Intermediate Accounting (2nd Edition)
2nd Edition
ISBN: 9780134730370
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Chapter 4, Problem 4.4P
a.
To determine
To prepare: The necessary closing entries at year-end.
b.
To determine
To prepare: The adjusted
c.
To determine
To prepare: The income statement, statement of shareholders’ equity, and a
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B. ADJUSTING ENTRIES: More Review Show (MRS) prepares quarterly statements. The
bookkeeper presented to you the records and you found out the following account balances
before adjustments for the quarter ended March 31, 200B:
1. The notes receivable balance of P180,000 as of March 31, 200B consisted of a 60-day 12%
note for P120,000 dated February 14, 200B and a 30-day 6% note for P60,000 dated March
16, 200B
2. The balance of the prepaid insurance account of P22,000 represents a one-year policy
contracted last November 1, 200A for P10,000 and two year policy contracted last July 1, 200Å
for P12,000
3. The balance of the prepaid rent account of P50,000 pertains to advance rent paid last
December 1, 200A six months effective on the same date.
4. The rate per day of each of the four shop workers is P350. MRS pays the weekly salaries of
its workers every Monday of the following week ( a week consist of five days from Monday to
Friday). March 31, 200B falls on Thursday.
5. Mortgage notes…
Instructions
Mar.
Purchased merchandise on account from Kirkwood Co., $372,000, terms n/30.
1
31
Issued a 30-day, 4% note for $372,000 to Kirkwood Co., on account.
Apr.
30
Paid Kirkwood Co. the amount owed on the note of March 31.
Jun.
Borrowed $150,000 from Triple Creek Bank, issuing a 45-day, 8% note.
1
Jul.
1.
Purchased tools by issuing a $276,000, 60-day note to Poulin Co., which discounted the note at the
rate of 6%.
16
Paid Triple Creek Bank the interest due on the note of June 1 and renewed the loan by issuing a new
30-day, 6.5% note for $150,000. (Journalize both the debit and credit to the notes payable account.)
Aug.
15
Paid Triple Creek Bank the amount due on the note of July 16.
30
Paid Poulin Co. the amount due on the note of July 1.
Dec.
Purchased equipment from Greenwood Co. for $540,000, paying $108,000 cash and issuing a series of
ten 4% notes for $43,200 each, coming due at 30-day intervals.
22
Settled a product liability lawsuit with a customer for $309,500, payable…
Suppose a customer rents a vehicle for three months from Franklin Rental on November 1, paying $3,750 ($1,250/month).
Required:
1.&2. Record the necessary entries in the Journal Entry Worksheet below.
3. Calculate the year-end adjusted balances of Deferred Revenue and Service Revenue (assuming the balance of Deferred Revenue at the beginning of the year is $0).
Chapter 4 Solutions
Intermediate Accounting (2nd Edition)
Ch. 4 - Prob. 4.1QCh. 4 - ShoeBuy uses reversing entries for events such as...Ch. 4 - What is equity? What are the three components of...Ch. 4 - Prob. 4.4QCh. 4 - Will all transactions have a dual effect on the...Ch. 4 - Prob. 4.6QCh. 4 - What is meant by the term normal balance? Provide...Ch. 4 - Why is the general journal referred to as the book...Ch. 4 - Are account balances found in the general ledger?...Ch. 4 - What is the purpose of an unadjusted trial...
