Accounting Principles 12th edition Jerry Weygandt, Paul Kimmel, Donald Kieso - Solutions

Classify each item as an operating, investing, or financing activity. Assume all items involve cash unless there is information to the contrary and the indirect method is used.(a) Purchase of equipment.(b) Proceeds from sale of building. (c) Redemption of bonds. (d) Depreciation.(e)
Each of the items below must be considered in preparing a statement of cash flows for Baskerville Co. for the year ended December 31, 2017. For each item, state how it should be shown in the statement of cash flows for 2017.(a) Issued bonds for $200,000 cash.(b) Purchased equipment for $150,000
Harding Financial Services Company holds a large portfolio of debt and stock securities as an investment. The total fair value of the portfolio at December 31, 2017, is greater than total cost. Some securities have increased in value and others have decreased. Ann Bales, the financial vice
The annual report of Apple Inc. is presented in Appendix A. Instructions for accessing and using the company’s complete annual report, including the notes to the financial statements, are also provided in Appendix A.Instructions(a) Determine the percentage increase for (1) short-term marketable
Part I Debby Kauffman and her two colleagues, Jamie Hiatt and Ella Rincon, are personal trainers at an upscale health spa/resort in Tampa, Florida. They want to start a health club that specializes in health plans for people in the 501 age range. The growing population in this age range and
The following data, presented in alphabetical order, are taken from the records of Nieto Corporation.The investment in Sasse common stock is considered to be a long-term available-for-sale security.InstructionsPrepare a classified balance sheet at December 31, 2017. Accounts payable Accounts
The following securities are in Frederick Company’s portfolio of long-term available-for-sale securities at December 31, 2017.
Heidebrecht Design acquired 20% of the outstanding common stock of Quayle Company on January 1, 2017, by paying $800,000 for the 30,000 shares. Quayle declared and paid $0.30 per share cash dividends on March 15, June 15, September 15, and December 15, 2017. Quayle reported net income of $320,000
Vilander Carecenters Inc. provides financing and capital to the healthcare industry, with a particular focus on nursing homes for the elderly. The following selected transactions relate to bonds acquired as an investment by Vilander, whose fiscal year ends on December 31.2017Jan. 1 Purchased at
Flynn Company purchased 70 Rinehart Company 6%, 10-year, $1,000 bonds on January 1, 2017, for $70,000. The bonds pay interest annually on January 1. On January 1, 2018, after receipt of interest, Flynn Company sold 40 of the bonds for $38,500.InstructionsPrepare the journal entries to record the
Jenek Corporation had the following transactions pertaining to debt investments.1. Purchased 50 9%, $1,000 Leeds Co. bonds for $50,000 cash. Interest is payable annually on January 1, 2017.2. Accrued interest on Leeds Co. bonds on December 31, 2017.3. Received interest on Leeds Co. bonds on January
Some of Tollakson Corporation’s investment securities are classified as trading securities and some are classified as available-for-sale. The cost and fair value of each category at December 31, 2017, were as follows.At December 31, 2016, the Fair Value Adjustment—Trading account had a debit
Kurtyka Corporation had the following transactions relating to debt investments: Jan. 1, 2017 Purchased 50, $1,000, 10% Spiller Company bonds for $50,000. Interest is payable annually on January 1.Dec. 31, 2017 Accrued interest on Spiller Company bonds.Jan. 1, 2018 Received interest from Spiller
Godfrey Corporation holds, as a long-term investment, available-for-sale securities costing $72,000. At December 31, 2017, the fair value of the securities is $68,000. Prepare the adjusting entry to record the securities at fair value.
The cost of the trading securities of Munoz Company at December 31, 2017, is $64,000. At December 31, 2017, the fair value of the securities is $59,000. Prepare the adjusting entry to record the securities at fair value.
Ownbey Corporation purchased debt investments for $52,000 on January 1, 2017. On July 1, 2017, Ownbey received cash interest of $2,340. Journalize the purchase and the receipt of interest. Assume that no interest has been accrued.
Ling Corporation uses the equity method to account for its ownership of 35% of the common stock of Gorman Packing. During 2017, Gorman reported a net income of $80,000 and declares and pays cash dividends of $10,000. What recognition should Ling Corporation give to these events?
