Question: A comparative balance sheet for Stokely, Inc.,

> The Furniture Lot is a retail store that specializes in modern living room and dining room furniture. Merchandise sales are subject to an 8 percent sales tax. The firm’s credit sales and sales returns and allowances for June are reflect

> On what financial statement do the accounts related to purchases of merchandise appear? In which section of this statement are they reported?

> Awesome Appliances is a retail store that sells household appliances. Merchandise sales are subject to an 8 percent sales tax. The firm’s credit sales for June are listed below Instruction 4, along with the general ledger accounts used

> A partially completed worksheet for Rissa Potter, CPA, for the month ending June 30, 20X1, is shown below. INSTRUCTIONS 1. Record the balances as of June 30 in the ledger accounts. 2. Prepare the worksheet. 3. Journalize (use 3 as the journal page number

> On December 31, after adjustments, The Pollock Family Farm’s ledger contains the following account balances. 101 Cash $21,374 Dr. 111 Accounts Receivable 5,400 Dr. 121 Supplies 2,750 Dr. 131 Prepaid Rent 17,325 Dr. 141 Equipment 27,000

> A completed worksheet for Elegant Lawn Nursery and Landscape is shown below. INSTRUCTIONS 1. Record the balances as of December 31 in the ledger accounts. 2. Journalize (use 3 as the page number) and post the adjusting entries. Use account number 131 for

> Tobias Cleaning and Maintenance, owned by Triana Tobias, provides cleaning services to hotels, motels, and hospitals. On January 31, 20X1, the firm’s worksheet showed the following adjustment data. The balances of the revenue and expense accounts listed

> Christopher Foster owns Estate Planning and Investments Company. The trial balance of the firm for June 30, 20X1, the first month of operations, is shown below. INSTRUCTIONS 1. Complete the worksheet for the month. 2. Prepare an income statement, stateme

> The completed worksheet for JP’s Accounting Services for the month ended December 31, 20X1, appears on the next page. INSTRUCTIONS 1. Prepare an income statement. 2. Prepare a statement of owner’s equity. The owner made no additional investments during t

> The adjusted trial balance of Sergio Mendez, Attorney-at-Law, as of November 30, 20X1, after the company had completed the first month of operations, appears below. Appropriate adjustments have been made for the following items: a. Supplies used during t

> The trial balance of Lazo Company as of February 28, 20X1, appears below. INSTRUCTIONS 1. Record the trial balance in the Trial Balance section of the worksheet. 2. Complete the worksheet by making the following adjustments: supplies on hand at the end o

> Several transactions that occurred during December 20X1, the first month of operation for Wells’ Accounting Services, follow. The company uses the general ledger accounts listed below. INSTRUCTIONS Record the transactions in the general

> What is the normal balance of the Purchases account?

> All the journal entries shown below contain errors. The entries were prepared by an employee of Helena Corporation who does not have an adequate knowledge of accounting. INSTRUCTIONS Examine the journal entries carefully to locate the errors. Prepare jou

> In June 20X1, Chan Lee opened a photography studio that provides services to public and private schools. His firm’s financial activities for the first month of operations and the chart of accounts appear below. INSTRUCTIONS 1. Journaliz

> The transactions listed below took place at Prasad Building Cleaning Service during September 20X1. This firm cleans commercial buildings for a fee. INSTRUCTIONS Analyze and record each transaction in the general journal. Choose the account names from th

> The accounts and transactions of Brian Carter, Counselor and Attorney at Law, follow. INSTRUCTIONS Analyze the transactions. Record each in the appropriate T accounts. Use plus and minus signs in front of the amounts to show the increases and decreases.

> The following transactions took place at P and W Capital Investments. INSTRUCTIONS Analyze each of the transactions. For each transaction, decide what accounts are affected and set up T accounts. Record the effects of the transaction in the T accounts. T

> The following transactions took place at Aircraft Maintenance Company. INSTRUCTIONS For each transaction, set up T accounts from the following list: Cash; Shop Equipment; Store Equipment; Truck; Accounts Payable; Shirley Cosby, Capital; and Shirley Cosby

> What is the difference between a purchase invoice and a sales invoice?

