Enter the following column headings across the top of a sheet of paper:

Enter the transaction/adjustment letter in the first column and show the effect, if any, of each transaction/adjustment on the appropriate balance sheet category or on net income by entering for each category affected the account name and amount, and indicating whether it is an addition (+) or a subtraction (−). Items that affect net income should not also be shown as affecting owners’ equity. You may also write the journal entries to record each transaction/adjustment.
a. Recorded the financing (capital) lease of a truck. The present value of the lease payments is $32,000; the total of the lease payments to be made is $58,000.
b. Paid, within the discount period, an account payable of $1,500 on which terms were 1/15, n30. The purchase had been recorded at the gross amount.
c. Issued $7,000 of bonds payable at a price of 102.
d. Adjusted the estimated liability under a warranty program by reducing previously accrued warranty expense by $2,500.
e. Retired bonds payable with a carrying value of $3,000 by calling them at a redemption value of 101.
f. Accrued estimated health care costs for retirees; $24,000 is expected to be paid within a year, and $310,000 is expected to be paid in more than ayear.

  • CreatedMarch 14, 2012
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