Financial Accounting
5th Edition
ISBN: 9780134728643
Author: Robert Kemp; Jeffrey Waybright
Publisher: Pearson Education (US)
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Textbook Question
Chapter 1, Problem 19AE
Transaction analysis (Learning Objective 5) 15-20 min.
Shavon Loreal opened a medical practice titled Shavon Loreal M.D., Inc. During August, the first month of operations, the business experienced the following events:
| Aug 2 | Loreal bought $60,000 of common stock in the business by opening a bank account in the name of Shavon Loreal M D., Inc. |
| 6 | The business paid $45,000 cash for land with the intention of building an office building on the land. |
| 11 | Tue business purchased medical supplies for $700 on account. |
| 15 | The business officially opened for business. |
| 17 | The business treated patients and earned service revenue of $10,000, receiving cash. |
| 19 | The business paid office rent $1,400. |
| 22 | The business sold supplies to another doctor for $300 cash, the cost of those supplies. |
| 25 | The business received a $175 utility hill in the mall. The bill will be paid in 30 days |
| 30 | The business paid $100 on account related to the August 11 purchase. |
Requirement
- 1. Analyze the effects of these events on the
accounting equation of the medical practice of Shavon Loreal M.D., Inc. Use headings for Cash, Medical Supplies, Land, Accounts Payable, Common Stock, Service Revenue, Rent Expense, and Utility Expense.
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What I Can Do
Activity 9-4
As a senior high school in your school, you were required to undergo Work
Immersion in a bank. You were assigned in accounting department and your
immediate superior instructed you to conduct an audit to the following
transactions:
1. The bank acquired Furniture and Fixtures last February 1, 2020 for
P125,000. The said asset has a salvage value of P20,000 after its estimated
useful life of 10 years.
2. The payment for one-year rent of P96,000 dated January 1, 2020 was
debited to Prepaid Rent.
3. The Notes Receivable of P200,000 dated February 29, 2020 with 15%
interest is collectible after six months.
Prepare the adjusting journal entries as of June 30, 2020 (with computation in
good form)
Assessment
Test I: True or False
Write TRUE if the statement is corect and FALSE if the statement is incorrect.
1. All adjusting entries require to analyze the source document before they
recorded.
2. Prepaid expense is an expense account with a debit normal balance.
17
While completing undergraduate school work in information systems, Dallin Bourne and Michael Banks decided to start a
technology support company called eSys Answers. During year 1, they bought the following assets and incurred the
following start-up fees:
Purchase Date
October 30, Year 1
October 30, Year 1
October 30, Year 1
October 30, Year 1
Basis
$16,200
10,000
5,400
19,160
Year 1 Asseta
Computers (5-year)
office equipment (7-year)
Furniture (7-year)
Start-up costa
In April of year 2, they decided to purchase a customer list from a company providing virtually the same services, started
by fellow Information systems students preparing to graduate. The customer list cost $12,160, and the sale was completed
on April 30. During their summer break, Dailin and Michael passed on internship opportunities in an attempt to really grow
their business into something they could do full time after graduation. In the summer, they purchased a small van (for
transportation, not considered a luxury…
The Sir Arthur Lewis Community College has recently invited all accounting students in from
the Principles of cost and management accounting (ACC115) class to participate in a business
degree scholarship with an emphasis in accounting. The award for the highest score is a full
scholarship for a degree in Business Administration.
The following information for Good Times Inc. has been provided to assess the proficiency of all
participants in accounting:
Estimates for the period January to June 2021
Purchases ($) Operating
expenses ($)
35,000
20,000
Month
Sales ($)
January
February
March
350,000
200,000
100,000
250,000
300,000
360,000
210,000
120,000
60,000
150,000
180,000
10,000
25,000
30,000
36,000
April
May
June
216,000
Relevant data for the Good Times Inc. operations:
a. Payment for purchases is made as follows 80% in the month of purchase and the balance in
the following the following month. Payments made in the month of purchase are entitled to a
10% discount.
b. Sales are made on…
Chapter 1 Solutions
Financial Accounting
Ch. 1 - The text states that accounting is the "language...Ch. 1 - Would you describe accounting as primarily a...Ch. 1 - Prob. 3DQCh. 1 - What are some reasons why accounting has adopted...Ch. 1 - What are some of the uses of financial statements?Ch. 1 - Prob. 6DQCh. 1 - Prob. 7DQCh. 1 - How is the accounting equation affected by each of...Ch. 1 - In what order should the financial statements be...Ch. 1 - Which financial statement would be most useful to...
Ch. 1 - Prob. 1SCCh. 1 - Prob. 2SCCh. 1 - Which accounting principle specifically states...Ch. 1 - Wave Rider is famous for custom skateboards. At...Ch. 1 - Assume that Wave Rider sold skateboards to a...Ch. 1 - Assume that Wave Rider sold skateboards to another...Ch. 1 - Assume that Wave Rider paid expenses totaling...Ch. 1 - Consider the overall effects of the transactions...Ch. 1 - The balance sheet reports a. a businesss financial...Ch. 1 - The income statement reports a. a business's...Ch. 1 - Prob. 11SCCh. 1 - Prob. 12SCCh. 1 - Accounting principles (Learning Objective 4) 5-10...Ch. 1 - Accounting principles (Learning Objective 4) 5-10...Ch. 1 - Prob. 3SECh. 1 - Basic accounting equation (Learning Objective 5)...Ch. 1 - Prob. 5SECh. 1 - Prob. 6SECh. 1 - Prob. 7SECh. 1 - Entering transactions in the accounting equation...Ch. 1 - Prob. 9SECh. 1 - Prob. 10SECh. 1 - Entering transactions in the accounting equation...Ch. 1 - Transaction analysis (Learning Objective 5) 5-10...Ch. 1 - Transaction analysis (Learning Objective 5) 5-10...Ch. 1 - Prob. 14SECh. 1 - Basic accounting equation (Learning Objective 5)...Ch. 1 - Basic accounting equation (Learning Objective 5)...Ch. 1 - Prob. 17AECh. 1 - Using the accounting equation to determine net...Ch. 1 - Transaction analysis (Learning Objective 5) 15-20...Ch. 1 - Types of business organizations and balance sheet...Ch. 1 - Types of accounts and income statement preparation...Ch. 1 - Using the accounting equation to determine net...Ch. 1 - Basic accounting equation (Learning Objective 5)...Ch. 1 - Prob. 24BECh. 1 - Prob. 25BECh. 1 - Prob. 26BECh. 1 - Transaction analysis (Learning Objective 5) 15-20...Ch. 1 - Prob. 28BECh. 1 - Prob. 29BECh. 1 - Prob. 30BECh. 1 - Transaction analysis and the calculation of net...Ch. 1 - Prob. 32APCh. 1 - A Preparing the income statement, statement of...Ch. 1 - Preparing the income statement and balance sheet;...Ch. 1 - Prob. 35APCh. 1 - Transaction analysis and the calculation of net...Ch. 1 - Prob. 37BPCh. 1 - Prob. 38BPCh. 1 - Preparing the income statement and balance sheet;...Ch. 1 - Prob. 40BPCh. 1 - Prob. 1CECh. 1 - This problem is the first problem in a sequence...Ch. 1 - Prob. 1CFSAPCh. 1 - Prob. 1EIACh. 1 - Prob. 2EIACh. 1 - Prob. 1FACh. 1 - Industry Analysis Purpose: To help you understand...Ch. 1 - Prob. 1SBACh. 1 - Prob. 1WC
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