Question: Sandy Chen owns a small specialty store,

> The following is a list of outstanding notes receivable as of December 31, 20--: REQUIRED 1. Compute the accrued interest at the end of the year. 2. Prepare the adjusting entry in the general journal. Principal $1,000 Maker Date of Note Interest Ter

> Marienau Suppliers had the following transactions: Mar. 1 Sold merchandise on account to G. Perez $5,000. 20 G. Perez gave a $5,000, 90-day, 6% note to extend time for payment. 30 G. Perez’s note is discounted at Commerce Bank at a discount rate of 8%. A

> J. K. Pratt Co. had the following transactions: 20-1 July 20 received a $750, 30-day, 5% note from J. Akita in payment for sale of merchandise. Aug. 19 J. Akita paid note issued July 20 plus interest. 25 Sold merchandise on account to L. Beene, $1,100. S

> Identify the six major steps of the accounting process and explain each step.

> Calculate total time in days for the following notes. (Assume there are 28 days in February.) Date of Note Due Date Time in Days May 4 August 17 July 5 December 11 July 17 October 1 September 5 February 5 May 16 March 24 January 6 March 18

> At the completion of the current fiscal year ending December 31, the balance of Accounts Receivable for Yang’s Gift Shop was $30,000. Credit sales for the year were $355,200. REQUIRED Make the necessary adjusting entry in general journal form under each

> Pyle Nurseries used the allowance method to record the following transactions, adjusting entries, and closing entries during the year ended December 31, 20--: Feb. 9 Received 60% of the $4,000 balance owed by Wiley’s Waterworks, a bankrupt business, and

> Como’s Music Store uses the direct write-off method in accounting for uncollectible accounts. Record the following transactions in general journal form: 20-1 May 8 wrote off $1,745 owed by Vickie Lawrence, who has no assets. July 15 Wrote off $1,300 owed

> Maria Rivera, owner of Rivera Pharmacy, uses the direct write-off method in accounting for uncollectible accounts. Record the following transactions in general journal form: July 20 Wrote off $2,325 owed by Joe Balouka, who has no assets. Oct. 15 Wrote o

> At the end of the current year, the accounts receivable account of Glenn’s Nursery Supplies has a debit balance of $390,000. Credit sales are $2,800,000. Record the end-of-period adjusting entry on December 31, in general journal form, for the estimated

> Julia Alvarez, owner of Alvarez Rentals, uses the allowance method in accounting for uncollectible accounts. Record the following transactions in general journal form: July 7 wrote off $5,350 owed by Randy Dalzell, who has no assets. Aug. 12 wrote off $2

> Brito’s Hundai Sales and Service estimates the amount of uncollectible accounts using the percentage of receivables method. Based on aging the accounts, it is estimated that $4,500 will not be collected. Record the end-of-period adjusting entry on Decemb

> Rossin’s Racers has total credit sales for the year of $280,000 and estimates that 3% of its credit sales will be uncollectible. Record the end-of-period adjusting entry on December 31, in general journal form, for the estimated bad debt expense. Assume

> The trial balance after one month of operation for Mason’s Delivery Service as of September 30, 20--, is shown below. Data to complete the adjustments are as follows: (a) Supplies inventory as of September 30, $90. (b) Insurance expired

> Name and define the six major elements of the accounting equation.

> Prepare the entry for each of the following transactions, using the (a) cash basis, (b) modified cash basis, and (c) accrual basis of accounting. 1. Purchase supplies on account. 2. Make payment on asset previously purchased. 3. Purchase supplies for

> The partially completed work sheet from the books of Lewis Music Store, a business owned by Hugo Lewis, for the year ended December 31, 20--, is shown on page 554. REQUIRED 1. Analyze the work sheet and determine the adjusted trial balance and the adjus

> Williams & Hendricks Distributors uses the direct write-off method in accounting for uncollectible accounts. 20-1 Feb. 18 Sold merchandise on account to Merry Merchants, $17,500. Mar. 22 Sold merchandise on account to Utter Unicorns, $14,300. June 3 Rece

