Fund. of Financial Accounting - With Access
5th Edition
ISBN: 9781259636240
Author: PHILLIPS
Publisher: MCG
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Chapter 13, Problem 13.13E
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The Sports Authority, Inc., is a private full-line sporting goods retailer. Assume one of the SportsAuthority stores reported current assets of $88,000 and its current ratio was 1.75, and then completed the following transactions: (1) paid $6,000 on accounts payable, (2) purchased a deliverytruck for $10,000 cash, (3) wrote off a bad account receivable for $2,000, and (4) paid previouslydeclared dividends in the amount of $25,000.Required:Compute the updated current ratio, rounded to two decimal places, after each transaction.
Mr. Steve Persian hired Elizabeth to prepare the Statement of Financial Position of his business. To prepare the statement, Elizabeth identified the following assets and liabilities of Mr. Persian:
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f. He bought the materials from his suppliers amounting to P30, 000 and promised to pay the said amount one month after the end of the year.
g. He paid the contributions of his employees such as SSS, Philhealth and Pag ibig amounting to P6, 500
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i. He acquired a 2 year loan from YKY Bank amounting to P45, 000.
The following selected transactions were completed by Silverado Delivery Service during February:1. Received cash from owner as additional investment, $25,000.2. Purchased supplies for cash, $750.3. Paid rent for February, $3,000.4. Paid advertising expense, $1,500.5. Received cash for providing delivery services, $16,800.6. Billed customers for delivery services on account, $32,500.7. Paid creditors on account, $1,400.8. Received cash from customers on account, $23,770.9. Determined that the cost of supplies on hand was $275 and $475 of supplies had been used during the month.10. Paid cash to owner for personal use, $5,000.Indicate the effect of each transaction on the accounting equation by listing the numbers identifying the transactions, (1) through (10), in a column and inserting at the right of each number the appropriate letter from the following list:a. Increase in an asset, decrease in another asset.b. Increase in an asset, increase in a liability.c. Increase in an asset,…
Chapter 13 Solutions
Fund. of Financial Accounting - With Access
Ch. 13 - What is the general goal of trend analysis?Ch. 13 - Prob. 2QCh. 13 - What is ratio analysis? Why is it useful?Ch. 13 - What benchmarks are commonly used for interpreting...Ch. 13 - Prob. 5QCh. 13 - Prob. 6QCh. 13 - Slow Cellars current ratio increased from 1.2 to...Ch. 13 - From last year to this year, Colossal Companys...Ch. 13 - From last year to this year, Berry Bam reported...Ch. 13 - Explain whether the following situations, taken...
Ch. 13 - What are the two essential characteristics of...Ch. 13 - Prob. 12QCh. 13 - Prob. 13QCh. 13 - Prob. 14QCh. 13 - Prob. 15QCh. 13 - Prob. 16QCh. 13 - 1. Which of the following ratios is not used to...Ch. 13 - Prob. 2MCCh. 13 - Prob. 3MCCh. 13 - Analysts use ratios to a. Compare different...Ch. 13 - Which of the following ratios incorporates stock...Ch. 13 - Prob. 6MCCh. 13 - Prob. 7MCCh. 13 - A bank is least likely to use which of the...Ch. 13 - Prob. 9MCCh. 13 - (Supplement 13A) Which of the following items is...Ch. 13 - Calculations for Horizontal Analyses Using the...Ch. 13 - Calculations for Vertical Analyses Refer to M13-1....Ch. 13 - Interpreting Horizontal Analyses Refer to the...Ch. 13 - Interpreting Vertical Analyses Refer to the...Ch. 13 - Prob. 13.5MECh. 13 - Prob. 13.6MECh. 13 - Prob. 13.7MECh. 13 - Analyzing the Inventory Turnover Ratio A...Ch. 13 - Inferring Financial Information Using the Current...Ch. 13 - Prob. 13.10MECh. 13 - Identifying Relevant Ratios Identify the ratio...Ch. 13 - Prob. 13.12MECh. 13 - Analyzing the Impact of Accounting Alternatives...Ch. 13 - Describing the Effect of Accounting Decisions on...Ch. 13 - Prob. 13.1ECh. 13 - Prob. 13.2ECh. 13 - Prob. 13.3ECh. 13 - Computing Profitability Ratios Use the information...Ch. 13 - Prob. 13.5ECh. 13 - Matching Each Ratio with Its Computational Formula...Ch. 13 - Computing and Interpreting Selected Liquidity...Ch. 13 - Prob. 13.8ECh. 13 - Prob. 13.9ECh. 13 - Prob. 13.10ECh. 13 - Prob. 13.11ECh. 13 - Prob. 13.12ECh. 13 - Prob. 13.13ECh. 13 - Prob. 13.14ECh. 13 - Analyzing the Impact of Alternative Inventory...Ch. 13 - Prob. 13.1CPCh. 13 - Analyzing Comparative Financial Statements Using...Ch. 13 - Prob. 13.3CPCh. 13 - Prob. 13.4CPCh. 13 - Prob. 13.5CPCh. 13 - Prob. 13.6CPCh. 13 - Prob. 13.7CPCh. 13 - Prob. 13.1PACh. 13 - Analyzing Comparative Financial Statements Using...Ch. 13 - Prob. 13.3PACh. 13 - Prob. 13.4PACh. 13 - Interpreting Profitability, Liquidity, Solvency,...Ch. 13 - Using Ratios to Compare Loan Requests from Two...Ch. 13 - Prob. 13.7PACh. 13 - Prob. 13.1PBCh. 13 - Prob. 13.2PBCh. 13 - Prob. 13.3PBCh. 13 - Prob. 13.4PBCh. 13 - Interpreting Profitability, Liquidity, Solvency,...Ch. 13 - Using Ratios to Compare Loan Requests from Two...Ch. 13 - Prob. 13.7PBCh. 13 - Prob. 13.1SDCCh. 13 - Prob. 13.2SDCCh. 13 - Prob. 13.5SDCCh. 13 - Prob. 13.6SDCCh. 13 - Prob. 13.7SDCCh. 13 - Prob. 13.1CC
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- Krespy Corp. has a cash balance of $7,500 before the following transactions occur: A. received customer payments of $965 B. supplies purchased on account $435 C. services worth $850 performed, 25% is paid in cash the rest will be billed D. corporation pays $275 for an ad in the newspaper E. bill is received for electricity used $235. F. dividends of $2,500 are distributed What is the balance in cash after these transactions are journalized and posted?arrow_forwardWhat accounting method (cash or accrual) would you recommend for the following businesses? a. A gift shop with average annual gross receipts of 900,000. b. An accounting partnership with average annual gross receipts of 12 million. c. A drywall subcontractor who works on residences and has annual gross receipts of 3 million. d. An incorporated insurance agency with average annual gross receipts of 28 million. e. A sole proprietor operating a retail clothing store with average annual gross receipts of 12 million. f. A sole proprietor operating a widget manufacturing plant with average annual gross receipts of 27 million.arrow_forwardDiscuss how each of the following transactions will affect assets, liabilities, and stockholders equity, and prove the companys accounts will still be in balance. A. A company purchased $450 worth of office supplies on credit. B. The company parking lot was plowed after a blizzard. A check for $75 was given to the plow truck operator. C. $250 was paid on account. D. A customer paid $350 on account. E. Provided services for a customer, $500. The customer asked to be billed.arrow_forward
- In March, T. Carter established Carter Delivery Service. The account headings are presented below. Transactions completed during the month of March follow. a. Carter deposited 25,000 in a bank account in the name of the business. b. Bought a used truck from Degroot Motors for 15,140, paying 5,140 in cash and placing the remainder on account. c. Bought equipment on account from Flemming Company, 3,450. d. Paid the rent for the month, 1,000, Ck. No. 3001. e. Sold services for cash for the first half of the month, 6,927. f. Bought supplies for cash, 301, Ck. No. 3002. g. Bought insurance for the truck for the year, 1,200, Ck. No. 3003. h. Received and paid the bill for utilities, 349, Ck. No. 3004. i. Received a bill for gas and oil for the truck, 218. j. Sold services on account, 3,603. k. Sold services for cash for the remainder of the month, 4,612. l. Paid wages to the employees, 3,958, Ck. Nos. 30053007. m. Carter withdrew cash for personal use, 1,250, Ck. No. 3008. Required 1. Record the transactions and the balance after each transaction 2. Total the left side of the accounting equation (left side of the equal sign), then total the right side of the accounting equation (right side of the equal sign). If the two totals are not equal, check the addition and subtraction. If you still cannot find the error, re-analyze each transaction.arrow_forwardOn January 24, 20Y8, Niche Consulting collected $5,700 it had hilled its clients for services rendered on December 31, 20Y7. How would you record the January 24 transaction, using the accrual basis? A. Increase Cash, $5,700; decrease Fees Earned, $5,700 B. Increase Accounts Receivable, $5,700; increase Fees Earned, $5,700 C. Increase Cash, $5,700; decrease Accounts Receivable, $5,700 D. Increase Cash, $5,700; increase Fees Earned, $5,700arrow_forwardThe following selected transactions were completed by Silverado Delivery Service during February:1. Received cash from owner as additional investment, $25,000.2. Purchased supplies for cash, $750.3. Paid rent for February, $3,000.4. Paid advertising expense, $1,500.5. Received cash for providing delivery services, $16,800.6. Billed customers for delivery services on account, $32,500.7. Paid creditors on account, $1,400.8. Received cash from customers on account, $23,770.9. Determined that the cost of supplies on hand was $275 and $475 of supplies had been used during the month.10. Paid cash to owner for personal use, $5,000.Indicate the effect of each transaction on the accounting equation by listing the numbers identifying the transactions, (1) through (10), in a column and inserting at the right of each number the appropriate letter from the following list:a. Increase in an asset, decrease in another asset.b. Increase in an asset, increase in a liability.c. Increase in an asset,…arrow_forward
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- The following account balances were included in the trial balance of Twain Corporation at June 30, 2020. Sales revenue $1,578,500 Depreciation expense (office Sales discounts 31,150 furniture and equipment) $ 7,250 Cost of goods sold 896,770 Property tax expense 7,320 Salaries and wages expense (sales) 56,260 Bad debt expense (selling) 4,850 Sales commissions 97,600 Maintenance and repairs Travel expense (salespersons) 28,930 expense (administration) 9,130 Delivery expense 21,400 Office expense 6,000 Entertainment expense 14,820 Sales returns and allowances 62,300 Telephone and Internet expense (sales) 9,030 Dividends received 38,000 Depreciation expense (sales equipment) 4,980 Interest expense 18,000 Maintenance and repairs expense (sales) 6,200 Income tax expense 102,000 Miscellaneous selling expenses 4,715 Depreciation understatement Office supplies used 3,450 due to…arrow_forwardRecord all transactions in appropriate T-accounts (costs by nature), close all accounts and prepare an Income Statement.a) The company recorded an invoice for rubbish disposal in the current month; value 400.b) The company recorded bank fees; value 50.c) The company sold goods worth 2 000 for 3 500 on deferred payment.d) Goods were delivered to a customer – transport cost 500 and additional insurance cost of 200, both paid by bank money transfer..arrow_forwardThe following transactions took place in the month of January 2023 in the books of Ruth Charles Wholesale. Jan 1 Ms. Ruth Charles started her wholesale business with $44,000 cash Jan 2 she purchased Equipment costing $17,000 paying a deposit of $5,000 and signing a Note Payable for the remainder Jan 4 Brought Inventory costing $6,500 on credit Jan 6 Received 8% loan from Credit Union of 10,000 to purchase a motor vehicle for business use Jan 7 sold inventory for $ 10,500 cash Jan 8 Sold Inventory on credit for $ 12,000 Jan10 Purchased inventory costing $7,800 Jan 12 Paid rent for warehouse space $2,500 Jan 14 Paid salaries and wages of $9,000 Jan 16 Ruth took $3,500 cash for her own use Jan 18 paid $2,500 to note payable Jan 21 Inventory was return to accounts payable costing $500 Jan 23 Receive part payment from Accounts Receivables of $3,000 Jan 25 Paid Accounts Payable $2,000 Jan 26 purchased inventory for $3,700 cash Jan 28 Cash sale of inventory…arrow_forward
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