> The following transactions took place at Willis Counseling Services, a business established by Raymond Willis. INSTRUCTIONS For each transaction, set up T accounts from this list: Cash; Office Furniture; Office Equipment; Automobile; Accounts Payable; Ra

> The following transactions occurred at several different businesses and are not related. INSTRUCTIONS Analyze each of the transactions. For each, decide what accounts are affected and set up T accounts. Record the effects of the transaction in the T acco

> The accountant for the firm owned by Vincent Sutton prepares financial statements at the end of each month. INSTRUCTIONS Use the figures in the T accounts for Problem 3.4A to prepare a trial balance, an income statement, a statement of owner’s equity, an

> The following equation shows the transactions of Cotton Cleaning Service during May. The business is owned by Taylor Cotton. INSTRUCTIONS Analyze each transaction carefully. Prepare an income statement and a statement of owner’s equity

> Oil Field Equipment Repair Service is owned by Jack Phillips. INSTRUCTIONS Use the following figures to prepare a balance sheet dated February 28, 20X1. (You will need to compute the owner’s equity.) Cash $137,200 Supplies 25,520 Accounts Receivable 52,8

> Carter Wilson is a painting contractor who specializes in painting commercial buildings. At the beginning of June, his firm’s financial records showed the following assets, liabilities, and owner’s equity. INSTRUCTIONS

> On July 1, Alfred Herron established Herron Commercial Appraisal Services, a firm that provides expert commercial appraisals and represents clients in commercial appraisal hearings. INSTRUCTIONS Analyze the following transactions. Record in equation form

> OZ Innovations, Inc., is currently manufacturing a part that goes into its main product. Each year 5,000 of these parts are used. Cost data for the past year that relates to the 5,000 parts are given below. Fixed costs are allocated on the basis of direc

> Prince Corporation makes a single product that it sells to retail stores. The firm’s finishing department uses hand labor to perform its work on all products. A proposal has been made by the company’s vice president to acquire machinery that will perform

> Texas Controls Inc. began operations in 20X1 to manufacture a single product. There are no ending work-in-process inventories. Relevant data for the year follow: OPERATING DATA FOR 20X1 Quantities: Beginning inventories, finished goods –0– Units produced

> The following data pertains to the operations of Alpha Corporation for the year ended December 31, 20X1, its first year of operations. Alpha Corporation makes computer equipment. Round ending inventory computations to the nearest dollar. DATA FOR 20X1 Sa

> Zack Manufacturing Company makes a product that is processed through two departments: cutting and final. All materials are added in the first department. During the month of March 20X1, the company made 6,000 units of the product. Standard costs and actu

> West Texas Chemical Company manufactures a product called Kylon, which requires three raw materials. Production is in batches of 1,000 gallons of finished product. The firm uses standard costs as a control device. Its standard costs for materials for eac

> The accountant for C. Breit Products, Inc., has analyzed the manufacturing overhead costs for the company’s assembly department. The fixed and variable costs follow: INSTRUCTIONS 1. Prepare a flexible budget for the department for the m

> What journals can be used to enter various merchandise purchase transactions?

> The accountant of Saturn Health Products, LLC, has compiled the following information about the direct labor hours and the indirect labor costs for each month of 20X1: INSTRUCTIONS 1. Compute the monthly fixed costs (rounded to the nearest whole dollar)

> MP Corporation adds all materials at the beginning of production. On August 1, 20X1, 2,500 gallons of its product were in production in the first department. During the month of August, 7,500 gallons were put into production. On August 31, 2,000 gallons

> KAT Games Inc. has two producing departments—fabricating and assembly. The following data is from the firm’s records for the month of April 20X1. There were no beginning inventories. INSTRUCTIONS 1. In general journal

> RedTek, Inc., manufactures a single type of garden cart. The monthly production report for May 20X1 follows: INSTRUCTIONS Prepare the equivalent production computations for each department. Analyze: Which department’s ending work in pro

> Kitchen Inc. builds kitchen cabinets. On January 1, 20X2, one job (D42) was in progress. The order is from Dallas Apartment Corporation and was begun on December 21, 20X1. Costs accumulated to date on that job are materials, $1,040; labor, $1,500; and ov

> In April 20X1, TN Trailers Inc. had the following cost data: COST DATA a. Raw materials costing $100,000 were purchased. b. Raw materials costing $90,000 were used: direct materials, $85,000; indirect materials $5,000. c. Factory wages of $55,000 were in