Ch. 4 - Explain the difference between the accrual basis...Ch. 4 - Under the accrual basis of accounting when do...Ch. 4 - Why are adjusting journal entries made? When do...Ch. 4 - What is a deferred revenue? When will the full...Ch. 4 - What is the purpose of the adjusted trial...Ch. 4 - Which statements can be prepared from the adjusted...Ch. 4 - Prob. 4.17QCh. 4 - Jefferson, CPAs provides accounting services for a...Ch. 4 - Gates Accounting Services (GAS), a sole...Ch. 4 - Prob. 4.3MCCh. 4 - State University sold all of its basketball...Ch. 4 - Prob. 4.5MCCh. 4 - Sampson Manufacturing Company (SMC) has an empty...Ch. 4 - On July 15, Year 1, Southeastern University hired...Ch. 4 - Embree Corp. purchased a four-year insurance...Ch. 4 - The Cougars football team sells season tickets in...Ch. 4 - Prob. 4.10MCCh. 4 - Prob. 4.1BECh. 4 - Transaction Analysis. Florences Floral...Ch. 4 - Journal Entries. Using the information provided in...Ch. 4 - Transaction Analysis; Journal Entries. Cals...Ch. 4 - Transaction Analysis; Journal Entries. Using the...Ch. 4 - Journal Entries; T-accounts. Using the information...Ch. 4 - Retained Earnings. In its first year of...Ch. 4 - Retained Earnings. Using the information provided...Ch. 4 - Prob. 4.9BECh. 4 - Prob. 4.10BECh. 4 - Adjusting Journal Entries. Barnard and Associates...Ch. 4 - Prob. 4.12BECh. 4 - Prob. 4.13BECh. 4 - Prob. 4.14BECh. 4 - Prob. 4.15BECh. 4 - Closing Entries. Using the information provided in...Ch. 4 - Closing Entries. At year-end Nelsons Nursery, Inc...Ch. 4 - Closing Entries. Readers, Inc., an online...Ch. 4 - Adjusting Journal Entries. Barnard and Associates...Ch. 4 - Prob. 4.20BECh. 4 - Adjusting Journal Entries. Gerhard News collects...Ch. 4 - Prob. 4.22BECh. 4 - Prob. 4.23BECh. 4 - Prob. 4.24BECh. 4 - Transaction Analysis. The following transactions...Ch. 4 - Prob. 4.2ECh. 4 - Transaction Analysis; Journal Entries. Master Mind...Ch. 4 - Prob. 4.4ECh. 4 - Prob. 4.5ECh. 4 - Posting to the General Ledger. Using the...Ch. 4 - Preparing Journal Entries in the General Journal....Ch. 4 - Preparing the T-accounts. Using the information...Ch. 4 - Transaction Analysis: Journal Entries and Posting...Ch. 4 - Transaction Analysis: Journal Entries and Posting...Ch. 4 - Prob. 4.11ECh. 4 - Adjusting Journal Entries: T-accounts. Fanatical...Ch. 4 - Prob. 4.13ECh. 4 - Prob. 4.14ECh. 4 - Prob. 4.15ECh. 4 - Prob. 4.16ECh. 4 - Prob. 4.17ECh. 4 - Adjusting Journal Entries; Adjusted Trial Balance....Ch. 4 - Preparing Financial Statements. Using the adjusted...Ch. 4 - Prob. 4.20ECh. 4 - Prob. 4.21ECh. 4 - Closing Entries. Diane s Dairy Sales Delivery...Ch. 4 - Prob. 4.23ECh. 4 - Prob. 4.24ECh. 4 - Transaction Analysis; Journal Entries; Adjusting...Ch. 4 - Transaction Analysis; Journal Entries; Adjusting...Ch. 4 - Journal Entries; Post to the General Ledger;...Ch. 4 - Prob. 4.4PCh. 4 - Prob. 4.5PCh. 4 - Journal Entries; Post to the General Ledger;...Ch. 4 - Preparing the Trial Balance; Adjusting Journal...Ch. 4 - Transaction Analysis; Journal Entries; Adjusting...Ch. 4 - Closing Process. Using the information in P4-6 and...Ch. 4 - Closing Process. Sherlock Locksmiths, Inc has the...Ch. 4 - Transaction Analysis; Journal Entries, Posting,...Ch. 4 - Transaction Analysis; Journal Entries, Posting,...
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- On June 7,2019, Dilby Mechanical Corp completed $50,00 of servicing work for a client and billed them for that amount plus a GST of $2,500 and PST of $3,50; terms are N20. Required: a. Prepare the journal entry as it would appear in Dilby's accounting records. b. Assume the receivable established on June 7 was collected on June 27. Record the entry.arrow_forwardBelow is the trial balance which was extracted from the books of the Ready Hospital Supplies on June 30, the end of the company’s financial year. You are required to collaborate and analyse the problem at hand then apply the accrual basis of accounting in the preparation of the company’s financial statements. Ready Hospital Supplies Trial Balance as at June 30, 2020 Dr $ Cr $ Cash 127,000.00 Accounts Receivable 151,000.00 Allowance for Bad-Debts 12,500.00 Merchandise Inventory 187,500.00 Store Supplies 58,000.00 Prepaid Insurance 72,000.00 Prepaid Rent 56,000.00 Furniture & Fixtures 800,000.00 Accumulated Depreciation: Furniture & Fixtures 256,000.00 Computer Equipment 450,000.00 Accumulated Depreciation: Computer Equipment Accounts Payable 133,500.00 Salaries Payable Interest Payable 27,000.00…arrow_forwardMore Review Show (MRS) prepares quarterly statements. The bookkeeper presented to you the records and you found out the following account balances before adjustments for the quarter ended March 31, 200B: The balance of the prepaid insurance account of P22,000 represents a one-year policy contracted last November 1, 200A for P10,000 and two year policy contracted last July 1, 200A for P12,000 Required: Prepare adjusting entryarrow_forward
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