ACCT 2301 Week 1 | Assignment 1 Help | Central Texas College
Question 1
Presented below is the basic accounting equation.
Determine the missing amounts.
Assets
=
Liabilities
+
Stockholders’
Equity
(a)
$78,000
$50,000
$enter a dollar
amount
(b)
$enter a dollar
amount
$45,000
$70,000
(c)
$94,000
$enter a dollar
amount
$60,000
Question 2
Given the accounting equation, answer each of the
following questions.
(a) The liabilities of Holland Company are $120,000 and its
stockholders’ equity is $232,000. What is the amount of Holland Company’s total
assets?
Total assets
$
(b) The total assets of Holland Company are $190,000 and its
stockholders’ equity is $86,000. What is the amount of its total liabilities?
Total liabilities
$
(c) The total assets of Holland Company are $600,000 and its
liabilities are equal to onehalf of its total assets. What is the amount of
Holland Company’s stockholders’ equity?
Stockholders’ equity
$
Question 3
At the beginning of the year, Canon Company had
total assets of $870,000 and total liabilities of $500,000. Answer the
following questions.
(a) If total assets increased $150,000 during the year and
total liabilities decreased $80,000, what is the amount of stockholders’
equity at the end of the year?
Stockholders’ equity
$
(b) During the year, total liabilities increased
$100,000 and stockholders’ equity decreased $66,000. What is the amount
of total assets at the end of the year?
Total assets
$
(c) If total assets decreased $80,000 and and owner’s equity
increased $120,000 during the year, what is the amount of total
liabilities at the end of the year?
Total liabilities
$
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Question 4
Use the accounting equation to answer each of the
following questions.
(a) The liabilities of Olga Company are $90,000. Common stock
account is $150,000; dividends are $40,000; revenues, $450,000; and expenses,
$320,000. What is the amount of Olga Company’s total assets?
Total assets
$enter total assets in dollars
(b) The total assets of Lafayette Company are $57,000. Common stock
account is $23,000; dividends are $7,000; revenues, $50,000; and expenses,
$35,000. What is the amount of the company’s total liabilities?
Total liabilities
$enter Total liabilities in dollars
(c) The total assets of Dierdorf Co. are $600,000 and its
liabilities are equal to two-thirds of its total assets. What is the amount of
Dierdorf Co.’s stockholders’ equity?
Stockholders’ equity
$enter Stockholders’ equity in
dollars
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Question 5
Your answer is correct.
Indicate whether each of the following items is an
asset, liability, or part of stockholders’ equity.
(a)
Accounts receivable
1.liability
2.assets
3.stock holder equity
(b)
Salaries and wages payable
1.liability
2.assets
3.stock holder equity
(c)
Equipment
1.liability
2.assets
3.stock holder equity
(d)
Supplies
1.liability
2.assets
3.stock holder equity
(e)
Dividends
1.liability
2.assets
3.stock holder equity
(f)
Notes payable
1.liability
2.assets
3.stock holder equity
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Question 6
Your answer is correct.
Classify each of the following items as
dividends, revenue, or expense.
(a)
Advertising expense
1.divendeds
2.expenses
3.revenue
(b)
Service revenue
1.divendeds
2.expenses
3.revenue
(c)
Insurance expense
1.divendeds
2.expenses
3.revenue
(d)
Salaries and wages expense
1.divendeds
2.expenses
3.revenue
(e)
Dividends
1.divendeds
2.expenses
3.revenue
(f)
Rent revenue
1.divendeds
2.expenses
3.revenue
(g)
Utilities expense
1.divendeds
2.expenses
3.revenue
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Question 7
Your answer is correct.
Presented below are three transactions. Mark each
transaction as affecting common stock, dividends, revenue, expense, or not
affecting stockholders’ equity.
(a)
Received cash for services performed.
1.expense
2.revenue
3.divedends
4.common stock
5.no affecting stock holder equity
(b)
Paid cash to purchase equipment.
1.expense
2.revenue
3.divedends
4.common stock
5.no affecting stock holder equity
(c)
Paid employee salaries.