> An analysis of the accounts receivable of Johnson Company as of December 31, 20--, reveals the following: REQUIRED 1. Prepare an aging schedule as of December 31, 20--, by adding the following column to the three columns shown above: Estimated Amount Unc

> Updike owns a department store that has a $50,000 balance in Accounts Receivable and a $2,500 credit balance in Allowance for Doubtful Accounts. 1. Determine the net realizable value of the accounts receivable. 2. Assume that an account receivable in the

> Use the work sheet and financial statements prepared in Problem 15-8A. All sales are credit sales. The Accounts Receivable balance on January 1, 20--, was $3,800. REQUIRED Prepare the following financial ratios: (a) Working capital (b) Current ratio (c)

> Paulson’s Pet Store completed the work sheet on page 602 for the year ended December 31, 20--. Owner’s equity as of January 1, 20--, was $21,900. The current portion of Mortgage Payable is $500. REQUIRED 1. Prepare a multiple-step income statement. 2. P

> Prepare entries for (a), (b), and (c) listed below using two methods. First, prepare the entries without making a reversing entry. Second, prepare the entries with the use of a reversing entry. Use T-accounts to assist your analysis. (a) Wages paid durin

> From the work sheet used in Exercise 15-5A, Exercise 15-5A: From the work sheet on page 600, prepare the following: 1. Closing entries for Gimbel’s Gifts and Gadgets in a general journal. 2. A post-closing trial balance. Identify the adjusting entry (

> From the work sheet on page 600, prepare the following: 1. Closing entries for Gimbel’s Gifts and Gadgets in a general journal. 2. A post-closing trial balance.

> Name and describe four areas of specialization for a public accountant.

> Based on the financial statements for Jackson Enterprises (income statement, statement of owner’s equity, and balance sheet) shown on pages 598–599, prepare the following financial ratios. All sales are credit sales. T

> Use the following information to prepare a multiple-step income statement, including the revenue section and the cost of goods sold section, for Sauter Office Supplies for the year ended December 31, 20--. Sales ……………………………………………………………. $156,300 Sales Re

> Based on the information that follows, prepare the cost of goods sold section of a multiple-step income statement. Merchandise Inventory, January 1, 20-- ……………………………………………. $ 37,000 Purchases ……………………………………………………………………………………….. 106,000 Purchases Returns

> The partial work sheet shown below is taken from the books of Stark Street Computers, a business owned by Logan Cowart, for the year ended December 31, 20--. REQUIRED 1. Determine the adjusting entries by analyzing the difference between the adjusted t

> Vicki’s Fabric Store shows the trial balance on page 603 as of December 31, 20-1. At the end of the year, the following adjustments need to be made: (a and b) Merchandise inventory as of December 31, $31,600. (c) Unused supplies on hand

> Based on the information that follows, prepare the revenue section of a multiple-step income statement. Sales ……………………………………………………………………… $150,000 Sales Returns and Allowances ………………………………………. 6,000 Sales Discounts …………………………………………………………… 3,400

> The trial balance for the Venice Beach Kite Shop, a business owned by Molly Young is shown on page 550. Year-end adjustment information is as follows: (a and b) Merchandise inventory costing $35,000 is on hand as of December 31, 20--. (The periodic inven

> On December 31, Anup Enterprises completed a physical count of its inventory. Although the merchandise inventory account shows a balance of $350,000, the physical count comes to $325,000. Prepare the appropriate adjusting entry under the perpetual invent

> Bhushan Building Supplies entered into the following transactions. Prepare journal entries under the perpetual inventory system. June 1 purchased merchandise on account from Brij Builder’s Materials, $500,000. 3 Purchased merchandise for cash, $400,000.

> The following partial work sheet is taken from the books of Kelly’s Kittens, a local pet kennel, for the year ended December 31, 20--. Journalize the adjustments in a general journal. Kelly's Kittens Work Sheet (Partial) For Year En

> Explain when expenses are recorded under the cash basis, modified cash basis, and accrual basis of accounting.