> RealTime Inc. manufactures parts for computers. The Trial Balance section of its worksheet and other year-end data follow. INSTRUCTIONS 1. Prepare a 12-column manufacturing worksheet for the year ended December 31, 20X1. Enter the trial balance in the fi

> SuSu Manufacturing Company makes water heaters. Selected account balances on December 31, 20X1, the end of its fiscal year, are given below. Data about the beginning and ending inventories are also given. INSTRUCTIONS 1. Prepare a statement of cost of go

> The Lawn Shop sells plants, fertilizers, and other garden products. The store has three departments: plants, chemicals, and tools. Certain information about the revenues and expenses of the departments for the year ended December 31, 20X1, follows. Indir

> Selected information from the adjusted trial balance of 4Feet Co. as of December 31, 20X1, follows: INSTRUCTIONS Prepare a departmental income statement for the year ended December 31, 20X1. The bases for allocating indirect expenses are given below. (No

> How is the net delivered cost of purchases computed?

> The comparative balance sheet for Short Company as of December 31, 2022 and 2021, is shown below, followed by the condensed income statement. INSTRUCTIONS Prepare a statement of cash flows for 2022. Additional information for the year follows: a. Acquire

> The condensed income statement and comparative balance sheet of The Donald Inc. as of December 31, 2022 and 2021, are provided below. Other financial data are also given. INSTRUCTIONS Prepare a statement of cash flows for The Donald Inc. for 2022. Additi

> Postclosing trial balance data and other financial data for KB Company as of December 31, 2022 and 2021, follow. INSTRUCTIONS Prepare a statement of cash flows for 2022. Additional information for the year follows: a. Sold common stock for $50,000 in cas

> Below you will find the condensed financial statements for Koko Inc. and Suz Inc. for 2022. INSTRUCTIONS 1. Compute the following ratios for each company (please round to 2 decimal places for these calculations): a. Rate of return on net sales b. Rate of

> Using the financial statements for Meeting Pointe, Inc. from Problem 23.1A, calculate the following financial ratios for 2021 and 2022. Round percentages to nearest 0.1 percent; round to whole numbers those ratios expressed as a number times 1 (as curren

> The firm’s comparative income statement and balance sheet for the years 2022 and 2021 follow: INSTRUCTIONS 1. Prepare both a horizontal and a vertical analysis of the statements. Carry all calculations to two decimal places, and then ro

> On May 1, 2022, Star Inc. issued $600,000 face value, 10 percent bonds at 98.6. The bonds are dated May 1, 2022, and mature 10 years later. The discount is amortized on each interest payment date. The interest is payable semiannually on May 1 and Novembe

> TNCal Company has outstanding $500,000 of its 6 percent bonds payable, dated January 1, 2022, and maturing on January 1, 2042, 20 years later. The corporation is required under the bond contract to transfer $25,000 to a sinking fund each year. The direct

> The board of directors of Watch Shop, Inc., authorized the issuance of $1,000,000 face value, 10 year, 5 percent bonds dated April 1, 2022, and maturing on April 1, 2032. Interest is payable semiannually on April 1 and October 1. INSTRUCTIONS 1. Record t

> Why are the invoice date and terms recorded in the purchases journal?

> The board of directors of Calmont, LLC, authorized the issuance of $600,000 face value, 20-year, 6 percent bonds, dated March 1, 2022, and maturing on March 1, 2042. Interest is payable semiannually on September 1 and March 1. INSTRUCTIONS 1. Record the

> The board of directors of ALL Services Inc. authorized the issuance of $500,000 face value, 20 year, 5 percent bonds dated April 1, 2022, and maturing on April 1, 2042. Interest is payable semiannually on April 1 and October 1. ALL uses the calendar year

> The Stockholders’ Equity section of the balance sheet of Serious Corporation on January 1, 20X1, is shown below; selected transactions for the year follow: INSTRUCTIONS 1. Open the stockholders’ equity accounts in the

> The stockholders’ equity accounts of Genisus Corporation on January 1, 20X1, contained the following balances: Preferred Stock (10%, $100 par value, 10,000 shares authorized) Issued and Outstanding, 2,000 Shares $200,000 Paid-in Capital

> Bruin Corporation has been authorized to issue 5,000 shares of 12 percent noncumulative, nonparticipating preferred stock with a par value of $100 per share and 200,000 shares of common stock with a par value of $10 per share. As of December 31, 20X1, 2,

> Selected transactions of Oceanic Corporation during 20X1 follow. Record them in the general journal. Analyze: What annual per share dividend was paid to common stockholders in 20X1?

