Fill This Form To Receive Instant Help

Help in Homework
trustpilot ratings
google ratings


Homework answers / question archive / Chapter 1: Exercise 2 2

Chapter 1: Exercise 2 2

Accounting

Chapter 1:
Exercise 2
2. Basic computations. The following selected balances were extracted from the accounting records of
Rossi Enterprises on December 31, 20X3: Accounts Payable $ 3,200 , Interest Expense $ 2,500, Accounts
Receivable 14,800, Land 18,000, Auto Expense 1,900, Loan Payable 40,000, Building 30,000, Tax Expense
3,300, Cash 7,400, Utilities Expense 4,100, Fee Revenue 56,900, Wage Expense 37,500.
a. Determine Rossi’s total assets as of December 31.
b. Determine the company’s total liabilities as of December 31.
c. Compute 20X3 net income or loss.

Exercise 5
5. Accounting equation; analysis of owner’s equity. Sportscar Repair revealed the following financial
data on January 1 and December 31 of the current year.
Assets Liabilities
January 1 $45,000 $20,000
December 31 49,000 31,000
a. Compute the change in owner’s equity during the year by using the accounting equation.
b. Assume that there were no owner investments or withdrawals during the year. What is the probable
cause of the change in owner’s equity from part (a)?
c. Assume that there were no owner investments during the year. If the owner withdrew $17,000,
determine and compute the company’s net income or net loss. Be sure to label your answer.
d. If owner investments and withdrawals amounted to $13,000 and $2,000, respectively, determine
whether the company operated profitably during the year. Show appropriate calculations.

Exercise 8:

8. . Financial statement relationships. The following information appeared on the financial statements of
the Altoona Repair Company:

Income statement
Total expenses $ 64,900
Net income 7,200
Statement of owner’s equity
Beginning owner’s equity balance $ 113,200
Owner withdrawals 61,300
Ending owner’s equity balance 70,800
Balance sheet
Total liabilities $ 97,000
By picturing the content of and the interrelationships among the financial statements, determine the
following:
a. Total revenues for the year
b. Total owner investments
c. Total assets

Chapter 1:
Problems 3
3. Statement preparation. The following information is taken from the accounting records of Grimball
Cardiology at the close of business on December 31, 20X1.
Accounts Payable $ 14,700 Surgery Revenue $175,000
Surgical Expenses 80,000 Cash 60,000
Surgical Equipment 37,000 Office Equipment 118,000
Salaries Expense 30,000 Rent Expense 15,000
Accounts Receivable 135,000 Loan Payable 10,300
Utilities Expense 5,000

Problem 5
5. 5. Financial statement preparation. On October 1, 20X6, Susan Thompson opened Thompson
Decorating Services, a sole proprietorship. Susan began operations with $50,000 cash, 60% of which was
acquired via an owner investment. The remaining amount was obtained from a bank loan. A review of
the accounting records for October revealed the following:
• Asset purchases: Van, $16,000; office equipment, $4,000; and decorator (household) furnishings,
$17,000. These amounts were paid in cash except for $2,100 that is still owed for the furnishings
acquisition.
• Services performed: Total billings on account, $18,300. Clients have remitted a total of $14,200 in
settlement of their balances due.
• Expenses incurred: Salaries, $8,700; advertising, $2,500; taxes, $150; postage, $1,800; utilities, $100;
interest, $450; and miscellaneous, $200. These amounts had been paid by month-end with the
exception of $700 of the advertising expenditures.
Further information revealed that Thompson withdrew $5,500 of cash from the business on October 31.
Instructions
a. Prepare an income statement for the month ending October 31, 20X6.
b. Prepare a statement of owner’s equity for the month ending October 31, 20X6.
c. Prepare a balance sheet as of October 31, 20X6

Chapter 2
Exercise 3
Basic journal entries. The following April transactions pertain to the Jennifer Royall Company:
4/1: Received cash of $15,000 and land valued at $10,000 from Jennifer Royall as an investment in the
business.
4/5: Provided $1,200 of services to Jason Ratchford, a client.
4/5: Ratchford agreed to pay $800 in 15 days and the remaining amount in May.
4/9: Paid $250 in salaries to an employee.
4/19: Acquired a new computer for $3,200; Royall will pay the dealer in May.
4/20: Collected $800 from Jason Ratchford for services provided on April 5.
4/24: Borrowed $7,500 from Best Bank by securing a 6-month loan.

Prepare journal entries (and explanations) to record the preceding transactions and events.
Exercise 4:
4. Trial balance preparation. Brighton Company began operation on March 1 of the current year. The
following account balances were extracted from the general ledger on March 31; all accounts have
normal balances.
Accounts Payable $ 12,000 Interest Expense $ 300
Accounts Receivable 8,800 Land ?
Advertising Expense 5,700 Loan Payable 26,000
Bob Brighton, Capital 30,000 Salaries Expense 11,100
Cash 22,500 Utilities Expense 700
Fees Earned 18,900
a. Determine the cost of the company’s land by preparing a trial balance.
b. Determine the firm’s net income for the period ending March 31.

Option 1

Low Cost Option
Download this past answer in few clicks

5.98 USD

PURCHASE SOLUTION

Already member?


Option 2

Custom new solution created by our subject matter experts

GET A QUOTE