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Question;BUS 591 Financial Accounting;Analysis WEEK 4 Homework Assignment;P8-2B;At December 31, 2013, Dustin Company;reported this information on its balance sheet.;Accounts;receivable $960,000;Less;Allowance for doubtful accounts 78,000;During 2014, the company had the;following transactions related to receivables.;1. Sales on account;2. Sales returns and allowances;3. Collections of accounts receivable;4. Write-offs of accounts receivable;deemed uncollectible;5. Recovery of bad debts previously;written off as uncollectible;Instructions;(a)Prepare the journal entries to;record each of these five transactions. Assume that no cash discounts were;taken on the collections of accounts receivable. (Omit cost of goods sold;entries.);(b)Enter the January 1, 2014;balances in Accounts Receivable and Allowance for Doubt-ful Accounts, post the;entries to the two accounts (use T-accounts), and determine the balances.;(c)Prepare the journal entry to;record bad debt expense for 2014, assuming that aging the accounts receivable;indicates that expected bad debts are $140,000.;(d)Compute the accounts receivable;turnover and average collection period.;P8-6B;On January 1, 2014, Alter Company had;Accounts Receivable $154,000, Notes Receivable of $12,000, and Allowance for;Doubtful Accounts of $13,200. The note receivable is from Hartwig Company. It;is a 4-month, 9% note dated December 31, 2013. Alter Company prepares financial;statements annually. During the year, the following selected transactions;occurred.;Jan. 5;Sold $10,000 of merchandise to;Flynn Company, terms n/15.;20;Accepted Flynn Company?s $10,000;3-month, 6% note for balance due.;Feb. 18 Sold $4,000 of merchandise to Mink Company and accepted;Mink?s $4,000;6-month, 8% note for the amount due.;Apr. 20;Collected Flynn Company note in;full.;30;Received payment in full from;Hartwig Company on the amount due.;May 25 Accepted Creech Inc.?s $9,000, 6-month, 4% note in;settlement of a past-due balance on account.;Aug. 18;Received payment in full from Mink;company on note due.;Sept. 1 Sold $5,000 of merchandise to Glazer Company and;accepted a $5,000, 6-month, 6% note for the amount;due.;Instructions;Journalize the transactions. (Omit;cost of goods sold entries).;P9-2B;At December 31, 2013, Tong;Corporation reported these plant assets.;Land $ 4,000,000;Buildings $28,800,000;Less: Accumulated;depreciation?buildings 11,520,000 17,280,000;Equipment 48,000,000;Less: Accumulated depreciation?equipment;5,000,000 43,000,000;$64,280,000;During 2014, the following selected;cash transactions occurred.;Apr. 1 Purchased land for $2,600,000;May 1 Sold;equipment that cost $750,000 when purchased on January 1, 2009.;The;equipment was sold for $367,000.;June 1 Sold land purchased on June 1, 2002, for $2,000,000.;The land cost $800,000.;Sept. 1 Purchased equipment for $840,000.;Dec. 31 Retired equipment that cost $470,000 when purchased on;December 31, 2004. No salvage value was received.;Instructions;(a) Journalize the transactions.;(Hint: You may wish to set up T-accounts, post beginning balances, and then;post 2014 transactions.) Tong uses straight-line depreciation for buildings and;equipment. The buildings are estimated to have a 40-year life and no salvage;value, the equipment is estimated to have a 10-year useful life and no salvage;value. Update depreciation on assets disposed of at the time of sale or;retirement.;(b) Record adjusting entries for;depreciation for 2014.;(c) Prepare the plant assets section;of Tong?s balance sheet at December 31, 2014.;P9-7B;In recent years Howard Company has;purchased three machines. Because of frequent employee turnover in the;accounting department, a different accountant was in charge of selecting the;depreciation method for each machine, and various methods have been used.;Information concerning the machines is summarized in the table below.;Machine Acquired Cost Salvage Useful Life Depreciation;Value (In years) Method;1 July;1, 2012 $68,000 $5,000 7 Straight-line;2 Apr.;1, 2013 64,000 6,000 4 Declining-balance;3 Sept.;1, 2013 84,000;4,000 8 Units-of-activity;For the declining-balance method;Howard Company uses the double-declining rate. For the units-of-activity;method, total machine hours are expected to be 40,000. Actual hours of use in;the first 3 years were: 2013, 1,200, 2014, 6,400, and 2015, 7,000.;Instructions;(a) Compute the amount of accumulated;depreciation on each machine at December 31, 2015.;(b) If machine 2 was purchased on;November 1 instead of April 1, what would be the depreciation expense for this;machine in 2013? In 2014? (Round to the nearest dollar.)


Paper#40203 | Written in 18-Jul-2015

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