1.expense
2.revenue
3.divedends
4.common stock
5.no affecting stock holder equity
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Question 7
Your answer is correct.
In alphabetical order below are balance sheet items
for Ellerby Company at December 31, 2020.
Accounts payable
$85,000
Accounts receivable
72,500
Cash
44,000
Common stock
31,500
Question 8
Your answer is correct.
Indicate whether the following items would appear
on the income statement, balance sheet, or retained earnings statement.
(a)
Notes payable
1.income statement
2.balance sheet
3.retained earning statement
(b)
Advertising expense
1.income statement
2.balance sheet
3.retained earning statement
(c)
Common stock
1.income statement
2.balance sheet
3.retained earning statement
(d)
Cash
1.income statement
2.balance sheet
3.retained earning statement
(e)
Service revenue
1.income statement
2.balance sheet
3.retained earning statement
(f)
Dividends
1.income statement
2.balance sheet
3.retained earning statement
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Question 9
Callison Company performs the following
accounting tasks during the year.
Accounting is “an information system that identifies, records,
and communicates the economic events of an organization to
interested users.”
Categorize the accounting tasks performed by Callison as relating to either
the identification, recording, or communication aspects of accounting.
1.records
2.identifies
3.communicates
Analyzing and interpreting information.
1.records
2.identifies
3.communicates
Classifying economic events.
1.records
2.identifies
3.communicates
Explaining uses, meaning, and
limitations of data.
1.records
2.identifies
3.communicates
Keeping a systematic chronological
diary of events.
1.records
2.identifies
3.communicates
Measuring events in dollars and
cents.
1.records
2.identifies
3.communicates
Preparing accounting reports.
1.records
2.identifies
3.communicates
Reporting information in a standard
format.
Selecting economic activities
relevant to the company.
1.records
2.identifies
3.communicates
1.records
2.identifies
3.communicates
Summarizing economic events.
Question 10
Your answer is correct.
(a) The
following are users of financial statements.
Identify the users as being either external users or internal
users.
1.internal user
2.external user
Customers
1.internal user
2.external user
Internal Revenue Service
1.internal user
2.external user
Labor unions
1.internal user
2.external user
Marketing manager
1.internal user
2.external user
Production supervisor
Securities and Exchange Commission
1.internal user
2.external user
1.internal user
2.external user
Store manager
1.internal user
2.external user
Suppliers
1.internal user
2.external user
Vice president of finance
(b) The following questions could be asked by an internal user or
an external user.
Identify each of the questions as being more likely asked by an internal
user or an external user.
1.internal user
2.external user
Can we afford to give our employees a
pay raise?
1.internal user
2.external user
Did the company earn a satisfactory
income?
1.internal user
2.external user
Do we need to borrow in the near
future?
How does the company’s profitability
compare to other companies?
1.internal user
2.external user
1.internal user
2.external user
What does it cost us to manufacture
each unit produced?
1.internal user
2.external user
Which product should we emphasize?
Will the company be able to pay its
short-term debts?
1.internal user
2.external user
Question 10
Your answer is correct.
Bailey Cleaners has the following balance sheet
items.
Classify each item as an asset, liability, or stockholders’ equity.
Accounts payable
1.Assets
2.liability
3.stock holder equity
Cash
1.Assets
2.liability
3.stock holder equity
Equipment
1.Assets
2.liability
3.stock holder equity
Supplies
1.Assets
2.liability
3.stock holder equity
Accounts receivable
1.Assets
2.liability
3.stock holder equity
Notes payable
1.Assets
2.liability
3.stock holder equity
Salaries and wages payable
1.Assets
2.liability
3.stock holder equity
Common stock
1.Assets
2.liability
3.stock holder equity
Question 11
Your answer is correct.
Selected transactions for Verdent Lawn Care Company
are as follows.
Describe the effect of each transaction on assets, liabilities, and
stockholders’ equity.
For example, the first answer is: Increase in assets and increase in
stockholders’ equity.
1.
