Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN: 9781305654174
Author: Gary A. Porter, Curtis L. Norton
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
error_outline
This textbook solution is under construction.
Students have asked these similar questions
Explain how the transactions below should be treated in the financial statements of Gidimadjor Catering Services in accordance to IAS 10; Events after the Reporting Period:i. Gidimadjor Catering Services has an investment worth GH¢1 million in its financial statements at 31 December 2018. Due to the continuing recession, the investment reduced in value to GH¢900,000 by 15, January 2019.ii. On 8 January 2019, one of the accountants left Gidimadjor Catering Services suddenly. On further investigation, the company realized that this employee had been paying himself money from the bank account in relation to false rental invoices. The amount of the overpayment was found to be GH¢86,000. With the help of the police, the accountant was tracked down and repaid all of the money on 18 January 2019.iii. On 10 January 2019, Gidimadjor Catering Services sold some inventory for GH¢80,000. This inventory had been included in the year-end inventory count at cost of GH¢100,000.iv. Gidimadjor Catering…
The unadjusted trial balance of the Manufacturing Equitable at December 31, 2018, the end of its fiscal year,included the following account balances. Manufacturing’s 2018 financial statements were issued on April 1,2019.Accounts receivable $ 92,500Accounts payable 35,000Bank notes payable 600,000Mortgage note payable 1,200,000Other information:a. The bank notes, issued August 1, 2018, are due on July 31, 2019, and pay interest at a rate of 10%, payable atmaturity.b. The mortgage note is due on March 1, 2019. Interest at 9% has been paid up to December 31 (assume 9% is arealistic rate). Manufacturing intended at December 31, 2018, to refinance the note on its due date with a new10-year mortgage note. In fact, on March 1, Manufacturing paid $250,000 in cash on the principal balanceand refinanced the remaining $950,000.c. Included in the accounts receivable balance at December 31, 2018, were two subsidiary accounts that hadbeen overpaid and had credit balances totaling $18,000. The…
The following balances have been excerpted from Tito Piccolo's statement of financial position:
Prepaid Insurance
Interest Receivable
Salaries Payable
Accounts Receivable
December 31
January 1
P
6,000
P
7,500
3,700
14,500
61.500
53,000
550.000
415.000
Allowance for bad debts
40.000
25,000
Tito Piccolo Company reported the following during 2020 the following items:
Insurance premiums paid
Interest collected
Salaries paid
Sales
41,500
123,500
481,000
1,980,000
How much is the interest revenue on the income statement for 2020? (no peso sign, no comma, whole number only)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Reporting Liabilities Morton Electronics had the following obligations: a. A legally enforceable claim against the business to be paid in 3 months. b. A guarantee given by a seller to a purchaser to repair or replace defective goods during the first 6 months following a sale. c. An amount payable to Bank One in 10 years. d. An amount to be paid next year to Citibank on a long-term note payable. Required: CONCEPTIJAL CONNECTION Describe how each of these items should be reported in the balance sheet.arrow_forwardWrite-Off of Uncollectible Accounts King Enterprises had 27 customers utilizing its financial planning services in 2019. Each customer paid King $25,000 for receiving Kings assistance. King estimates that 2% of its $675,000 credit sales in 2019 will be uncollectible. During 2020, King wrote off $2,700 related to services performed in 2019. Required: 1. Prepare the journal entry to record the defaulted balance. 2. Prepare the adjusting entry to record the bad debt expense for 2019.arrow_forwardAdjusting Entries Kretz Corporation prepares monthly financial statements and therefore adjusts its accounts at the end of every month. The following information is available for March 2016: Kretz Corporation takes out a 90-day, 8%, $15,000 note on March 1, 2016, with interest and principal to be paid at maturity. The asset account Office Supplies on Hand has a balance of $1,280 on March 1, 2016. During March, Kretz adds $750 to the account for purchases during the period. A count of the supplies on hand at the end of March indicates a balance of $1,370. The company purchased office equipment last year for $62,600. The equipment has an estimated useful life of six years and an estimated salvage value of $5,000. The companys plant operates seven days per week with a daily payroll of $950. Wage earners are paid every Sunday. The last day of the month is Thursday, March 31. The company rented an idle warehouse to a neighboring business on February 1, 2016, at a rate of $2,500 per month. On this date, Kretz Corporation credited Rent Collected in Advance for six months rent received in advance. On March 1, 2016, Kretz Corporation credited a liability account, Customer Deposits, for $4,800. This sum represents an amount that a customer paid in advance and that Kretz will earn evenly over a four-month period. Based on its income for the month, Kretz Corporation estimates that federal income taxes for March amount to $3,900. Required For each of the preceding situations, prepare in general journal form the appropriate adjusting entry to be recorded on March 31, 2016.arrow_forward
