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Acct220: Principles of Accounting I - Final Examination

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Question;Acct220;Principles of Accounting I;Problem 1: 15% points;The account balances appearing on;the trial balance (below) were taken from the general ledger of Flip's Copy;Shop at June 30, 2012.;Additional information for the;month of June which has not yet been recorded in the accounts is as follows;(a) A physical count of supplies indicates $300;on hand at June 30.;(b) The amount of insurance that expired in the;month of June was $200.;(c) Depreciation on equipment for June was $400.;(d) Rent owed on the copy shop for the month of;June was $600 but will not be paid until July.;Flip?s Copy Shop;Trial Balance;June 30, 2012;Account;Titles;Debit;Credit;Cash;$1,000;Supplies;1,100;Prepaid;Insurance;2,200;Equipment;24,000;Accum.;Depreciation, Equipment;$4,500;Accounts;Payable;2,400;Notes;Payable;4,000;Flip?s;Capital;15,300;Flip?s;Drawings;2,400;Service;Revenue;4,900;Utilities;Expense;400;Totals;$31,100;$31,100;Instructions;a. Prepare;in journal form, without explanations, the end of month adjusting entries for;Flip's Copy Shop for the month of June.;b. Prepare;a partial adjusted trial balance for the accounts provided.;c. Prepare;in journal form, without explanations, the end of month closing entries for;Flip's Copy Shop for the month of June.;Problem 2: 15% points;The following information is available for Flip Company;Beginning inventory 600 units at $4;First purchase 900 units at $6;Second purchase 500 units at $7.20;Assume;that Flip uses a periodic inventory system and that there are 700 units left at;the end of the month.;Instructions;a.;Compute the cost of goods available for sale.;b.;Compute the value of ending inventory and Cost of Good Sold under the;(1) LIFO method.;(2) FIFO method.;(3);Average-cost method;Problem 3: 15% points;The;following items were taken from the December 31, 2013 adjusted trial balance of;Flip Company. (All balances are normal.);Mortgage payable $ 1,443 Accumulated;depreciation 3,655;Prepaid expenses 880 Accounts;payable 1,444;Equipment 11,000 Notes payable after 2015 1,200;Long-term investments 1,100 Flip?s capital 11,480;Short-term investments 3,690 Accounts receivable 1,696;Notes payable in 2014 1,000 Inventories 1,756;Cash 2,100 Service Revenue 9,000;Rent Expense 1,000 Wages Expense 5,000;Utilities Expense 1,000;Instructions:Prepare a;classified balance sheet in good form as of December 31, 2013.;Problem 4: 10% points;Prepare journal entries to record the following transactions;entered into by Flip Company;2012;June 1 Accepted;a $10,000, 12%, 1-year note from Flop as full payment on her account.;Nov. 1 Sold;merchandise on account to Flap, Inc. for $12,000, terms 2/10, n/30.;Nov. 5 Flap;Inc. returned merchandise worth $500.;Nov. 9 Received;payment in full from Flap, Inc.;Dec. 31 Accrued;interest on Flop's note.;2013;June 1 Flop;honored her promissory note by sending the face amount plus interest. No;interest has been accrued in 2013;Problem 5: 10% points;Flip;Company purchased equipment on January 1, 2011 for $90,000. It is estimated;that the equipment will have a $5,000 salvage value at the end of its 5-year;useful life. It is also estimated that the equipment will produce 100,000 units;over its 5-year life.;Instructions;Answer the following independent questions.;1. Compute the;amount of depreciation expense for the year ended December 31, 2011, using the;straight-line method of depreciation.;2. If 16,000 units;of product are produced in 2011 and 24,000 units are produced in 2012, what is;the book value of the equipment at December 31, 2012? The company uses the;units-of-activity depreciation method.;3. If the company;uses the double-declining-balance method of depreciation, what is the balance;of the Accumulated Depreciation?Equipment account at December 31, 2013?;Problem 6: 10% points;Flip;earns a salary of $7,500 per month during the year. FICA taxes are 8% on the;first $100,000 of gross earnings. Federal unemployment insurance taxes are 6.2%;of the first $7,000, however, a credit is allowed equal to the state;unemployment insurance taxes of 5.4% on the $7,000. During the year, $25,600;was withheld for federal income taxes and $5,700 was withheld for state income;taxes.;Instructions;(a) Prepare;a journal entry summarizing the payment of Flip?s total salary during the year.;(b) Prepare a;journal entry summarizing the employer payroll tax expense on Flip?s salary for;the year.;(c) Determine the;cost of employing Flip for the year.

 

Paper#45087 | Written in 18-Jul-2015

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