2.99 See Answer

Question: Sterling Company’s bank statement for the


Sterling Company’s bank statement for the month of March included the following information:

Ending balance, March 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $32,346
Bank service charge for March. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130
Interest paid by bank to Sterling for March . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107

In comparing the bank statement to its own cash records, Sterling found the following:

Deposits made but not yet recorded by the bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,689
Checks written and mailed but not yet recorded by the bank . . . . . . . . . . . . . . . . . . . . . . . . 6,530

In addition, Sterling discovered that it had erroneously recorded a check for $46 that should have been recorded for $64. What is Sterling’s correct Cash balance at March 31?


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> How is retailing know-how transferred internationally?

> Discuss the implications for the international marketer of the trend towards cross border retailing.

> What are the main advantages and disadvantages of following a Multiple Distribution Channel Strategy?

> Do grey marketers serve useful marketing functions for consumers and manufacturers?

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> Discuss current distribution trends in world markets.

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> Explain these types of letter of credit: revocable/irrevocable, confirmed/unconfirmed. Under what sets of circumstances would exporters use the following methods of payment: (a) revocable letter of credit; (b) confirmed letter of credit; (c) confirmed ir

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> Why is it often difficult to compute fair arm’s-length transfer prices?

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> . Identify the ways to reach foreign markets by making a domestic sale.

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> Discuss the possible implications that the firm’s choice of geographic expansion strategy may have on the ability of a local marketing manager of a foreign subsidiary to develop and implement marketing programmes.

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> Identify some constraints in marketing to a traditional Muslim society. Use some of the examples in the chapter.

> Do you think that cultural differences between nations are more or less important than cultural variations within nations? Under what circumstances is each important?

> Identify the major dimensions used to analyse a competitor’s strengths and weaknesses profile. Do local, regional and global competitors need to be analysed separately?

> What is the reason for the ‘convergence of orientation’ in LSEs and SMEs?

> Using the following information, compute cash collected from customers. Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,000 Cost of goods sold . . . . . . . . . . . . .

> The company constructed its own building. The cost of materials was $400,000. Labor cost incurred on the construction project was $600,000. Total overhead cost for the company for the year was $8,000,000; total labor cost (including the cost of construct

> Bad debt expense for the year was estimated to be $12,000. Total accounts written off as uncollectible during the year were $8,100. Make the necessary summary journal entries to record this information.

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> Dandy Hardware Stores reported the following asset values in 2012 and 2013: In addition, Dandy Hardware had sales of $3,500,000 in 2013. Cost of goods sold for the year was $2,200,000. Compute Dandy Hardware’s fixed asset turnover rat

> On July 15, Mann Company sold $900,000 in accounts receivable for cash of $750,000. The factor withheld 10% of the cash proceeds to allow for possible customer returns or account adjustments. An Allowance for Bad Debts of $120,000 had previously been est

> Exploratory Company is an oil and gas exploration firm. During 2013, Exploratory engaged in 86 different exploratory projects, only 20 of which were successful. The total cost of this exploration effort was $24 million, $5.6 million of which was associat

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> Pringle Company has a substantial research department. Following are listed, in chronological order, some of the major activities associated with one of Pringle’s research projects. Project Started (a) Purchased special equipment to be used solely for th

> Trend Industries Company reported the following amounts on its 2012 and 2013 financial statements: 1. Compute the accounts receivable turnover for 2013. 2. What is the average collection period during 2013? (Use 365 days.)

> GoodeHill Company replaced some parts of its factory building during 2013: (a) The outside corrugated covering on the factory walls was removed and replaced. The job was done by an expert crew from Hollister Construction Company and will extend the life

> On July 23, Stevensonville Company purchased goods on account for $6,000. Stevensonville later returned defective goods costing $450. Record the purchase and the return of the defective goods assuming (1) A periodic inventory system and (2) A perpetual

> Olavssen Hardware regularly buys merchandise from Dawson Suppliers. Olavssen uses the net method to record purchases and discounts. On August 15, Olavssen Hardware purchased material from Dawson Suppliers. The invoice received from Dawson showed an invoi

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> Refer to Practice 7-2. Make all journal entries necessary to record both the sales and the cash collections. Use the net method of accounting for sales discounts. In Practice 7-2 On January 16, two credit sales were made, one for $300 and one for $400.

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> Because of the extreme deterioration in the financial condition of a customer, the customer’s account in the amount of $7,500 was written off as uncollectible on July 23. By November 1, the customer’s financial condition had improved such that the custom

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> Company A had sales for the year totaling $480,000. The net property, plant, and equipment balance at the beginning of the year was $160,000; the ending balance was $200,000. Compute the fixed asset turnover ratio.

> Using the following information, compute the cash balance. Restricted deposits in foreign bank accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,200 Cash overdraft . . . . . . . . . . . . . . . . . . . . . . . . . .