Sold common stock for cash to start
business.
Increase in assets and increase in
stockholders’ equity.
2.
Paid monthly rent.
select an effect on assets,
liabilities, and stockholders’ equity
3.
Purchased equipment on account.
select an effect on assets,
liabilities, and stockholders’ equity
4.
Billed customers for services
performed.
select an effect on assets,
liabilities, and stockholders’ equity
5.
Paid dividends.
select an effect on assets,
liabilities, and stockholders’ equity
6.
Received cash from customers billed
in (4).
select an effect on assets,
liabilities, and stockholders’ equity
7.
Incurred advertising expense on
account.
select an effect on assets,
liabilities, and stockholders’ equity
8.
Purchased additional equipment for
cash.
select an effect on assets,
liabilities, and stockholders’ equity
9.
Received cash from customers when
service was performed.
select an effect on assets,
liabilities, and stockholders’ equity
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Question 12
Your answer is correct.
Keystone Computer Timeshare Company entered into
the following transactions during May 2020.
Describe the effect of each transaction on assets, liabilities, and
stockholders' equity.
1.
Purchased computers for $20,000 from
Data Equipment on account.
select an effect on assets,
liabilities, and stockholders’ equity
2.
Paid $3,000 cash for May rent on
storage space.
select an effect on assets, liabilities,
and stockholders’ equity
3.
Received $15,000 cash from customers
for contracts billed in April.
select an effect on assets,
liabilities, and stockholders’ equity
4.
Performed computer services for Ryan
Construction Company for $2,700 cash.
select an effect on assets,
liabilities, and stockholders’ equity
5.
Paid Midland Power Co. $11,000 cash
for energy usage in May.
select an effect on assets,
liabilities, and stockholders’ equity
6.
Stockholders invested an additional
$32,000 in the business.
select an effect on assets,
liabilities, and stockholders’ equity
7.
Paid Data Equipment for the computers
purchased in (1) above.
select an effect on assets,
liabilities, and stockholders’ equity
8.
Incurred advertising expense for May
of $840 on account.
select an effect on assets,
liabilities, and stockholders’ equity
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Question 13
Your answer is partially correct.
An analysis of the transactions made by Foley
& Co., a certified public accounting firm, for the month of August is
shown below.
Assets
=
Liabilities
+
Stockholders’ Equity
Cash
+
Accounts Receivable
+
Supplies
+
Equipment
Accounts Payable
Common Stock
Retained Earnings
=
+
+
Revenues
–
Expenses
–
Dividend
1.
+$15,000
+$15,000
2.
–2,000
+$5,000
+$3,000
3.
–750
+$750
4.
+4,900
+$4,500
+$9,400
Service Revenue
5.
–1,500
–1,500
6.
–2,000
-$2,000
7.
–850
–$850
Rent Expense
8.
+450
–450
9.
–3,900
–3,900
Salaries/Wages Expense
10.
+500
–500
Utilities Expense
(b) Determine how much stockholders’ equity increased for the
month.
Increase in stockholders' equity
$
(c) Compute the amount of net income for the month.
Net income
$
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Question 14
An analysis of the transactions made by Foley
& Co., a certified public accounting firm, for the month of August, its
first month of operations is shown below.
Assets
=
Liabilities
+
Stockholders’ Equity
Cash
+
Accounts Receivable
+
Supplies
+
Equipment
Accounts Payable
Common Stock
Retained Earnings
=
+
+
Revenues
–
Expenses
–
Dividend
1.
+$15,000
+$15,000
2.
–2,000
+$5,000
+$3,000
3.
–750
+$750
4.
+4,900
+$4,500
+$9,400
Service Revenue
5.
–1,500
–1,500
6.
–2,000
-$2,000
7.
–850
–$850
Rent Expense
8.
+450
–450
9.
–3,900
–3,900
Salaries/Wages Expense
10.
+500
–500
Utilities Expense
Your answer is correct.
Prepare an retained earnings statement for
August. (List items that increase retained
earnings first.)
Your answer is correct.
