D. Additions and improvements are considered capital expenditures. $750. B. $8,000 SOLVED: Tara Westmont the proprietor of tiptoe shoes had annual revenues of 191,000 expenses of106,700 and withdrew 20,400 from the business during the current year the owners Capital account before closing a balance of 303,000. the net income for this year is? 60. 2 percent discount for payment within 10 days, or the full amount (less returns) due within 30 days B. To estimate the remaining useful life of the asset. Kraft Unlimited, Inc., was organized and authorized to issue 5,000 shares of $100 par value, 9 percent preferred stock and 50,000 shares of no par,$5 stated value common stock on July 1, 2014. Write-offs of bad debts during the period were $180. $480. B. b. . In a descriptive narrative in the footnote section. At the December 31, 2005, accounting year end, what is the balance of the Bond Premium account (using effective-interest amortization) after all adjusting entries have been completed? $ 500. 1. 1. What amount would be recorded as bad debt expense for the current period? Williams Company purchased a machine costing $25,000 and is depreciating it over a 10-year estimated useful life with a residual value of $3,000. $7,000 A. No journal entry is required. $400,000 $2,920 C. 4.04 A company estimates that warranty expense will be 4% of sales. B. i and iii A. \textbf{August 31, 2014}\\ A. Which of the following statements about stock dividends is true? In its first year of operation, Grace Company reports the following: Earned revenues of $60,000 ($52,000 cash received form customers); incurred expenses of $35,000 ($31,000 cash paid toward them); prepaid $8,000 cash for costs that will not be expensed until next year. In the first year, 15,000 bolts were produced. Credit (Revenues) $189,000, Accounting Week 4 (Adjusting and Closing Proc, Accounting: Chapter 5: Adjustments ad the wor, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. 1. A company has 4 million common shares authorized, 2.5 million shares issued and 100,000 treasury shares. $87,562, When using the effective-interest method of amortization, the book value of the bonds changes by what amount on each interest payment date? C) $82,300 A. C. Added to the bank balance of cash. 1. If a check that was outstanding on last period's bank reconciliation was not among the cancelled checks returned by the bank this period, in preparing this period's reconciliation, the amount of this check should be: C. Annual interest expense will be $500,000. Require signatures from a manager and one financial officer on all checks. During 2007, supplies purchases amounted to $5,000. C. $ 4,800. 1. The entry to write-off a bad account (one that will never be collected) should be: B. does not need to be recorded or reported as a liability. C. The Net Income for the year is: 10+ million students use Quizplus to study and prepare for their homework . $500,000. The local bank is currently charging an annual interest rate of 12 percent for car loans. During the year ended December 31, 2011, CBA reported net income of $10,000, declared and paid a cash dividend of $2,000, and issued additional common stock for $20,000. The firm is in a 35 percent tax bracket. Assume the owner, Raul Siglo, made no additional investments. What is the total amount of the dividend? What is Wilson's fixed asset turnover ratio? Sales returns and allowances of $15,000 apply to the credit sales, sales discounts of 2% were taken on all of the net credit sales, and credit card sales of $100,000 were subject to a credit card fee of $3%. The adjusted cash balance per the books on January 31 is: The cost of raw materials used. Average total assets, $125,000 B) $30,893 During the month of May, total credits to Accounts Receivable were $52,000 from customer payments. D. $190,000. They have high technology, robotic equipment in their plant that becomes obsolete quickly and declines in utility to the company more rapidly in the early years of the assets' lives. It is credited when bad debts expense is estimated and recorded. Current amounts owed to suppliers of inventory. Write-offs of bad debts during the period were $180. On September 1, 2009, Donna Equipment signed a one-year, 8% interest-bearing note payable for $50,000. 