> Stove Inc. was organized on March 1, 20X1, to operate a delivery service. The firm is authorized to issue 75,000 shares of no-par-value common stock with a stated value of $100 per share and 30,000 shares of $100 par-value, 8 percent preferred stock that

> Cold Corp., a new corporation, took over the assets and liabilities of Trey Cold on January 2, 20X1. The assets and liabilities, after appropriate revaluation by Cold, are as follows (amounts in parentheses are credits; other amounts are debits): Cash $

> Jone Nelson and Helen Giddings are equal partners in N&G Appliance Center, which sells appliances and operates an appliance repair service. Nelson and Giddings have decided to incorporate the business. The new corporation will be known as N&G App

> A portion of the Stockholders’ Equity section of CMH Corporation’s balance sheet as of December 31, 20X3, appears below. Dividends have not been paid for the years 20X1 and 20X2. There has been no change in the number of shares of stock issued and outsta

> What two methods are commonly used to record sales involving credit cards issued by credit card companies?

> Red Hot Company issued and has outstanding 100,000 shares of $10 par-value common stock and 5,000 shares of $50 par-value 6 percent preferred stock. The board of directors votes to distribute $10,000 as dividends in 20X1, $20,000 in 20X2, and $100,000 in

> Dexter Thomas and Herman Walker, attorneys, operate a law practice. They would like to expand the expertise of their firm. In anticipation of this, they have agreed to admit Jewell Lorenzo to the partnership on January 1, 20X1. The capital account balanc

> The balance sheet of Adams Pharmacy after the revenue, expense, and partners’ drawing accounts have been closed on December 31, 20X1, follows: On that date, Larry Adams, Hazel Adams, and Isiah Adams agree to admit Vickie Neal to the par

> Lewis Wardell and Lewis Lomas own Lewis’s Antiques. Their partnership agreement provides for annual salary allowances of $200,000 for Wardell and $180,000 for Lomas, and interest of 10 percent on each partner’s invested capital at the beginning of the ye

> Angie Castillo and Reesa Cameron own The Garden and Lawn Shop. The partnership agreement provides that Castillo can withdraw $10,000 a month and Cameron, $9000 a month in anticipation of profits. The withdrawals, which are not considered to be salaries,

> Thomas Richey operates a small shop that sells fishing equipment. His postclosing trial balance on December 31, 20X1, is shown below. Richey plans to enter into a partnership with Kathryn Price, effective January 1, 20X2. Profits and losses will be share

> James Walker operates a store that sells computer software. Walker has agreed to enter into a partnership with Robert Tolliver, effective January 1, 20X1. The new firm will be called International Computing. Walker is to transfer all assets and liabiliti

> Selected accounts of the Johnson Company are listed below. On January 1, 20X1, the only intangible asset in the company’s accounts was Goodwill. This was recorded seven years ago when the company acquired another company and paid $150,000 more than the f

> Hendrix Realty Company owns a number of large office buildings in several cities in the United States. One of the buildings is 16 years old and has had a large number of vacant office suites for several years. The building’s book value is $26.4 million.

> Kingston Mining Company had total depletable capitalized costs of $828,000 for a mine acquired in early 20X1. It was estimated that the mine contained 920,000 tons of recoverable ore when production began. During 20X1, 46,500 tons were mined, and 174,800

> In a particular state, the sales tax rate is 5 percent of sales. The retailer is allowed to record both the selling price and the tax in the same account. Explain how to compute the sales tax due when this method is used.

> James Company purchased four identical machines on January 10, 20X1, paying $5,500 for each. The useful life of each machine is expected to be five years, with a salvage value of $700 each. The company uses the straight-line method of depreciation. Selec

> The transactions listed below occurred at Jenson Company during 20X1: INSTRUCTIONS Note: In following these instructions, assume that straight-line depreciation is used and that depreciation was last recorded on December 31, 20X0. Compute depreciation to

> On January 12, 20X1, Zolle Company purchased a computer (cost, $7,500; expected life, five years; estimated salvage value, $1,500) and a lightweight van for delivery purposes (cost, $36,000; estimated life, seven years; estimated salvage value, $8,000).

