Haskins and Jones, Attorneys-at-Law, maintains its books on a cash basis. During 2021, the law firm collected $640,000 for services rendered to its clients and paid out $431,000 in expenses. You are able to determine the following information about accounts receivable, prepaid expenses, deferred service revenue, and accrued liabilities: Accounts receivable Prepaid insurance Prepaid rent Deferred service revenue Accrued liabilities (for various expenses) In addition, 2021 depreciation expense on office equipment is $31,500. Required: Determine accrual basis net income for 2021. Cash basis income Add: Increase in deferred service revenue Decrease in accounts receivable Deduct: Answer is not complete. Accrual basis net income X X 2,300 X 5,000 X January 1, 2021 $ 81,000 6,400 11,100 11, 100 14, 100 ✓ $ 7,300 December 31, 2021 $76,000 8,300 9,000 13,400 18,900

Haskins and Jones, Attorneys-at-Law, maintains its books on a cash basis. During 2021, the law firm collected $640,000 for services rendered to its clients and paid out $431,000 in expenses. You are able to determine the following information about accounts receivable, prepaid expenses, deferred service revenue, and accrued liabilities: Accounts receivable Prepaid insurance Prepaid rent Deferred service revenue Accrued liabilities (for various expenses) In addition, 2021 depreciation expense on office equipment is $31,500. Required: Determine accrual basis net income for 2021. Cash basis income Add: Increase in deferred service revenue Decrease in accounts receivable Deduct: Answer is not complete. Accrual basis net income X X 2,300 X 5,000 X January 1, 2021 $ 81,000 6,400 11,100 11, 100 14, 100 ✓ $ 7,300 December 31, 2021 $76,000 8,300 9,000 13,400 18,900

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Description: Not understanding the explanation provided, see image Haskins and Jones, Attorneys-at-Law, maintains its books on a cash basis. During 2021, the law firm collected $640,000 for servicesrendered to its clients and paid out $431,000 in expenses. You ar

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter4: The Balance Sheet And The Statement Of Shareholders' Equity

Section: Chapter Questions

Problem 5C: It is February 16, 2020, and you are auditing Davenport Corporation's financial statements for 2019...

