Chapter 2 Class exercises - accruals

Question (I got $44,000... correct?): Riley Company began operations on August 1, 2026 and entered into the following transactions during 2026: 1. On August 1, Riley Company sold common stock to owners in the amount of $60,000 and borrowed $48,000 from a local bank on a 10-month, 10% note payable. 2. On August 14, Riley Company purchased inventory for $42,000 cash. 3. On September 1, Riley Company purchased a 3-year insurance policy for $27,000 cash. 4. On September 19, Riley Company purchased land for $30,000 cash. 5. On October 28, Riley Company sold two-thirds of the inventory that was purchased on August 14 to a customer for $62,000 cash. 6. On December 3, Riley Company sold the land that was purchased on September 19 for $19,000 cash. 7. On December 31, Riley recorded all necessary adjusting entries. Calculate the amount of total expenses reported in Riley Company's 2026 income statement after all of the above transactions have been recorded and posted.

On May 1, Year 1, Benz's Sandwich Shop loaned $12,000 to Mark Henry for one year at 7 percent interest. Required a. What is Benz's interest income for Year 1? b. What is Benz's total amount of receivables at December 31, Year 1? c. How will the loan and interest be reported on Benz's Year 1 statement of cash flows? d. What is Benz's interest income for Year 2? e. What is the total amount of cash that Benz's will collect in Year 2 from Mark Henry? f. How will the loan and interest be reported on Benz's Year 2 statement of cash flows? g. What is the total amount of interest that Benz's earned on the loan to Mark Henry? (For all requirements, round your answers to the nearest dollar amount.) а. Int est income b. Receivables C. d. Interest income e. Cash f. g. Interest earned

On May 1, Year 1, Benz's Sandwich Shop loaned $10,000 to Mark Henry for one year at 6 percent interest. Required a. What is Benz's interest income for Year 1? b. What is Benz's total amount of receivables at December 31, Year 1? c. How will the loan and interest be reported on Benz's Year 1 statement of cash flows? d. What is Benz's interest income for Year 2? e. What is the total amount of cash that Benz's will collect in Year 2 from Mark Henry? f. How will the loan and interest be reported on Benz's Year 2 statement of cash flows? g. What is the total amount of interest that Benz's earned on the loan to Mark Henry?

On November 1, Year 1 Shelter Company loaned $4,000 cash to Cove Company. The one-year note carried a 5% rate of interest. Which of the following shows how the loan will affect Shelter's financial statements on November 1, Year 1? Balance Sheet =Liabilities+ Stockholders' Equity Accounts Common Retained Stock + Earnings ΝΑ ΝΑ ΝΑ ΝΑ A. B. C. D. Assets Cash -4,000 -4,000 -4,000 -4,000 Multiple Choice Net + Receivable = Payable + 4,000 ΝΑ 4,000 ΝΑ ΝΑ 4,000 ΝΑ -4,000 Option A Option C Option B Option D ΝΑ ΝΑ ΝΑ ΝΑ Revenue ΝΑ ΝΑ ΝΑ ΝΑ Income Statement Expense ΝΑ ΝΑ ΝΑ ΝΑ Net Income ΝΑ 3333 ΝΑ ΝΑ ΝΑ Statement of Cash Flows -4,000 IA -4,000 OA 4,000 IA -4,000 OA

On May 1, Year 1, Benz’s Sandwich Shop loaned $14,000 to Mark Henry for one year at 8 percent interest. Requireda. What is Benz’s interest income for Year 1?b. What is Benz’s total amount of receivables at December 31, Year 1?c. How will the loan and interest be reported on Benz’s Year 1 statement of cash flows?d. What is Benz’s interest income for Year 2?e. What is the total amount of cash that Benz’s will collect in Year 2 from Mark Henry?f. How will the loan and interest be reported on Benz’s Year 2 statement of cash flows?g. What is the total amount of interest that Benz’s earned on the loan to Mark Henry?

On December 1, Williams Company borrowed $50,000 cash from Second National Bank by signing a 90-day, 5% note payable. a. Prepare Williams' journal entry to record the issuance of the note payable. b. Prepare Williams' journal entry to record the accrued interest due at December 31. C. Prepare Williams' journal entry to record the payment of the note on March 1 of the next year. Essay Toolbar navigation BIUS = 山 EE三、