The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to its financial statements, are also provided in Appendix F.InstructionsUse the company’s annual report to answer the following
Ratzlaff Company issues (in euros) €2 million, 10-year, 8% bonds at 97, with interest payable annually on January 1.Instructions(a) Prepare the journal entry to record the sale of these bonds on January 1, 2017.(b) Assuming instead that the above bonds sold for 104, prepare the journal entry to
Amazon.com, Inc.’s financial statements are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions for accessing and using the complete annual reports of Amazon and Wal-Mart, including the notes to the financial statements, are also
PepsiCo’s financial statements are presented in Appendix B. Financial statements of The Coca-Cola Company are presented in Appendix C. Instructions for accessing and using the complete annual reports of PepsiCo and Coca-Cola, including the notes to the financial statements, are also provided in
The financial statements of Apple Inc. are presented in Appendix A. Instructions for accessing and using the company’s complete annual report, including the notes to the financial statements, are also provided in Appendix A.Instructions(a) What were Apple’s total long-term liabilities at
The following is taken from the Colaw Company balance sheet.Interest is payable annually on January 1. The bonds are callable on any annual interest date. Colaw uses straight-line amortization for any bond premium or discount. From December 31, 2017, the bonds will be outstanding for an additional
Saberhagen Company sold $3,500,000, 8%, 10-year bonds on January 1, 2017. The bonds were dated January 1, 2017 and pay interest annually on January 1. Saberhagen Company uses the straight-line method to amortize bond premium or discount.Instructions(a) Prepare all the necessary journal entries to
Presented below are three different lease transactions that occurred for Ruggiero Inc. in 2017. Assume that all lease contracts start on January 1, 2017. In no case does Ruggiero receive title to the properties leased during or at the end of the lease term.Instructions(a) Which of the leases are
Jernigan Co. receives $300,000 when it issues a $300,000, 10%, mortgage note payable to finance the construction of a building at December 31, 2017. The terms provide for annual installment payments of $50,000 on December 31.InstructionsPrepare the journal entries to record the mortgage loan and
The following section is taken from Ohlman Corp.’s balance sheet at December 31, 2016.Current liabilitiesInterest payable..............................................................................$ 112,000Long-term liabilitiesBonds payable, 7%, due January 1,
Whitmore Company issued $500,000 of 5-year, 8% bonds at 97 on January 1, 2017. The bonds pay interest annually.Instructions(a) (1) Prepare the journal entry to record the issuance of the bonds.(2) Compute the total cost of borrowing for these bonds.(b) Repeat the requirements from part (a),
Laudie Company issued $400,000 of 9%, 10-year bonds on January 1, 2017, at face value. Interest is payable annually on January 1, 2018.InstructionsPrepare the journal entries to record the following events.(a) The issuance of the bonds.(b) The accrual of interest on December 31, 2017.(c) The
Nick Bosch has prepared the following list of statements about bonds.1. Bonds are a form of interest-bearing notes payable.2. Secured bonds have specific assets of the issuer pledged as collateral for the bonds.3. Secured bonds are also known as debenture bonds.4. A conversion feature may be added
State whether each of the following statements is true or false._______ 1. Mortgage bonds and sinking fund bonds are both examples of debenture bonds._______ 2. Convertible bonds are also known as callable bonds._______ 3. The market rate is the rate investors demand for loaning funds._______ 4.
