Accounting help - 31805

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1.      The unadjusted trial balance amount for the Prepaid Rent account on December 31, 2013, is $3,600.  The rental is for extra office space for 12 months. The rental started on April 1, 2013 and the $3,600 rental fee was paid on that date. The required adjusting entry on December 31, 2013 would require a

                  Debit to    _______________ (Account Title)

                  For            $_______________ (Amount)

 

 

2.      Ned Sales had net credit sales in June of $100,000.  On June 30, 2013 (before any adjustments) Accounts receivable are $20,000 and Allowance for Doubtful Accounts has a $100 debit balance.  If Ned Sales estimates bad debt losses as 4% of net credit sales, the net realizable value of the Accounts Receivable AFTER the June 30, 2013 adjusting entry is:

                                    $_______________ (Amount)

 

 

3.      If Mel Corporation sells 60,000 shares of its new $1 par value common stock to investors for $14 per share, the required journal entry would require a  credit to Common Stock for:

                                    $_______________ (Amount)

 

 

4.      Jen Industries purchased specialized equipment on July 1, 2011, that cost $85,000, has a residual value of $5,000, and a useful life of four years.  Jen uses the sum of the year’s digits method. The depreciation expense for the year 2013 is:

                                    $_______________ (Amount)

 

 

5.    On September 1, 2013, five months' rent income totaling $5,000 was received on an office rental.  The advance collection was originally recorded by a credit to Rental Revenue.  The required adjusting entry at December 31, 2013 would require a:

                  Debit to    _______________ (Account Title)

                  For            $_______________ (Amount)

 

 

USE THE FOLLOWING INFORMATION FOR QUESTIONS 6 and 7:

 

Janet Inc., has an inventory for notebooks on January 1 and purchases of this item during 2013 as follows:

Jan. 1

Beginning inventory.........................

 500 units @ $3.00

 

Mar. 5

Purchase................................................

 600 units @ $4.00

 

Sept. 3

Purchase................................................

 900 units @ $5.00

 

Nov. 4

Purchase................................................

 700 units @ $7.00

 

 

During 2013, Janet sold 1,200 notebooks at $10.00 each.  Assume Janet uses a Periodic Inventory System.

 

6.      Using FIFO, compute the cost of goods sold on December 31, 2013. $_________.

 

 

7.      Using LIFO, compute the cost of the ending inventory on December 31, 2013. $_________.

 

 

8.      During a period of falling  prices, the cost flow assumption that will generally result in the highestamount of income taxes paid is: (State correct Inventory Cost Flow Method)

____________________

 

 

9.      How would this year’s total owners’ equity be affected by a common “stock” (not cash) dividend that had been declared  and distributed this year?

a.      Decrease

b.      No effect                   

c.      cannot tell based on this information 

d.      Increase                                                                          

 

(Enter your multiple choice answer A, B, C, D for question 9)


(USE THE FOLLOWING INFORMATION FOR QUESTIONS 10 and 11)

 

Bill Company (which uses a periodic inventory system)

has the following account balances after adjusting entries at December 31, 2013:

 

Cash                                                                                                          $ 220,000

Depreciation Expense                                                                                20,000

Paid-in Capital from Treasury Stock Transactions, Common          50,000

Other Operating Expenses                                                                       45,000

Sales Discounts                                                                                             5,000

Accumulated Depreciation- Equipment                                               30,000

Treasury Stock, Common (22,000 shares)                                            42,000

Preferred Stock 6% ($10 par)                                                                   85,000

Merchandise Inventory (1/1/2013)                                                     100,000

Equipment                                                                                                  170,000

Accounts Receivable                                                                                 90,000

Paid-in Capital in Excess of Par Value, Preferred                              27,000

Purchases                                                                                                    700,000

Interest Expense                                                                                          20,000

Unearned Revenue                                                                                        8,000

Purchases Returns and Allowances                                                      15,000

Salary Expense                                                                                             80,000