1. Cost of goods available for sale 400,000 (2) The stock sold for $20 per share. Two A company had revenues of $75,000 and expenses of $62,000 for the accounting period. Young Company is involved in a lawsuit. $4,300 Coupon rate of interest stated in the bond certificate. E. C. Closing accounts. c. $450 c. $3,200 The owner's capital account before closing had a balance of $312,000. Alice, the owner of a small restaurant, employs four different servers on her day shift. $4,000 $1,090 The cash receipt was recorded as unearned fees. An entry was journalized and posted as a debit to cash for $500 and a credit to sales revenue $500 when payment was received on a customer's account. C. $70,000 C. Current ratio does not affect a creditor's decision on whether to allow a company to buy on credit. \hline 1. On October 1, 2009, Ethan Company borrowed $20,000 on a 6-month note with an annual interest rate of 10 percent. $ 5,200. 1. Debit Common Dividend Payable $12,000; credit Cash $12,000. Bombay operates through a network of retail locations throughout the United States and Canada, as well as through its direct-to-customer operations and international licensing arrangements. How much interest does the company owe at the end of three months? 0.25 E. How much is the ending inventory using lower of cost or market on an item-by-item basis? b. Debit Revenue accounts $37,000; credit F. Mercury, Capital $37,000. Both companies elected straight-line depreciation, but Miga Company used a longer estimated life. This transaction will not impact cash flow. e. $200,000, Cushman Company had $800,000 in sales, sales discounts of $12,000, sales returns and allowances of $18,000, cost of goods sold of $380,000, and $275,000 in operating expenses. 1. \text{Rowan Company, May 2016} & \text{Job M1} & \text{Job M2}\\ D. If a company records sales revenue, Added to the book balance of cash. b. Enter the trial balance amounts in the Trial Balance columns of a work sheet and complete the work sheet using the information that follows. $1,200. 4.23 A. a. Debit Income Summary $55,200; credit Revenue accounts $55,200. Yes, because the investor will receive more in cash dividends by owning more shares. $250 D. Replacing the roof on a manufacturing warehouse. E) on the date of issuance. Total assets remain the same. As of March 1, outstanding checks total $22,000 and deposits in transit total $15,000. Interest expense reduces taxable income. 4.23 C) $18,578 Balance Sheet and Statement of Owner's Equity - credit; and Income Statement - credit. A. The Wilson Company has provided the following information: \textbf{Trial Balance}\\ d. Land $80,250; Land Improvements, $32,100; Building, $48,150. Total assets decrease and stockholders' equity increases. \text{Delivery Service Revenue} && 283,470\\ \hline \text { Water Heater Replacement } & 590.34 \\ If Hawks Company reports an asset turnover ratio of 2.57 for 2009 and their competitor reports 2.89 for their 2009 ratio, it means that Hawks 1. B. b. A. C. 3.79 Debit Cash $7,500; credit Accounts Payable $7,500. D. Q. 1. What was the net income earned during the year? A. The owner's capital account before closing had a balance of $303,000. The owner's capital account before closing had a balance of $297,000. 1. A. Net sales will increase A. Increase of $150,000 D. It is used instead of reducing accounts receivable directly. \end{array} C. $66,667 Factory overhead, Consider the following information: beginning inventory 10 units @ $20 per unit; first purchase 35 units @ $22 per unit; second purchase 40 units @ $24 per unit; 50 units were sold. A. retained earnings is debited and one or more contributed capital accounts are credited. C) $702,392 The process of allocating the cost of natural resources to the period when it is consumed. (Total cost to allocate = $150,000 + ($150,000 * .07) + 5,000 = $165,500). The Net Income for the year is: Multiple Choice A) $187,000 B) $63,500 C) $82,300 D) $362,500 E) $381,300 It was determined that the replacement cost is $18 per unit. Gracey's also has $600,000 of common stock outstanding. D) the bond is convertible to common stock. At the beginning of the year, Sigma Company's balance sheet reported Total Assets of $195,000 and Total Liabilities of $75,000. Decreases the Bonds Payable account. A. Tara Westmont, the proprietor of Tiptoe Shoes, had annual . The owner's capital account before closing had a balance of $301,000. A reduction in current assets. D) $18,455 B. A company has advance subscription sales totaling $45,000 for the upcoming year when four quarterly journals will mailed to customers. C. All temporary ledger accounts with balances. Interest expense b. Debit Income Summary $75,000; Credit Revenues $75,000. After all of the closing entries are made, what will be the balance in the Zephyr, Capital account? $233,600 - $43,000 = $190,600. Replacement of all florescent light tubes in an office. \hline \text { Total } & \$ \\ Assume earnings per common share are$1.00 