The end-of-year unadjusted trial balance of Berry Fashion Centre contained the following accounts at June 30,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The end-of-year unadjusted trial balance of Berry Fashion Centre contained the following accounts at June 30, 2010, the end of the entity's fiscal year. Cash Accounts Receivable Allowance for Bad-Debts Inventory Store Supplies Prepaid Rent Furniture & Fixtures Accumulated Depreciation: Furniture & Fixtures Computer Equipment Accumulated Depreciation: Computer Equipment Accounts Payable Wages Payable Interest Payable Unearned Sales Revenue Notes Payable, Long-Term A. Berry, Capital A. Berry, Withdrawals Sales Revenue Earned Sales Discount Sales Returns & Allowances Cost of Goods Sold Wages Expense Rent Expense Utilities Expense Depreciation Expense - Furniture & Fixtures Depreciation Expense-Equipment Store Supplies Expense Bad-Debt Expense Interest Expense Total Adjustment data at June 30, 2010 Dr $89,000 37,000 190,000 40,000 36,000 135,000 180,000 68,000 5,000 10,000 320,000 125,000 120,000 35,000 (vi) Accrued interest expense, $9,000 (vii) Inventory on hand at June 30, 2010, $182,000 Cr $3,500 40,000 50,000 43,500 130,000 363,000 770,000 10.000 $1,400,000 $1,400,000 Store supplies on hand at June 30, 2010 amounted to $8,000 Rent of $36,000 was paid on April 30, 2010 for the 3-months to July 31, 2010. (iii) The furniture and fixtures has an estimated useful life of 6 years and is being depreciated on the straight-line method down to a residue value of $15,000. (iv) The computer equipment was acquired on March 1, 2010 and is being depreciated over 4 years on the double-declining method of depreciation, down to a residue of $10,000. (v) Wages earned by employees not yet paid amounted to $15,000 at June 30, 2010. (viii) At June 30, 2010, $32,000 of the previously unearned sales revenue had been earned. (ix) The aging of the Accounts Receivable schedule at June 30, 2010 indicated that the estimated uncollectible expense is $5,500. Other data: (x) $25,000 of the notes payable is due for payment on March 31, 2011. Required: a) b) c) d) e) f) g) Identify the inventory system used by the business. How can you tell? Prepare the necessary adjusting journal entries on June 30, 2010. Prepare Berry's multiple-step income statement for the year ended June 30, 2010. Prepare Berry's statement of owner's equity for the year ended June 30, 2010. Prepare Berry's classified balance sheet, in report format, at June 30, 2010 Calculate the following ratios for the year ended June 30, 2010 (i) Current Ratio (ii) Debt Ratio iii) Gross Profit Percentage iv) Inventory Turnover (Inventory on hand at June 30, 2009 was $128,000) State the two methods used to treat uncollectible accounts. With the aid of journal entries, briefly explain the steps necessary in recording collections on an account which was previously written-off as bad under both methods. Assuming that the debtor was reinstated, what impact would this transaction have on the accounts receivable of the business? The end-of-year unadjusted trial balance of Berry Fashion Centre contained the following accounts at June 30, 2010, the end of the entity's fiscal year. Cash Accounts Receivable Allowance for Bad-Debts Inventory Store Supplies Prepaid Rent Furniture & Fixtures Accumulated Depreciation: Furniture & Fixtures Computer Equipment Accumulated Depreciation: Computer Equipment Accounts Payable Wages Payable Interest Payable Unearned Sales Revenue Notes Payable, Long-Term A. Berry, Capital A. Berry, Withdrawals Sales Revenue Earned Sales Discount Sales Returns & Allowances Cost of Goods Sold Wages Expense Rent Expense Utilities Expense Depreciation Expense - Furniture & Fixtures Depreciation Expense-Equipment Store Supplies Expense Bad-Debt Expense Interest Expense Total Adjustment data at June 30, 2010 Dr $89,000 37,000 190,000 40,000 36,000 135,000 180,000 68,000 5,000 10,000 320,000 125,000 120,000 35,000 (vi) Accrued interest expense, $9,000 (vii) Inventory on hand at June 30, 2010, $182,000 Cr $3,500 40,000 50,000 43,500 130,000 363,000 770,000 10.000 $1,400,000 $1,400,000 Store supplies on hand at June 30, 2010 amounted to $8,000 Rent of $36,000 was paid on April 30, 2010 for the 3-months to July 31, 2010. (iii) The furniture and fixtures has an estimated useful life of 6 years and is being depreciated on the straight-line method down to a residue value of $15,000. (iv) The computer equipment was acquired on March 1, 2010 and is being depreciated over 4 years on the double-declining method of depreciation, down to a residue of $10,000. (v) Wages earned by employees not yet paid amounted to $15,000 at June 30, 2010. (viii) At June 30, 2010, $32,000 of the previously unearned sales revenue had been earned. (ix) The aging of the Accounts Receivable schedule at June 30, 2010 indicated that the estimated uncollectible expense is $5,500. Other data: (x) $25,000 of the notes payable is due for payment on March 31, 2011. Required: a) b) c) d) e) f) g) Identify the inventory system used by the business. How can you tell? Prepare the necessary adjusting journal entries on June 30, 2010. Prepare Berry's multiple-step income statement for the year ended June 30, 2010. Prepare Berry's statement of owner's equity for the year ended June 30, 2010. Prepare Berry's classified balance sheet, in report format, at June 30, 2010 Calculate the following ratios for the year ended June 30, 2010 (i) Current Ratio (ii) Debt Ratio iii) Gross Profit Percentage iv) Inventory Turnover (Inventory on hand at June 30, 2009 was $128,000) State the two methods used to treat uncollectible accounts. With the aid of journal entries, briefly explain the steps necessary in recording collections on an account which was previously written-off as bad under both methods. Assuming that the debtor was reinstated, what impact would this transaction have on the accounts receivable of the business?