> Buyer Company purchased Target Company for $800,000 cash. Target Company had total liabilities of $300,000. Buyer Company’s assessment of the fair values it obtained when it purchased Target Company is as follows: Cash . . . . . . . . . . . . . . . . .

> Sales for the year were $400,000. The Accounts Receivable balance was $50,000 at the beginning of the year and $65,000 at the end of the year. Compute the average collection period using (1) The average accounts receivable balance and (2) The ending acco

> Refer to Practice 7-15. Assume that the sale of the receivables was done with recourse. The estimated value of the recourse obligation is $1,300. Make the journal entry necessary on Cammo’s books to record the sale of these receivables with recourse. In

> Cammo Company sold receivables (without recourse) for $53,000. Cammo received $50,000 cash immediately from the factor (the company to whom the receivables were sold). The remaining $3,000 will be received once the factor verifies that none of the receiv

> Stafford Company purchased Deaver Manufacturing for $1,400,000 cash on January 1. The book value and fair value of the assets of Deaver as of the date of the acquisition follow: In addition, Deaver had liabilities totaling $500,000 at the time of the a

> Using the following information, compute cash paid for income taxes. Reported income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $35,500

> Using the following information, compute cash flow from operating activities. (With the limited information given, only the indirect method can be used.) Decrease in inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

> During the year, the company made the following research and development expenditures: Compute the total research and development (R&D) expense for the year assuming (1) The expenditures were for normal R&D, (2) The expenditures were for softwa

> On January 16, two credit sales were made, one for $300 and one for $400. Terms for both sales were 3/15, n/30. Cash for the $300 sale was collected on January 25; cash for the $400 sale was collected on February 14. Make all journal entries necessary to

> Using the following information, compute cash flow from operating activities. (With the limited information given, only the indirect method can be used.) Increase in accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

> The company recently replaced the heating/cooling system for its building. The old system cost $160,000, and was 80% depreciated. The new system cost $210,000, which was paid in cash. The new system will extend the economic useful life of the building by

> On July 15, goods costing $8,400 were sold for $12,000 on account. The customer returned the goods before paying for them. Make the journal entry or entries necessary on the books of the seller to record the return of the goods. Assume that the goods are

> The company purchased a mining site that will have to be restored to certain specifications when the mining production ceases. The cost of the mining site is $800,000, and the restoration cost is expected to be $200,000. It is estimated that the mine wil

> Historically, warranty expenditures have been equal to 4% of sales. Total sales for the year were $750,000. Actual warranty repairs made during the year totaled $37,400. Make the necessary summary journal entries to record this warranty-related informati

> The company has received a donation of land from a rich local philanthropist. The land originally cost the philanthropist $48,000. On the date of the donation, it had a market value of $111,000. Make the journal entry necessary on the books of the compan

> The following aging of accounts receivable is as of the end of the year: Historical experience indicates the following: Age of Account ______________________Percentage Ultimately Uncollectible Less than 30 days . . . . . . . . . . . . . . . . . . . .

> Refer to the information in Practice 5-6. Compute cash paid for operating expenses. In Practice 5-6 Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,000 Cost of goods sol

> Refer to Practice 10-6. Make the journal entry necessary to record total interest paid for the year. Assume that all of the interest was paid in cash on December 31. In Practice 10-6 The company had the following loans outstanding for the entire year:

> Bad debt expense is estimated using the percentage-of-sales method. Total sales for the year were $600,000. The ending balance in Accounts Receivable was $100,000. Historically, bad debts have been 3% of total sales. The economic circumstances of credit

> Credit sales for the year were $150,000. Collections on account were $101,000. Make the necessary summary journal entries to record this information.

> The following summary data are for Gwynn Company: All current assets and current liabilities relate to operations. Instructions: 1. Compute net cash provided by (used in) operating activities for 2012 and 2013. 2. How would the numbers you computed in

> On December 31, 2013, analysis of Sayer Sporting Goods’ operations for 2013 revealed the following. (a) Total cash collections from customers, $105,260. (b) December 31, 2012, inventory balance, $12,180. (c) Total cash payments, $92,450. (d) Accounts rec

> The following data are for Ernst Company. (All inventory is purchased on account, and Accounts Payable relates only to the purchase of inventory.) INCOME STATEMENT DATA Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

> A newly hired staff accountant prepared the pre-audit income statement of Be Fit Recreation Incorporated for the year ending December 31, 2013. The following information was obtained by Be Fit’s independent auditor. (a) Net revenues i

> Refer to the data for Novations, Inc., in Problem 5-47. In Problem 5-47 The table below shows the account balances of Novations, Inc., at the beginning and end of the company’s accounting period. The following additional information

2.99

See Answer