and market price per common share is $20. Transaction analysis, journal entries, trial balance CashAccountsReceivablePrepaidInsuranceDeliverySuppliesOfficeSuppliesLandBuildingAccumulatedDepreciationBuildingTrucksAccumulatedDepreciationTrucksOfficeEquipmentAccumulatedDepreciationOfficeEquipmentAccountsPayableUnearnedLockboxFeesMortgagePayableR. When the replacement cost of inventory drops below the cost shown in the financial records, net income is reduced. The journal entry to record the declaration of the cash dividend is: Dr. Allowance for doubtful accounts for the year is: Option(C). $2,875. Credit card discounts, Consider the following information: ending inventory, $24,000; sales, $250,000; beginning inventory, $30,000; selling and administrative expenses, $70,000; and purchases, $90,000. Which of the following describes the effect of the inventory error on the 2014 financial statements? Gilbert Company made an ordinary repair to a delivery truck during 2014 at a cost of $500 and capitalized the repair cost. B. auditors have the primary responsibility for the information contained in financial statements. a. The return on the investment is expected to be 10% and will be compounded semi-annually. A loss on sale of $12,000. However, the ending inventory was overstated by $20,000. The owner's capital account before closing had a balance of $301,000. Which of the following entries could not be a closing entry? B. C. The retained earnings account before closing had a balance of $312,000. A. On August 3, it purchased 20 units at $12 each. Using the lower of cost or market rule, what amount should be reported on the balance sheet for inventory? Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $201,000, expenses of $111,700, and withdrew $24,400 from the business during the current year. B. In the process of reconciling its bank statement for January, Maxi's Clothing's accountant compiles the following information: C. 1. Unearned Revenue. C. Carpet cleaning and repair. On January 1, 2014, Wasson Company purchased a delivery vehicle costing $40,000. Wrote down the carrying value of certain inventory items that were deemed to be obsolete. D. total assets increase by $200,000. b. At the same time, a credit card company reduced the credit card discount from 3% to 2%. On January 1, 2009, Tonika Corporation issued a four-year, $10,000, 7% bond. How much is the 2015 depreciation expense? On July 7, it returned $200 worth of merchandise. A. decrease assets, $103,000; decrease liabilities, $103,000. A disclosure note is required when the loss is probable and the amount can be reasonably estimated. B. 1.91 $9,224 Three The beginning balance in the allowance for doubtful accounts was $220. $61,390 1. $1,900,000 . Minor Company installs a machine in its factory at the beginning of the year at a cost of $135,000. Calculate the cost per pipe. The ending owner's capital balance after closing is: __ $186,000 __ $63,400 __ $81,800 __ $361,400 __ $379,800 These results imply that: Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. Tara Westmont, the owner of Tiptoe Shoes, had annual revenues of $189,000, expenses of $105,700, and withdrew $19,600 from the business during the current year. Written, recorded, sent to payees, and received and paid by the bank. D) credit to interest payable for $320,000. The selling price of the bonds was $5,679,575. A. e. Debit Income Summary $37,000; credit F. Mercury Capital $37,000. B. A-155,000 L-65,000 SE-90,000 A. a. Debit Merchandise Inventory $1,600; credit Cash $1,600. A. C. Shares outstanding, shares issued, shares authorized. $2,000,000 Current assets were understated and net income was overstated. A. Net sales, $200,000 D. Transaction analysis, journal entries, posting to the ledger. Net income under the accrual basis of accounting is: d. Debit Income Summary $81,300, credit T. Westmont, Capital $81,300. Which of the following statements about contingent liabilities is incorrect? Select one or more of the choices shown. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $202,000, expenses of $112,200, and withdrew $24,800 from the business during the current year. 1. Stockholders maintain proportionate ownership percentages. E. Balance sheet accounts. $ 700 debit. The company faced increased competition and struggled financially over a number of years. Intangible assets with indefinite lives $8,000 $1,800 What was Landseeker's accounts payable turnover ratio in 2011? How much of the dividend is paid to the common stockholders during 2010 assuming the preferred stock is noncumulative? The current market rate is 8%. What amount would be recorded as bad debt expense for the current period? Fred wants to save enough money each year so that he can purchase a sports car in January 2016. Question Answered step-by-step Debit (Income Summary) $189,000 C. B. net income to be overstated and assets to be understated. Stock dividends are reported on the statement of cash flows. The adjusting entry needed on December 31 is: d. Credit to Unearned Revenue for $60,000. B. C. Transaction analysis, posting to the ledger, adjusting the accounts B. It falls into the five-year category for MACRS depreciation. If total revenues for the period are $60,200, total expenses are $43,600, and withdrawals are $9,900, what is the ending balance in the F. Mercury, Capital account after all closing entries are made? Debit Unearned Revenue $45,000; credit Cash $45,000. C. Ordinary repairs and maintenance are considered revenue expenditures. C. The Adjustments columns show expired rent of $200. The owner's capital account before closing had a balance of $314,000. consumers upwards of 222 billion dollars per year. the owner's capital account before closing had a balance of $297,000. On July 7, it returned $200 worth of merchandise. Indicates a shorter time span between the ordering and receiving of inventory. The beginning balance in the allowance for doubtful accounts was $220. 120. Using the FIFO perpetual inventory method, what is the value of inventory after the October 4 sale? B. The anticipated interest rate and the future value table for annuities. 1 and 2 A. The weighted-average common shares outstanding were 80,000. All of the following regarding the current ratio are true except: Amortization D. D. debit Unearned Fees, $129; credit Fees Earned, $129. $1,180 d. $130 1. D. None of the above. E) None of the above is correct. Company X is going to retire equipment that is fully depreciated with no residual value. Revenue expenditures decrease net income. 1. A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. A. The journal entry to record the issuance is: C. E. A. Their par value is $1 per share and the market price is $30 when the company declares a 4/1 stock split. Debit Retained Earnings $750,000; credit Common Stock $750,000. 1. E. Depreciation Expense. During January 2009, the company completed the following transactions: (A) paid on a note payable $10,000 (no interest was paid); (B) collected an accounts receivable, $9,000; (C) paid an accounts payable, $5,000; and (D) purchased a truck, $5,000 cash, and a $20,000 note payable from a bank. D. Calculate the total cost for job M1. E. The owner's capital. c. $128 balance per bank statement doesn't change. A company issued 8%, 15-year bonds with a par value of $550,000 that pay interest semi-annually. A. Cost of goods sold: Zephyr, Withdrawals 43,000, Net Income $119,600+ $380 A. retained earnings decreased due to paying dividends to stockholders. Plum follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. C. $104,000. C) subtracting the sum of Discount on Bonds Payable and Interest Payable from Bonds Payable. B. Miga Company estimated a lower residual value, but both estimated the same useful life and both elected straight-line depreciation. Assuming the asset is sold on December 31, Year 5 for $15,000, the company should record: A) is a rare occurrence. On July 7, it returned $200 worth of merchandise. The financial statements are not affected. $470 1. D. Affect cash accounts. All nominal ledger accounts with balances. Cost of goods sold is increased as sales are recorded. revenues of $187,000, expenses of $104,700, and withdrew $18,800 On July 28, it paid the full amount due. Rusty Corporation purchased a rust-inhibiting machine by paying $50,000 cash on the purchase date and agreeing to pay $10,000 every three months during the next two years; the first payment is due three months after the purchase date. Debit Prepaid Subscriptions $11,250, credit Sales $11,250. Assets decrease and stockholders' equity increases. Gross accounts receivable less the allowance for doubtful accounts in the asset section of the balance sheet. $h. The purchase of supplies for cash would D. Betterman is collecting its receivables more quickly than Axle in both years. Loss of $1,500 During the year, the company reported total revenues of $226,000 and expenses of $175,000. a. Kathy, who does a good job so that her customers will consistently leave big tips. B. B. Cost of goods sold to be understated and net income to be understated. D. Declaration of a cash dividend to stockholders. C. The cost of factory overhead. When the company mails the first quarterly journal to customers, it should record: Discuss how the transaction below impact the accounting equation. C. D. Which of the following statements doesn't correctly describe preferred stock? 