> From the following partial work sheet, indicate the dollar amount of beginning and ending merchandise inventory: ADIUSTMENES ADSED RALSLANE KOMESTATMINT MTOUNT E DET DEST DEST DET 1 Merchandise Inventory (b) 60 0 0 0 00 (a) 55 0 0 0 00| 60 0 0 0 60 0

> The following partial work sheet is taken from Kevin’s Gift Shop for the year ended December 31, 20--. The ending merchandise inventory is $50,000. 1. Complete the Adjustments columns for the merchandise inventory. 2. Extend the merchan

> Set up T accounts for Cash, Unearned Ticket Revenue, and Ticket Revenue. Post the following two transactions to the appropriate accounts, indicating each transaction by letter: (a) Sold 1,200 season tickets at $400 each, receiving cash of $480,000. (b) A

> Prepare the cost of goods sold section for Adams Gift Shop. The following amounts are known: Beginning merchandise inventory ………………………………………... $27,000 Ending merchandise inventory ………………………………….…………... 22,000 Purchases …………………………………………………………………………… 78,

> The trial balance for Cascade Bicycle Shop, a business owned by David Lamond, is shown below. Year-end adjustment information is as follows: (a and b) Merchandise inventory costing $22,000 is on hand as of December 31, 20--. (The periodic inventory syste

> Matt Henry owns a business called Henry’s Sporting Goods. His beginning inventory as of January 1, 20--, was $45,000, and his ending inventory as of December 31, 20--, was $57,000. Set up T accounts for Merchandise Inventory and Income Summary and perfor

> The following information is provided by Raynette’s Pharmacy for the last quarter of its fiscal year ending on March 31, 20--: REQUIRED 1. Estimate the ending inventory as of March 31 using the retail inventory method. 2. Estimate the

> A fire completely destroyed all the inventory of Glisan Lumber Yard on August 5, 20--. Fortunately, the accounting records were not destroyed in the fire. The following information is provided by Glisan Lumber Yard for the time period January 1 through A

> Douglas Company’s beginning inventory and purchases during the fiscal year ended December 31, 20--, were as follows: REQUIRED 1. Calculate the total amount to be assigned to the ending inventory and cost of goods sold on December 31 un

> Swing Company’s beginning inventory and purchases during the fiscal year ended September 30, 20-2, were as follows: REQUIRED Calculate the total amount to be assigned to cost of goods sold for the fiscal year ended September 30, 20-2,

> Explain when revenues are recorded under the cash basis, modified cash basis, and accrual basis of accounting.

> Stalberg Company’s beginning inventory and pur chases during the fiscal year ended December 31, 20--, were as follows: There are 10 units of inventory on hand on December 31. 1. Calculate the total amount to be assigned to the ending

> Joan Ziemba owns a small variety store. The following transactions took place during March of the current year. Journalize the transactions in a general journal using the perpetual inventory method. Mar. 3 Purchased merchandise on account from City Galle

> Paul Nasipak owns a business called Diamond Distributors. The following transactions took place during January of the current year. Journalize the transactions in a general journal using the periodic inventory method. Jan. 5 Purchased merchandise on acco

> Flint owns a small retail business called Flint’s Fantasy. The cash account has a balance of $20,000 on July 1. The following transactions occurred during July: July 1 Issued Check No. 414 in payment of July rent, $1,500. 1 Purchased merchandise on accou

> Sam Santiago operates a retail variety store. The books include a cash payments journal and an accounts payable ledger. All cash payments (except petty cash) are entered in the cash payments journal. Selected account balances on May 1 are as follows: T

> The purchases journal of Kevin’s Kettle, a small retail business, is as follows: REQUIRED 1. Post the total of the purchases journal to the appropriate general ledger accounts. Use account numbers as shown in the chapter. 2. Post the

> Assume that in year 1, the ending merchandise inventory is overstated by $50,000. If this is the only error in years 1 and 2, indicate which items will be understated, overstated, or correctly stated for years 1 and 2. Year 1 Year 2 Ending merchandis

> J. B. Speck, owner of Speck’s Galleria, made the following purchases of merchandise on account during the month of September: Sept. 3 Purchase Invoice No. 415, $2,650, from Smith Distributors. 8 Purchase Invoice No. 132, $3,830, from Michaels Wholesaler.

