Question: Explain where each of these items would

> On January 6, Jacob Co. sells merchandise on account to Harley Inc. for $9,200, terms 1/10, n/30. On January 16, Harley pays the amount due. Instructions Prepare the entries on Jacob Co.’s books to record the sale and related collection. (Omit cost of go

> Assume that on September 1, Office Depot had an inventory that included a variety of calculators. The company uses a perpetual inventory system. During September, these transactions occurred. Sept. 6 Purchased calculators from Dragoo Co. at a total cost

> On July 15, a company purchases on account goods costing $1,900, with credit terms of 2/10, n/30. On July 18, the company receives a $400 credit memo from the supplier for damaged goods. Give the journal entry on July 24 to record payment of the balance

> In the following cases, use a periodic inventory system to identify the item(s) designated by the letters X and Y. (a) Purchases − X − Y = Net purchases. (b) Cost of goods purchased − Net purchases = X. (c) Beginning inventory + X = Cost of goods availab

> Harbinger Inc. reported sales of $2 million for 2017. Accounts receivable decreased $150,000 and accounts payable increased $300,000. Compute cash receipts from customers, assuming that the receivable and payable transactions are related to operations.

> Identify the accounts that are added to or deducted from purchases to determine the cost of goods purchased under a periodic system. For each account, indicate (a) whether it is added or deducted, and (b) its normal balance.

> Suppose 3M Company reported the following financial data for 2017 and 2016 (in millions). Instructions (a) Calculate the current ratio for 3M for 2017 and 2016. (b) Suppose that at the end of 2017, 3M management used $300 million cash to pay off $300 mi

> Dowell Hardware reported cost of goods sold as follows. Dowell made two errors: 1. 2016 ending inventory was overstated by $2,000. 2. 2017 ending inventory was understated by $5,000. Instructions Compute the correct cost of goods sold for each year.

> If a 6%, 10-year, $800,000 bond is issued at face value and interest is paid annually, what is the amount of the interest payment at the end of the first period?

> Prepare the journal entries to record these transactions on Kimble Company’s books using a periodic inventory system. (a) On March 2, Kimble Company purchased $800,000 of merchandise from Poe Company, terms 2/10, n/30. (b) On March 6, Kimble Company retu

> Hoffman Corporation reported income taxes of $370,000,000 on its 2017 in-come statement and income taxes payable of $277,000,000 at December 31, 2016, and $528,000,000 at December 31, 2017. What amount of cash payments were made for in-come taxes during

> Dorsett Corporation reported sales revenue of $257,000, net income of $45,300, cash of $9,300, and net cash provided by operating activities of $23,200. Accounts receivable have increased at three times the rate of sales during the last 3 years. Instruct

> On October 5, Iverson Company buys merchandise on account from Lasse Company. The selling price of the goods is $5,000, and the cost to Lasse Company is $3,000. On October 8, Iverson returns defective goods with a selling price of $640 and a scrap value

> Cabo Corporation reported net income of $346,000, cash of $67,800, and net cash provided by operating activities of $221,200. What does this suggest about the quality of the company’s earnings? What further steps should be taken?

> Suppose Columbia Sportswear Company had accounts receivable of $299,585,000 at January 1, 2017, and $226,548,000 at December 31, 2017. Assume sales revenue was $1,244,023,000 for the year 2017. What is the amount of cash receipts from customers in 2017?

> Garten Corporation reported net sales $800,000, cost of goods sold $520,000, operating expenses $210,000, and net income $68,000. Calculate the following values and explain what they mean: (a) profit margin and (b) gross profit rate.

> Scribe Company reports net sales of $800,000, gross profit of $560,000, and net income of $230,000. What are its operating expenses?

> The trial balance of Mendez Company at the end of its fiscal year, August 31, 2017, includes these accounts: Beginning Inventory $18,700, Purchases $154,000, Sales Revenue $190,000, Freight-In $8,000, Sales Returns and Allowances $3,000, Freight-Out $1,0

> Dublin Corporation reported net sales of $250,000, cost of goods sold of $150,000, operating expenses of $50,000, net income of $32,500, beginning total assets of $520,000, and ending total assets of $600,000. Calculate each of the following values and e

> Suppose Canwest Global Communications Corp. reported net cash used by operating activities of $104,539,000 and sales revenue of $2,867,459,000 during 2017. Cash spent on plant asset additions during the year was $79,330,000. Calculate free cash flow.