On May 1, Year 1, Benz's Sandwich Shop loaned $12,000 to Mark Henry for one year at 9 percent interest. Required: a. What is Benz's interest income for Year 1? b. What is Benz's total amount of receivables at December 31, Year 1? c. How will the loan and interest be reported on Benz's Year 1 statement of cash flows? d. What is Benz's interest income for Year 2? e. What is the total amount of cash that Benz's will collect in Year 2 from Mark Henry? f. How will the loan and interest be reported on Benz's Year 2 statement of cash flows? g. What is the total amount of interest that Benz's earned on the loan to Mark Henry? Note: For all requirements, round your answers to the nearest dollar amount. a. b. ذان C. e f. f. g. × Answer is not complete. Interest income Receivables Cash used in investing activities Interest income Cash Cash provided by operating activities Cash provided by investing activities Interest earned P ✔ >>

rrent Attempt in Progress n providing accounting services to small businesses, you encounter the following situations. 1. 2. Lily Corporation rings up cash sales and sales taxes separately on its cash register. On April 10, the register totals are pre-tax sales of sales $4,200 plus GST of $210 and PST of $336. (i) During the month of March, Bramble Corporation's employees earned gross salaries of $60,000. Withholdings deducted from employee earnings related to these salaries were $3,254 for CPP, $948 for El, $7,050 for income taxes. (ii) Bramble's employer portions were $3,254 for CPP and $1,327 for El for the month. Prepare the journal entries to record the above transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)

Mark Jacobs established Jacobs Services in August by contributing $30,000 cash from his personal savings to the business in exchange for 100% of the common stock. Jacobs Services had the following transactions in September.   September 1​Purchased equipment with a price of $15,000 by paying $5,000 cash and signing a note for the remaining balance. September 2​Paid $2,400 cash for a oneyear (or 12month) premium toward insurance. September 3 ​Paid September rent of $3,000. September 5 ​Purchased $4,000 of supplies on credit. September 8​Performed serviced and received $1,000 cash. September 10 ​Billed clients $8,500 for services performed. September 12 ​Received an advance of $3,000 cash from a client for a project to be delivered in November. September 18 ​Collected $8,500 cash from clients toward their accounts billed on September 10. September 24 ​Paid $4,000 for the supplies purchased on September 5. September 30 ​Paid $100 cash for newspaper advertising to be aired in October.…

Mark Jacobs established Jacobs Services in August by contributing $30,000 cash from his personal savings to the business in exchange for 100% of the common stock. Jacobs Services had the following transactions in September.   September 1​Purchased equipment with a price of $15,000 by paying $5,000 cash and signing a note for the remaining balance. September 2​Paid $2,400 cash for a oneyear (or 12month) premium toward insurance. September 3 ​Paid September rent of $3,000. September 5 ​Purchased $4,000 of supplies on credit. September 8​Performed serviced and received $1,000 cash. September 10 ​Billed clients $8,500 for services performed. September 12 ​Received an advance of $3,000 cash from a client for a project to be delivered in November. September 18 ​Collected $8,500 cash from clients toward their accounts billed on September 10. September 24 ​Paid $4,000 for the supplies purchased on September 5. September 30 ​Paid $100 cash for newspaper advertising to be aired in October.…

On May 15, 2022, Powell Incorporated obtained a six-month working capital loan from its bank. The face amount of the note signed by the treasurer was $478,700. The interest rate charged by the bank was 6.75%. The bank made the loan on a discount basis.   Exercise 7-7 (Algo) Part a - Journal entry a-3. Record the journal entry to show the effect of signing the note and the receipt of the cash proceeds on May 15, 2022. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.

On August 1, Year 1, Hernandez Company loaned $58,800 cash to Acosta Company. The one-year note carried a 5% rate of Interest. Which of the following shows how the December 31, Year 1, recognition of accrued Interest will affect Hernandez's financial statements? Assets A. $ 1,715 = B. $ 1,715 = C. $ 1,225 D. $ 1,225 = Multiple Choice O Balance Sheet = Liabilities + ΝΑ + ΝΑ + ΝΑ O O Option A Option B Option C Option D ΝΑ Income Statement Expenses = ΝΑ NA Equity Revenues $1,715 $ 1,715 - $1,715 $ 1,715 - $ 1,225 $1,225 - $1,225 + + $1,225 ΝΑ NA = = = = Net Income $ 1,715 $ 1,715 $ 1,225 $ 1,225 Statement of Cash Flows $ 1,715 OA ΝΑ $ 1,225 OA NA

Illustration: Roth Contractor Corporation was incorporated on December 1, 2019 and had following transactions during December 1 Dec Issued Capital for 5000 cash 3 Dec Paid 1200 cash for three months rent in advance 4 Dec Purchased a used truck for 10,000 on credit 4 Dec Purchased Supplies of 1000 on credit 6 Dec Paid 1800 for a one-year truck insurance policy 7 Dec Billed a customer 4500 for work completed to date 8 Dec Collected 800 for work completed to date 12 Dec Paid the following expense in cash Advertisement 350  Interest 100  Telephone 75  truck operating 425 Wages 2500 15 Dec Collected 2000 of the amount billed on 7 dec 18 Dec Billed Customer 6500 for work completed to date 19 Dec Signed a 9000 contract for work to be performed in Jan 2017 22 Dec Paid the following Expenses Advertisement 200  Interest 150 Truck Operating 375 Wages 2500 27 Dec Collected advance on work to be done in January 28 Dec Received a bill for 100 for electricity used during the…

