CHAPTER 1: INTRODUCTION TO ACCOUNTING AND BUSINESS TEST BANK OF ACCOUNTING 26TH EDITION BY WARREN

Amount to be paid by the purchaser if the discount is taken. Buyer returns $700 of merchandise as defective.

Is so near maturity that it presents insignificant risk of change in interest rate. C. Which is legally restricted and related to a short-term loan is classified separately as current the information below relates to the cash account in the ledger of minton company. asset. Suppose that a bank holds cash in its vault of $1.4 million, short-term government securities of $12.4 million, privately issued money market instruments of $5….

Assignment Accounting 12 – 13

The total merchandise on hand at the end of the year as determined by taking a physical inventory is $62,000. Of the $62,000, $8,000 has been sold FOB destination and is awaiting pickup by the carrier. The account form of the balance sheet is presented in a downward sequence in three sections. Because many companies use computerized accounting systems, periodic inventory is widely used.

• Revising depreciation estimates affects the amounts of depreciation expense recorded in past periods.
• The capital of the owner was $68,000 on January 1.
• The posting references in the following purchases journal are indicated by letters.
• A corporation often issues callable bonds to protect itself against significant declines in future interest rates.
• Williams uses the double-declining-balance method of depreciation.
• Using the following accounts and balances, prepare the stockholders’ equity section of the balance sheet.
• Journalizing a transaction with both the debit and the credit for $69 instead of $96 will cause the trial balance to be out of balance.

Receiving payments on an account receivable increases both equity and assets. D. The cash amount reported in the statement of financial position must be the balance reported in the bank statement. Bank reconciliations are normally prepare on a monthly basis to identify adjustments needed in the depositor’s records and to identify bank errors. Adjustments on the part of the depositor should be recorded for A. Bank errors, outstanding checks and deposits in transit. All items except bank errors, outstanding checks and deposits in transit.

Shareholder Activism and Impact on Corporations

The manner of reporting cash flows from investing and financing activities will be different under the direct method as compared to the indirect method. Cash, as the term is used for the statement of cash flows, could indicate either cash or cash equivalents. Calculate the following balances to be reported in the financial statements dated December 31. Prepare the stockholders’ equity section of the balance sheet as of December 31. Provide the journal entry to record the adjustment of the available-for-sale security portfolio to fair value on December 31. Purchased 3,500 shares of the 10,000 shares no par common shares of Ramon Co. for $45,700.

The double-declining-balance method is an accelerated depreciation method. All property, plant, and equipment assets are depreciated over time. The cost of new equipment is called a revenue expenditure because it will help generate revenues in the future. The cost of repairing damage to a machine during installation is debited to a fixed asset account. Land acquired as a speculation is reported under Investments on the balance sheet.

JOB ORDER COSTING

The cost of merchandise inventory is limited to the purchase price less any purchase discounts. Freight in is the amount paid by the company to deliver merchandise sold to a customer. Record the transactions in the purchases and cash payments journals. The purchase of supplies for cash would be recorded in the purchases journal.

• Examples of temporary accounts are supplies and prepaid expenses which are in the ledger for just a short time before they expire.
• The payroll summary for December 31 for Waters Co. revealed total earnings of $80,000.
• It is necessary for a company to use the same depreciation method for all of its depreciable assets.
• Ȁ ⸀Ā ЀĀ ȀĀ⸀Ā ᜀ Ā ᜀ Ā ᜀ Ā ᜀ Ā ᜀ Ā ᜀ Ā ᜀ 䀀 Ā Ȁ ⸀Ā ЀĀ ȀĀ⸀Ā ᜀ Ā ᜀ Ā ᜀ Ā ᜀ Ā ᜀ Ā ᜀ Erin deposits $15,000 in a bank account in the name of Erin’s Lawn Service.
• Explain whether each of the following would usually be used in a computerized accounting system and why or why not.

Record the foregoing transactions of the seller in the sequence indicated below. Oct. 8 Purchased merchandise, $10,000, terms FOB shipping point, 2/15, n/30, with prepaid freight charges of $525 added to the invoice. On March 29, customers who owe $10,500 on account to Sonic Sales Company submit payments of $4,250. Closing entries for a merchandising business are not similar to those for a service business.

A summary of selected ledger accounts appear below for Alberto’s Plumbing Services for the current calendar year-end. Use the adjusted trial balance for Stockton Company below to answer the questions that follow. On the work sheet, the capital and drawing account balances are extended to the Balance Sheet columns. The work sheet is not considered a part of the formal accounting records. A tenant paid 6 months’ rent in advance when he moved in on the first day of the month. No entry was made on the last day of the month.

Another group of shareholder activists is typified by Carl Icahn. Various strategies, some controversial, may be employed. In the 1980s, some investors bought shares and threatened the target company’s leadership with a hostile https://simple-accounting.org/ takeover. The investors used these threats to force the company to buy back their shares at a premium. This practice was termed “greenmail” and is generally condemned as enriching some shareholders at the expense of others.

Test Bank for Managerial Accounting Tools for Business Decision Making 7th Edition by Weygandt Kimme

Check for $690 incorrectly recorded by the company as $960. Consider the following information from the cash account.

An automated billing tool that acts as a Record of Merchant also takes care of the day-to-day aspects of refunds and chargebacks. For businesses that are growing quickly, this becomes more time-consuming and complicated with every new customer that’s onboarded without automated billing. Alert them if a payment fails and give them time to rectify it. Of course, once your business starts growing, dunning management becomes even more critical. You can’t manually chase payments forever, and the more customers you get, the list of those missing their payments is sure to grow. “A combination of one-time purchases, subscriptions, and usage-based consumption pricing is critical to driving digital growth,” he says.