Financial Accounting
14th Edition
ISBN: 9781305088436
Author: Carl Warren, Jim Reeve, Jonathan Duchac
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 4, Problem 1PA
(1)
To determine
Prepare income statement for the year ended December 31, 2016.
(2)
To determine
Prepare statement of owners’ equity for the year ended December 31, 2016.
(3)
To determine
Prepare the balance sheet of Company L at December 31, 2016.
(4)
To determine
Journalize the closing entries for L Company.
(5)
To determine
Prepare post–closing trial balance of Company L for the month ended December 31, 2016.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Beacon Signals Company maintains and repairs warning lights, such as those found on radio towers and lighthouses. Beacon Signals Company prepared the following end-of-period spreadsheet at December 31, 2019, the end of the fiscal year:
Required:
Prepare an income statement for the year ended December 31.
Prepare a statement of owner’s equity for the year ended December 31. No additional investments were made during the year.
Prepare a balance sheet as of December 31.
Based upon the end-of-period spreadsheet, journalise the closing entries.
Prepare a post-closing trial balance.
The following unadjusted trial balance is for Ace Construction Co. as of the end of its 2017 fiscal year. The June 30, 2016, credit balance of the owner’s capital account was $53,660, and the owner invested $35,000 cash in the company during the 2017 fiscal year.
1. Prepare and complete a 10-column work sheet for fiscal year 2017, starting with the unadjusted trial balance and including adjustments based on these additional facts.
a. The supplies available at the end of fiscal year 2017 had a cost of $3,300.
b. The cost of expired insurance for the fiscal year is $3,800.
c. Annual depreciation on equipment is $8,400.
d. The June utilities expense of $650 is not included in the unadjusted trial balance because the bill arrived after the trial balance was prepared. The $650 amount owed needs to be recorded.
e. The company’s employees have earned $1,800 of accrued wages at fiscal year-end.
f. The rent expense incurred and not yet paid or recorded at fiscal year-end is $500.
g. Additional…
Reece Financial Services Co., which specializes in appliance repair services, is owned and operated by Joni Reece. Reece Financial Services’ accounting clerk prepared the following unadjustedtrial balance at July 31, 2018:
The data needed to determine year-end adjustments are as follows:• Depreciation of building for the year, $6,400.• Depreciation of equipment for the year, $2,800.• Accrued salaries and wages at July 31, $900.• Unexpired insurance at July 31, $1,500.• Fees earned but unbilled on July 31, $10,200.• Supplies on hand at July 31, $615.• Rent unearned at July 31, $300.Instructions1. Journalize the adjusting entries using the following additional accounts: Salaries and WagesPayable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; DepreciationExpense—Equipment; and Supplies Expense.2. Determine the balances of the accounts affected by the adjusting entries, and prepare anadjusted trial balance.
Chapter 4 Solutions
Financial Accounting
Ch. 4 - Prob. 1DQCh. 4 - Describe the nature of the assets that compose the...Ch. 4 - Prob. 3DQCh. 4 - Prob. 4DQCh. 4 - Why are closing entries required at the end of an...Ch. 4 - Prob. 6DQCh. 4 - What is the purpose of the post-closing trial...Ch. 4 - Prob. 8DQCh. 4 - Prob. 9DQCh. 4 - Recent fiscal years for several well-known...
Ch. 4 - The balances for the accounts that follow appear...Ch. 4 - The balances for the accounts that follow appear...Ch. 4 - Marcie Davies owns and operates Gemini Advertising...Ch. 4 - Prob. 2PEBCh. 4 - The following accounts appear in an adjusted trial...Ch. 4 - The following accounts appear in an adjusted trial...Ch. 4 - After the accounts have been adjusted at October...Ch. 4 - After the accounts have been adjusted at April 30,...Ch. 4 - From the following list of steps in the accounting...Ch. 4 - From the following list of steps in the accounting...Ch. 4 - Balance sheet data for HQ Properties Company...Ch. 4 - Balance sheet data for Brimstone Company follows:...Ch. 4 - The balances for the accounts that follow appear...Ch. 4 - Prob. 2ECh. 4 - Bamboo Consulting is a consulting firm owned and...Ch. 4 - Elliptical Consulting is a consulting firm owned...Ch. 4 - The following account balances were taken from the...Ch. 4 - The following revenue and expense account balances...Ch. 4 - FedEx Corporation had the following revenue and...Ch. 4 - Apex Systems Co. offers its services to residents...Ch. 4 - Selected accounts from the ledger of Restoration...Ch. 4 - Prob. 10ECh. 4 - At the balance sheet date, a business owes a...Ch. 4 - Prob. 12ECh. 4 - List the errors you find in the following balance...Ch. 4 - Prob. 14ECh. 4 - Prior to its closing, Income