Accounting: What the Numbers Mean
11th Edition
ISBN: 9781259535314
Author: David Marshall, Wayne William McManus, Daniel Viele
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 7, Problem 7.21E
Exercise 7.21
LO 4. 5, 8
Transaction analysis-various accounts Enter the following column headings across the top of a sheet of paper:
Transaction/Adjustment Current Assets Current Liabilities Long-Term Debt Net Income
Enter the transaction/adjustment letter in the first column and show the effect, if any, of each of the transactions/adjustments on the appropriate balance sheet category7 or on the income statement by entering the amount and indicating whether it is an addition (+) or a subtraction (-). You may also write the
- Wages of S465 for the last three days of the fiscal period have not been accrued.
- Interest of $340 on a hank loan has not been accrued.
- Interest on bonds payable has not been accrued for the current month. The company has outstanding $480,000 of 6.5% bonds.
- The discount related to the bonds in part c has not been amortized for the current month. The current month amortization is $150.
- Product warranties were honored during the month; parts inventory items valued at $1,660 were sent to customers making claims, and cash refunds of $820 were also made.
- During the fiscal period, advance payments from customers totaling $3,000 were received and recorded as sales revenues. The items will not be delivered to the customers until the next fiscal period. Record the appropriate adjustment.
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JOURNAL
ACCOUNTING EQUATION
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
1
Adjusting Entries
2
3
4
5
6
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Question 10 of 18
Which of the following increases the reported receivables in the financial statements?
Select the correct response:
a credit balance in an account payable
offsetting a credit balance in an account receivable
O adjustment to eliminate a debit balance in account payable
a credit balance in an allowance account
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On 31 December 20X7, a company has the following bond on the statement of financial position:
Bond payable, 7%, interest due semi-annually on 31 Dec. and 30
June; maturity date, 30 June 20X11
Premium on bonds payable
$6, 200,000
52,080
$6,252,080
On 28 February 20X8, 20% of the bond was retired for $1,364,000 plus accrued interest to 28 February. Interest was paid on this date
only for the portion of the bonds that were retired. Premium amortization was recorded on this date in the amount of $500,
representing amortization on the retired debt only.
Required:
Provide the entries to record the bond interest on 28 February and the bond retirement. (If no entry is required for a
transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Round your
answers to the nearest whole dollar amount.)
Chapter 7 Solutions
Accounting: What the Numbers Mean
Ch. 7 - Prob. 7.1MECh. 7 - Mini-Exercise 7.2 LO 4 Other accrued...Ch. 7 - Mini-Exercise 7.3 LO 5 Other accrued...Ch. 7 - Prob. 7.4MECh. 7 - Exercise 7.5 LO 2 Notes payable-discount basis On...Ch. 7 - Prob. 7.6ECh. 7 - Exercise 7.7 LO 4 Other accrued...Ch. 7 - Exercise 7.8 LO 5 Other accrued liabilities-real...Ch. 7 - Exercise 7.9 LO 5 Other accrued...Ch. 7 - Exercise 7.10 LO 5 Other accrued...
Ch. 7 - Exercise 7.11 LO 3 Unearned revenues-customer...Ch. 7 - Exercise 7.12 LO 3 Unearned revenues-ticket sales...Ch. 7 - Prob. 7.13ECh. 7 - Prob. 7.14ECh. 7 - Prob. 7.15ECh. 7 - Prob. 7.16ECh. 7 - Prob. 7.17ECh. 7 - Prob. 7.18ECh. 7 - Prob. 7.19ECh. 7 - Prob. 7.20ECh. 7 - Exercise 7.21 LO 4. 5, 8 Transaction...Ch. 7 - Prob. 7.22ECh. 7 - Prob. 7.23ECh. 7 - Prob. 7.24ECh. 7 - Prob. 7.25PCh. 7 - Problem 7.26 LO 3 Unearned revenues-subscription...Ch. 7 - Prob. 7.27PCh. 7 - Prob. 7.28PCh. 7 - Prob. 7.29PCh. 7 - Prob. 7.30PCh. 7 - Prob. 7.31PCh. 7 - Prob. 7.32PCh. 7 - Prob. 7.33CCh. 7 - Prob. 7.34CCh. 7 - Prob. 7.35C
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