Golden Inc. issues $4 million, 5-year, 10% bonds at 102, with interest payable annually on January 1. The straight-line method is used to amortize bond premium.(a) Prepare the journal entry to record the sale of these bonds on January 1, 2017.(b) Prepare the adjusting journal entry to record
Sweetwood Company issues $5 million, 10-year, 9% bonds at 96, with interest payable annually on January 1. The straight-line method is used to amortize bond discount.(a) Prepare the journal entry to record the sale of these bonds on January 1, 2017.(b) Prepare the adjusting journal entry to record
Presented below are long-term liability items for Lind Company at December 31, 2017. Prepare the long-term liabilities section of the balance sheet for Lind Company.Bonds payable, due 2019..........................................$600,000Lease
Hanschu Inc. issues an $800,000, 10%, 10-year mortgage note on December 31, 2017, to obtain financing for a new building. The terms provide for annual installment payments of $130,196. Prepare the entry to record the mortgage loan on December 31, 2017, and the first installment payment on December
The balance sheet for Miley Consulting reports the following information on July 1, 2017.Miley decides to redeem these bonds at 101 after paying annual interest. Prepare the journal entry to record the redemption on July 1, 2017. Long-term liabilities Bonds payable Less: Discount on bonds payable
Nasreen Company issues $2 million, 10-year, 8% bonds at 97, with interest payable each January 1.(a) Prepare the journal entry to record the sale of these bonds on January 1, 2017.(b) Assuming instead that the above bonds sold for 104, prepare the journal entry to record the sale of these bonds on
Nasreen Company issues $2 million, 10-year, 8% bonds at 97, with interest payable each January 1.(a) Prepare the journal entry to record the sale of these bonds on January 1, 2017.(b) Assuming instead that the above bonds sold for 104, prepare the journal entry to record the sale of these bonds on
Meera Corporation issued 4,000, 8%, 5-year, $1,000 bonds dated January 1, 2017, at 100. Interest is paid each January 1.(a) Prepare the journal entry to record the sale of these bonds on January 1, 2017.(b) Prepare the adjusting journal entry on December 31, 2017, to record interest expense.(c)
Windsor Corporation issues $500,000 of 9%, 5-year bonds on January 1, 2017, at 104. If Windsor uses the effective-interest method in amortizing the premium, will the annual interest expense increase or decrease over the life of the bonds? Explain.
DeWeese Corporation issues $400,000 of 8%, 5-year bonds on January 1, 2017, at 105. Assuming that the straight-line method is used to amortize the premium, what is the total amount of interest expense for 2017?
Did Apple redeem any of its debt during the fiscal year ended September 28, 2013?
The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to its financial statements, are also provided in Appendix F.InstructionsUse the company’s annual report to answer the following
The stockholders’ equity accounts of Gonzalez, Inc., at January 1, 2017, are as follows.Preferred Stock, no par, 4,000 shares issued.............................$400,000Common Stock, no par, 140,000 shares issued..........................700,000Retained
Amazon.com, Inc.’s financial statements are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions for accessing and using the complete annual reports of Amazon and Wal-Mart, including the notes to the financial statements, are also
PepsiCo’s financial statements are presented in Appendix B. Financial statements of The Coca-Cola Company are presented in Appendix C. Instructions for accessing and using the complete annual reports of PepsiCo and Coca-Cola, including the notes to the financial statements, are also provided in
The financial statements of Apple Inc. are presented in Appendix A. Instructions for accessing and using the company’s complete annual report, including the notes to the financial statements, are also provided in Appendix A.InstructionsRefer to Apple’s financial statements and answer the
After establishing their company’s fiscal year-end to be October 31, Natalie and Curtis began operating Cookie & Coffee Creations Inc. on November 1, 2017. On that date, they issued both preferred and common stock. After the first year of operations, Natalie and Curtis want to prepare
The post-closing trial balance of Storey Corporation at December 31, 2017, contains the following stockholders’ equity accounts.Preferred Stock (15,000 shares issued).....................................$ 750,000Common Stock (250,000 shares
The stockholders’ equity accounts of Karp Company at January 1, 2017, are as follows.Preferred Stock, 6%, $50 par.............................................................$600,000Common Stock, $5 par..........................................................................800,000Paid-in
This financial information is available for Klinger Corporation.The weighted-average number of shares of common stock outstanding was 180,000 for 2016 and 150,000 for 2017.InstructionsCalculate earnings per share and return on common stockholders’ equity for 2017 and 2016. 2017 2016 Average
The following financial information is available for Plummer Corporation.The weighted-average number of shares of common stock outstanding was 80,000 for 2016 and 100,000 for 2017.InstructionsCalculate earnings per share and return on common stockholders’ equity for 2017 and 2016. 2017 2016
The following information is available for Norman Corporation for the year ended December 31, 2017: sales revenue $700,000, other revenues and gains $92,000, operating expenses $110,000, cost of goods sold $465,000, other expenses and losses $32,000, and preferred stock dividends $30,000. The
Herr Corporation has 3,000 shares of 7%, $100 par value preferred stock outstanding at December 31, 2017. At December 31, 2017, the company declared a $105,000 cash dividend. Determine the dividend paid to preferred stockholders and common stockholders under each of the following scenarios.1. The
Income and common stock data for Ziegler Corporation are presented in BE14-10. Assume also that Ziegler has cumulative preferred stock dividends for the current year of $30,000 that were declared and paid. Compute the earnings per share of common stock.BE14-10Ziegler Corporation reports net income
The following information is available for Reinsch Corporation for the year ended December 31, 2017: cost of goods sold $205,000, sales revenue $350,000, other revenues and gains $50,000, and operating expenses $75,000. Assuming a corporate tax rate of 30%, prepare an income statement for the
SUPERVALU, one of the largest grocery retailers in the United States, is headquartered in Minneapolis. Suppose the following financial information (in millions) was taken from the company’s 2017 annual report: net sales $40,597, net income $393, beginning common stockholders’ equity $2,581, and
What were the amounts of basic earnings per share of common stock that Apple reported in the years 2009 to 2013?