> Here is the income statement for Myers, Inc. Additional information: 1. Common stock outstanding January 1, 2017, was 32,000 shares, and 40,000 shares were outstanding at December 31, 2017. 2. The market price of Myers stock was $14 in 2017. 3. Cash div

> Assume the same information as in BE5-9 and also that Spacey Company has beginning inventory of $60,000, ending inventory of $90,000, and net sales of $612,000. Determine the amounts to be reported for cost of goods sold and gross profit. Data from BE5-9

> SUPERVALU, one of the largest grocery retailers in the United States, is head-quartered in Minneapolis. Suppose the following financial information (in millions) was taken from the company’s 2017 annual report: net sales $44,597, net income $393, beginni

> Presented here are the components in Salas Company’s income statement. Determine the missing amounts. Sales Cost of Gross Operating Expenses (d) (e) $46,200 Net Goods Sold Revenue $ 71,200 $108,000 (a) Profit $ 30,000 (c) $109,600 I

> Suppose these selected condensed data are taken from recent balance sheets of Bob Evans Farms (in thousands). Compute the current ratio for each year and comment on your results. 2017 2016 $ 13,606 $ 7,669 19,951 31,345 11,909 Cash Accounts receivab

> Sprouts Corporation reported net cash provided by operating activities of $412,000, net cash used by investing activities of $250,000, and net cash provided by financing activities of $70,000. In addition, cash spent for capital assets during the period

> Information for two companies in the same industry, Merrill Corporation and Wingate Corporation, is presented here. Instructions Compute free cash flow for both companies and compare. Merrill Wingate Corporation Corporation $ 80,000 Net cash provided

> Tascon Corporation sells coffee beans, which are sensitive to price fluctuations. The following inventory information is available for this product at December 31, 2017. Instructions Calculate Tascon’s inventory by applying the lower-o

> In its income statement for the year ended December 31, 2017, Laine Inc. reported the following condensed data. Instructions (a) Prepare an income statement. (b) Prepare a comprehensive income statement. $ 725,000 Operating expenses Cost of goods so

> Assume that Spacey Company uses a periodic inventory system and has these account balances: Purchases $404,000, Purchase Returns and Allowances $13,000, Purchase Discounts $9,000, and Freight-In $16,000. Determine net purchases and cost of goods purchase

> Ravine Company issues $400,000, 20-year, 7% bonds at 101. Prepare the journal entry to record the sale of these bonds on June 1, 2017.

> Suppose the following is 2017 information for PepsiCo, Inc. and The Coca-Cola Company. Instructions Compute free cash flow for both companies and compare. ($ in millions) Coca-Cola Pepsico $ 6,796 8,772 5,979 43,232 2,128 2,732 $ 8,186 Net cash provi

> Suppose during 2017 that Cypress Semiconductor Corporation reported net cash provided by operating activities of $89,303,000, cash used in investing of $43,126,000, and cash used in financing of $7,368,000. In addition, cash spent for fixed assets during

> Digital Camera Shop Inc. uses the lower-of-cost-or-market basis for its inventory. The following data are available at December 31. Instructions What amount should be reported on Digital Camera Shop’s financial statements, assuming the

> Hana Ascot is planning to start a business. Identify for Hana the advantages and disadvantages of the corporate form of business organization.

> Winnebago Industries, Inc. is a leading manufacturer of motor homes. Suppose Winnebago reported ending inventory at August 29, 2017, of $46,850,000 under the LIFO inventory method. In the notes to its financial statements, assume Winnebago reported a LIF

> Suppose in its income statement for the year ended June 30, 2017, The Clorox Company reported the following condensed data (dollars in millions). Instructions (a) Prepare a multiple-step income statement. (b) Calculate the gross profit rate and the prof

> Silas Company sold goods with a total selling price of $800,000 during the year. It purchased goods for $380,000 and had beginning inventory of $67,000. A count of its ending inventory determined that goods on hand was $50,000. What was its cost of goods

> Bridle Inc. issues $300,000, 10-year, 8% bonds at 98. Prepare the journal entry to record the sale of these bonds on March 1, 2017.