Summary had total...Ch. 4 - After all revenue and expense accounts have been...Ch. 4 - Prob. 17ECh. 4 - Prob. 18ECh. 4 - An accountant prepared the following post-closing...Ch. 4 - Rearrange the following steps in the accounting...Ch. 4 - The following data (in thousands) were taken from...Ch. 4 - Prob. 22ECh. 4 - Prob. 23ECh. 4 - Alert Security Services Co. offers security...Ch. 4 - Alert Security Services Co. offers security...Ch. 4 - Prob. 26ECh. 4 - Based on the data in Exercise 4-24, prepare the...Ch. 4 - Based on the data in Exercise 4-25, prepare the...Ch. 4 - Prob. 1PACh. 4 - Finders Investigative Services is an investigative...Ch. 4 - The unadjusted trial balance of Epicenter Laundry...Ch. 4 - The unadjusted trial balance of Lakota Freight Co....Ch. 4 - For the past several years, Steffy Lopez has...Ch. 4 - Last Chance Company offers legal consulting advice...Ch. 4 - The Gorman Group is a financial planning services...Ch. 4 - The unadjusted trial balance of La Mesa Laundry at...Ch. 4 - The unadjusted trial balance of Recessive...Ch. 4 - For the past several years, Jeff Horton has...Ch. 4 - The unadjusted trial balance of PS Music as of...Ch. 4 - Kelly Pitney began her consulting business, Kelly...Ch. 4 - Picasso Graphics is a graphics arts design...Ch. 4 - The following is an excerpt from a telephone...Ch. 4 - Prob. 3CP
Knowledge Booster
Similar questions
- Reece Financial Services Co., which specializes in appliance repair services, is owned and operated by Joni Reece. Reece Financial Services Co.s accounting clerk prepared the following unadjusted trial balance at July 31, 2016: The data needed to determine year-end adjustments are as follows: a. Depreciation of building for the year, 6,400. b. Depreciation of equipment for the year, 2,800. c. Accrued salaries and wages at July 31, 900. d. Unexpired insurance at July 31, 1,500. e. Fees earned but unbilled on July 31, 10,200. f. Supplies on hand at July 31, 615. g. Rent unearned at July 31, 300. Instructions 1. Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation ExpenseBuilding; Depreciation ExpenseEquipment; and Supplies Expense. 2. Determine the balances of the accounts affected by the adjusting entries and preparean adjusted trial balance.arrow_forwardApex Systems Co. offers its services to residents in the Seattle area. Selected accounts from the ledger of Apex Systems Co. for the fiscal year ended December 31, 2016, are as follows: Prepare a statement of owners equity for the year.arrow_forwardSelected accounts from the ledger of Restoration Arts for the fiscal year ended April 30, 2016, are as follows: Prepare a statement of owners equity for the year.arrow_forward
- The following balances were retrieved from the records of Carlo's Janitorial Services for the year ended December 31, 2016: •Capital, January 1, 2016 P 500,000 •Withdrawals P 100,000 •Additional Investments P 50,000 •Net Loss P 45,000 Prepare a Statement of Changes in Owner's Equityarrow_forwardBadger Bagels had the following separate situations occur during 2016.The company’s accountant is preparing the annual financial statements at December 31, 2016 and has asked you to record the adjusting entries for each situation in the journal entry form. a. The Unearned Revenue account has an unadjusted balance of $8,000 consisting of gift cards sold to customers. Redeemed gift cards that have not yet been recorded total $4,800. b. At the beginning of the year, the company purchased supplies worth $5000 and paid cash. At December 31, 2016, the supplies available are $2000. c. At December 31, 2016, employee wages of $9,200 have been incurred but not paid or recorded. d. Nine months ago, the company paid one year's advance rent of $1200 in cash. e. The company purchased equipment on January 1 by paying $ 100,000 cash. Unrecorded depreciation on equipment is $11,200.arrow_forwardThe adjusted trial balance of Pacific Scientific Corporation on December 31, 2016, the end of the company’s fiscal year, contained the following income statement items ($ in millions): sales revenue, $2,106; cost of goods sold, $1,240; selling expenses, $126; general and administrative expenses, $105; interest expense, $35; and gain on sale of investments, $45. Income tax expense has not yet been recorded. The income tax rate is 40%. If the company’s accountant prepared a multiple-step income statement, what amount would appear in that statement for (a) operating income and (b) nonoperating income?arrow_forward
