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Exercise J Assume that the following items were included in the Retained Earnings column in the summary of
transactions for Cinck Company for July 2010:
Salaries expense $120,000
Service revenue 300,000
Gas and oil expense 27,000
Rent expense 48,000
Dividends paid 40,000
Prepare an income statement for July 2010.
What does "cleared the check" mean?
Can you provide me a simple definition? Thank you.
Debit Discount on Notes Payable
Credit Unearned Revenue
What does this journal entry mean? Thank you.
This question is based on the following information for ice cream: What will happen to the equilibrium position if there is a decrease in the price of milk that is used in the production of ice cream?
- A. Both the equilibrium price and quantity will decrease.
- B. The equilibrium price will increase and the equilibrium quantity will decrease.
- C. Both the equilibrium price and quantity will increase.
- D. The equilibrium price will decrease and the equilibrium quantity will increase
Magic Carpets Inc. sells a full line of area rugs, from top quality to bargain basement. Economic conditions have hit the textile industry, and Magic Carpets accountant is concerned that its rug inventory may not worth the amount Magic paid for it. Information about three lines of rugs is found below:
Figure 8.16
Cost
Replacement Cost
Sales Price
Cost to Sell
Number in inventory
High Flyers
$230
$240
$350
$40
80
Midflight
150
120
220
25
125
Under the Radar
100
100
110
20
165
1.
Determine market value for each type of rug.
2.
Determine lower-of-cost-or-market for each type of rug.
3.
Determine if Magic Carpets has suffered a loss of value on its inventory, and if so, what the amount of loss is.
Montez Muffins and More is a bakery located in New York. Montez purchases a great deal of flour in bulk from a wholesaler. The wholesaler offers purchase discounts for fast payment. Montez purchased 600 pounds of flour for $100 on May 1, under terms 2/10 n/30. Determine the amount Montez should pay under the following scenarios:
1.
Montez pays the full balance on May 25.
2.
Montez pays the full balance on May 10.
3.
Montez pays half the balance on May 10 and half on May 25.
ConnecTech bought 400 computers in December 20X2 for $300 each. It paid $260 to have them delivered to its store. In January 20X3, ConnecTech sold 220 of the computers for $550 each. ConnecTech uses a perpetual inventory system.
8.6 End-of-Chapter Exercises 220
1.
Prepare the journal entry(ies) to record ConnecTech’s purchase of the computers.
2.
Determine the balance in ConnecTech’s ending inventory on December 31, 20X2.
3.
Prepare the journal entry(ies) to record the sale of the computers.
4.
Determine the balance in ConnecTech’s ending inventory on January 31, 20X3.
Nakatobi Company has a warehouse in Fargo, ND. The company utilizes a periodic inventory system. At the beginning of the year, the warehouse contained $369,000 worth of inventory. During the first quarter, Nakatobi purchased another $218,000 worth of inventory and made sales of $450,000. On April 1, a flood hit Fargo and destroyed half of the inventory housed in the warehouse. Nakatobi needs to estimate the value of the inventory for insurance purposes. The only additional information Nakatobi has is that typically its cost of goods sold is 55 percent of sales.
1.
Determine the value of the inventory on March 31, before the flood hit.
2.
Determine Nakatobi’s loss on April 1.
Fay’s uses a perpetual inventory system. In March, Fay’s purchased a type of swimwear designed to be slimming to the wearer. It purchased twenty suits of varying sizes for $40 each and priced them at $120 each. They sold out almost immediately, so Fay purchased forty more suits in April for $40 each and sold thirty-eight of them for $130 each. Again in July, Fay made one more purchase of twenty suits at $40 each and sold fifteen of them for $130 each. Fay decided not to put the rest of her inventory on sale at the end of the summer, but to hold onto it until cruise season started the following winter. She believed she could sell the rest then without having to mark them down.
1.
Make the journal entries for the purchases Fay made.
2.
Make the journal entries for the sales Fay made.
3.
Determine the balance in ending inventory on December 31.
Bowling Corporation had the following transactions occur during February:
1.
Bowling purchased $450,000 in inventory on credit.
2.
Bowling received $13,000 in cash from customers for subscriptions that will not begin until the following month.
3.
Bowling signed a note from Midwest Bank for $67,000.
4.
Bowling sold all the inventory purchased in (a) above for $700,000 on account.
5.
Bowling paid employees $120,000 for services performed during January.
6.
Bowling purchased land for $56,000 in cash.
7.
Bowling received $650,000 in cash from customers paying off January’s accounts receivable.
8.
Bowling paid dividends to stockholders in the amount of $4,000.
9.
Bowling owes its employees $123,000 for work performed during February but not yet paid.
10.
Bowling paid $300,000 on its accounts payable.
11.
Bowling paid taxes in cash of $45,000.
Required:
4.6 End-of-Chapter Exercises 86
1.
Prepare journal entries for the above transactions
