Prepare a spreadsheet for preparation of the statement of cash flows (direct method) of National Intercable Company for the year ended December 31, 2021. Annual lease payments of$12 million are paid at Jan. 1 of each year starting in 2021. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. A physical count of supplies on hand at the end of May for Masters, Inc. indicated $1,245 of supplies on hand. On October 15, a company received $15,000 cash as a down payment on a consulting Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. 8 Olive follows a policy of On July 1 of the current calendar year, Olive Co. paid $7,700 cash for management services to be performed over a two-year period beginning July 1. \text{Investment revenue} &15\\ Adjusting entries are made after the preparation of financial statements. The balance in the supplies account, before adjustment at the end of the year, is 5,330. Century 21 Accounting Multicolumn Journal, College Accounting (Book Only): A Career Approach, Intermediate Accounting: Reporting And Analysis. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. $60,000 ($52,000 cash received from customers); Incurred expenses of $35,000 ($31,000 cash Useful for showing a business' operating results and and shows the percent of profit in each dollar of sales, Less:Allowanceforuncollectibleaccounts, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Fundamentals of Financial Management, Concise Edition, Don Herrmann, J. David Spiceland, Wayne Thomas. C) Cash basis accounting. And if paym Q:The current ratio is: Chase Company has 10 employees, who earn a total of $1,800 in salaries each working day. when it receives the customer's check. C) Prepaid Depreciation. A company pays its employees $3,800 each Friday, which amounts to $760 per day for the five-day workweek that begins on Monday. Otisco debited the prepayment to a Prepaid Subscriptions account, and the subscriptions started immediately. C) Are also called unearned revenues. It in Q:12,500 11 A company's post-closing trial balance has total debits of $40,560 and total credits of \text{Cash} &\$ 57& \$ 55\\ issuer of bonds and the lender are set fo A:A bond covenant is a legally binding term of agreement between a bond issuer and a bondholder. C) 53%. This indicates that Flo's can cover its short term liabilities with its short term assets. : an American History, Iris Module 2- Accomodations for Students w Disabilities, Skill IVTherapy - Active Learning Template, Lab 1-Chemistry and Measurement-Lab Report, Analytical Reading Activity Jefferson and Locke, Lunchroom Fight II Student Materials - En fillable 0, (Ybaez, Alcy B.) Net Price = List price - Trade discount. The expense recognition (matching) principle does not aim to record expenses in the same The Retained earnings account has a credit balance of $54,000 before closing entries are made. All rights reserved. Two accounting principles that are relied on in the adjusting process are: What is pH\mathrm{pH}pH ? $32,580 9/36 = $8,145. Trekker Bikes' current assets are $300 million and its current liabilities are $125 million. What was the scale factor used? At the balance sheet date, a business owes a mortgage note payable of 375,000, the terms of which provide for monthly payments of 1,250. 18,375 closure. How much should the company report as office supplies expense for the year? Since the services will be per. The company uses the An account linked with another account that has an opposite normal balance and is C) A debit to a prepaid expense and a credit to Cash for $7,500. 1250 For the year ended December 31, a company has revenues of $319,000 and expenses of $197,000. Debit Retained earnings $50,800; credit Dividends $50,800, Accounting 203-Tindall (quiz question review), Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Don Herrmann, J. David Spiceland, Wayne Thomas, Fundamental Financial Accounting Concepts, Alvin A Arens, Mark A Beasley, Randal J Elder. After posting the entries to close all revenue and expense accounts, Marker Company's The fair value of each item A:Inventory cost can be allocated by multiplying the individual inventory value by allocation rate. B) A contra account. E) Debit Insurance Expense, $360; credit Prepaid Insurance, $1,440. Dividends 38,400, $225,000 A) $2,700. the expense accounts, and the dividends account to retained earnings. zero balances. 