> Owens Distributors is a retail business. The following sales, returns, and cash receipts occurred during March 20--. There is an 8% sales tax. Beginning general ledger account balances were Cash, $9,741; and Accounts Receivable, $1,058.25. Beginning cust

> Describe underapplied and overapplied overhead. What is commonly done with the underapplied or overapplied balance in the factory overhead account?

> Zebra Imaginarium, a retail business, had the following cash receipts during December 20--. The sales tax is 6%. Dec. 1 Received payment on account from Michael Anderson, $1,360. 2 Received payment on account from Ansel Manufacturing, $382. 7 Made cash s

> Futi Ishanyan owns a retail business and made the following sales during the month of August 20--. There is a 6% sales tax on all sales. Aug. 1 Sale No. 213 to Jeter Manufacturing Co., $1,300, plus sales tax. 3 Sale No. 214 to Hassan Co., $2,600, plus sa

> Lakeview Industries uses a cash payments journal. Prepare a cash payments journal using the same format and account titles as illustrated in the chapter. Record the following payments for merchandise purchased: Sept. 5 Issued Check No. 318 to Clausen Cor

> Enter the following transactions in a purchases journal like the one below. May 3 Purchased merchandise from Climen, $7,200. Invoice No. 321, dated May 1, terms n/30. 9 Purchased merchandise from Misho, $3,100. Invoice No. 614, dated May 8, terms 2/10, n

> Enter the following transactions in a cash receipts journal: July 6 Daren Chesbrough made payment on account, $527. 10 Made cash sales for the week, $2,470. 14 Adam Casady made payment on account, $394. 15 Yue Zou made payment on account, $203. 17 Made c

> Enter the following transactions in a sales journal. Use a 6% sales tax rate. May 1 Sold merchandise on account to J. Adams, $2,000, plus sales tax. Sale No 488. 4 Sold merchandise on account to B. Clark, $1,800, plus sales tax. Sale No. 489. 8 Sold merc

> Identify the journal (sales, cash receipts, purchases, cash payments, or general) in which each of the following transactions should be recorded: (a) Sold merchandise on account. (b) Purchased delivery truck on account for use in the business. (c) Receiv

> J. B. Speck, owner of Speck’s Galleria, made the following purchases of merchandise on account during the month of September: Sept. 3 Purchase Invoice No. 415, $2,650, from Smith Distributors. 8 Purchase Invoice No. 132, $3,830, from Michaels Wholesaler.

> Ryan’s Express, a retail business, had the following beginning balances and purchases and payments activity in its accounts payable ledger during October. Prepare a schedule of accounts payable for Ryan’s Express as of

> Enter the following cash payments transactions in a general journal: Sept. 5 Issued Check No. 318 to Whittle Corp. for merchandise purchased August 28, $5,000, terms 2/10, n/30. Payment is made within the discount period. 12 Issued Check No. 319 to Marti

> What steps are followed in posting from the cash payments journal to the accounts payable ledger?

> Using page 3 of a general journal and the following general ledger and accounts payable ledger accounts, journalize and post the following transactions: July 7 Returned merchandise to Starcraft Industries, $700. 15 Returned merchandise to XYZ, Inc., $450

> Journalize the following transactions in a general journal: May 3 Purchased merchandise from Reed, $6,100. Invoice No. 321, dated May 1, terms n/30. 9 Purchased merchandise from Omana, $2,500. Invoice No. 614, dated May 8, terms 2/10, n/30. 18 Purchased

> The following data were taken from the accounts of Fluter Hardware, a small retail business. Determine the gross profit. Sales $120,000 Sales returns and allowances 900 Sales discounts 650 Merchandise inventory, January 1 Purchases during the period

> Using T accounts for Cash, Accounts Payable, Purchases, Purchases Returns and Allowances, Purchases Discounts, and Freight-In, enter the following purchase transactions. Identify each transaction with ts corresponding letter. Use a new set of T accounts