Expert Answer:
Answer rating: 100% (QA)
ANSWER a The inventory system used by the business is a perpetual inventory system This can be determined by the presence of the Inventory account on the unadjusted trial balance which indicates that ... View the full answer
Related Book For
Financial Accounting Tools for Business Decision Making
ISBN: 978-1119368458
7th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
Posted Date:
Students also viewed these accounting questions
-
The Accounts Receivable balance and Allowance for Bad Debts for Signature Lamp Company at December 31, 2017, was $10,800 and $2,000 (credit balance), respectively. During 2018, Signature Lamp Company...
-
The trial balance of Bellemy Fashion Center contained the following accounts at November 30, the end of the companys fiscal year. Adjustment data: 1. Supplies on hand totaled 1,500. 2. Depreciation...
-
The trial balance of Gaolee Fashion Center contained the following accounts at November 30, the end of the company's fiscal year. Adjustment data: 1 . Supplies on hand totaled $2,600. 2 ....
-
If a large chilled water plant has 6 chillers and 5 of them are operating at 1 0 0 % , when the operator starts the 6 th chiller, to what percent do the first 5 chillers unload? What formula do you...
-
What purpose initially motivated Merrill Lynch to offer money market mutual funds to its customers?
-
Use the following matrices to compute each expression. BC 3 -4 -3 2 4 A = I| -2 -1 4.
-
How to use social media sites for evidence in court?
-
Prompt Parcel Service operates a fleet of delivery trucks in a large metropolitan area. A careful study by the companys cost analyst has determined that if a truck is driven 120,000 kilometres during...
-
The All Seasonings Company uses 400 glass jars per hour. The waiting time for a standard container, which holds 90 jars, averages 0.75 hour. If management uses a safety factor of twenty percent, how...
-
Returning to problem 5, now assume that the products to be removed are strategicin the sense that they drive sales from some key customersand also that their wholesale price is \($70\) (instead of...
-
(a) Determine the missing amount for each letter. (1) Direct Materials Used $137,300 (2) (3) 94,400 (4) eTextbook and Media Save for Later 82,600 Direct Manufa Labor Over $165,200 (c) 236,000 83,800...
-
Bob spent the entire 2 0 1 9 year in Tokyo. His annual salary was $ 9 0 , 0 0 0 and he paid $ 3 0 , 0 0 0 rent. What is the highest amount of foreign earned income and foreign housing expenses Bob...
-
Should content marketing (Blogs, News, Videos, Podcast, etc.) always include a "Call to Action" (CTA)? Why or why not? Also, how should one apply content marketing CTAs within an organization? Should...
-
calculate the tax in SAR for company supplier's that cost $1000.000 if you know the tax 15%?
-
How does the alignment between organizational climate and corporate values influence customer satisfaction and business performance, and what methods can ensure consistency in this alignment ?
-
P1) The structure presented in the video "Member with a hole - failure modes and design" is reproduced here. You may use any values calculated in the video for this structure without having to...
-
During FY 2020 Bay Manufacturing had total manufacturing costs are $434,000. Their cost of goods manufactured for the year was $469,000. The January 1, 2021 balance of Work-in-Process Inventory is...
-
The following information is for Montreal Gloves Inc. for the year 2020: Manufacturing costs Number of gloves manufactured Beginning inventory $ 3,016,700 311,000 pairs 0 pairs Sales in 2020 were...
-
If a company increases its receivables turnover ratio and its inventory turnover ratio (assuming nothing else changes), what impact will this have on the current ratio?
-
Walmart Stores Inc. and Target Corp. reported the following information in 2015 (excluding Target's discontinued operations): ________________________Walmart (in U.S. $ millions)_______Target (in...
-
Nisson Distributing Ltd. completed the following merchandising transactions in the month of April 2018. At the beginning of April, Nisson's general ledger showed Cash $4,000; Accounts Receivable...
-
When there is a concentration gradient in the system, show that the potential gradient is composed of two terms, (i) an Ohm's-law contribution and (ii) a diffusional contribution. State the equation...
-
Copper is deposited at a cathode from solution with a bulk concentration of \(0.5 \mathrm{M}\) at the rate of \(3.0 \mathrm{~g} / \mathrm{m}^{2} \cdot \mathrm{s}\). Find the surface concentration of...
-
Find the mobility of \(\mathrm{H}^{+}, \mathrm{OH}^{-}\), and other ions from the diffusivity data given in Table 22.1. Table 22.1. Diffusion coefficients of ions in water at 25 C. H+ Na+ K+ Ca+ OH-...
Study smarter with the SolutionInn App