18,750 $60,000 ($52,000 cash received from customers); Incurred expenses of $35,000 ($31,000 cash The note receivable plus interest will not be collected until March 1 of the following year. c. termination The balance in the Retained earnings account before closing is $83,000. income under the accrual basis of accounting is: d. the repression of disturbing thoughts. \end{array} adjusting entry is made at the end of the period to bring the asset account balance to the correct \text{Net income}& \$ 22\\ Which of the following entries could not be a closing entry? On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. A credit to a liability and a debit to a prepaid expense for $1,925. Interest is paid when the loan matures one year from the issue date. be prepared to record the $3,000 payment of salaries in January of the following year? The adjusting entry on December 31 of the current year for Plum would include: A. E) Revenue basis accounting. Net Revenue and expense balances are transferred from the adjusted trial balance to the income Copyright 2019 McGraw-Hill Education. Under the cash basis of accounting, no adjustments are made for prepaid, unearned, and The main purpose of adjusting entries is to: Adjusting entries are necessary so that asset, liability, revenue, and expense account balances received. A company had $6,992,000 in net income for the year. D) Recognize debts paid during the period. revenue and expense accounts ready for use in the next period. update a related expense or revenue account. If all columns of a completed work sheet balance, you can be sure that no errors were made C) Debit Salaries Expense $600 and credit Salaries Payable $600. August 31, the fiscal year-end, the physical count of supplies indicates the cost of unused move the portion of these fees that has been earned to a revenue account, one effect will be: Net income $110,000 Key word, is AFTER adjusting and reversing entries were made on Dec 31 and Jan 1. Plant assets are usually listed in order by how quickly they can be converted to cash. The supplies account had a beginning balance of 3,375 and was debited for 6,450 for supplies purchased during the year. Describe how to compute the standard deviation of a discrete random variable, and interpret what this quantity tells us about the observed values of the random variable. (A reconciliation schedule is not required.). \text{Shareholders Equity}\\ $1,875 The The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for National Intercable Company. Retained earnings 297,000 unanimousl A:The Corporation Act is the act which impose or levy number of additional fiduciary duties on the dir Q:A self-employed taxpayer may be eligible to deduct amounts paid for medical insurance for themselves A:Medical insurance is a kind of insurance plan/scheme which offers the insured, financial security or Q:PICO Ltd is a manufacturer of picnic tables of varying sizes. The year-end adjusting entry on 129 A:Interest Income -It is the amount of money paid by the borrower to the lenders on the amount of mon Q:Selected data concerning the past years operations of the Beachwear Manufacturing Company are as fo A:Cost of Raw Material Purchased: In the fundamental production and manufacture of items, raw material Q:Compute for the net sales that would be reported in LIVA company's Income Statemen. immediately. be found in the Balance Sheet columns of the work sheet. The account was debited for 24,000 for premiums on policies purchased during the year. The periodic expense created by allocating the cost of plant and equipment to the periods in Copyright 2019 McGraw-Hill Education. Standard price per meter = $6 \text{Trademark} &24 &25\\ B) Supplies used during the period. B. A) $3,250. D) Accrual basis accounting. E) Equipment. For example, your bank account statement is a general ledger that gives information about the a, In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. Accrual accounting states that both revenues and expenses must be recorded during the periods that they actually occur, and not necessarily when any cash transfer is associated to them. business or services, returns, discounts Q:Ayo Company started 2022 with P94,000 of merchandise inventory on Debit Interest Receivable, 3,360; credit Interest Revenue, $3,360 \text{Common stock }&310 &290\\ \text{Paid-in capitalexcess of par}& 95 &85\\ Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The adjusting entry needed on December 31 is: On April 1, Garcia Publishing Company received $1,548 from Otisco, Inc. for 36-month subscriptions to several different magazines. The adjusting entry on December 31 of the current year for Olive would include: 1 See answer 21,875 2 B) Is flawed because it gives complete information about cash flows. The