T.J. Carlin has the following transactions during August of the current year. Indicate (a) the effect on the accounting equation and (b) the debit-credit analysis. Aug. 1 | | Opens an office as a financial advisor, investing $8,000 in cash. | 4 | | Pays insurance in advance for 6 months, $1,800 cash. | 16 | | Receives $800 from clients for service provided. | 27 | | Pays secretary $1,000 salary. | | | (a) Effect on Accounting Equation | (b) Debit-Credit Analysis | Aug. 1 | | The Asset account Cash is increased. | Debits increase Assets : | | | | Debit Cash | | | | | | | The …show more content…
(If answer is zero, please enter 0. Do not leave any fields blank.) BOARDIN' COMPANY | Trial Balance | December 31, 2010 | | Debit | Credit | Cash | $ 6,000 | $ 0 | Accounts Receivable | 8,000 | 0 | Supplies | 5,000 | 0 | Equipment | 80,000 | 0 | Notes Payable | 0 | 20000 | Accounts Payable | 0 | 11,000 | Salaries Payable | 0 | 3,000 | Hawk, Capital | 0 | 25,000 | Hawk, Drawing | 8,000 | 0 | Service Revenue | 0 | 88,000 | Supplies Expense | 2,000 | 0 | Salaries Expense | 38,000 | 0 | | $ 147,000 | $ 147,000 | | |
E2-14 Correct. The accounts in the ledger of Sanford Delivery Service contain the following balances on July 31, 2010. Accounts Receivable $7,642 Prepaid Insurance $ 1,968 Accounts Payable 8,396 Repair Expense 961 Cash ? Service Revenue 10,610 Delivery Equipment 49,360 Sanford, Drawing 700 Gas and Oil Expense 758 Sanford, Capital 44,636 Insurance Expense 523 Salaries Expense 4,428 Notes Payable 18,450 Salaries Payable 815 Instructions Complete the trial balance and fill in the missing amount for cash. (If answer is zero, please enter 0. Do not leave any fields blank.) SANFORD DELIVERY SERVICE Trial Balance July 31, 2010 Debit
Debt to Equity ℎℎ ′ 9,771+1,885 Dividend Payout Inventory Turnover = 0.069 Working backwards from the income tax expense, we estimate income tax rate to be 34%. NOPAT is then Operating profit taxes, or 3,137*(1-0.34) = 0.319 Average
| (TCO 2) Transaction analysis results in the development of a journal entry. In the start-up of a business, the owner contributes $750,000 of cash. (1) Name the accounts impacted and how to use the format account name/debit or credit/dollar amount (10 points), and (2) explain how the Accounting Equation is impacted. (10 points)
The ledger of Wainwright Company at the end of the current year shows Accounts Receivable $78,000; Credit Sales $810,000; and Sales Returns and Allowances $40,000. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date: Name: ID: Answer the following Questions: 1. Tower Inc. owns 30% of Yale Co. and applies the equity method. During the current year, Tower bought inventory costing $66,000 and then sold it to Yale for $120,000. At year-end, only $24,000 of merchandise was still being held by Yale. What amount of inter-company inventory profit must be deferred by Tower? A. $6,480 B. $3,240 C. $10,800 D. $16,200 E. $6,610 2. All of the following statements regarding the investment account using the equity method are true except A. The investment is recorded at cost B. Dividends received are reported as revenue C. Net income of investee increases the investment account D. Dividends received reduce the investment account E.