Prepare a balance sheet at August 31, 2020. (List Assets in order of liquidity.)
Question 15
Your answer is correct.
In alphabetical order below are balance sheet items
for Ellerby Company at December 31, 2020.
Accounts payable
$85,000
Accounts receivable
72,500
Cash
44,000
Common stock
31,500
Prepare a balance sheet. (List
Current Assets in order of liquidity.)
Question 16
Your answer is correct.
Indicate whether the following items would appear
on the income statement, balance sheet, or retained earnings statement.
(a)
Notes payable
1.retained statement
2.balance sheet
3.income statement
(b)
Advertising expense
1.retained statement
2.balance sheet
3.income statement
(c)
Common stock
1.retained statement
2.balance sheet
3.income statement
(d)
Cash
1.retained statement
2.balance sheet
3.income statement
(e)
Service revenue
1.retained statement
2.balance sheet
3.income statement
(f)
Dividends
1.retained statement
2.balance sheet
3.income statement
Question 17
Callison Company performs the following accounting
tasks during the year.
Accounting is “an information system that identifies, records,
and communicates the economic events of an organization to
interested users.”
Categorize the accounting tasks performed by Callison as relating to either the
identification, recording, or communication aspects of accounting.
1.communicates
2.records
3.identifies
Analyzing and interpreting
information.
1.communicates
2.records
3.identifies
Classifying economic events.
1.communicates
2.records
3.identifies
Explaining uses, meaning, and
limitations of data.
1.communicates
2.records
3.identifies
Keeping a systematic chronological
diary of events.
1.communicates
2.records
3.identifies
Measuring events in dollars and
cents.
1.communicates
2.records
3.identifies
Preparing accounting reports.
1.communicates
2.records
3.identifies
Reporting information in a standard
format.
Selecting economic activities
relevant to the company.
1.communicates
2.records
3.identifies
Summarizing economic events.
1.communicates
2.records
3.identifies
Question 18
(a) The
following are users of financial statements.
Identify the users as being either external users or internal
users.
1. internal user
2.external user
Customers
1. internal user
2.external user
Internal Revenue Service
1. internal user
2.external user
Labor unions
1. internal user
2.external user
Marketing manager
1. internal user
2.external user
Production supervisor
Securities and Exchange Commission
1. internal user
2.external user
1. internal user
2.external user
Store manager
1. internal user
2.external user
Suppliers
1. internal user
2.external user
Vice president of finance
(b) The following questions could be asked by an internal user or
an external user.
Identify each of the questions as being more likely asked by an internal
user or an external user.
Can we afford to give our employees a
pay raise?
1. internal user
2.external user
Did the company earn a satisfactory
income?
1. internal user
2.external user
Do we need to borrow in the near
future?
1. internal user
2.external user
How does the company’s profitability
compare to other companies?
1. internal user
2.external user
What does it cost us to manufacture
each unit produced?
1. internal user
2.external user
Which product should we emphasize?
1. internal user
2.external user
Will the company be able to pay its
short-term debts?
1. internal user
2.external user
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Question 19
Your answer is correct.
Bailey Cleaners has the following balance sheet
items.
Classify each item as an asset, liability, or stockholders’ equity.
Accounts payable
1.stock holder
2.assets
3.liability
Cash
1.stock holder
2.assets
3.liability
Equipment
1.stock holder
2.assets
3.liability
Supplies
1.stock holder
2.assets
3.liability
Accounts receivable
1.stock holder
2.assets
3.liability
Notes payable
1.stock holder
2.assets
3.liability
Salaries and wages payable
1.stock holder
2.assets
3.liability
Common stock
1.stock holder
2.assets
3.liability
Question 19
Your answer is correct.
Selected transactions for Verdent Lawn Care Company
are as follows.
Describe the effect of each transaction on assets, liabilities, and
stockholders’ equity.
For example, the first answer is: Increase in assets and increase in
stockholders’ equity.
1.
Sold common stock for cash to start
business.
Increase in assets and increase in
stockholders’ equity.
2.