> On January 5, 20X1, Sampson Company purchased equipment for $325,000 that had an estimated useful life of five years or 150,000 units of product. The estimated salvage value was $25,000. Actual production data for the first three years were 20X1—26,000 u

> On January 4, 20X1, Wilson Company purchased new equipment for $310,000 that had a useful life of four years and a salvage value of $40,000. INSTRUCTIONS Prepare a schedule showing the annual depreciation and end-of-year accumulated depreciation for the

> On January 6, 20X1, Turner Company purchased a site for a new manufacturing plant for $7,200,000. At a cost of $45,880, it razed an existing facility (fair market value $600,000) and received $32,000 from its salvage. The company also paid $15,200 in att

> Jamison Sailing Company sells boats as a supplement to its boat storage operations. Data for its boat sales for August 20X1 are given below. The beginning inventory on August 1 was composed of the following items: INSTRUCTIONS Sales during the month were

> The August 1 inventory of Thompson Company had a cost of $180,000 and a retail value of $250,000. During August, merchandise was purchased for $202,260 and marked to sell for $304,000. August sales totaled $272,000. INSTRUCTIONS 1. Compute the retail val

> Over the past several years, Buzman Electronics has had an average gross profit of 30 percent. At the end of 20X1, the income statement of the company included the following information: Investigation revealed that employees of the company had not taken

> This data is for selected inventory items at Kimble Supply Company: INSTRUCTIONS Determine the amount to be reported as the inventory valuation at cost or net realizable value, whichever is lower, under each of these methods: 1. Lower of cost or net real

> The sales tax on a credit sale is not collected from the customer immediately. When is this tax usually entered in a firm’s accounting records? What account is used to record this tax?

> The following data pertains to software packages in the inventory of the Investment Software division of Foreign Market Investment Outlets: Inventory, January 1 110 units at $234 Purchases: May 10 80 units at $230 August 18 115 units at $228 October 1

> The following data concerns inventory and purchases at Hinojosa Company: Inventory, January 1 100 units at $113 Purchases: January 6 70 units at $112 January 15 54 units at $113 January 22 44 units at $106 Inventory, January 31 100 units INSTRUCTIO

> On May 16, 20X1, Safeway Company received a 90-day, 8 percent, $10,500 interest-bearing note from Black Company in settlement of Black’s past-due account. On June 30, Safeway discounted this note at Fargo Bank and Trust. The bank charged a discount rate

> The notes receivable held by the Tuttle Company on August 3, 20X1, are summarized below. On August 4, 20X1, Tuttle discounted all of these notes at Community Bank and Trust at a discount rate of 10 percent. Compute the net proceeds received from discount

> The following notes were received by Keller Company during 20X1: Compute the maturity value of each note. Analyze: What is the total interest expense on these notes for the year?

> Give the general journal entry to record each of the following transactions for Wilkinson Company: 1. Issued a 6-month, 9 percent note for $110,000 to purchase two forklifts on May 14, 20X1 (debit Warehouse Equipment). 2. Discounted its own 180-day, noni

> Keller Company issued the following notes during 20X1. Find the interest due on each of the notes, using the interest formula method. Show all calculations. 1. A $30,000 note at 9 percent for 180 days, issued February 15. 2. A $28,000 note at 12 percent

> Pittman Company records uncollectible accounts expense as they occur. Selected transactions for 20X1 and 20X2 are described below. The accounts involved in these transactions are Notes Receivable, Accounts Receivable, and Uncollectible Accounts Expense.

> The balances of selected accounts of the Davidson Company on December 31, 20X1, are given below: Accounts Receivable $ 850,000 Allowance for Doubtful Accounts (credit) 4,000 Total Sales 10,050,000 Sales Returns and Allowances (total) 250,000 INSTRUCTIONS

> The schedule of accounts receivable by age, shown below, was prepared for the Lucero Company at the end of the firm’s fiscal year on December 31, 20X1: INSTRUCTIONS 1. Compute the estimated uncollectible accounts at the end of the year

> What kind of account is Sales Returns and Allowances?