M3-2 Reporting Cash Basis versus Accrual Basis IncomeMostert Music Company had the following transactions in March:a.b.Sold music lessons to customers for $10,000; received $6,000 in cash and the rest on account.Paid $600 in wages for the month.C.Received a $200 bill for utilities that will be paid in April.d. Received $1,000 from customers as deposits on music lessons to be given in April.Complete the following statements for March:Cash Basis Income StatementRevenuesCash SalesCustomer DepositsExpensesWages PaidCash Income$$Accrual Basis Income StatementRevenuesSalesExpensesSalaries and Wages ExpenseUtilities ExpenseNet IncomeCHAPTERitsupa gaitnuos$

Lets understand the basics. There are two way to prepare income statement which are, (1) Cash basis…

M3-2 Reporting Cash Basis versus Accrual Basis Income Mostert Music Company had the following transactions a. Sold music lessons to customers for $10,000; receiv b. Paid $600 in wages for the month. C. Received a $200 bill for utilities that will be paid in d. Received $1,000 from customers as deposits on mu: Complete the following statements for March: Cash Basis Income Statement Revenues Cash Sales Customer Deposits Expenses Wages Paid Cash Income $ $ | SA Accrual Basis Revenues Sales Expenses Salaries and Utilities Expe Net Income

M3-2 Reporting Cash Basis versus Accrual Basis Income Mostert Music Company had the following transactions a. Sold music lessons to customers for $10,000; receiv b. Paid $600 in wages for the month. C. Received a $200 bill for utilities that will be paid in d. Received $1,000 from customers as deposits on mu: Complete the following statements for March: Cash Basis Income Statement Revenues Cash Sales Customer Deposits Expenses Wages Paid Cash Income $ $ | SA Accrual Basis Revenues Sales Expenses Salaries and Utilities Expe Net Income