Paid monthly rent.
select an effect on assets,
liabilities, and stockholders’ equity
3.
Purchased equipment on account.
select an effect on assets,
liabilities, and stockholders’ equity
4.
Billed customers for services
performed.
select an effect on assets, liabilities,
and stockholders’ equity
5.
Paid dividends.
select an effect on assets,
liabilities, and stockholders’ equity
6.
Received cash from customers billed
in (4).
select an effect on assets,
liabilities, and stockholders’ equity
7.
Incurred advertising expense on
account.
select an effect on assets,
liabilities, and stockholders’ equity
8.
Purchased additional equipment for
cash.
select an effect on assets,
liabilities, and stockholders’ equity
9.
Received cash from customers when
service was performed.
select an effect on assets,
liabilities, and stockholders’ equity
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Question 20
Your answer is correct.
Keystone Computer Timeshare Company entered into
the following transactions during May 2020.
Describe the effect of each transaction on assets, liabilities, and
stockholders' equity.
1.
Purchased computers for $20,000 from
Data Equipment on account.
select an effect on assets,
liabilities, and stockholders’ equity
2.
Paid $3,000 cash for May rent on
storage space.
select an effect on assets,
liabilities, and stockholders’ equity
3.
Received $15,000 cash from customers
for contracts billed in April.
select an effect on assets,
liabilities, and stockholders’ equity
4.
Performed computer services for Ryan
Construction Company for $2,700 cash.
select an effect on assets, liabilities,
and stockholders’ equity
5.
Paid Midland Power Co. $11,000 cash
for energy usage in May.
select an effect on assets,
liabilities, and stockholders’ equity
6.
Stockholders invested an additional
$32,000 in the business.
select an effect on assets,
liabilities, and stockholders’ equity
7.
Paid Data Equipment for the computers
purchased in (1) above.
select an effect on assets,
liabilities, and stockholders’ equity
8.
Incurred advertising expense for May
of $840 on account.
select an effect on assets,
liabilities, and stockholders’ equity
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Question 20
An analysis of the transactions made by Foley &
Co., a certified public accounting firm, for the month of August is shown
below.
Assets
=
Liabilities
+
Stockholders’
Equity
Cash
+
Accounts Receivable
+
Supplies
+
Equipment
Accounts Payable
Common Stock
Retained
Earnings
=
+
+
Revenues
–
Expenses
–
Dividend
1.
+$15,000
+$15,000
2.
–2,000
+$5,000
+$3,000
3.
–750
+$750
4.
+4,900
+$4,500
+$9,400
Service Revenue
5.
–1,500
–1,500
6.
–2,000
-$2,000
7.
–850
–$850
Rent Expense
8.
+450
–450
9.
–3,900
–3,900
Salaries/Wages Expense
10.
+500
–500
Utilities Expense
(b) Determine how much stockholders’ equity increased for the
month.
Increase in stockholders' equity
$
(c) Compute the amount of net income for the month.
Net income
$
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Question 20
An analysis of the transactions made by Foley
& Co., a certified public accounting firm, for the month of August, its
first month of operations is shown below.
Assets
=
Liabilities
+
Stockholders’ Equity
Cash
+
Accounts Receivable
+
Supplies
+
Equipment
Accounts Payable
Common Stock
Retained Earnings
=
+
+
Revenues
–
Expenses
–
Dividend
1.
+$15,000
+$15,000
2.
–2,000
+$5,000
+$3,000
3.
–750
+$750
4.
+4,900
+$4,500
+$9,400
Service Revenue
5.
–1,500
–1,500
6.
–2,000
-$2,000
7.
–850
–$850
Rent Expense
8.
+450
–450
9.
–3,900
–3,900
Salaries/Wages Expense
10.
+500
–500
Utilities Expense
Prepare an income statement for August.
Prepare an retained earnings statement for
August. (List items that increase retained
earnings first.)
Prepare a balance sheet at August 31, 2020. (List Assets in order of liquidity.)
Question 20
.
Toth Company had the following assets and
liabilities on the dates indicated.