- Reading 3M Companys Balance Sheet: Accounts Receivable The following current asset appears on the balance sheet in 3M Companys Form 10-K for the year ended December 31, 2013 (amounts in millions of dollars): Required What is the balance in 3M Companys Allowance for Doubtful Accounts at the end of 2013 and 2012? What is the net realizable value of 3M Companys accounts receivable at the end of each of these two years? What caused increases in the allowance account during 2013? What caused decreases? Explain what a net decrease in the account for the year means.arrow_forwardReal-world annual report The financial statements for Nike, Inc. (NKE), are presented in Appendix E at the end of the text. The following additional information is available (in thousands): Instructions 1. Determine the following measures for the fiscal years ended May 31, 2017, and May 31, 2016. Round ratios and percentages to one decimal place. a. Working capital b. Current ratio c. Quick ratio d. Accounts receivable turnover e. Number of days sales in receivables f. Inventory turnover g. Number of days sales in inventory' h. Ratio of liabilities to stockholders equity i. Asset turnover j. Return on total assets, assuming interest expense is 82 million for the year ending May 31. 2017, and 33 million for the year ending May 31, 2016. k. k. Return on common stockholders equity l. Price-eamings ratio, assuming that the market price was 52.81 per share on May 31, 2017, and 54.35 per share on May 31, 2016. m. m. Percentage relationship of net income to sales 2. What conclusions can be drawn from these analyses?arrow_forwardFortune Accounting reports $1,455,000 in credit sales for 2018 and $1,678,430 in 2019. It has an $825,000 accounts receivable balance at the end of 2018 and $756,000 at the end of 2019. Fortune uses the balance sheet method to record bad debt estimation at 7.5% during 2018. To manage earnings more favorably, Fortune changes bad debt estimation to the income statement method at 5.5% during 2019. A. Determine the bad debt estimation for 2018. B. Determine the bad debt estimation for 2019. C. Describe a benefit to Fortune in 2019 as a result of its earnings management.arrow_forward
- Multiple Company had the following liabilities on December 31, 2021:Accounts payable after deducting debit P 500,000balances in supplier’s accounts of P100,000 Accrued liabilities 150,000Note payable – due March 31, 2022 1,000,000Note payable – due May 1, 2022 800,000Bonds payable – due December 31, 2023 2,000,000On March 1, 2022 before the 2021 financial statements were issued, the note payable of P1,000,000 was replaced by an 18-month note for the same amount. The entity is considering similar action on the P800,000 note due on May 1, 2022. The financial statements were issued on March 31, 2022. 1. Compute the total non-current liabilities as of December 31, 2021 2. Compute the total current liabilities as of December 31, 2021arrow_forwardThese transactions took place for Swifty Corporation 2016 May 1 Received a $ 3,300, 12-month, 6% note in exchange for an outstanding account receivable from R. Stoney. Dec. 31 Accrued interest revenue on the R. Stoney note. 2017 May 1 Received principal plus interest on the R. Stoney note. (No interest has been accrued since December 31, 2016.) Record the transactions in the general journal. The company does not make entries to accrue interest except at December 31.(Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Creditarrow_forwardThese transactions took place for Sheffield Corp. 2016 May 1 Received a $4,600, 12-month, 3% note in exchange for an outstanding account receivable from R. Stoney. Dec. 31 Accrued interest revenue on the R. Stoney note. 2017 May 1 Received principal plus interest on the R. Stoney note. (No interest has been accrued since December 31, 2016.) Record the transactions in the general journal. The company does not make entries to accrue interest except at December 31.(Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)arrow_forward
- On December 31, 2019, Stevens Company's bookkeeper prepared the following balance sheet with items erroneously classified. Stevens Company Balance SheetFor Year Ended December 31, 2019 Current Assets: Current Liabilities: Inventory $ 6,000 Accounts payable $ 9,900 Accounts receivable 5,900 Allowance for doubtful accounts 800 Cash 2,300 Salaries payable 1,500 Treasury stock (at cost) 3,300 Taxes payable 2,500 Long-Term Investments: Long-Term Liabilities: Temporary investments in marketable securities 3,200 Bonds payable (due 2023) 11,000 Investment in held-to-maturity bonds 10,000 Unearned rent (for 3 months) 900 Property, Plant, and Equipment: Shareholders' Equity: Land 8,100 Retained earnings 24,200 Office supplies 800 Accumulated depreciation on buildings and equipment 9,200 Buildings and equipment 35,600 Additional paid-in capital on common stock 10,400 Intangibles:…arrow_forwardAccounting for Warranties, vacation, and bonuses McNight Industries completed the following transactions during 2018: Journalize the transactions. Explanations are not required. Round to the nearest dollar.arrow_forwardQuestion 1 - PART AYaso plc is a manufacture company and its financial year ended at 31st December 2019.Total assets are £40m and net profit before tax is £12m. Yaso plc’s trade receivables ledgerincludes a large number of customers. The year-end trade receivables balance is £4m(comparable to £2m in 2018) and the allowance for trade receivables is £400,000 (comparableto £600,000 in 2018). PART A Requirement:• Describe substantive procedures the auditor should perform to obtain sufficient andappropriate audit evidence in relation to Yaso plc’s trade receivables. QUESTION 1 - PART B According to ISA 260, it is important for auditors to communicate throughout the auditwith those charged with governance. PART B Requirement: • Explain why it is important for auditors to communicate with those chargedwith governance.• Identify three examples of matters which the auditor may communicate to those chargedwith governance.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Financial Accounting: The Impact on Decision Make...AccountingISBN:9781305654174Author:Gary A. Porter, Curtis L. NortonPublisher:Cengage LearningCornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningPrinciples of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
- Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Financial Accounting: The Impact on Decision Make...
Accounting
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
7.2 Ch 7: Notes Payable and Interest, Revenue recognition explained; Author: Accounting Prof - making it easy, The finance storyteller;https://www.youtube.com/watch?v=wMC3wCdPnRg;License: Standard YouTube License, CC-BY