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 18E

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FINANCIAL RATIOS Use the work sheet and financial statements prepared in Problem 15-8B. All sales are credit sales. The Accounts Receivable balance on January 1 was 38,200. REQUIRED Prepare the following financial ratios: (a)Working capital (b)Current ratio (c)Quick ratio (d)Return on owners equity (e)Accounts receivable turnover and the average number of days required to collect receivables (f)Inventory turnover and the average number of days required to sell inventory
Analyzing the Accounts The controller for Summit Sales Inc. provides the following information on transactions that occurred during the year: a. Purchased supplies on credit, $18,600 b. Paid $14,800 cash toward the purchase in Transaction a c. Provided services to customers on credit1 $46,925 d. Collected $39,650 cash from accounts receivable e. Recorded depreciation expense, $8,175 f. Employee salaries accrued, $15,650 g. Paid $15,650 cash to employees for salaries earned h. Accrued interest expense on long-term debt, $1,950 i. Paid a total of $25,000 on long-term debt, which includes $1.950 interest from Transaction h j. Paid $2,220 cash for l years insurance coverage in advance k. Recognized insurance expense, $1,340, that was paid in a previous period l. Sold equipment with a book value of $7,500 for $7,500 cash m. Declared cash dividend, $12,000 n. Paid cash dividend declared in Transaction m o. Purchased new equipment for $28,300 cash. p. Issued common stock for $60,000 cash q. Used $10,700 of supplies to produce revenues Summit Sales uses the indirect method to prepare its statement of cash flows. Required: 1. Construct a table similar to the one shown at the top of the next page. Analyze each transaction and indicate its effect on the fundamental accounting equation. If the transaction increases a financial statement element, write the amount of the increase preceded by a plus sign (+) in the appropriate column. If the transaction decreases a financial statement element, write the amount of the decrease preceded by a minus sign (-) in the appropriate column. 2. Indicate whether each transaction results in a cash inflow or a cash outflow in the Effect on Cash Flows column. If the transaction has no effect on cash flow, then indicate this by placing none in the Effect on Cash Flows column. 3. For each transaction that affected cash flows, indicate whether the cash flow would be classified as a cash flow from operating activities, cash flow from investing activities, or cash flow from financing activities. If there is no effect on cash flows, indicate this as a non-cash activity.
Accounts Receivable Balance XYZ Corp sells widgets to consumers for $20 each. Its beginning accounts receivable balance was $24,975, and it sold 12,376 widgets throughout the year. The total cash collections for the year amounted to $217,750. Required: Calculate the ending accounts receivable balance.
Calculation of Revenue from Cash Collection Anderson Lawn Service provides mowing, weed control, and pest management services for a flat fee of $300 per lawn per month. During November, Anderson collected $9,900 in cash from customers, which included $1,200 for lawn care provided in October. At the end of November, Anderson had not collected from 6 customers who had promised to pay in December when they returned from vacation. Required: Calculate the amount of Andersons revenue for November.
Van Company provided the following data for the current year in relation to accounts receivable: Debits January 1 balance after deducting credit balance P30,000 Charge sales Charge for goods out on consignment Shareholders' subscriptions 530,000 5,250,000 50,000 1,000,000 10,000 25,000 Accounts written off but recovered Cash paid to customer for January 1 credit balance Goods shipped to cover January 1 credit balance Deposits on long-term contract Claim against common carrier Advances to supplier 5,000 500,000 400,000 300,000 Credits Collections from customers, including over payment of P50,000 Writeoff 5,200,000 35,000 25,000 15,000 50,000 Merchandise returns Allowances to customers for shipping damages Collection on carrier claim Collection on subscription What total amount of trade and other receivables should be reported under current 200,000 assets?
Current Attempt in Progress Manuel Company had cash sales of $86,800 (including taxes) for the month of June. Sales are subject to 8.50% sales tax. Prepare the entry to record the sales. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit
A company has the following account balances at the end of the year:• Credit Sales = $400,000• Accounts receivable = $80,000• Allowance for Uncollectible Accounts = $400 credit The company estimates 1% of credit sales will be uncollectible. At what amount would Allowance for Uncollectible Accounts be reported in the current year’s balance sheet? a. $4,000.b. $4,400. c. $3,600. d. $800.
a. Record Navis, Incorporated's sales for a month at $75,000. The items sold cost $62,500. Navis records sales at the total invoice amount. b. Record the return of $7,500 of the above sales within the 30-day return period. c. Record the receipt of payment on the remainder of the month's sales, assuming that customers purchasing $50,000 took advantage of a 2 percent cash discount for early payment. None of the customers taking advantage of the cash discount were among those that returned their purchases. Complete this question by entering your answers in the tabs below. Required A Required B Required C Record the receipt of payment on the remainder of the month's sales, assuming that customers purchasing $50,000 took advantage of a 2 percent cash discount for early payment. None of the customers taking advantage of the cash discount were among those that returned their purchases. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first…
Von Company provided the following data for the current year in relation to accounts receivable: Debits: Jan. 1 balance after deducting credit balance of P30,000 530,000 Charge sales 5,250,000 Charge for goods out for consignment 50,000 Shareholders’ subscription receivable 200,000 Accounts written off but recovered 10,000 Cash paid to customer for Jan. 1 credit balance 25,000 Goods shipped to cover for Jan. 1, credit balance 5,000 Deposit on Contract 120,000 Claim against common carrier 15,000 Advances to supplier 155,000 Credits Collections from customers, including overpayment of P50,000 5,200,000 Write off 35,000 Merchandise returns 25,000 Allowances to customers for shipping damages 15,000 Collection on carrier claim 10,000 Collection on subscription 50,000 What is the balance of accounts receivable on December 31
ASSIGNMENT Given: A. Cash Receipts: Schedule of Sales (Values in Pesos) January 3,000 February 3,000 March 5,000 April 6,000 Of the sales transactions, 25% comprises cash sales, while the other 75% will be collected after one month. B. Cash Disbursements: Schedule of Purchases (Values in Pesos) January 3,000 February 0 March 2,000 April 4,000 Of the purchases, 50% are to be paid in cash, while the other 50% will be paid one month later. In addition, the following cash expenses are also shown. (Values in Pesos) Rent 1,000 monthly Supplies 500 monthly Labor 1,000 monthly c. Other Information: Ending Cash Balance in December was P5,000. b. Interest is 1% per month, if applicable There is no minimum ending cash balance required. a. C. Required: Construct a schedule of cash budget for the four-month period.
A. Assume that all sales are on account. If sales revenue was $18,000,000 and the average days in accounts receivable was 38 days for the last operating year, what would the average accounts receivable balance have been? a. $1,680,000 b. $1,500,000 c. $1,875,000 d. $18,000,000 B. If accounts receivable is projected to be $800,000 at the beginning of the next operating year and $1,100,000 at the end of the next operating year: would cash be generated by accounts receivable or needed to fund accounts receivable? And, by how much? a. $300,000 of cash needed to fund accounts receivable b. $1,100,000 of cash needed to fund accounts receivable c. $500,000 of cash needed to fund accounts receivable d. $300,000 of cash generated by accounts receivable
For the month of December, the records of Scrooge Corporation show the following information: Cash received on accounts receivable $45,000 Cash sales 30,000 Accounts receivable, December 1 80,000 Accounts receivable, December 31 75,000 Accounts receivable written off 2,000 The corporation uses the direct write-off method in accounting for uncollectible accounts receivable. What are the gross sales for the month of December? a.$72,000 b.$61,000 c.$59,000 d.$60,000