December
31
Total
Assets
Total
Liabilities
2019
$400,000
$260,000
2020
$480,000
$300,000
2021
$590,000
$400,000
Toth began business on January 1, 2019, with an investment of $100,000 from
stockholders.
From an analysis of the change in stockholders’ equity during the year, compute
the net income (or loss) for:
(a) 2019, assuming Toth paid $15,000 in dividends for the
year.
Net income (loss) for 2019
$enter the Net income (loss) for 2019
in dollars
(b) 2020, assuming stockholders made an additional investment of
$50,000 and Toth paid no dividends in 2020.
Net income (loss) for 2020
$enter the Net income (loss) for 2020
in dollars
(c) 2021, assuming stockholders made an additional investment of
$15,000 and Toth paid dividends of $30,000 in 2021.
Net income (loss) for 2021
$enter the Net income (loss) for 2021
in dollars
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Question 21
The following information relates to La Greca Co.
for the year 2020.
Retained earnings, January 1, 2020
$48,000
Advertising expense
$ 1,800
Dividends during 2020
5,000
Rent expense
10,400
Service revenue
62,500
Utilities expense
3,100
Salaries and wages expense
28,000
After analyzing the data, prepare an income
statement for the year ending December 31, 2020.
After analyzing the data, prepare a retained
earnings statement for the year ending December 31, 2020. (List items that increase retained earnings
first.)
Question 22
Wyco Park, a public camping ground near the Four
Corners National Recreation Area, has compiled the following financial
information as of December 31, 2020.
Revenues during 2020—camping fees
$140,000
Notes payable
$60,000
Revenues during 2020—general store
47,000
Expenses during 2020
150,000
Accounts payable
11,000
Supplies on hand
2,500
Cash on hand
20,000
Common stock
20,000
Original cost of equipment
105,500
Retained earnings
?
Fair value of equipment
140,000
Your answer is correct.
Determine Wyco Park’s net income for 2020.
Wyco Park's net income
$enter Wyco Park's net income in
dollars
Question 23
Your answer is correct.
Presented below is financial information related to
the 2020 operations of Louisa Cruise Company.
Maintenance and repairs expense
$ 92,000
Utilities expense
10,000
Salaries and wages expense
142,000
Advertising expense
3,500
Ticket revenue
328,000
Prepare the 2020 income statement for Louisa Cruise Company.
Exercise 1-16
Your answer is correct.
Presented below is information related to Alexis
and Ryans, Attorneys at Law.
Retained earnings, January 1, 2020
$23,000
Legal service revenue—2020
340,000
Total expenses—2020
211,000
Assets, January 1, 2020
85,000
Liabilities, January 1, 2020
62,000
Assets, December 31, 2020
168,000
Liabilities, December 31, 2020
80,000
Dividends—2020
64,000
Prepare the 2020 retained earnings statement for Alexis and Ryans, Attorneys at
Law. (List items that increase retained
earnings first.)
Question 24
Fredonia Repair Inc. was started on May 1. A
summary of May transactions is presented below.
1.
Stockholders invested
$10,000 cash in the business in exchange for common stock.
2.
Purchased equipment for
$5,000 cash.
3.
Paid $400 cash for May office
rent.
4.
Paid $300 cash for supplies.
5.
Incurred $250 of advertising
costs in the Beacon News on account.
6.
Received $4,700 in cash from
customers for repair service.
7.
Declared and paid a $700 cash
dividend.
8.
Paid part-time employee salaries
$1,000.
9.
Paid utility bills $140.
10.
Performed repair services worth
$1,100 on account.
11.
Collected cash of $120 for
services billed in transaction (10).
Prepare a tabular analysis of the transactions.
Revenue is called Service Revenue. (If
a transaction causes a decrease in Assets, Liabilities or Stockholders'
Equity, place a negative sign (or parentheses) in front of the amount entered
for the particular Asset, Liability or Equity item that was reduced. See
Illustration 1-8 for example.)
From an analysis of the Retained Earnings
columns, compute the net income or net loss for May.
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