Spring Semester Advanced Accounting Techniques

Published: 11 months ago

Spring Semester Advanced Accounting Techniques

16. 118.Boneta City College sold season tickets for the 2016 football season for $250,000. A total of 8.

118.Boneta City College sold season tickets for the 2016 football season for $250,000. A total of 8 games will be played during September, October and November. In September, three games were played. The adjusting journal entry at September 30

a.is not required. No adjusting entries will be made until the end of the season in November.

b.will include a debit to Cash and a credit to Ticket Revenue for $62,500.

c.will include a debit to Unearned Ticket Revenue and a credit to Ticket Revenue for $93,750.

d.will include a debit to Ticket Revenue and a credit to Unearned Ticket Revenue for $83,333.

119.Boneta City College sold season tickets for the 2016 football season for $250,000. A total of 8 games will be played during September, October and November. In September, two games were played. In October, three games were played. The balance in Unearned Ticket Revenue at October 31 is

a.$0.

b.$50,000.

c.$93,750.

d.$156,250.

120.Boneta City College sold season tickets for the 2016 football season for $250,000. A total of 8 games will be played during September, October and November. Assuming all the games are played, the Unearned Ticket Revenue balance that will be reported on the December 31 balance sheet will be

a.$0.

b.$93,750.

c.$156,250.

d.$250,000.

121.At March 1, 2016, Milo Corp. had supplies on hand of $600. During the month, Milo purchased supplies of $1,300 and used supplies of $1,400. The March 31 adjusting journal entry should include a

a.debit to the supplies account for $1,400.

b.credit to the supplies account for $600.

c.debit to the supplies account for $1,300.

d.credit to the supplies account for $1,400.

122.Grand Slam Company purchased equipment for $9,600 on January 1, 2016. The company expects to use the equipment for 4 years. It has no salvage value. Monthly depreciation expense on the asset is

a.$0.

b.$200.

c.$2,400.

d.$9,600.

123.Cornhusker Supplies Inc. purchased a month insurance policy on March 1, 2016 for $2,640. At March 31, 2016, the adjusting journal entry to record expiration of this asset will include a

a.debit to Prepaid Insurance and a credit to Cash for $2,640.

b.debit to Prepaid Insurance and a credit to Insurance Expense for $275.

c.debit to Insurance Expense and a credit to Prepaid Insurance for $220.

d.debit to Insurance Expense and a credit to Cash for $220.

124.Blue Chip Investments purchased an month insurance policy on May 31, 2016 for $3,480. The December 31, 2016 balance sheet would report Prepaid Insurance of

a.$0 because Prepaid Insurance is reported on the Income Statement.

b.$2,030.

c.$1,450.

d.$3,480.

125.At March 1, Payday Inc. reported a balance in Supplies of $250. During March, the company purchased supplies for $800 and consumed supplies of $700. If no adjusting entry is made for supplies

a.owner’s equity will be overstated by $700.

b.expenses will be understated by $800.

c.assets will be understated by $150.

d.net income will be understated by $700.

126.Petite Inc. pays its rent of $57,000 annually on January 1. If the February 28 monthly adjusting entry for prepaid rent is omitted, which of the following will be true?

a.Failure to make the adjustment does not affect the February financial statements.

b.Expenses will be overstated by $4,750 and net income and owner’s equity will be understated by $4,750.

c.Assets will be overstated by $9,500 and net income and owner’s equity will be understated by $9,500.

d.Assets will be overstated by $4,750 and net income and owner’s equity will be overstated by $4,750.

127.On January 1, 2015, Miraz Company purchased furniture for $7,800. The company expects to use the furniture for 3 years. The asset has no salvage value. The book value of the furniture at December 31, 2016 is

a.$0.

b.$2,600.

c.$5,200.

d.$7,800.