> (a) If Erin Company had net income of $300,000 in 2016 and it experienced a 24.5% increase in net income for 2017, what is its net income for 2017? (b) If 6 cents of every dollar of Erin’s revenue is net income in 2016, what is the dollar amount of 2016

> Suppose at December 31 of a recent year, the following information (in thousands) was available for sunglasses manufacturer Oakley, Inc.: ending inventory $155,377, beginning inventory $119,035, cost of goods sold $349,114, and sales revenue $761,865. Ca

> A credit sale is made on July 10 for $900, terms 1/15, n/30. On July 12, the purchaser returns $100 of goods for credit. Give the journal entry on July 19 to record the receipt of the balance due within the discount period.

> In its income statement for the year ended December 31, 2017, Darren Company reported the following condensed data. Instructions (a) Prepare a multiple-step income statement. (b) Calculate the profit margin and gross profit rate. (c) In 2016, Darren had

> The following information relates to Karen Weigel Inc. for the year 2017. After analyzing the data, (a) compute net income and (b) prepare a comprehensive income statement for the year ending December 31, 2017. $ 1,800 Retained earnings, January 1,

> Data for Betsy Strand are presented in BE10-5(given below). Prepare the employer’s journal entry to record payroll taxes for the period. Ignore unemployment taxes. Data from BE10-5: Betsy Strand’s regular hourly wage rate is $16, and she receives an hour

> The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to its financial statements, are also provided in Appendix F. Instructions Use the compa

> If Coho Company had net income of $382,800 in 2017 and it experienced a 16% increase in net income over 2016, what was its 2016 net income?

> Wahlowitz Video Center accumulates the following cost and market data at December 31. Compute the lower-of-cost-or-market valuation for the company’s inventory. Inventory Categories Cost Market Data Data Cameras $12,500 9,000 13,000

> Financial information is presented here for two companies. Instructions (a) Fill in the missing amounts. Show all computations. (b) Calculate the profit margin and the gross profit rate for each company. (c) Discuss your findings in part (b). Yoste N

> Net income was $500,000 in 2015, $485,000 in 2016, and $518,400 in 2017. What is the percentage of change from (a) 2015 to 2016, and (b) from 2016 to 2017? Is the change an increase or a decrease?

> Presented below is information for Lieu Co. for the month of January 2017. Instructions (a) Prepare an income statement using the format presented in Illustration 5-11. (b) Prepare a comprehensive income statement. (c) Calculate the profit margin and the

> Barto Company provides this information for the month ended October 31, 2017: sales on credit $300,000, cash sales $150,000, sales discounts $5,000, and sales returns and allowances $19,000. Prepare the sales section of the income statement based on this

> Basse Corporation has 7,000 shares of common stock outstanding. It declares a $1 per share cash dividend on November 1 to stockholders of record on December 1. The dividend is paid on December 31. Prepare the entries on the appropriate dates to record th

> Waymon Co. has net sales of $100,000, cost of goods sold of $70,000, and operating expenses of $18,000. What is its gross profit?

> The adjusted trial balance of Doqe Company shows these data pertaining to sales at the end of its fiscal year, October 31, 2017: Sales Revenue $900,000, Freight-Out $14,000, Sales Returns and Allowances $22,000, and Sales Discounts $13,500. Instructions

> On June 30, Flores Corporation discontinued its operations in Mexico. On September 1, Flores disposed of the Mexico facility at a pretax loss of $640,000. The applicable tax rate is 25%. Show the discontinued operations section of Flores’s statement of c

> Clean Lake Corporation’s accounting records show the following at year-end December 31, 2017: Assuming that Clean Lake Corporation uses the periodic system, compute (a) cost of goods purchased and (b) cost of goods sold. $ 5,900 8,

> From the information in BE5-3, prepare the journal entries to record these transactions on McLeena Company’s books under a perpetual inventory system. Information from BE5-3: (a) On March 2, Borst Company sold $800,000 of merchandise to McLeena Company,

> Layes Inc. issues 8,000 shares of $100 par value preferred stock for cash at $106 per share. Journalize the issuance of the preferred stock.

> Carolina University sold 9,000 season football tickets at $100 each for its five-game home schedule. What entries should be made (a) when the tickets are sold and (b) after each game?

