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					                                                  Solution
      1. Bank Reconciliation


119)        c       115)     a       116)     c        131)   b   111)   b


Solution Ex.178
1.      B                   6. E

2.      D                   7. A

3.      B                   8. D

4.      A                   9. A

5.      C                  10. B



Solution Ex.169
(a)                                         OGLEBY BOAT COMPANY
                                              Bank Reconciliation

                                                  September 30

Cash balance per bank                                                                  $ 7,000

Add:        (1) Deposit in transit                                                       5,700

                                                                                       12,700

Less:       (4) Outstanding checks                                                       6,000

Adjusted cash balance per books                                                        $ 6,700



Cash balance per books                                                                 $ 5,459

Add:        (5) Accounts Payable Error                                       $    81

            (7) Collect $1,500 note and interest $60                         1,560       1,641

                                                                                         7,100

Less:       (2) Check printing                                                   40

            (6) NSF Check                                                        360      400

Adjusted cash balance per books                                                        $ 6,700

Note: Item (3) is not a reconciling item.
   2. Accounts Receivable


    84) b      88) c            89) b               96)          b           97)          a           148)      b



Solution Ex. 174
(a) Aug. 10       Allowance for Doubtful Accounts .........................................                         1,000

                           Accounts Receivable—Ann Koch ................................                                    1,000

                              (To write off Ann Koch account)

    Sept. 12      Allowance for Doubtful Accounts .........................................                         4,000

                           Accounts Receivable—Joe Yates.................................                                   4,000

                              (To write off Joe Yates account)

    Oct. 10       Accounts Receivable—Ann Koch ..........................................                           1,000

                           Allowance for Doubtful Accounts ...............................                                  1,000

                              (To reinstate Ann Koch account previously

                              written off)

                  Cash ......................................................................................        550

                           Accounts Receivable—Ann Koch ................................                                     550

                              (To record collection on account)

    Nov. 15       Cash ......................................................................................        450

                           Accounts Receivable—Ann Koch ................................                                     450

                              (To record collection on account)



(b) Dec. 31       Bad Debts Expense ($500,000 × 1%) ....................................                            5,000

                           Allowance for Doubtful Accounts ...............................                                  5,000

                              (To record estimate of uncollectible accounts)



(c) Balance of Allowance for Doubtful Accounts at December 31, 2008, is $6,000 ($5,000 – $1,000 –
    $4,000 + $1,000 + $5,000).
Solution Ex. 175
(a) Bad Debts Expense ....................................................................................       4,460

                Allowance for Doubtful Accounts ($5,160 – $700) ........................                                         4,460

                   (To adjust the allowance account to total estimated uncollectible)



(b) Bad Debts Expense ....................................................................................       5,660

                Allowance for Doubtful Accounts ($5,160 + $500) ........................                                         5,660

                   (To adjust the allowance account to total estimated uncollectible)



(c)    Bad Debts Expense ($550,000 × 1%) .........................................................               5,500

                Allowance for Doubtful Accounts...................................................                               5,500

                   (To record estimated bad debts for year)


Solution BE 162



      Customer                                 Total      Not yet due Days past           Days past      Days past   Days past
                                                                        due                 due            due         due

                                                                             1–30           31–60            61–90   Over 90
      DV Farmer                                $ 500                           $300            $200
      JJ Joysen                                    300            100                                          200
      NJ Bell                                      150                                            50                     100
      JC Net                                       200            200
                                              $1,150              300            300             250           200       100
      % uncollectible                                              1%             5%            10%            20%       50%
      Total Estimated                            $133               $3           $15             $25           $40       $50
      Uncollectible Amounts



Net Receivables = ($1,150 – $133 = $1,017)
       3. Depreciation Expense

           88)         c            87)          d           89)          c            91)         b            94)       d     99)     a

           100)        c            113)         b           114)         c            115)        c            119)      a     123)    b


       4. Bonds Payable
           Solution BE. 192
(a)     Cash ..........................................................................................................   485,000

        Discount on Bonds Payable ......................................................................                   15,000

                 Bonds Payable ................................................................................                        500,000

(b)     Cash ..........................................................................................................   510,000

                 Bonds Payable ................................................................................                        500,000

                 Premium on Bonds Payable. ..........................................................                                   10,000


Solution BE. 193
2008

Jul.      1      Cash ................................................................................................    784,000

                 Discounts on Bond payable ............................................................                    16,000

                           Bonds Payable ......................................................................                        800,000



Dec. 31          Bond Interest Expense....................................................................                 24,800

                           Bond Interest Payable ..........................................................                             24,000

                           Discounts on Bond payable ..................................................                                     800
Solution BE. 193/2
2008

Jul.         1     Cash ................................................................................................   848,000

                             Bonds Payable ......................................................................                         800,000

                             Premium on Bonds Payable ..................................................                                   48,000



Dec. 31            Bond Interest Expense....................................................................                21,600

                   Premium on Bonds Payable ...........................................................                        2,400

                             Bond Interest Payable ..........................................................                              24,000


Solution BE.194
Jan. 1           Bonds Payable.................................................................................... 1,000,000

                         Cash..........................................................................................                  1,000,000



             150)        b           148)         c            140)        d            136)         d           151)      b



       5. Statement of Cash flows

Solution BE.151
1.     D                                       6.       A
2.     D                                       7.       A
3.     A                                       8.       A
4.     D                                       9.       D
5.     A                                      10.       A


Solution BE’152
Net Income............................................................................................................................   $275,000

Adjustments to reconcile net income to net cash provided by operating activities:

           Depreciation expense .................................................................................................          25,000

           Decrease in accounts receivable .................................................................................               55,000

           Increase in inventory ...................................................................................................      (12,000)

           Decrease in accounts payable .....................................................................................              (6,600)

           Increase in income taxes payable ...............................................................................                 1,500
       Loss on sale of land .....................................................................................................      5,000

               Net cash provided (used) by operating activities ..............................................                      $342,900


Solution BE. 156
1. C                       4. C

2. B                       5. A

3. A                       6. B


Solution B.E. 157
  1. (c)          Financing activity                               6. (d)           Noncash activity

  2. (c)          Financing activity                               7. (c)           Financing activity

  3. (a)          Operating activity                               8. (b)           Investing activity

  4. (b)          Investing activity                               9. (a)           Operating activity

  5. (a)          Operating activity                              10. (d)           Noncash activity
                                          MOTT COMPANY

                                       Statement of Cash Flows

                                       For a year, Ended December 31, 2008


Cash flows from Operating Activities

    Net Income                                                         40,000

    Decrease in Account receivable                                      2,000

    Increase in Inventory                                             (4,000)

    Decrease in Prepaid Expense                                         1,000

    Decrease in Accounts Payable                                      (3,000)

    Depreaciation Expense                                               1,000

    Loss on retirement of bonds                                         2,500

    Net Cash Provided by Operating Activities                                       39,500


Cash flows from Investing Activities

           -                                                     -

    Net Cash Provided by Operating Activities                                   -


Cash flow from Financial Activities

    Issuing Common Stock                                               15,000

    Retirement of Bonds Payable                                       (3,500)

    Paid Dividends                                                    (9,000)

    Net Cash Provided by Operating Activities                                        2,500
Net Increase in
Cash                                                                                42,000

Balance cash at December 31,2007                                                    12,000

Balance cash at December 31,2008                                                    54,000

				
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