17. On May 22. Jarrett Company borrows $7, 500 from Fairmont Financing, signing a 90-day, 8%. $7, 500...

On May 22. Jarrett Company borrows $7, 500 from Fairmont Financing, signing a 90-day, 8%. $7, 500 note. What is the journal entry needed to record the payment of the note by Jarrett Company on the maturity date7 Debit Notes Payable $7, 650: credit Cash $7.650. Debit Notes Payable $7, 500; credit Cash $7, 500 Debit Notes Payable $7, 500; debit Interest Expense $150: credit Cash $7, 650. Debit Notes Payable $7, 500; credit Interest Expense $150; credit Cash $7, 350. Debit Cash $7, 650; credit Interest Revenue $150: credit Notes Receivable $7, 500.

18. Aunt Ethel's Fancy Cookie Company manufactures and sells three flavors of cookies: Macaroon, Sugar,...

Aunt Ethel's Fancy Cookie Company manufactures and sells three flavors of cookies: Macaroon, Sugar, and Buttercream. The batch size for the cookies is limited to 1,000 cookies based on the size of the ovens and cookie molds owned by the company. Based on budgetary projections, the information listed below is available:

Total overhead costs and activity levels for the year are estimated as follows:

1) Determine the activity-cost-driver rate for packaging costs.

2) Using the ABC system, for the sugar cookie, compute the estimated overhead costs per thousand cookies.

3) Using the ABC system, for the sugar cookie, compute the estimated operating profit per thousand cookies.

4) Using a traditional system (with direct labor hours as the overhead allocation base) for the sugar cookie, compute the estimated overhead costs per thousand cookies.

5) Using a traditional system (with direct labor hours as the overhead allocation base) for the sugar cookie, compute the estimated operating profit per thousand cookies.

6) Explain the difference between the profits obtained from the traditional system and the ABC system. Which system provides a better estimate of profitability? Why?

19. Solve All Answers,I give a positive rating Rollers company is incorporated on January 1, 2018. Compa

Solve All Answers,I give a positive rating

Rollers company is incorporated on January 1, 2018. Company is authorized to issue 160,000 shares of $6 par value. Following transactions related to stockholder's equity is given below: Shares issued Shares issued Net income Dividend paid | Treasury stock purchased 16.000 a $8 per share 32,000 @ $9 per share $160,000 $80,000 3,500 shares @ $11 per share The balance of stockholder's equity at end of year 2018 is: a. $416,000 b. $457,500 c. $576,000 d. $489,500 The information regarding the fixed assets of Broadwing Company as of December 31, 2019 is provided below: $80,000 $105,000 Expected future cash flows from the fixed assets Carrying value of fixed assets Present value of expected future cash flows from the fixed assets Selling price of fixed assets $68,000 $90,000 What is the amount of impairment loss under US GAAP? a. $10,000 b. $25,000 c. $23,000 d. $15,000 The accountant of ABC Company is preparing a bank reconciliation statement for the month of October. The bank statement shows a balance of $9,719 while the ledger balance is $7,261. He compiles the following information: c Description a Check #3119 recorded at $1,830 b NSF checks EFT for insurance deducted d EFT for rent collected e Service charge deducted f Outstanding checks Lg Deposit in transit h Notes collected by bank Amount $1,380 $500 $336 $775 $15 $4,036 $3,402 $1,450 Compute the adjusted bank balance for the month of October. a. $10,520 b. $9,070 c. $9,085 d. $8,749 The following information pertains to Machine A purchased by Axa Incorporation. Orginal Cost $30,000 Residual Value $3,000 Estimated Life 5 years Accumulated Depreciation (based on straight line depreciation) $21,600 (4 years) Machine A was sold on January 1 for $9,000. While preparing the journal entry for disposal, the loss/gain on sale of equipment will be recorded at what amount? a. Loss on sale of equipment $600 b. Gain on sale of equipment $600 c. Loss on sale of equipment $30.00 d. Loss on sale of equipment $21,600 The National Bank collected $3,000 including $300 interest on behalf of Z Inc. from one of its debtors on May 29, 2017. No entry for this collection was made by Z Inc. till May 31, 2017 How will Z Inc. have adjusted the collection of $3,000 by National Bank on a bank reconciliation prepared on May 31, 2017? a. Add $2,700 to cash balance on May 31, 2017, as per bank statement. b. Add $3,000 to cash balance on May 31, 2017, as per bank statement. c. Add $3,000 to cash balance on May 31, 2017, as per books d. Add $2,700 to cash balance on May 31, 2017, as per books.