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It is February 16, 2020, and you are auditing Davenport Corporation's financial statements for 2019 (which will be issued in March 2020). You read in the newspaper that Travis Corporation, a major customer of Davenport, is in financial difficulty. Included in Davenports accounts receivable is 50,000 (a material amount) owed to it by Travis. You approach Jim Davenport, president, with this information and suggest that a reduction of accounts receivable and recognition of a loss for 2019 might be appropriate. Jim replies, Why should we make an adjustment? Ted Travis, the president of Travis Corporation, is a friend of mine; he will find a way to pay us, one way or another. Furthermore, this occurred in 2020, so lets wait and see what happens; we can always make an adjustment later this year. Our 2019 income and year-end working capital are not that high; our creditors and shareholders wouldnt stand for lower amounts than they already are. Required: From financial reporting and ethical perspectives, prepare a response to Jim Davenport regarding this issue.
Haskins and Jones, Attorneys-at-Law, maintains its books on a cash basis. During 2021, the law firm collected $640,000 for services rendered to its clients and paid out $431,000 in expenses. You are able to determine the following information about accounts receivable, prepaid expenses, deferred service revenue, and accrued liabilities: January 1, 2021 December 31, 2021 Accounts receivable $ 81,000 $ 76,000 Prepaid insurance 6,400 8,300 Prepaid rent 11,100 9,000 Deferred service revenue 11,100 13,400 Accrued liabilities (for various expenses) 14,100 18,900 In addition, 2021 depreciation expense on office equipment is $31,500. Required: Determine accrual basis net income for 2021.
Haskins and Jones, Attorneys-at-Law, maintain its books on a cash basis. During 2016, the company collected $545,000 in fees from its clients and paid out $412,000 in expenses. You are able to determine the following information about accounts receivable, prepaid expenses, deferred fee revenue, and accrued liabilities: Required: Determine accrual basis net income for 2016.
During 2021, Ocean Consulting had the following transactions with its clients (customers): On February 1, 2021, the company receieved cash of $10,000 from clients in payment of their account balances as of December 31, 2020. On November 1, 2021, the company receieved $4,000 cash as payments in advance for services to be performed in 2022. The company receieved a total of $26,000 in cash for services that were performed during 2021. The company sent bills totaling $8,000 to clients for services performed during 2021; this amount was unpaid as December 31, 2021 Which of the following statements about the activities for Ocean Consulting for 2021, is correct? A. if accounts receivable at December 31, 2020 totaled $50,000, the amount of accounts receivable to be reported on the balance sheet at December 31, 2021 will be $48,000 B. the $4,000 receieved from clients for services to be performed next year will be reported as revenue on the 2021 income statement C. the $8,000 owed by clients…
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Zuhoor Muscat Company reported the following transactions during the year 2020: collected RO 45,000 cash from customers for services provided during 2020 and received RO 45,000 from customers for services provided during 2019. Additionally, Zuhoor Muscat Company provided services to customers on account during 2020 for a total of RO 90,0000 and accepted RO 55,000 cash for services to be performed in 2021. If Zuhoor Muscat Company is applying accrual accounting, then the effect of the above transactions on its net income at year-end 2020 will be:
The following transactions occurred during December 31, 2021, for the Microchip Company. On October 1, 2021, Microchip lent $90,000 to another company. A note was signed with principal and 8% interest to be paid on September 30, 2022. On November 1, 2021, the company paid its landlord $6,000 representing rent for the months of November through January. Prepaid rent was debited. On August 1, 2021, collected $12,000 in advance rent from another company that is renting a portion of Microchip’s factory. The $12,000 represents one year’s rent and the entire amount was credited to deferred rent revenue. Depreciation on office equipment is $4,500 for the year. Vacation pay for the year that had been earned by employees but not paid to them or recorded is $8,000. The company records vacation pay as salaries expense. Microchip began the year with $2,000 in its asset account, supplies. During the year, $6,500 in supplies were purchased and debited to supplies. At year-end, supplies costing…
The following balances are extracted from the records of VKS Corporation as of December 31, 2021:· Commercial savings account, DVD- P1,500,000· Commercial checking account, DVD- P1,800,000· Travel advances for executive travel for the 1st quarter of 2022 (employee to reimburse through salary deduction)- P375,000· Cash fund for retirement of long-term debt- P2,000,000· Petty cash fund- P20,000· I.O.U. from an officer- P50,000· Bank overdraft, BPI- P450,000· Certificates of deposits, maturity of 120 days acquired on December 1, 2021- P3,000,000· Check received from customer dated January 2, 2022- P175,000· Maintaining balance at DVD to ensure future credit availability- P200,000· Currency and coin on hand not yet deposited - P25,000 How much will be reported as cash and cash equivalents on December 31, 2021?
On January 1, 2019, Sharon Matthews established Tri-City Realty, which completed the following transactions during the month: Sharon Matthews transferred cash from a personal bank account to an account to be used for the business, $18,000. Paid rent on office and equipment for the month, $3,370. Purchased supplies on account, $990. Paid creditor on account, $370 Earned fees, receiving cash, $15,300. Paid automobile expenses (including rental charge) for month, $930, and miscellaneous expenses, $630. Paid office salaries, $1,960. Determined that the cost of supplies used was $550. Withdrew cash for personal use, $900\ 4. As a result of the January transactions (a-i), determine the following: a. Amount of total revenue recorded in the ledger. b. Amount of total expenses recorded in the ledger. c. Amount of net income for January. 5. Determine the total increase or decrease in owner's equity for January.
On January 1, 2019, Sharon Matthews established Tri-City Realty, which completed the following transactions during the month: Sharon Matthews transferred cash from a personal bank account to an account to be used for the business, $40,000. Paid rent on office and equipment for the month, $6,000. Purchased supplies on account, $3,200. Paid creditor on account, $1,750. Earned fees, receiving cash, $18,250. Paid automobile expenses (including rental charge) for month, $1,880, and miscellaneous expenses, $420. Paid office salaries, $5,000. Determined that the cost of supplies used was $1,400. Withdrew cash for personal use, $2,000. Instructions Journalize entries for transactions (a) through (i), using the following account titles: Cash; Supplies; Accounts Payable; Sharon Matthews, Capital; Sharon Matthews, Drawing; Fees Earned; Rent Expense; Office Salaries Expense; Automobile Expense; Supplies Expense; Miscellaneous Expense. Explanations may be omitted. Prepare T…