$135,000 $90,000 TOTAL REVENUE $3,136,500 $2,352,375 $1,568,250 Expences TOTAL VARIABLE COSTS $454,000 $340,500 $227,000 TOTAL FIXED COSTS $1,403,000 $1,403,001 $1,403,002 TOTAL EXPENSE BEFORE IT $1,857,000 $1,743,501 $1,630,002 EBIT $1,279,500 $608,874 -$61,752 Depreciation $320,000 $320,001 $320,002 EBITDA $1,599,500 $928,875 $258,250 Furnishing Interest $110,000 $110,000 $110,000 20yr Mortgage Interest $182,000 $182,000 $182,000 TOTAL INTEREST $292,000 $292,000 $292,000 TAXES (40%) $395,000.00 $126,749.60 -$141,500.80 Furnishing Principal $180,160 $180,160 $180,160 20yr Mortgage Principal $49,713 $49,713 $49,713 TOTAL PRINCIPAL $229,873 $229,873 $229,873 NET INCOME $362,627 -$39,749 -$442,124 DIVIDEND PAYMENT $29,010 -$3,180 -$35,370 RETAINED EARNINGS $333,617 -$36,569 EBIT/INTEREST 4.38 2.09 (0.21) EBITDA/INTEREST 5.48 3.18 0.88 BURDEN $675,121.67 $675,121.67 $675,121.67 EBIT/BURDEN 1.90 0.90 (0.09) ROE= Net Income/OE (H1) 32.97% -3.61% -40.19% Revenue Estimates Revenue Item 100% Monthly 75%
Case 12-02 To Recognize or Not to Recognize, That Is the Question Shakespeare Inc. (“Shakespeare” or the “Company”) is a privately held book printing and publishing company with a December 31 year-end. The summary balance sheet as of December 31, 2010, included: Current assets Noncurrent assets Total assets Current liabilities Noncurrent liabilities Total liabilities Total shareholder equity $ 6,500,000 28,250,000 $34,750,000 $ 4,500,000 13,750,000 $18,250,000 $16,500,000
Accounts receivable (net) increased by $500,000 during the year. This increase has what effect on cash flow?
Account W/P Common Common # Title Ref. Balance Size Balance Size Amount Percentage REVENUE 40000 Sales 246,172,918.44 102.33% 245,213,452.88 106.40% -959,465.56 -0.39% 41000 Sales Returns 4,497,583.20 1.87% 13,600,220.89 5.90% 9,102,637.69 202.39% 42000 Warranty Exp 1,100,281.48 0.46% 1,158,128.47 0.50% 57,846.99 5.26% Net Sales 240,575,053.76 100.00% 230,455,103.52 100.00% (10,119,950.24) -4.21% EXPENSES 50000 COGS 141,569,221.61 58.85% 130,246,645.26 56.52% (11,322,576.35) -8.00% Gross Margin 99,005,832.15 41.15% 100,208,458.26 43.48% 1,202,626.11 1.21% GA-7.4
ACC 201 (Principles of Financial Accounting) Complete Class All Discussion Questions , Chapters Problems and Assignments
Question 3: Describe and show the journal entries illustrating how the company accounts for the transfer of its accounts receivable to financial institutions. Is this accounting treatment reasonable? What are the key assumptions made under this approach? Do you agree with these assumptions?
Name: ________________________________ Date: _________________ [1]BASIC BANK01 - BAT 003 Which of the following statements is true? A. An asset account is increased by a credit B. An expense account is increase by a credit C. A revenue account is decreased by a credit D. An equity account is decreased by a debit [2]BASIC BANK02 - BAT 010 The Income Summary account contains: A. Total revenues and total expenses for the year B. Total assets and total liabilities at year end C. Total revenues, expenses, assets, and liabilities
b. Trace the line item “Balance per Bank Statement” – Accuracy and Existence (AU-C 315.A114 a-iii, b-i)
The process of recording and posting the effects of business transaction is done in a double entry t-form. The total dollar amount of debits must equal the total dollar amount of credits, with debits to the left and account credit to the right. Broken down, Assets = Liabilities + Stakeholder Equity. “Since debits increase assets, expense, and dividend accounts, they normally have debit balances. Conversely, because credits increase liability, capital stock, retained earnings, and revenue accounts, they normally have credit balances.”( Edwards, J. D., Hermanson, R.H., & Maher, M. W. (2011). p.84)
| | | | |Assets | | |Non-cash Assets from Start-up |$350,000 | |Cash Requirements from Start-up |$14,600 | |Additional Cash Raised |$0 | |Cash Balance on Starting Date |$14,600 | |Total Assets |$364,600 | | | | | | | |Liabilities and Capital | | | | | |Liabilities | | |Current Borrowing |$0 | |Long-term Liabilities
April balance of the $4,000, so beginning cash was $4,000.Carmen got cash sales revenue $7,400, less paid cash $1,510 for employee wages, less paid replenishment inventory $2,900,less rent for three-month $1,800, less paid cash $1,800 for sewing machine. Finally the ending cash was $3,390. According to above details , the statement of cash flow for the three-month operations of Ribbons an’ Bows, Inc., can be created as follows.