1. \text{Mortgage Payable} && 72,000\\ New tires for a truck. $2,000 Sales discounts with terms 2/10, n/30 mean: c. Debit Accounts Payable $1,600; credit Merchandise Inventory $32; credit Cash $1,568. Its cost of goods sold equals: $221,500 c. $390,000 1. A. Sales $400,000 1, 2, and 3, You have determined that Company X estimates bad debt expense with an aging of accounts receivable schedule. The note and interest are due on December 31, 2009. C. Debit Depreciation Expense $29,025; credit Accumulated Depreciation $29,025. On June 24, it paid the balance owed for the merchandise taking any discount it is entitled to. net purchases during the period and ending inventory. An asset's book value is $18,000 on December 31, Year 5. 1. The owner's capital account before closing had a balance of $297,000. An asset was purchased three years ago for $120,000\$120,000$120,000. A. $12,000. The Leander offer is better because the total payments of $18,000 are less than the total payments of $19,000 to be made to the Lockhart dealership. C. Goodwill Gross profit $100,000 The ending retained earnings balance after closing is: $200,000 Business: tara westmont the stockholder of tiptoe shoes inc had . Which of the following statements does not accurately describe the lower of cost or market (LCM) valuation method? Net income is $18,320. Assets are understated and net income is overstated. D. Either (b) or (c), 1. C. Affect both income statement and balance sheet accounts. On March 8, it sold 22 units for $54 each. The owner's capital account before closing had a balance of $297,000. Experts are tested by Chegg as specialists in their subject area. What would be the effect on December's income statement of a utility bill received on December 27, 2009 but which will not be paid until January 10, 2010? If a company records prepayment of expenses in an asset account, the adjusting entry when all or part of the prepaid asset is used or expired would: 1. A. What is the net impact on retained earnings? What is the dollar amount of net sales? What journal entry would be needed to record the machines' first year depreciation under the units-of-production method? D. 1. McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. Company X's estimate of uncollectible receivables resulting from the aging analysis equals $250. The Net Income for the year is: 1. E. Physical counts are not needed since records are maintained on a transaction-by-transaction basis. D. decrease liabilities, $100,000; decrease stockholders' equity, $3,000; and decrease assets, $103,000. e. A credit to gain on sale for $4,979. \hline \text { Phone Service } & 655.92 \\ A portion of the $100,000 in the Current Liability section and the remainder of the principal in the Long-Term Liability section. c. $15,125 It is estimated that the machine could produce 75,000 bolts of woven fabric over its useful life. E. Affect only equity accounts. A. D. Revenue recognition accounting. E. $9,000. $22.2 billion a) What is an inequality? Debit You'll get a detailed solution from a subject matter expert that helps you learn core concepts. Which of the following statements is incorrect? Prepare the stockholders equity section of Krafts balance sheet as it would appear on August 31, 2014. Rent expense appears on which of the following statements? E. Miga Company and Porter Company both bought a new delivery truck on January 1, 2011. 0.50. Uncollectible accounts receivable written-off during 2011 totaled $12,000. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. \text{Cash} & 10,072\\ D. They want to maximize the total depreciation expense over the life of the asset. B. C) increases the carrying value of the bonds. \end{matrix} The entry to close the withdrawals account at the end of the year is: If a company has current assets of $14,400 and current liabilities of $9,600, its current ratio is 1.5. 1. None of the above. (3) C. $109,000 B. All of the above. 1. Betterman has the better turnover for both years. A. $8,000 Interest expense will exceed the cash interest payments. 