> What amount did Apple report as “Other comprehensive earnings” in its consolidated statement of comprehensive income ending September 27, 2014? By what percentage did Apple’s “Comprehensive income” differ from its “Net income”?

> (a) Explain the income measurement process in a merchandising company. (b) How does income measurement differ between a merchandising company and a service company?

> On June 10, Pais Company purchased $9,000 of merchandise from McGiver Company, terms 3/10, n/30. Pais pays the freight costs of $400 on June 11. Goods totaling $600 are returned to McGiver for credit on June 12. On June 19, Pais Company pays McGiver Comp

> Prepare the journal entries to record the following transactions on Borst Company’s books using a perpetual inventory system. (a) On March 2, Borst Company sold $800,000 of merchandise to McLeena Company, terms 2/10, n/30. The cost of the merchandise sol

> On June 1, Forrest Inc. issues 3,000 shares of no-par common stock at a cash price of $7 per share. Journalize the issuance of the shares.

> Archer Company issued (in pounds) £4,000,000 par value, 7% convertible bonds at 99 for cash. The net present value of the debt without the conversion feature is £3,800,000. Prepare the journal entry to record the issuance of the convertible bonds.

> The following are the major balance sheet classifications. Current assets (CA) Current liabilities (CL) Long-term investments (LTI) Long-term liabilities (LTL) Property, plant, and equipment (PPE) Stockholders’ equity (SE) Intangible assets (IA) Instruct

> The financial statements of Amazon.com, Inc. are presented in Appendix D. Financial statements for Wal-Mart Stores, Inc. are presented in Appendix E. Instructions (a) Based on the information in the financial statements, compute these 2014 values for eac

> Data for McLanie Company are presented in BE6-2. Compute the cost of the ending inventory under the average-cost method. (Round the cost per unit to three decimal places.) Data from BE6-2 given below: In its first month of operations, McLanie Company mad

> Matilda Company reported the following amounts (in euros) in 2017: Net income, €150,000; Unrealized gain related to revaluation of buildings, €10,000; and Unrealized loss on non-trading securities, €(35,000). Determine Matilda’s total comprehensive incom

> Rita Company buys merchandise on account from Linus Company. The selling price of the goods is $900 and the cost of the goods sold is $590. Both companies use perpetual inventory systems. Journalize the transactions on the books of both companies.

> Pietr Corporation reports operating expenses of $90,000, excluding depreciation expense of $15,000, for 2017. During the year, prepaid expenses decreased $7,200 and accrued expenses payable increased $4,400. Compute the cash payments for operating expens

> Kale Company issued $350,000 of 8%, 20-year bonds on January 1, 2017, at face value. Interest is payable annually on January 1. Instructions Prepare the journal entries to record the following events. (a) The issuance of the bonds. (b) The accrual of int

> On May 10, Pilar Corporation issues 2,500 shares of $5 par value common stock for cash at $13 per share. Journalize the issuance of the stock.

> Presented here are long-term liability items for Stevens Inc. at December 31, 2017. Prepare the long-term liabilities section of the balance sheet for Stevens Inc. Bonds payable (due 2021) $700,000 Notes payable (due 2019) 80,000 Discount on b

> The balance sheet for Gelher Company reports the following information on July 1, 2017. Gelher decides to redeem these bonds at 102 after paying annual interest. Prepare the journal entry to record the redemption on July 1, 2017. GELHER COMPANY Bala

> Clooney Corporation issued 3,000 7%, 5-year, $1,000 bonds dated January 1, 2017, at face value. Interest is paid each January 1. (a) Prepare the journal entry to record the sale of these bonds on January 1, 2017. (b) Prepare the adjusting journal entry o

> On January 1, Kirkland Company issued $300,000, 8%, 10-year bonds at face value. Interest is payable annually on January 1. Instructions Prepare journal entries to record the following events. (a) The issuance of the bonds. (b) The accrual of interest on

> Indicate whether each of the following transactions would increase (+), decrease (−), or not affect (N/A) total assets, total liabilities, and total stockholders’ equity. Stockholders' Transaction (a) Declared cash

> The T-accounts for Equipment and the related Accumulated Depreciation—Equipment for Goldstone Company at the end of 2017 are shown here. In addition, Goldstone’s income statement reported a loss on the disposal of plan

> Data for Betsy Strand are presented in BE10-5. Prepare the employer’s journal entries to record (a) Betsy’s pay for the period and (b) the payment of Betsy’s wages. Use January 15 for the end of the pay period and the payment date.