20. Why would a sole proprietor/ partnership need to prepare a budget, and what type of budget would...

Why would a sole proprietor/ partnership need to prepare a budget, and what type of budget would be needed? 

Joe Bloggs Pty Ltd has just gained a major contract, which will generate additional income over a 2 year period, but will also require extra resources. At the same time, however, they are planning to expand into website sales. What type of budget/s would they need to prepare, and why? What methods could they use to fund the website expansion? 

When setting budgets it is a good idea to make contingency plans. What are contingency plans and why are they necessary? 

You are a sales manager for a large hospitality operation, and required to review and provide feedback via email on the budget document. What process would you follow, and what are some of the questions you would ask in order to provide valuable feedback? 

Explain and discuss the things that might be taken into consideration when prioritising income and expenditure requirements for a budget. 

Why should employees be involved in setting and monitoring the budget? 

Budgets are used to allocate resources for work. What are some of the resources that might be required in a hospitality operation? List at least 8 different resources that might be allocated via the budget. 

In what ways might information relating to budgets and resource allocations be communicated to staff? 

What is the importance of collecting, filing and maintaining accurate financial/ resource allocation records?

21. 1. Which of the following information is not specifically a required disclosure of IAS 1? (a) Name..

1. Which of the following information is not specifically a required disclosure of IAS 1? (a) Name of the reporting entity or other means of identification, and any change in that information from the previous year. (b) Names of major/significant shareholders of the entity. (c) Level of rounding used in presenting the financial statements. (d) Whether the financial statements cover the individual entity or a group of entities. 2. Which one of the following is not required to be presented as minimum information on the face of the balance sheet, according to IAS 1? (a) Investment property. (b) Investments accounted under the equity method. (c) Biological assets. (d) Contingent liability.

22. answer and show your solution Problem 17-12 (AICPA Adapted) On January 1, 2019, Bliss Company purcha

answer and show your solution Company's outstanding ordinary shares for P4,000,000 Bliss Company is the largest single shareholder in Red Company and Bliss Company’s officers are a majority on Red Company’s board of directors. Red Company reported net income of P5,000,000 for the current year and paid dividends of P1,500,00O. On December 31, 2019, what amount should be reported investment in associate? as 4,350,000 b. 4,500,000 4,000,000 d. 3,850,000 a. c. Problem 17-13 (AICPA Adapted) On January 1, 2019, Small Company purchased 25% of Big Company. No "excess" resulted from the purchase. Small Company appropriately carried this investment at equity and the carrying amount of the investment was P1,900,000 on December 31, 2019. Big Company reported net income of P1,200, 000 for the current year and paid cash dividend of P480,000 on December 31, 2019. What amount did Small Company pay for the 25% interest in Big Company? a. 2,320,000 b. 2,020,000 c. 2,080,000 d. 1,720,000

23. preparing adjustments on March 31 prior to financial statement preparation:

1. The March 31 amount of computer supplies still available totals $2,005.


2. Three more months have expired since the company purchased its annual insurance policy at a $2,220 cost for 12 months of coverage.


3. Lyn Addie has not been paid for seven days of work at the rate of $125 per day.


4. Three months have passed since any prepaid rent has been transferred to expense. The monthly rent expense is $825.


5. Depreciation on the computer equipment for January 1 through March 31 is $1,250.


6. Depreciation on the office equipment for January 1 through March 31 is $400.


7. The March 31 amount of merchandise inventory still available totals $704.

24. Accounting has its own vocabulary and basic relationships.

Using accounting vocabulary

Accounting has its own vocabulary and basic relationships.