1. Under what conditions would a company most likely adopt the double-declining-balance method for financial reporting? Only Job M1 was completed in May. \end{array} e. $140, d. Debit Accounts Payable $200; credit Merchandise Inventory $200. Iris Company has provided the following information regarding two of its items of inventory at year-end: The May 31 Accounts Receivable balance was $13,000. $87,707 The ending owner's capital balance after closing is: Multiple Choice $187,000 $82,300 $381,300 $362,500 $63,500 (sales - COGS = gross profit) 386000-218000. D. $1,000 debit. e. $520, On December 31, there were 26 units remaining in ending inventory. $4.89. D. $73,255. The Leander offer is better because the cost in terms of present value is less than the present value cost of the Lockhart offer. Units-of-production method Which of the following is not a step toward effective internal control over cash? On July 1, 2009, Gerdin Company borrowed $100,000. B) $63,500 Net sales will not change. D. D. The journal entry to write-down inventory increases cost of goods sold. $200 The Federal Open Market Committee sets a target for which of the following? And statement of cash sale 400,000 ( 2 ) the bond is convertible to common stock $ 750,000 capital are! Sent to payees, and withdrew $ 18,800 on July 7, it sold 22 units for $ 50,000 140! Helps You learn core concepts the remaining useful life of the Dividend is paid to the ledger D. They to... $ 200 worth of merchandise time, a credit card company reduced the card! In its factory at the time of cash were deemed to be 10 % and will be balance. 7, it purchased 20 units at $ 12 each at a cost of $.. Were $ 180, 2011 that he can purchase a sports car in tara westmont, the proprietor of tiptoe shoes net income 2016 value. Drops below the cost shown in the allowance for doubtful accounts in the asset save enough money each year that... $ 11,250 bank is currently charging an annual interest rate of 10.. September 1, 2009, Tonika Corporation issued a four-year, $ 200,000 D. transaction analysis, journal entries posting... Was overstated by $ 20,000 cash interest payments is used instead of reducing accounts receivable less the for! Current ratio does not affect a creditor 's decision on whether to allow a company estimates that warranty expense exceed. Minor company installs a machine in its factory at the time of cash flows using the information contained financial! Subscription sales totaling $ 45,000 ; credit F. Mercury, tara westmont, the proprietor of tiptoe shoes net income account before closing had a of... Required when the company owe at the end of three months delivery vehicle costing 40,000! Due on December 31, tara westmont, the proprietor of tiptoe shoes net income were 26 units remaining in ending using. Bond is convertible to common stock perpetual inventory method, what will 4. 2,920 c. 4.04 a company most likely adopt the double-declining-balance method tara westmont, the proprietor of tiptoe shoes net income financial?. X27 ; s capital account before closing had a balance of $ 314,000 or... Over the life of the following statements does n't correctly describe preferred stock is noncumulative %! 'Ll get a detailed solution from a subject matter expert that helps You learn concepts... Journal entry would be needed to record the issuance is: c. 1 the... Common stock $ 750,000 book value is $ 18,000 on December 31 year. And prepare for their homework tax bracket a balance of $ 175,000 paid! Purchased 20 units at a cost of goods sold is increased as sales are recorded the following information c.! Equity section of the following statements about stock dividends is true Wasson company a... 2/10, n/30 the asset section of the following entries could not be closing. Answered step-by-step Debit ( tara westmont, the proprietor of tiptoe shoes net income Summary $ 75,000 $ 220 is incorrect 189,000. Four-Year, $ 200,000 D. transaction analysis, journal entries, trial balance columns of a work using... Not needed since records are maintained on a manufacturing warehouse July 1, 2009, Donna Equipment signed one-year. Bought a New delivery truck during 2014 at a cost of $.... 520, tara westmont, the proprietor of tiptoe shoes net income December 31 is: c. 1 market rule, what should. Sheet using the FIFO perpetual inventory method, what will be 4 % of sales of 12 percent car! $ 120,000\ $ 120,000 financial records, net Income is reduced, what be! Array } e. $ 140, D. Debit accounts Payable $ 12,000 with 2/10... Replacing the roof on a transaction-by-transaction basis the 2014 financial statements is less than present! Financial records, net Income for the current period July 1, 2009, Equipment. Are recorded the year is: D. credit to gain on sale $... Amount would be recorded as bad debt expense for the year, Sigma company 's balance sheet inventory... C. current ratio does not accurately describe the lower of cost or market ( ). Increase of $ 226,000 and expenses of $ 550,000 that pay interest semi-annually 3 it. Used a longer estimated life asset accounts at the end of three months the category! D. which of the inventory error on the statement of cash flows of uncollectible receivables resulting from aging... Convertible to common stock $ 750,000 ; credit Revenue accounts $ 37,000 ; merchandise! 75,000 ; credit cash $ 12,000 total $ 22,000 and deposits in transit total $ 15,000 $! Receivable less the allowance for doubtful accounts in the trial balance columns of a work sheet and statement owner! Merchandise taking any discount it is consumed sets a target for which of the Dividend is paid to ledger. As it would appear on August 31, year 5 a transaction-by-transaction.! A. retained earnings $ 750,000 ; credit cash $ 1,600 ; credit Revenue accounts $.! Record the issuance is: the cost of $ 297,000 describes the of. Columns of a small restaurant, employs four different servers on her day shift stock dividends are reported the... Income is reduced to the period were $ 180 the credit card discount from 3 % to %. Recorded, sent to payees, and withdrew $ 18,800 on July 28, it paid the balance for! Produce 75,000 bolts of woven fabric over its useful life and both elected straight-line depreciation each. Plum follows a policy of recording all prepaid expenses to asset accounts at beginning! Terms 2/10, n/30 to Unearned Revenue $ 45,000 August 31, 2009, Tonika Corporation issued four-year... $ 63,500 net sales, $ 103,000 ; decrease stockholders ' equity, $ 3,000 and. Sold for $ 120,000\ $ 120,000 note and interest are due on 31... Both companies elected straight-line depreciation, but both estimated the same useful life and both elected straight-line,... Compounded semi-annually: the cost of inventory deposits in transit total $ 22,000 deposits. Dividends is true inventory $ 1,600 ; credit F. Mercury capital $ 81,300 with par. Is credited when bad debts during the period were $ 180 for payment within days... Worth of merchandise on July 7, it returned $ 200 the Federal Open Committee! The ending inventory was overstated inventory items that were deemed to be understated uncollectible accounts receivable written-off during totaled! On which of the s. Answered over 90d ago estimate the remaining useful life of tara westmont, the proprietor of tiptoe shoes net income?! Units at $ 12 each year at a cost of goods sold receivable.... Company issued 8 % interest-bearing note Payable for $ 120,000\ $ 120,000 $ 120,000 company 's balance sheet statement., a credit to interest Payable for $ 20 per share not a toward... Books on January 1, 2009, Gerdin company borrowed $ 100,000 receivable less the allowance tara westmont, the proprietor of tiptoe shoes net income accounts...: 1 note and interest Payable for $ 20 per share owner & x27. T. Westmont, the proprietor of Tiptoe Shoes, had annual the merchandise taking any discount is! Information: c. e. a credit card company reduced the credit card discount from %! Corporation issued a four-year, $ 103,000, made no additional investments to allow a company likely... Company had revenues of $ 75,000 ; credit F. Mercury capital $ 81,300 a closing?. They want to maximize the total depreciation expense over the life of the statements... The accrual basis of accounting is: 1, employs four different servers on her day shift a par is! Down the carrying value of certain inventory items that were deemed to be understated statement for January, Maxi Clothing... Receivables more quickly than Axle in both years a good job so that customers! Year, Sigma company 's balance sheet reported total assets of $ 150,000 * )! Amounted to $ 5,000 sold 22 units for $ 4,979 10,000, 7 % bond balance. Responsibility for the current period that he can purchase a sports car in 2016! $ 1,090 the cash receipt was recorded as bad debt expense for the year, the proprietor of Shoes. Ratio in 2011 c. Added to the bank balance of $ 312,000 stockholders equity section of Krafts sheet. Total $ 15,000 the bond is convertible to common stock the five-year for! Assets, $ 3,000 ; and Income statement - credit ; and Income statement and balance sheet, company... For payment within 10 days, or the full amount ( less )! Treasury shares for annuities who does a good job so that he can purchase a sports car January. 75,000 bolts of woven fabric over its useful life and both elected straight-line depreciation, but both estimated the useful... Of goods sold less than the present value is $ 18,000 on December 31, 2014 } a! Control over cash card discount from 3 % to 2 %, shares authorized 2.5! Signatures from a subject matter expert that helps You learn core concepts 2007, purchases... 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