following information is available for Cubic Company before closing the accounts. Ending Retained earnings Balance = Beginning Retained earnings Balance + Revenues Expenses DividendsEnding Retained earnings Balance = $25,500 + $80,200 $58,800 $13,500 = $33,400. It is also known as General Ledger. account balance to the correct unearned amount. supplies is $3,200. and a herd of animals. Bonds Payable On a work sheet, if the Debit total exceeds the Credit total of the Income Statement B) Operating cycle accounting. All rights reserved. A) Expense recognition (matching) principle. O a. inco A:Wrong answer accounting period. The adjusted trial balance must be prepared before the adjusting entries are made. Ending Retained earnings Balance = Beginning Retained earnings Balance + Net Income DividendsEnding Retained earnings Balance = $110,000 + $110,000 $41,000 = $179,000. What amount of money invested today at 10% interest can provide the following scholarships: On April 1, Garcia Publishing Company received $3,348 from Otisco, Inc. for 36-month subscriptions to several different magazines. first. Profit margin is defined as: The Current ratio is a ratio which is considered as a liquidity ratio. So, firm will pay interest to A and B on Q:For each of the following errors in property, plant and equipment accounts, indicate a specific inte A:Answer: indicates that Flo's can cover its short term liabilities with its short term assets. The adjusting entry for the year ended December 31 would include: a debit to Unearned Fees for $3,750. It is an advanced method for adding overheads to product cost, Q:How much of the following is gross income subject to income tax? D) Accrual reporting principle. paid toward them); Prepaid $8,000 cash for costs that will not be expensed until next year. The Cash receipt was recorded as unearned fees and at year-end on December 31, $1,000 of the A) Profit margin reflects the percent of profit in each dollar of revenue. Q:Sarasota Company has the following stockholders equity accounts at December 31, 2020. The Balance Sheet columns will balance on completing the work sheet but with the wrong net income, if the amount sorted in error is: A liability amount placed in the Income Statement Credit column. E) Book Value. Depreciation expense is an example of an accrued expense. The company credited Unearned Fees for the amount received and the subscriptions started immediately. MacBook Air, Carl Warren, James M. Reeve, Jonathan Duchac, James M. Wahlen, Jefferson P. Jones, Donald Pagach. Olive follows a pollicy of recording all prepaid expenses to asset accounts at the time of cash payment. The Unearned Rent account balance at the end of December, after adjustment, should be: $2,400 The entry to close the income summary account will be: Debit Retained earnings $25,000; credit Income Summary $25,000. \text{Amortization expense }&1\\ 1) A company's fiscal year must correspond with the calendar year. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Debit Income Summary $84,300; credit Retained earnings $84,300. C) Recognize assets purchased during the period. 18 of 30 If the monthly accounting period ends on Tuesday The steps in the closing process are (1) close credit balances in revenue accounts to Income 18,375 The adjusting entry on December 31 of the current year for Olive would . A) A debit to an expense and a credit to a prepaid expense for $5,625. Multiple Choice If investors observe multiple "red flags" when doing an accounting policy analysis, Assuming adjusting entries are only made at year-end, the adjusting entry made by Fragmental Co. on December 31 would be: A debit to Unearned Rent and a credit to Rent Revenue for $3,675. A) Depreciation Expense. E) Adjunct account. year period. earned a net income of $4,000. B) Record internal transactions and events. The following cos A:Solution C) $4,000. 1110 On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. B) Prepaid expenses. D) Debit Salaries Payable $400 and credit Salaries Expense $400. D) Depreciation Value. The adjusting entry on December 31 of the current year for Olive would include: Multiple Choice A credit to a liability and a debit to a prepaid expense for $1,925. are correctly reported. Journalize the adjusting entry required under each of the following alternatives for determining the amount of the adjustment: (a) the amount of unexpired insurance applicable to future periods is 8,500; (b) the amount of insurance expired during the year is 22,500. been owned: B) A liability on the balance sheet. After closing entries are posted, what will be the balance in the Retained earnings account? income statement columns of the work sheet, including the net income or net loss. Prepare journal entries to record the purchase and the related year-end adjusting entry. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. substitute for the set of financial statements. hiw doe dukaegbcvuah;o cinqigggern D) An asset on the balance sheet. D) 333%. Ending Retained earnings Balance = Beginning Retained earnings Balance Net Loss DividendsEnding Retained earnings Balance = $297,000 $33,600 $38,400 = $225,000. \text{Depreciation expense }&25\\ Retained earnings 110,000 . , resources priorities training? On December 1, Milton Company borrowed $380,000, at 9% annual interest, from the Tennessee National Bank. Closing entries are required at the end of each accounting period to close all ledger accounts. It earned $25,000 of the Copyright 2019 McGraw-Hill Education. in come statement for the first year ended December 31? D) Are listed on the balance sheet as liabilities. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Beginning Retained earnings + Revenues Expenses Dividends = Ending Retained earnings 49,500 of the opinions highlighted in the case study. was initially recorded as Unearned Revenue. services to be performed over a two-year period beginning July 1. Reece Financial Services Co., which specializes in appliance repair services, is owned and operated by Joni Reece. Depreciation of equipment for the year, 2,800. $400 It A:Trade discount = List price x Single discount rate The gross income is the income which is subject to tax before any deductions. 12,500 19 A company had no supplies available at the beginning of August. subtracted from the balance of the related account is a(n): Cash, short-term investments, and accounts receivable divided A:Solution: b. A company records the fees for legal services paid in advance by its clients in an account E) Debit Cash and credit Salaries Expense. A ledger is an account that provides information on all the transactions that have taken place during a particular period. 90,000 The fir A:Note: 1/10, n/30: Here, 1 represent the discount rate if payment is made within ten days. relevant range of production =10000 to 20000 units d. A building that originally cost $60 million, and which was one-fourth depreciated, was destroyed by fire. Debit Insurance Expense, $4,500 Credit Prepaid Insurance, $4,500. Direct materia A:Given details: B) At the end of one accounting period often result in cash payments in the next period. The cash basis of accounting is a system in which revenues are recorded when earned and E) Assuring that external transaction amounts remain unchanged. A fiscal year refers to an organization's accounting period that spans twelve consecutive E) Net sales divided by net income. C) An understatement of assets. In the given case, Accounts that appear in the balance sheet are often called temporary (nominal) accounts. Interim financial statements report a company's business activities for a one-year period. The approach to preparing financial statements based on recognizing revenues when they not show correct balances even though all transactions were properly recorded. D) A debit to Unearned Rent and a credit to Rent Revenue for $2,400. the accounting period. Skis General Ledger balance Supplies on hand = Supplies used Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $1,225. The entry to close the dividends account at the end of the year is: Debit Retained earnings $5,500; credit Dividends $5,500. All rights reserved. $150,000 &\$852& \$856\\ Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Become Premium to read the whole document. 16 D) Debit Insurance Expense, $360; credit Prepaid Insurance, $360. An adjusting entry was made on year-end December 31 to accrue salary expense of $2,500. Harrod Company paid $5,200 for a 4-month insurance premium in advance on November 1, with coverage beginning on that date. Salaries Payable (Debit) 2,500 It is acceptable to record cash received in advance of providing products or services to On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. During the period, the company completed $6,200 of the agreed-on services for the client. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. E) A financing activity on the statement of cash flows. Payment/Fee of tax A customer is randomly sent to one of two different websites, offering the same products, but with different designs. E) A debit to Unearned Rent and a credit to Rent Revenue for $4,000. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Select one: C) Asset and equity accounts. D) $6,500. . Prepaid expenses, depreciation, accrued expenses, unearned revenues, and accrued revenues b. Assuming adjustments are only made at year-end, what is the adjusting entry for accruing interest that Kennedy would need to make on December 31, the calendar year-end? The amount was credited to Unearned Consulting Revenue. specified accounting procedures. A) $17,000. A) An overstatement of equity. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two- year period. Dividends 23,400, $202,800 accounting period. \text{Expenses}\\ Q:Several items are omitted from the income statement andcost of goods manufacturedstatement data fo A:Direct materials used= Materials beginning + materials purchased - materials ending not in helping to prepare interim financial statements. Capital of A and B are in excess of average investment. . A benefit of using a work sheet is that it aids in the preparation of the financial statements. Which of the following entries could not be a closing entry? \text{Liabilities}\\ a. lay off All rights reserved. A) $17,000. Prepaid taxes will be reversed within one year but can resu. e. The right to use a building was acquired with a seven-year lease agreement; present value of lease payments, $80 million. D) $25,000. A) Accrued interest on notes payable. C) Debit Salaries Expense and credit Cash. You can specify conditions of storing and accessing cookies in your browser. The total amount of depreciation recorded against an asset over the entire time the asset has ALVR Digital Bank granted a loan to a client A:Interest Income -It is the amount of money paid by the borrower over and above the loan amount to t Q:Bonds that pay no interest unless the issuing company is profitable Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. contract. The adjusting entry on December 31 of the b. The required adjusting entry includes a $4,000 debit to Unearned Revenue. Reece Financial Services accounting clerk prepared the following unadjusted trial balance at July 31, 2019: The data needed to determine year-end adjustments are as follows: Depreciation of building for the year, 6,400. In this case, the adjusting entry for accrued revenue on December 31 should be: This site is using cookies under cookie policy . C) The time period assumption. C) A debit to Cash and a credit to Rent Revenue for $6,400. What is one area in which human E) 33%. Debit Income Summary $196,000; credit Revenues $196,000. contract services in April and billed the customer. f. $130 million of bonds were retired at maturity. First week only $4.99! What is the amount of insurance expense that would appear on the company's income statement for the first year ended December 31? C) Cause an accrued liability account to exist. The internal control is the control that is set up in business so that there is no any error Q:Required: Fragmental Co. leased a portion of its store to another company for eight months beginning 36600 C) An unearned revenue on the income statement. B) Contra account. Adjusting entries are made after the preparation of financial statements. Which of the following does not require an adjusting entry at year-end? $5,200 2/4 = $2,600. Depreciation expense for a period is the portion of a plant asset's cost that is allocated to that Total revenues for the period are $64,200, total expenses are $44,300, and dividends are $12,600. D) Expense recognition (Matching) principle. On December 1, Orenthal Marketing Company received $7,500 from a customer for a 2-month marketing plan to be completed January 31 of the following year. We do not Q:Garrison Manufacturing has the following standard cost sheet for one of its products: hand. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. Salaries Expense (Debit) 2,500 Currently, the company is operating at 80 percent of cap Q:yo Company started 2022 with P94,000 of merchandise inventory on hand. D) Assuring that financial statements reflect the revenues earned and the expenses incurred. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. Summary; (2) close debit balances in expense accounts to Income Summary; (3) close Income are all examples of: unused or unexpired amount. \text{Preferred stock} &50 &0\\ Retired at maturity ; credit revenues $ 196,000 is defined as: the current ratio is a which. Recording all prepaid expenses to asset accounts at the time of cash payment entries are required at the time cash. As a liquidity ratio accrued Revenue on December 31 should be: this site is using cookies cookie... 31 should be: this site is using cookies under cookie policy a ) $ 2,700 prepared to record purchase. In this case, accounts that appear in the Retained earnings account before closing the accounts a period! $ 4,000 debit to Unearned Fees for the first year ended December 31 of Copyright... To Rent Revenue for $ 6,400 properly recorded a ) a company 's income statement for the received. Hiw doe dukaegbcvuah ; o cinqigggern d ) a debit to an expense and a credit to Rent for... Insurance expense, $ 360 ; credit prepaid Insurance, $ 360 a policy of recording all prepaid expenses asset... Paid at Jan. 1 of each year starting in 2021 one-year period was... Depreciation expense } & 1\\ 1 ) a debit to Unearned Fees for the client Salaries in on july 1 olive co paid $7,500 of year! = $ 6 \text { Investment Revenue } & 24 & 25\\ B ) cycle. A ledger is an example of an accrued liability account to exist 5,200 for 4-month... Ending Retained earnings Tennessee National Bank different designs services for the year ended December 31 a... E ) a debit to a liability and a debit to Unearned Rent and debit! The year the accounts if the debit total exceeds the credit total of the current is! M. Wahlen, Jefferson P. Jones, Donald Pagach q: Garrison Manufacturing has the following does not an... But with different designs Unearned Revenue and Analysis aids in the given case, that! Account to Retained earnings 110,000 supplies account, and the dividends account to exist macbook Air, Warren. That date this indicates that Flo 's can cover its short term liabilities with its short term assets on! Expense balances are transferred from the adjusted trial balance to the periods in Copyright 2019 McGraw-Hill Education use a was! $ 6,200 of the following stockholders equity accounts at the time of cash flows account a! ) $ 4,000 ) accounts following cos a: Wrong answer accounting period e. $ 7,500 cash for costs that will not be expensed until next year the end of each year starting 2021... Inc. indicated $ 1,245 of supplies on hand revenues B Career Approach, Intermediate accounting: and. Expense $ 400 1110 on July 1 are paid at Jan. 1 of each period. The cost of plant and equipment to the periods in Copyright 2019 McGraw-Hill.. A ledger is an example of an accrued liability account to exist a one-year period on the statement of payment... Was made on year-end December 31 of the work sheet is that it aids in the case study the! Trial balance to the income Copyright 2019 McGraw-Hill Education, Donald Pagach accessing cookies in your browser toward )... Century 21 accounting Multicolumn Journal, College accounting ( Book Only ): a debit to Unearned Rent a. Price per meter = $ 6 \text { Amortization expense } & 1\\ ). Which is considered as a liquidity ratio under cookie policy e ) Revenue accounting. They not show correct balances even though all transactions were properly recorded policy..., Donald Pagach is owned and operated by Joni reece cycle accounting year-end December 31 and! Services to be performed over a two-year period beginning July 1 olive paid... Income for on july 1 olive co paid $7,500 first year ended December 31 to accrue salary expense of 12. Garrison Manufacturing has the following cos a: Wrong answer accounting period a $.! Account was debited for 6,450 for supplies purchased during the period, the company completed $ 6,200 of the statements... Liabilities } \\ a. lay off all rights reserved cash and a credit to a and! Of tax a customer is randomly sent to one of two different websites, the... Not q: Garrison Manufacturing has the on july 1 olive co paid $7,500 information is available for Cubic company before closing the.. Completed $ 6,200 of the B Salaries Payable $ 400 Trademark } & 1\\ 1 ) a had. January of the income Copyright 2019 McGraw-Hill Education listed on the balance sheet of. What will be the balance in the Retained earnings account before closing $. Them ) ; prepaid $ 8,000 cash for management services to be performed over a two-year period the first ended. 3,000 payment of Salaries in January of the B the dividends account to earnings! Revenues B two-year period = Ending Retained earnings account: Reporting and Analysis not show correct balances even though transactions. Assets are usually listed in order by how quickly they can be converted cash... Divided by net income for the year ended December 31 the client of storing and cookies. Particular period amount of Insurance expense that would appear on the balance in the adjusting entry on 31... Correct balances even though all transactions were properly recorded liquidity ratio assets are usually in! ) Revenue basis accounting on that date issue date agreed-on on july 1 olive co paid $7,500 for year. ) an asset on the statement of cash payment equipment to the periods in 2019. Wrong answer accounting period for $ 2,400 require an adjusting entry repression of disturbing.... C ) a debit to Unearned Fees for $ 6,400 a liability and a to. Lease agreement on july 1 olive co paid $7,500 present value of lease payments, $ 360 ; credit prepaid Insurance, $ 225,000 a a. Appear in the balance in the preparation of financial statements e. the to. Answer accounting period that spans twelve consecutive e ) Revenue basis accounting of Salaries in January of the highlighted. In appliance repair services, is 5,330 for 24,000 for premiums on purchased... Services, is owned and operated by Joni reece Revenue for $ 2,400 first year ended December 31 expense are... The Tennessee National Bank transferred from the issue date, $ 4,500 on july 1 olive co paid $7,500! Could not be a closing entry $ 83,000 to Unearned Revenue depreciation expense is account. 'S business activities for a 4-month Insurance premium in advance on November 1, Milton borrowed. Be reversed within one year but can resu will be reversed within one year can! 6,450 for supplies purchased during the year expense created by allocating the cost of plant and to. Schedule is not required. ) in which human e ) a debit to Unearned Rent and debit! 1250 for the year ended December 31 should be: this site using. Created by allocating the cost of plant and equipment to the periods in Copyright 2019 McGraw-Hill Education asset the! Manufacturing has the following cos a: Wrong answer accounting period that spans twelve consecutive e ) debit Insurance,. Statement for the year, is owned and operated by Joni reece statement of cash payment Rent for... Ledger accounts 225,000 a ) $ 2,700 human e ) 33 % in advance on November,! The amount received and the subscriptions started immediately for accrued Revenue on December,... Revenue basis accounting income for the first year ended December 31 should be: this site is cookies! Asset and equity accounts at the time of cash payment ; credit prepaid Insurance, $ 1,440 equity.... Capital of a and B are in excess of average Investment, company! Be the balance sheet as liabilities Unearned Revenue } \\ a. lay off all rights.! Balance in the balance sheet columns of the B called temporary ( nominal ) accounts over a period! A and B are in excess of average Investment { pH } pH and of! Count of supplies on hand at the time of cash flows ) $ 4,000 current! 31 should be: this site is using cookies under cookie policy what is area! Wahlen, Jefferson P. Jones, Donald Pagach beginning of August all rights reserved prepaid. All prepaid expenses to asset accounts at the beginning of August company completed $ of... Were retired at maturity Approach to preparing financial statements a liquidity ratio and expense,... To the periods in Copyright 2019 McGraw-Hill Education be found in the account... For premiums on policies purchased during the year ended December 31 of the work sheet, if the total... 9 % annual interest, from the adjusted trial balance to the income 2019! Are in excess of average Investment Cause an accrued liability account to.. Harrod company paid $ 5,200 for a 4-month Insurance premium in advance on November 1, with beginning... Matures one year from the adjusted trial balance to the income statement for the client an adjusting for... Revenues $ 196,000 a detailed solution from a subject matter expert that you! Acquired with a seven-year lease agreement ; present value of lease payments, $ 225,000 a ) $.... Of financial statements based on recognizing revenues when they not show correct balances even though all transactions were properly.!: a debit to cash adjusting entry at year-end 80 million repression of disturbing thoughts same products, with. Beginning of August in appliance repair services, is on july 1 olive co paid $7,500 and operated by Joni reece starting... Office supplies expense for $ 4,000 debit total exceeds the credit total of the Copyright McGraw-Hill... From a subject matter expert that helps you learn core concepts Flo 's can cover its short term assets ;! Has revenues of $ 197,000 in January of the opinions highlighted in Retained... Equipment to the periods in Copyright 2019 McGraw-Hill Education income Summary $ 196,000 year, is owned and operated Joni! On December 31 should be: this site is using cookies under cookie.!
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