Chapter Homework Essays

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Chapters 1 & 2 Homework Complete the following exercises 1. Classify the accounts below (e.g. Assets, Liabilities or Stockholders’ Equity) a. Accounts Payable Liability b. Preferred Stock Stockholder Equity c. Office Supplies Assets d. Accounts Receivable Assets e. Machinery Assets f. Notes Receivable Assets g. Cash Assets h. Mortgage Payable Liability i. Inventory Assets 2. Determine the missing amounts. j. Assets $500,000 Stockholders’ Equity $150,000 Liabilities $350,000 k. Stockholders’ Equity $311,000 Liabilities $423,000 Assets $734,000 l. Assets at January 1, 2013 $950,000 Liabilities at January 1, 2013…show more content…
First-In, First-Out (FIFO) method 100 x 10 = 1000 50 x 14 = 700 200 x 11 = 2200 200 x 15 = 3000 300 x 12 = 3000 150 x 16 = 2400 250 x 13 = 3250 50 x 14 = 700 COGS $10,750 Inventory $6100 b. Last-In, Last-Out (LIFO) method 150 x 16 = 2400 100 x 12 = 1200 200 x 15 = 3000 200 x 11 = 2200 100 x 14 = 1400 100 x 10 = 1000 250 x 13 = 3250 200 x 12 = 2400 COGS $12,450 Inventory $4400 6. Forman, Inc. owns machinery with a cost of $250,000. Its estimated useful life is 10 years and a $30,000 salvage value. Determine the depreciation expense for each of the 10 years of the asset’s life, assuming the company uses: r. Straight-line method $220,000/10 = $22,000 per year s. Double-Declining Balance method 1. $220,000 x 20% = $44,000 2. $176,000 x 20% = $35,200 3. $140,800 x 20% = $28,160 4. $112,640 x 20% = $22,528 5. $90,112 x 20% = $18,022.40 Revert to Straight line method for remaining 6. $72,089.60 = $14,417.92 7. $57,671.68 = $14,417.92 8. $43,253.76 = $14,417.92 9. $28,835.48 = $14,417.92 10. $14,417.92 $220,000 t. Sum of Year’s Digits method 1+2+3+4+5+6+7+8+9+10 = 55 $220,000x10/55 = $40,000 $220,000x9/55 = $36,000 $220,000x8/55 = $32,000 $220,000x7/55 = $28,000 $220,000x6/55 = $24,000

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