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ACC 421 Final Exam WileyPlus




1. Transactions for Mehta Company for the month of May are presented below. Prepare journal entries for each of these transactions.;2. On July 1, 2012, Crowe Co. pays $19,628 to Zubin Insurance Co. for a 3-year insurance contract. Both companies have fiscal years ending December 31. For Crowe Co. journalize the entry on July 1 and the adjusting entry on December 31.;3. Dresser Company's weekly payroll, paid on Fridays, totals $6,600. Employees work a 5-day week. Prepare Dresser's adjusting entry on Wednesday, December 31, and the journal entry to record the $6,600 cash payment on Friday, January 2.;4. Side Kicks has year-end account balances of Sales $890,660, Interest Revenue $16,870, Cost of Goods Sold $557,320, Operating Expenses $207,440, Income Tax Expense $36,370, and Dividends $20,744. Prepare the year-end closing entries.;5. Financial information exhibits the characteristic of consistency when;6. What is the relationship between the Securities and Exchange Commission and accounting standard setting in the United States?;7. Starr Co. had sales revenue of $632,600 in 2012. Other items recorded during the year were;Prepare a single-step income statement for Allen for 2012. Allen has 100,000 shares of stock outstanding.;8. Portman Corporation has retained earnings of $752,650 at January 1, 2012. Net income during 2012 was $1,751,960, and cash dividends declared and paid during 2012 totaled $78,100. Prepare a retained earnings statement for the year ended December 31, 2012. Assume an error was discovered: land costing $87,490 (net of tax) was charged to repairs expense in 2009.;9. On January 1, 2012, Richards Inc. had cash and common stock of $63,790. At that date the company had no other asset, liability or equity balances. On January 2, 2012, it purchased for cash $24,120 of equity securities that it classified as available-for-sale. It received cash dividends of $4,560 net of tax during the year on these securities. In addition, it has an unrealized holding gain on these securities of $5,380 net of tax. Determine the following amounts for 2012: (a) net income, (b) comprehensive income, (c) other comprehensive income, and (d) accumulated other comprehensive income (end of 2012).;10. Armstrong Corporation reported the following for 2012: net sales $1,227,100, cost of goods sold $762,000, selling and administrative expenses $324,800, and an unrealized holding gain on available-for-sale securities $23,800. Prepare a statement of comprehensive income, using the two-income statement format. Ignore income taxes and earnings per share.;11. Guillen, Inc. began work on a $7,160,800 contract in 2012 to construct an office building. Guillen uses the completed-contract method. At December 31, 2012, the balances in certain accounts were construction in process $1,751,500, accounts receivable $245,100, and billings on construction in process $1,077,500. Indicate how these accounts would be reported in Guillen's December 31, 2012, balance sheet.;12. Lazaro, Inc. sells goods on the installment basis and uses the installment-sales method. Due to a customer default, Lazaro repossessed merchandise that was originally sold for $980, resulting in a gross profit rate of 40%. At the time of repossession, the uncollected balance is $680, and the fair value of the repossessed merchandise is $288. Prepare Lazaro's entry to record the repossession.;13. Harding Corporation has the following accounts included in its December 31, 2012, trial balance: Accounts Receivable $116,120, Inventories $295,100, Allowance for Doubtful Accounts $8,680, Patents $78,220, Prepaid Insurance $9,870, Accounts Payable $77,710, Cash $36,400. Prepare the current assets section of the balance sheet listing the accounts in proper sequence.;14. Patrick Corporation's adjusted trial balance contained the following asset accounts at December 31, 2012: Prepaid Rent $20,000, Goodwill $58,610, Franchise Fees Receivable $4,340, Franchises $43,080, Patents $36,100, Trademarks $11,620. Prepare the intangible assets section of the balance sheet.;15. Hawthorn Corporation's adjusted trial balance contained the following accounts at December 31, 2012: Retained Earnings $126,560, Common Stock $707,140, Bonds Payable $101,750, Additional Paid-in Capital $203,770, Goodwill $58,010, Accumulated Other Comprehensive Loss $153,850. Prepare the stockholders' equity section of the balance sheet.;16. Keyser Beverage Company reported the following items in the most recent year.;17. Linden Corporation is preparing its December 31, 2012, financial statements. Two events that occurred between December 31, 2012, and March 10, 2013, when the statements were issued, are described below.;A liability, estimated at $157,050 at December 31, 2012, was settled on February 26, 2013, at $175,160.;A flood loss of $78,580 occurred on March 1, 2013. What effect do these subsequent events have on 2012 net income?;18. Roder Corporation has seven industry segments with total revenues as follows. Based only on the total revenues test, which industry segments are reportable? Enter 1 if the segment is reportable. Enter 0 if the segment is not reportable.;19. Operating profits and losses for the seven industry segments of Roder Corporation are;Based only on the operating profit (loss) test, which industry segments are reportable?;Enter 1 if the segment is reportable. Enter 0 if the segment is not reportable.;21. Heartland Company's budgeted sales and budgeted cost of goods sold for the coming year are $143,870,000 and $31,464,000 respectively. Short-term interest rates are expected to average 10%. If Heartland can increase inventory turnover from its present level of 9 times a year to a level of 12 times per year, compute its expected cost savings for the coming year.;23. Ames Company reported 2012 net income of $153,850. During 2012, accounts receivable increased by $13,740 and accounts payable increased by $9,970. Depreciation expense was $40,990. Prepare the cash flows from operating activities section of the statement of cash flows.;24. Martinez Corporation engaged in the following cash transactions during 2012. Compute the net cash provided (used) by investing activities.;25: Martinez Corporation engaged in the following cash transactions during 2012. Determine Martinez's free cash flow, assuming that it reported net cash provided by operating activities of $401,270.;26 (Preparation of a Statement of Cash Flows);(a) comparative balance sheet for Orozco Corporation is presented below.;(b).Determine Orozco Corporation's current cash debt coverage ratio, cash debt coverage ratio, and free cash flow;27. Chris Spear invested $11,798 today in a fund that earns 12% compounded annually. To what amount will the investment grow in 3 years? To what amount would the investment grow in 3 years if the fund earns 12% annual interest compounded semiannually?;28. Amy Monroe wants to create a fund today that will enable her to withdraw $25,780 per year for 8 years, with the first withdrawal to take place 5 years from today. If the fund earns 10% interest, how much must Amy invest today?;29. Zach Taylor is settling a $25,000 loan due today by making 6 equal annual payments of $5,909.41. What payments must Zach Taylor make to settle the loan at the interest rate of 11%, but with the 6 payments beginning on the day the loan is signed?;30. (Simple and Compound Interest Computations);Lyle O 'Keefe invests $25,900 at 8% annual interest, leaving the money invested without withdrawing any of the interest for 8 years. At the end of the 8 years, Lyle withdrew the accumulated amount of money.;a). Compute the amount Lyle would withdraw assuming the investment earns simple interest.;b). Compute the amount Lyle would withdraw assuming the investment earns interest compounded annually. (Round to 2 decimal places, e.g. 25,250.25. Hint: Use tables in text.);c. Compute the amount Lyle would withdraw assuming the investment earns interest compounded semiannually. (Round to 2 decimal places, e.g. 25,250.25. Hint: Use tables in text.)


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