> Due to rapid employee turnover in the accounting department, the following transactions involving intangible assets were improperly recorded by Inland Corporation. 1. Inland developed a new manufacturing process, incurring research and development costs

> Betsy Strand’s regular hourly wage rate is $16, and she receives an hourly rate of $24 for work in excess of 40 hours. During a January pay period, Betsy works 47 hours. Betsy’s federal income tax withholding is $95, and she has no voluntary deductions.

> Using the data presented in BE13-4(given below) for Rollaird Company, perform vertical analysis. December 31, 2017 December 31, 2016 Accounts receivable $ 460,000 $ 400,000 Inventory Total assets 780,000 3,164,000 650,000 2,800,000

> Ratzlaff Company issues (in euros) €2 million, 10-year, 8% bonds at 97, with interest payable annually on January 1. Instructions (a) Prepare the journal entry to record the sale of these bonds on January 1, 2017. (b) Assuming instead that the above bond

> Bramble University sells 3,500 season basketball tickets at $80 each for its 10-game home schedule. Give the entry to record (a) the sale of the season tickets and (b) the revenue recognized after playing the first home game.

> In performing accounting services for small businesses, you encounter the following situations pertaining to cash sales. 1. Cerviq Company enters sales and sales taxes separately on its cash register. On April 10, the register totals are sales $22,000 an

> Using these data from the comparative balance sheet of Rollaird Company, perform horizontal analysis. December 31, 2017 December 31, 2016 Accounts receivable $ 460,000 $ 400,000 Inventory Total assets 780,000 3,164,000 650,000 2,800,000

> Greenspan Supply does not segregate sales and sales taxes at the time of sale. The register total for March 16 is $10,388. All sales are subject to a 6% sales tax. Compute sales taxes payable and make the entry to record sales taxes payable and sales.

> The following T-account is a summary of the Cash account of Alixon Company. What amount of net cash provided (used) by financing activities should be reported in the statement of cash flows? Cash (Summary Form) Balance, Jan. 1 Receipts from customer

> Hive Company borrows $90,000 on July 1 from the bank by signing a $90,000, 7%, 1-year note payable. Prepare the journal entries to record (a) the proceeds of the note and (b) accrued interest at December 31, assuming adjusting entries are made only at th

> Meenen Corporation has the following accounts at December 31, 2017 (in euros): Share Capital—Ordinary, €10 par, 5,000 shares issued, €50,000; Share Premium—Ordinary €10,000; Retained Earnings €45,000; and Treasury Shares—Ordinary, 500 shares, €11,000. Pr

> Summary financial information for Gandaulf Company is as follows. Compute the amount and percentage changes in 2017 using horizontal analysis, assuming 2016 is the base year. Dec. 31, 2017 Dec. 31, 2016 $ 200,000 1,040,000 $ 220,000 Current assets P

> An inexperienced accountant for Silva Corporation showed the following in the income statement: income before income taxes $450,000 and unrealized gain on available-for-sale securities (before taxes) $70,000. The unrealized gain on available-for-sale sec

> On May 10, Jaurez Corporation issues 1,000 shares of $10 par value ordinary shares for cash at $18 per share. Journalize the issuance of the shares.

> Describe the treatment of each of the following items under IFRS versus GAAP. (a) Interest paid. (b) Interest received. (c) Dividends paid. (d) Dividends received.

> Peete Company was organized on January 1. During the first year of operations, the following plant asset expenditures and receipts were recorded in random order. Instructions Analyze the transactions using the following table column headings. Enter the

> The Coca-Cola Company’s accounts receivable turnover was 9.05 in 2014, and its average amount of net receivables during the period was $3,424 million. What is the amount of its net credit sales for the period? What is the average collection period in day

> Suppose in 2017 that Campbell Soup Company reported average total assets of $6,265 million, net sales of $7,586 million, and net income of $736 million. What was Campbell Soup’s return on assets?

> Pauli Company’s internal controls over cash disbursements provide for the treasurer to sign checks imprinted by a check writer after comparing the check with the approved invoice. Identify the internal control principles that are present in these control