Paid-in Capital in Excess of Par Value, Common                               90,000

Dividends                                                                                                     10,000

Common Stock ($1 par)                                                                           167,000

Sales                                                                                                             940,000

Rent Expense                                                                                                67,000

Bonds Payable (due 2042)                                                                       50,000

Accounts Payable                                                                                       27,000

Retained Earnings (1/1/2013)                                                                80,000

 

Merchandise inventory on December 31, 2013 is $130,000

 

10.   The total stockholders’ equity at December 31, 2013 is:

 

$_____________  (amount)

 

 

11.   The net income for 2013 is:

 

$_____________  (amount)

 

 

QUESTIONS 12- AND 13 ARE BASED ON THE FOLLOWING INFORMATION:

 

The stockholders' equity accounts (normal balances) of the Vermont Corp. as of December 31, 2013, appeared as follows:

 

Common stock, $1 par (100,000 shares authorized, 64,000 shares issued)                            $64,000

Preferred Stock, 10%, $5 Par (40,000 shares authorized, 10,000 shares issued)                     50,000

Paid-in capital--excess over par value, common                                                                                70,000

Retained earnings                                                                                                                                       36,000

Treasury Stock (3,000 shares of common stock)                                                                                   8,000

 

12.          A stockholders' equity section prepared at December 31, 2013, would report total stockholders' equity of:

                                                      $___________.

 

13.     At December 31, 2013, the book value per share of the common stock  is

           (Assume no preferred dividends are in arrears) (round to nearest cent)

                                                      $___________.

 

 

 

 

 

 

 

 

 

 

 

 

USE THE FOLLOWING INFORMATION FOR QUESTIONS 14 – 16.

 

 Selected balance sheet account balances are:                                                  MO COMPANY

                                                                                                                                               December 31

                                                                                                                                     2013                          2012

  Cash                                                                                                                $  200,000                $  300,000

  Accounts Payable                                                                       45,000         60,000

  Accounts Receivable                                                                  125,000    140,000

  Salaries Payable                                                                                                    8,000                         4,000

  Land                                                                                                                    120,000                    140,000

  Merchandise Inventory                                                                                  130,000                    150,000

  Prepaid Rent                                                                                                        52,000                       45,000

 

Income statement  items for the year are:

Sales                                                                                                                    $800,000

Cost of Goods Sold                                                                                           380,000

Salary Expense                                                                                                      90,000

Depreciation Expense                                                                                         40,000

Rent Expense                                                                                                      100,000

 

14.     Cash payments to suppliers for merchandise inventory during 2013 is

           $ _____________

 

15.     Cash collections from customers during 2013 is 

           $ _____________

 

16.     Cash payments to employees for salary during 2013 is 

           $_____________

 

 

 

USE THE FOLLOWING INFORMATION FOR QUESTIONS 17 – 20.

 

Assume that the following information is relevant for one of the bond issues of Fran Company:

Face value                                  $900,000

Bond term                                   20 years

Stated interest rate                   10%   (paid semiannually)

Market interest rate                 8%

Issue date                                                     July 1, 2013

Interest payment dates            June 30 and December 31

 

Present Value Factors:                                4%            5%            8%            10%

Present value of 1 for 20 periods                                     0.456         0.377         0.215         0.149

Present value of 1 for 40 periods                                     0.208         0.142         0.046         0.022

 

Present value of annuity for 20 periods         13.590       12.462       9.818         8.514        

Present value of annuity for 40 periods         19.793       17.159       11.925       9.779

 

 (Use only the present value factors shown above to make calculations.)

 

17.        On July 1, 2013, the amount the bonds should sell for is

$___________

 

18.        The total amount of bond interest to be paid in cash over the life of the bonds is:

$_____________

 

19.        The  amount of interest expense for 2013  using the effective interest method of amortization is

$__________  (show exact amount including cents)

 

20.        The amount of bond interest paid in cash for 2014 is

$___________

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