a) Based on the information in these financial statements, compute the 2014 return on c
> The financial statements of Columbia Sportswear Company are presented in Appendix B. Financial statements of VF Corporation are presented in Appendix C. Instructions (a) Based on the information contained in these financial statements, compute the curren
> Busch Company has these obligations at December 31: (a) a note payable for $100,000 due in 2 years, (b) a 10-year mortgage payable of $200,000 payable in ten $20,000 annual payments and (c) interest payable of $15,000 on the mortgage, and (d) accounts pa
> Each of these items must be considered in preparing a statement of cash flows for Irvin Co. for the year ended December 31, 2017. For each item, state how it should be shown in the statement of cash flows for 2017. (a) Issued bonds for $200,000 cash. (b)
> Jenny Perez believes a current liability is a debt that can be expected to be paid in one year. Is Jenny correct? Explain.
> What is component depreciation, and when must it be used?
> Kiley Corporation had these transactions during 2017. (a) Purchased a machine for $30,000, giving a long-term note in exchange. (b) Issued $50,000 par value common stock for cash. (c) Issued $200,000 par value common stock upon conversion of bonds having
> Indicate whether each of the following statements is true or false. ______ 1. The corporation is an entity separate and distinct from its owners. ______ 2. The liability of stockholders is normally limited to their investment in the corporation. ______ 3
> Define current assets. What basis is used for ordering individual items within the current assets section?
> These items are taken from the financial statements of Martin Corporation for 2017. Retained earnings (beginning of year)……………………………$31,000 Utilities expense………………………………………………………………..2,000 Equipment………………………………………………………………………66,000 Accounts payable………………
> Moss Corporation had the following transactions. 1. Issued $160,000 of bonds payable. 2. Paid utilities expense. 3. Issued 500 shares of preferred stock for $45,000. 4. Sold land and a building for $250,000. 5. Loaned $30,000 to Dead End Corporation, rec
> Joe, a student, asks your help in understanding some characteristics of a corporation. Explain each of these to Joe. (a) Separate legal existence. (b) Limited liability of stockholders. (c) Transferable ownership rights.
> Explain sustainable income. What relationship does this concept have to the treatment of discontinued operations on the income statement?
> (a) What is a statement of cash flows? (b) Pat Marx maintains that the statement of cash flows is an optional financial statement. Do you agree? Explain.
> On January 1, 2017, the ledger of Romada Company contained these liability accounts. Accounts Payable $42,500 Sales Taxes Payable 6,600 Unearned Service Revenue 19,000 During January, the following selected transactions occurred. Jan.
> Here are comparative statement data for Duke Company and Lord Company, two competitors. All balance sheet data are as of December 31, 2017, and December 31, 2016. Instructions (a) Prepare a vertical analysis of the 2017 income statement data for Duke Co
> You are provided with the following information regarding events that occurred at Moore Corporation during 2017 or changes in account balances as of December 31, 2017. Instructions Moore prepares its statement of cash flows using the indirect approach.
> Tidal Corporation was organized on January 1, 2017. It is authorized to issue 20,000 shares of 6%, $50 par value preferred stock and 500,000 shares of no-par common stock with a stated value of $1 per share. The following stock transactions were complete
> Briefly describe some of the similarities and differences between GAAP and IFRS with respect to the accounting for liabilities.
> Discuss the differences that exist in the treatment of bank overdrafts under GAAP and IFRS.
> The financial statements of Columbia Sportswear Company are presented in Appendix B. Financial statements of VF Corporation are presented in Appendix C. Instructions (a) Based on the information contained in these fi nancial statements, compute the follo
> How is the cost for a plant asset measured in a cash transaction? In a noncash transaction?
> Kelly Jones and Tami Crawford borrowed $15,000 on a 7-month, 8% note from Gem State Bank to open their business, JC’s Coffee House. The money was borrowed on June 1, 2017, and the note matures January 1, 2018. Instructions (a) Prepare the entry to record
> For its fiscal year ending October 31, 2017, Haas Corporation reports the following partial data shown below. Income before income taxes $540,000 Income tax expense (20% × $420,000) 84,000 Income from continuing operations 456,000 L
> During its first year of operations, Mona Corporation had these transactions pertaining to its common stock. Jan. 10 Issued 30,000 shares for cash at $5 per share. July 1 Issued 60,000 shares for cash at $7 per share. Instructions (a) Journalize the tran
> a. You and several classmates are studying for the next accounting examination. They ask you to answer the following questions: 1. If cash is borrowed on a $60,000, 9-month, 10% note on August 1, how much interest expense would be incurred by December 31
> In its proposed 2017 income statement, Hrabik Corporation reports income before income taxes $500,000, income taxes $100,000 (not including unusual items), loss on operation of discontinued music division $60,000, gain on disposal of discontinued music d