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The Wyndham Wholesale Company began operations on August 1, 2021. The following transactions occur during the month of August.a. Owners invest $50,000 cash in the corporation in exchange for 5,000 shares of common stock.b. Equipment is purchased for $20,000 cash.c. On the first day of August, $6,000 rent on a building is paid for the months of August and September.d. Merchandise inventory costing $38,000 is purchased on account. The company uses the perpetual inventory system.e. $30,000 is borrowed from a local bank, and a note payable is signed. f. Credit sales for the month are $40,000. The cost of merchandise sold is $22,000.g. $15,000 is collected on account from customers.h. $20,000 is paid on account to suppliers of merchandise.i. Salaries of $7,000 are paid to employees for August.j. A bill for $2,000 is received from the local utility company for the month of August.k. $20,000 cash is loaned to another company, evidenced by a note receivable.l. The corporation pays its…

On September 1. Year 1, Western Company loaned $36,600 cash to Eastern Company. The one year note carried a 6% rate of interest. The amount of interest revenue on the income statement and the amount of cash flow from operating activities shown on Western's Year 2 financial statements would be Multiple Choice $732 interest revenue and $2196 cash inflow from operating activmes $1.464 imerest revenue and $2,196 cash inflow from operating activities

(Cash and Accrual Basis) On January 1, 2017, Norma Smith and Grant Wood formed a computer sales andservice company in Soapsville, Arkansas, by investing $90,000 cash. The new company, Arkansas Sales and Service, has the following transactions during January. 1. Pays $6,000 in advance for 3 months’ rent of office, showroom, and repair space. 2. Purchases 40 personal computers at a cost of $1,500 each, 6 graphics computers at a cost of $2,500 each, and 25 printers ata cost of $300 each, paying cash upon delivery. 3. Sales, repair, and office employees earn $12,600 in salaries and wages during January, of which $3,000 was still payable at the end of January. 4. Sells 30 personal computers at $2,550 each, 4 graphics computers for $3,600 each, and 15 printers for $500 each; $75,000 is received in cash in January, and $23,400 is sold on a deferred payment basis. 5. Other operating expenses of $8,400 are incurred and paid for during January; $2,000 of incurred expenses are payable at January…

Mary Maywood opened Maywood Cleaners on March 1, 2022. During March, the following transactions were completed.Mar.1 Shareholders invested €25,000 cash in the business in exchange for ordinary shares.Mar.1 Borrowed €7,000 cash by signing a 6-month, 8%, €7,000 note payable. Interest will be paid the first day of each subsequent month.Mar.1 Purchased used truck for €9,000 cash.Mar.2 Paid €2,500 cash to cover rent from March 1 through May 31.Mar.3 Paid €3,400 cash on a 6-month insurance policy effective March 1.Mar.6 Purchased cleaning supplies for €2,000 on account.Mar.14 Billed customers €4,700 for cleaning services performed.Mar.18 Paid €700 on amount owed on cleaning supplies.Mar.20 Paid €1,750 cash for employee salaries.Mar.21 Collected €1,800 cash from customers billed on March 14.Mar.28 Billed customers €4,500 for cleaning services performed.Mar.31 Paid €450 for gas and oil used in truck during month (use Maintenance and RepairsExpense).Mar.31 Declared and paid a €1000 cash…

Zirkle Company borrowed $129,000 from Plains Bank on July 31, Year 1. The note carried a 6% interest rate with a one-year term to maturity Required: a. Show the effects of borrowing the money and the December 31, Year 1 adjustment on the accounting equation. b. What is the amount of interest expense for Year 1? c. Prepare a statement of cash flows for the Zirkle Company for Year 1. Complete this question by entering your answers in the tabs below. Required A Required B Required C Show the effects of borrowing the money and the December 31, Year 1 adjustment on the accounting equation. Note: Enter any decreases to account balances with a minus sign. Leave cells blank if no input is needed. ZIRKLE COMPANY Effect of Adjustment on the Accounting Equation Event Year 1 July 31 December 31 December 31, Year 1 Assets Liabilities Stockholders' Equity Raquinad A Required B > 13

On April 1, 2021, Nels Ferrer organized a business called Friendly Trucking. During April, the company entered into the following transactions: April 1 - Nels Ferrer deposited additional P500,000 cash in a bank account in the name of the business 1 - Purchased for P250,000 a transportation equipment to be use in the business. Nels paid 50% as down payment while the balance will be paid on May 15, 2020 1 - Paid rental for the month of April, P5,000 4 - Collected accounts from previous month, P13,200 5 - Earned and collected trucking income from Ryan, P8,000 8 - Earned trucking income from Jesper, P30,000 on account. Jesper will pay on May 8, 2020 10 - Paid salaries of drivers, P10,000 15 - Rented the vehicle to Joshua for P35,000, Joshua paid P20,000 on that date and the balance on April 20 18 - Paid electric bills for the month, P2,000 20 - Collected from Joshua the balance of his April 15 account 25 - Purchased office supplies, P2,300 29 - Earned and…