a, b, c and d. Explanation Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically. Adjusting entries: Adjusting entries are those entries which are recorded at the end of the year, to update the income statement accounts (revenue and expenses) and balance sheet accounts (assets, liabilities, and stockholders’ equity ) to maintain the records according to accrual basis principle. Prepare adjusting entries using financial statement effects template. Table (1) Prepare adjusting entries in the form of journal entry. S.no Description Post Ref Debit ($) Credit($) a1 Prepaid catalog costs 62,550 Prepaid advertising 62,550 (To record catalog printing costs) a2. Advertising credits receivable 849 Advertising credit revenue 849 (To recognize advertising credits earned) b Catalog expense 62,138 Prepaid catalog costs 62,138 (To recognize catalog expense) c Advertising credit expiration expense 336 Advertising credit receivable 336 (To record the expiration of advertising credit) d1 Cash 19,175 Customer deposits 19,175 (To recognize gift certificate sold but not yet redeemed) d2 Customer deposits 18,230 Gift certificate revenues 18,230 (To recognize revenues based on redeemed gift certificate) Table (2) Working Notes: Calculation of the catalog expense...

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ISBN: 2810023103767

Author: DYCKMAN

Publisher: CAMB BUS

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Chapter 3, Problem 58CP

a, b, c and d.

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Prepare adjusting entries using financial statement effects template and in the form of journal entry.

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Direction: The following list of accounts for Pazado, Inc is available at the end of December 2020. Make a summary of Income Statement from the given information below with the following required data. 1. Calculate the turnover/ROI 2. Calculate the consumption of goods for sale 3. Prepare the Income Statement of Pazado, Inc for year 2020. Sales Rent Expense Depreciation Expense Utilities Expense Taxes and Licenses Goods Available for Sale Merchandise, Inventory, January 31 Salaries Expense Freight, out Uncollectible Accounts Sales Discount Sales Returns and Allowance 902,000 30,000 11,250 18,000 15,000 714,900 102,000 50,000 3.920 19,100 5,000 13,000

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Chapter 3 Solutions

FINANCIAL ACCOUNTING-TEXT

Ch. 3 - Prob. 1MC Ch. 3 - Prob. 2MC Ch. 3 - Prob. 3MC Ch. 3 - Prob. 4MC Ch. 3 - Prob. 5MC Ch. 3 - Prob. 1Q Ch. 3 - Prob. 2Q Ch. 3 - Prob. 3Q Ch. 3 - Prob. 4Q Ch. 3 - Prob. 5Q

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