Requirement

1. Match the accounting terms on the left with the corresponding definitions on the right.

25. During the past five years, you owned two stocks that had the following annual rates of return:...

During the past five years, you owned two stocks that had the following annual rates of return:

Year Stock T Stock B

1 0.19 0.08

2 0.08 0.03

3 –0.12 –0.09

4 –0.03 0.02

5 0.15 0.04

a. Compute the arithmetic mean annual rate of return for each stock. Which stock is most desirable by this measure?

26. The trial balance of Terry Manning Fashion Center contained the

The trial balance of Terry Manning Fashion Center contained the following accounts at

November 30, the end of the company’s fiscal year.



Adjustment data:

1. Store supplies on hand totaled $2,500.

2. Depreciation is $9,000 on the store equipment and $5,000 on the delivery equipment.

3. Interest of $4,080 is accrued on notes payable at November 30.

4. Merchandise inventory actually on hand is $44,400.

Instructions

(a) Enter the trial balance on a worksheet, and complete the worksheet.

(b) Prepare a multiple-step income statement and an owner’s equity statement for the year, and a classified balance sheet as of November 30, 2010. Notes payable of $30,000 are due in January 2011.

(c) Journalize the adjusting entries.

(d) Journalize the closing entries.

(e) Prepare a post-closing trialbalance.

27. Jennifer Company sells both chairs and tables at the following per unit data:

Jennifer Company sells both chairs and tables at the following per unit data:

Assuming $118,580 fixed costs, what is the total revenues in chairs Jennifer Company needs to break even?

a. $154,800

b. $169,400

c. $175,200

d. $188,600

28. Capitalization of Interest McPherson Furniture Company started c

Capitalization of Interest McPherson Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $5,000,000 on January 1, 2010. McPherson expected to complete the building by December 31, 2010. McPherson has the following debt obligations outstanding during the construction period.

Construction loan—12% interest, payable semiannually, issued

December 31, 2009 $2,000,000

Short-term loan—10% interest, payable monthly, and principal payable

at maturity on May 30, 2011 1,600,000

Long-term loan—11% interest, payable on January 1 of each

year. Principal payable on January 1, 2014 1,000,000

(Carry all computations to two decimal places.)

(a) Assume that McPherson completed the office and warehouse building on December 31, 2010, as planned at a total cost of $5,200,000, and the weighted average of accumulated expenditures was $3,800,000. Compute the avoidable interest on this project.

(b) Compute the depreciation expense for the year ended December 31, 2011. McPherson elected to depreciate the building on a straight-line basis and determined that the asset has a useful life of 30 years and a salvage value of $300,000.

29. In a factory guaranteed wages at the rate of Rs.18.00 per hour are paid in a 48-hour week. By time...

In a factory guaranteed wages at the rate of Rs.18.00 per hour are paid in a 48-hour week. By time and motion study it is estimated that to manufacture one unit of a particular product 20 minutes are taken. The time allowed is increased by 25%. During one week Abraham produced 180 units of the product. Calculate his wages under each of the following methods: (a) Time rate, (b) Piece-rate with a guaranteed weekly wage, (c) Halsey premium bonus and (d) Rowan premium bonus.

30. Percentage-of-Completion Analysis Espiritu Construction Co. has used the cost-to-cost...

Percentage-of-Completion Analysis

Espiritu Construction Co. has used the cost-to-cost percentage-of-completion method of recognizing revenue. Tony Espiritu assumed leadership of the business after the recent death of his father, Howard. In reviewing the records, Tony finds the following information regarding a recently completed building project for which the total contract was $2,000,000.

Espiritu wants to know how effectively the company operated during the last 3 years on this project and, because the information is not complete, has asked for answers to the following questions.

1. How much cost was incurred in 2008?

2. What percentage of the project was completed by the end of 2008?

3. What was the total estimated gross profit on the project by the end of 2008?

4. What was the estimated cost to complete the project at the end of 2008?