Dan Watson started a small merchandising business in Year 1. The business experienced the following events during its first year ofoperation. Assume that Watson uses the perpetual inventory system.a. Acquired $30,000 cash from the issue of common stock.b. Purchased inventory for $18,000 cash.c. Sold inventory costing $15,000 for $32,000 cash.Required:a. Record the events in a horizontal financial statements model.b. Prepare an income statement for Year 1 (use the multistep format).c. What is the amount of total assets at the end of the period?Complete this question by entering your answers in the tabs below.Required ARequired BTotal assetsRequired CWhat is the amount of total assets at the end of the period?

The accounting equation states that assets are equal to the sum of the liabilities and equity. The…

Answered: Dan Watson started a small…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following transactions occurred during December, the first month of operations for Harris Company. Prepare journal entries to record each transaction. 1) Purchased $500 of inventory on account. 2) Purchased $300 of inventory on account. 3) Paid suppliers $600. 4) Purchased $400 of inventory on account. 5) Paid suppliers $300. Debit Credit Inventory Accounts payable 1) To record purchase of inventory on account. Cash Inventory 2) To record purchase of inventory on account. Cash Inventory 0 x 3) To record payment to suppliers. Cash Inventory 4) To record purchase of inventory on account. Cash Inventory 0 x 5) To record payment to suppliers. Post the transactions (in order) to the accounts payable T-account. (Enter your answers in the first available field under the appropriate debit or credit column.) Accounts Payable Balance 0 x
The accountant for Dolfin Company prepared the following income statement. The auditor has asked you to use this statement to provide additional information to Dolfin Company on the Final Questions panel. Dolfin Company Income Statement For the Year Ended December 31, 2020 1 Sales $316,840.00 2 Expenses: 3 Cost of merchandise sold $215,451.20 4 Selling expenses 41,189.20 5 Administrative expenses 34,852.40 6 Interest expense 275.00 7 Total expenses 291,767.80 8 Net income $25,072.20 Final Questions The auditor has asked you to prepare additional information about Dolfin Company’s results for last year. Use the data shown on the income statement in your computations. 1. Compute the operating expenses for Dolfin Company. 2. Compute the gross profit for Dolfin Company. 3. Compute the income from operations for…
Dan Watson started a small merchandising business in Year 1. The business experienced the following events during its first year of operation. Assume that Watson uses the perpetual inventory system. 1. Acquired $30,500 cash from the issue of common stock. 2. Purchased inventory for $24,400 cash. 3. Sold inventory costing $15,500 for $31,500 cash. Required a. Record the events in general journal format. b. Post the entries to T-accounts. c. Determine the amount of gross margin.. d. What is the amount of net cash flow from operating activities for Year 1? Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Record the events in general journal format. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list
Rite Shoes was involved in the transactions described below. Purchased $9,500 of inventory on account. Paid weekly salaries, $1,050. Recorded sales for the first week: Cash: $8,400; On account: $6,600. Paid for inventory purchased in event (1). Placed an order for $7,500 of inventory. Required: Prepare the appropriate journal entry for each transaction. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Summer Kluxon, Inc. purchased inventory costing $150,000 and sold 75% of the goods for $180,000. All purchases and sales were on account. Kluxon later collected 40% of the accounts receivable. 1. Journalize these transactions for Kluxon, which uses the perpetual inventory system. 2. For these transactions, show what Kluxon will report for inventory, revenues, and expenses on its financial statements. Report gross profit on the appropriate statement. 1. Journalize these transactions for Kluxon, which uses the perpetual inventory system. (Record debits first, then credits. Explanations are not required. Leave unused cells blank.) Journalize the purchase of inventory. Accounts Journal Debit CO Credit
Roger Company completed the following transactions during Year 1. Roger's fiscal year ends on December 31. January 8 Purchased merchandise for resale on account. The invoice amount was $14,840; assume a perpetual inventory system. Paid January 8 invoice. Borrowed $60,000 from National Bank for general use; signed a 12-month, 13% annual interest-bearing note for the money. Purchased merchandise for resale on account. The invoice amount was $17,320. Paid June 3 invoice. Rented office space in one of Roger's buildings to another company and collected six months' rent in advance amounting to $21,000. December 20 Received a $240 deposit from a customer as a guarantee to return a trailer borrowed for 30 days. December 31 Determined wages of $10,400 were earned but not yet paid on December 31 (disregard payroll taxes). Required: January 17 April 1 June 3 July 5 August 1 1. Prepare journal entries for each of these transactions. 2. Prepare the adjusting entries required on December 31. 3. Show…
(B) Zeal Inc. Incorporation completed the following merchandising transactions in the month of May. At the beginning of May, the ledger of Zeal Inc. showed Cash of $8,000 and Zeal Inc., Capital of $45,000. Zeal Inc. incorporation follows the perpetual inventory system. May 3: Sold merchandise for cash to Seliece Co., $5,400. The cost of the merchandise sold was $4,800. May 6: Purchased merchandise on account from Rendick Co., $8,000, terms FOB Destination, 5/10, n/30, The relevant company paid the freight charge of $100. May 7: Purchased Equipment on credit $45,000. The equipment will be used by the business. May 8: Received $500 credit for merchandise inventory returned to Rendick Co. May 12: Paid Rendick Co. in full. May 15: Made refunds to Seliece Co. for defective merchandise $400. The returned merchandise had a scrap value of $50 only. Instructions: Journalize the above transactions
Analyze transactions and make and post journal entries.Makeadjusting entries, produce financial statements, and close nominal accounts. Selfish Gene Company is a merchandising firm. The following events occurredduring the month of May. ( Note: Selfish Gene maintains a perpetual inventorysystem.) Instructions:1.Record the preceding events in general journal form. 2.Which event do you think had the most significant economic impact on SelfishGene Company? Are all economically relevant events recorded in the financialrecords?
Rite Shoes was involved in the transactions described below. Purchased $8,200 of inventory on account. Paid weekly salaries, $920. Recorded sales for the first week: Cash: $7,100; On account: $5,300. Paid for inventory purchased in event (1). Placed an order for $6,200 of inventory. Required:Prepare the appropriate journal entry for each transaction. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Inventory at the beginning of the year cost $13,900. During the year, the company purchased (on account) inventory costing $86,500. Inventory that had cost $82,500 was sold on account for $97,000. Required: a. Calculate the amount of ending inventory. b. What was the amount of gross profit? c. Prepare journal entry to record sale of inventory assuming a perpetual system is used. Debit Credit Account
Your accounts receivable clerk, Mitra Adams, to whom you pay a salary of $1,500 per month, has just purchased a new Acura. You decide to test the accuracy of the accounts receivable balance of $82,000 as shown in the ledger. The following information is available for your first year in business. 1. Collections from customers $198,000 2. Merchandise purchased 320,000 3. Ending merchandise inventory 90,000 4. Goods are marked to sell at 40% above cost Instructions Compute an estimate of the ending balance of accounts receivable from customers that should appear in the ledger and any apparent shortages. Assume that all sales are made on account.
Based on the following transactions, answer the following questions. i. Purchased inventory with a cost of $ 24,800 on account. ii. Sales on account to customers totalled $57,800. iii. Payments made to employees for wages totalled $17,700. iv. Cash collections from customers settling their accounts totalled $41,700. v. Invoice received from the utility company for $3,800 is due in 30 days. vi. Payments totalling $16,900 were made to suppliers to settle part of the balance owing to them. vii. Received a deposit of $2,200 from a customer for goods to be delivered next month. Calculate the revenue,expenses and net income

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