> Merchandise was purchased on account from Jacob’s Distributors on May 17. The purchase price was $2,000, less a 10% trade discount and credit terms of 2/10, n/30. 1. Calculate the net amount to record the invoice, less the 10% trade discount. 2. Calculat

> Based on the information provided in Problem 11-11A, Problem 11-11A: Emily Frank owns a small retail business called Frank’s Fantasy. The cash account has a balance of $21,000 on July 1. The following transactions occurred during July: July 1 Issued C

> Emily Frank owns a small retail business called Frank’s Fantasy. The cash account has a balance of $21,000 on July 1. The following transactions occurred during July: July 1 Issued Check No. 414 in payment of July rent, $2,500. 1 Purchased merchandise on

> Sam Santiago operates a retail variety store. The books include a general journal and an accounts payable ledger. Selected account balances on May 1 are as follows: The following are the transactions related to cash payments for the month of May: May 1

> A partially completed flowchart showing some of the major documents commonly used in the purchasing function of a merchandise business is presented below. Identify documents 1, 3, and 4. 2 Purchase Order

> J. K. Bijan owns a retail business and made the following sales on account during the month of August 20--. There is a 6% sales tax on all sales. Aug. 1 Sale No. 213 to Jung Manufacturing Co., $1,200 plus sales tax. 3 Sale No. 214 to Hassad Co., $3,600

> What steps are followed in posting from the cash payments journal to the general ledger?

> From the accounts receivable ledger shown, prepare a schedule of accounts receivable for Pheng Co. as of August 31, 20--. ACCOUNTS RECEIVABLE LEDGER NAME B&G Distributors ADORESS 2628 Burfington Avenue, Chicago, IL 60604-1329 OST. DATE IEM CREDIT BAL

> Enter the following transactions in a general journal: July 6 James Adler made payment on account, $643. 10 Cash sales for the week were $2,320. 14 Betty Havel made payment on account, $430. 15 J. L. Borg made payment on account, $117. 17 Cash sales for

> Enter the following transactions starting on page 60 of a general journal and post them to the appropriate general ledger and accounts receivable ledger accounts. Use account numbers as shown in the chapter. Beginning balance in Accounts Receivable is $4

> Enter the following transactions in a general journal. Use a 6% sales tax rate. May 1 Sold merchandise on account to J. Adams, $2,000 plus sales tax. Sale No. 488. 4 Sold merchandise on account to B. Clark, $1,800 plus sales tax. Sale No. 489. 8 Sold mer

> Prepare journal entries for the following transactions. Aug. 4 sold merchandise on account to S. Miller for $320 plus sales tax of 4%, with 2/10, n/30 cash discount terms. 6 Sold merchandise on account to K. Krtek for $210 plus sales tax of 4%. 10 S. Mi

> Based on the following information, compute net sales. Gross sales $3,860 Sales returns and allowances 410 Sales discounts 80

> Using T accounts for Cash, Accounts Receivable, Sales Tax Payable, Sales, Sales Returns and Allowances, and Sales Discounts, enter the following sales transactions. Use a new set of accounts for each part, 1–5. 1. No sales tax. (a) Merchandise is sold fo

> Name the types of cash flows associated with operating activities.

> Financial statement analysis generally focuses on five main aspects of the business’s financial health. What are they?

> List the six steps to be followed when preparing a statement of cash flows. Be sure to include all aspects of the statement’s preparation.

> Describe the indirect method of reporting cash flows from operating activities.

> Identify four disadvantages of a partnership form of business organization.

> Describe leveraging and give an example of how a corporation can gain leverage by issuing bonds.

> Briefly describe five advantages of the corporate form of business organization. Describe two disadvantages.

> If a corporation issues only one class of stock, what four rights does each stockholder have?

> What are the three dates involved in the declaration and payment of dividends? What is the meaning of each date?

> How do the procedures for closing Income Summary of a corporation differ from those of a sole proprietorship or partnership?

> Describe four tips for finding errors on the work sheet.

> What five types of transactions involving notes payable do businesses generally encounter?

> What information usually is included in the charter?