- Prepare the journal entry (or entries) required to record a)the original transaction, and b) the year-end adjusting entry, if required for the Candlestick Inc. Office supplies on hand at Candlestick Inc. amounted to $300 at the beginning of the year. During the year, additional office supplies were purchased for cash at a cost of $1,500. At the end of the year, a physical count showed that supplies on hand amounted to $500. The Orosco Security Service began operations on January 1, 2002. By the end of the first year of operations, the following transactions occurred: Services provided but unbilled total $2,500 at December 31 Interest of $5,400 accrued on notes payable for the year $1,000 of unearned revenue has been earned Drivers’ salaries total $500 per day. On December 31, three days’ salaries are unpaid. Journalize the annual adjusting entries on December 31, 2002.arrow_forwardBelow are four transactions that were completed during 2016 by Timber Lodge. Provide any related journal entries (including both active and passive entries) for the fiscal year ended on December 31. A. On July 1, 2016, Timber Lodge paid a two-year insurance premium $8000 for a policy on its facilities. B. On December 31, 2016, a tenant renting some storage space from Timber Lodge had not paid the rent of $750 for December. C. On September 1, 2016, Timber Lodge borrowed $25,000 cash and gave a one-year, 6 percent, note payable. The interest is payable on the note's due date of August 31, 2017. D. On October 1, 2016, Timber Lodge collected $10,000 from a tenant for two years rent beginning October 1, 2016. E. On Jan 1, 2016, Timber Lodge had $1000 supplies at hand. It purchased $6000 on Oct 23. On December 31, the annual physical count shows it had $2000 remaining supplies.arrow_forwardAdam Vega's Landscaping Company compiled the following list of account balances of various assets, liabilities, revenues, and expenses on December 31, 2016, the end of its first year of operations. Common stock $25,200 Accounts payable 5,000 Salary expense 9,000 Repairs expense 1,600 Dividends 10,000 Truck 17,000 Equipment 12,600 Notes payable 16,400 Cash 35,200 Supplies expense 3,200 Service revenue 43,600 Gasoline expense 1,600 QUESTION #1:The total liabilities for Adam Vega's Landscaping on December 31, 2016 are: A) $23,400 B) $73,000 C) $37,800 D) $21,400 Questions #2: The total assets for Adam Vega's Landscaping on December 31, 2016 are: A) $64,800 B) $63,200 C) $43,200 D) $56,200arrow_forward
- Please explain how to complete the balance sheet and income statement given the following transactions. Gordon Company started operations on January 1 of the current year. It is now December 31, the end of the current annual accounting period. The part-time bookkeeper needs your help to analyze the following three transactions: During the year, the company purchased office supplies that cost $3,000. At the end of the year, office supplies of $800 remained on hand. On January 1 of the current year, the company purchased a special machine for cash at a cost of $25,000. The machine’s cost is estimated to depreciate at $2,500 per year. On July 1, the company paid cash of $1,000 for a two-year premium on an insurance policy on the machine; coverage began on July 1 of the current year. Required: Complete the following schedule with the amounts that should be reported for the current year: Selected Balance Sheet Accounts at December 31 Amount tobe…arrow_forwardThe adjusted trial balance columns of the worksheet for Wildhorse Company are as follows. The owner did not make any additional investments in the business in April. WILDHORSE COMPANYWorksheet (partial)For the Month Ended April 30, 2020 Adjusted Trial Balance Account Titles Dr. Cr. Cash 11,300 Accounts Receivable 7,700 Prepaid Rent 2,400 Equipment 23,100 Accumulated Depreciation—Equip. 5,400 Notes Payable 5,900 Accounts Payable 4,600 Owner’s Capital 28,460 Owner’s Drawings 3,700 Service Revenue 15,800 Salaries and Wages Expense 10,600 Rent Expense 700 Depreciation Expense 660 Interest Expense 60 Interest Payable 60 Totals 60,220 60,220 Prepare an owner’s equity statement.arrow_forwardThe adjusted trial balance columns of the worksheet for Wildhorse Company are as follows. The owner did not make any additional investments in the business in April. WILDHORSE COMPANYWorksheet (partial)For the Month Ended April 30, 2020 Adjusted Trial Balance Account Titles Dr. Cr. Cash 11,300 Accounts Receivable 7,700 Prepaid Rent 2,400 Equipment 23,100 Accumulated Depreciation—Equip. 5,400 Notes Payable 5,900 Accounts Payable 4,600 Owner’s Capital 28,460 Owner’s Drawings 3,700 Service Revenue 15,800 Salaries and Wages Expense 10,600 Rent Expense 700 Depreciation Expense 660 Interest Expense 60 Interest Payable 60 Totals 60,220 60,220arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Financial AccountingAccountingISBN:9781305088436Author:Carl Warren, Jim Reeve, Jonathan DuchacPublisher:Cengage LearningFinancial AccountingAccountingISBN:9781337272124Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
Financial Accounting
Accounting
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Cengage Learning
Financial Accounting
Accounting
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning