ACC 557 Homework Chapters 1-3
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Due Week 2 and
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Directions:
Answer the following questions in a separate Microsoft Word or Excel document.
Explain how you reached the answer or show your work if a mathematical
calculation is needed, or both. Submit your assignment using the assignment
link in Blackboard.
Exercises
E1-11. Two items are omitted from each of
the following summaries of balance sheet and income statement data for two
corporations for the year 2015, Plunkett Co. and Herring Enterprises.
Instructions
Determine the
missing amounts.
E2-9. Selected transactions from the
journal of Kati Tillman, investment broker, are presented below.
Instructions
a)
Post the transactions to T-accounts.
b)
Prepare a trial balance at August
31, 2015.
E2-11. Presented below is the ledger for
Higgs Co.
Instructions
a)
Reproduce the journal entries for
the transactions that occurred on October 1, 10, and 20, and provide
explanations for each.
b)
Determine the October 31 balance for
each of the accounts above, and prepare a trial balance at October 31, 2015.
E3-7. The ledger of Perez Rental Agency on
March 31 of the current year includes the selected accounts, shown below,
before quarterly adjusting entries have been prepared.
An analysis of
the accounts shows the following.
1.
The equipment depreciates $400 per
month.
2.
One-third of the unearned rent
revenue was earned during the quarter.
3.
Interest totaling $500 is accrued on
the notes payable for the quarter.
4.
Supplies on hand total $900.
5.
Insurance expires at the rate of
$200 per month.
Instructions
Prepare the
adjusting entries at March 31, assuming that adjusting entries are made
quarterly. Additional accounts are Depreciation Expense, Insurance Expense,
Interest Payable, and Supplies Expense.
E3-11. A partial adjusted trial balance of
Gehring Company at January 31, 2015, shows the following.
Instructions
Answer the
following questions, assuming the year begins January 1.
a)
If the amount in Supplies Expense is
the January 31 adjusting entry, and $1,000 of supplies was purchased in
January, what was the balance in Supplies on January 1?
b)
If the amount in Insurance Expense
is the January 31 adjusting entry, and the original insurance premium was for
one year, what was the total premium and when was the policy purchased?
c)
If $3,500 of salaries was paid in
January, what was the balance in Salaries and Wages Payable at December 31,
2014?
Problems
P1-2A. On August 31, the balance sheet of
La Brava Veterinary Clinic showed Cash $9,000, Accounts Receivable $1,700,
Supplies $600, Equipment $6,000, Accounts Payable $3,600, Common Stock $13,000,
and Retained Earnings $700. During September, the following transactions
occurred.
1.
Paid $2,900 cash for accounts
payable due.
2.
Collected $1,300 of accounts
receivable.
3.
Purchased additional equipment for
$2,100, paying $800 in cash and the balance on account.
4.
Recognized revenue of $7,300, of
which $2,500 is collected in cash and the balance is due in October.
5.
Declared and paid a $400 cash
dividend.
6.
Paid salaries $1,700, rent for
September $900, and advertising expense $200.
7.
Incurred utilities expense for month
on account $170.
8.
Received $10,000 from Capital Bank
on a 6-month note payable.
Instructions
a)
Prepare a tabular analysis of the
September transactions beginning with August 31 balances. The column headings
should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes
Payable + Accounts Payable + Common Stock + Retained Earnings + Revenues –
Expenses – Dividends.
b)
Prepare an income statement for
September, a retained earnings statement for September, and a balance sheet at
September 30.
P2-2A. Julia Dumars is a licensed CPA.
During the first month of operations of her business, Julia Dumars, Inc., the
following events and transactions occurred.
May 1
Stockholders invested $20,000 cash in exchange for common stock.
2 Hired a secretary-receptionist at a salary
of $2,000 per month.
3 Purchased $1,500 of supplies on account from
Vincent Supply Company.
7 Paid office rent of $900 cash for the month.
11 Completed a tax assignment and billed
client $2,800 for services performed.
12 Received $3,500 advance on a management
consulting engagement.
17 Received cash of $1,200 for services
performed for Orville Co.
31 Paid secretary-receptionist $2,000 salary
for the month.
31 Paid 40% of balance due Vincent Supply
Company.
Julia uses the
following chart of accounts: No. 101 Cash, No. 112 Accounts Receivable, No. 126
Supplies, No. 201 Accounts Payable, No. 209 Unearned Service Revenue, No. 311 Common
Stock, No. 400 Service Revenue, No. 726 Salaries and Wages Expense, and No. 729
Rent Expense.
Instructions
a)
Journalize the transactions.
b)
Post to the ledger accounts.
c)
Prepare a trial balance on May 31,
2015.
P3-1A. Deanna Nardelli started her own
consulting firm, Nardelli Consulting, on May 1, 2015. The trial balance at May
31 is as follows.
In addition to
those accounts listed on the trial balance, the chart of accounts for Nardelli
Consulting also contains the following accounts and account numbers: No. 150
Accumulated Depreciation—Equipment, No. 212 Salaries and Wages Payable, No. 631
Supplies Expense, No. 717 Depreciation Expense, No. 722 Insurance Expense, and
No. 732 Utilities Expense.
Other data:
1.
$900 of supplies have been used
during the month.
2.
Utilities expense incurred but not
paid on May 31, 2015, $250.
3.
The insurance policy is for 2 years.
4.
$400 of the balance in the unearned
service revenue account remains unearned at the end of the month.
5.
May 31 is a Wednesday, and employees
are paid on Fridays. Nardelli Consulting has two employees, who are paid $900
each for a 5-day work week.
6.
The equipment has a 5-year life with
no salvage value. It is being depreciated at $190 per month for 60 months.
7.
Invoices representing $1,700 of
services performed during the month have not been recorded as of May 31.
Instructions
a)
Prepare the adjusting entries for
the month of May. Use J4 as the page number for your journal.
b)
Enter the totals from the trial
balance as beginning account balances and place a check mark in the posting
reference column. Post the adjusting entries to the ledger accounts.
c)
Prepare an adjusted trial balance at
May 31, 2015.
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