Farley Inc. declares a $55,000 cash dividend on December 31, 2017. The required annual dividend on preferred stock is $10,000. Determine the allocation of the dividend to preferred and common stockholders assuming the preferred stock is cumulative and dividends are 1 year in arrears.
The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to its financial statements, are also provided in Appendix F.InstructionsUse the company’s annual report to answer the following
A high percentage of Americans own stock in corporations. As a shareholder in a corporation, you will receive an annual report. One of the goals of this course is for you to learn how to navigate your way around an annual report.InstructionsUse Apple’s 2013 annual report provided in Appendix A to
The stockholders’ meeting for Percival Corporation has been in progress for some time. The chief financial officer for Percival is presently reviewing the company’s financial statements and is explaining the items that comprise the stockholders’ equity section of the balance sheet for the
Amazon.com, Inc.’s financial statements are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions for accessing and using the complete annual reports of Amazon and Wal-Mart, including the notes to the financial statements, are also
PepsiCo, Inc.’s financial statements are presented in Appendix B. Financial statements of The Coca-Cola Company are presented in Appendix C. Instructions for accessing and using the complete annual reports of PepsiCo and Coca-Cola, including the notes to the financial statements, are also
The stockholders’ equity section for Apple Inc. is shown in Appendix A. Instructions for accessing and using the company’s complete annual report, including the notes to the financial statements, are also provided in Appendix A.Instructions(a) What is the par or stated value per share of
Irwin Corporation has been authorized to issue 20,000 shares of $100 par value, 10%, preferred stock and 1,000,000 shares of no-par common stock. The corporation assigned a $2.50 stated value to the common stock. At December 31, 2017, the ledger contained the following balances pertaining to
The following stockholders’ equity accounts arranged alphabetically are in the ledger of Galindo Corporation at December 31, 2017.Common Stock ($5 stated value)....................................................................$2,000,000Paid-in Capital from Treasury
Peck Corporation is authorized to issue 20,000 shares of $50 par value, 10% preferred stock and 125,000 shares of $5 par value common stock. On January 1, 2017, the ledger contained the following stockholders’ equity balances.Preferred Stock (10,000
Peck Corporation is authorized to issue 20,000 shares of $50 par value, 10% preferred stock and 125,000 shares of $5 par value common stock. On January 1, 2017, the ledger contained the following stockholders’ equity balances.Preferred Stock (10,000
The stockholders’ equity accounts of Castle Corporation on January 1, 2017, were as follows.Preferred Stock (8%, $50 par, 10,000 shares authorized)...........................$ 400,000Common Stock ($1 stated value, 2,000,000 shares authorized)...............1,000,000Paid-in Capital in Excess of
The following stockholders’ equity accounts, arranged alphabetically, are in the ledger of Eudaley Corporation at December 31, 2017.Common Stock ($5 stated value).....................................................................$1,500,000Paid-in Capital in Excess of Par—Preferred
How many shares of common stock did Apple have outstanding at September 28, 2013, and at September 29, 2012?
The partners in Crawford Company decide to liquidate the firm when the balance sheet shows the following.The partners share income and loss 5:3:2. During the process of liquidation, the following transactions were completed in the following sequence.1. A total of $51,000 was received from
Terry, Nick, and Frank are forming The Doctor Partnership. Terry is transferring $30,000 of personal cash and equipment worth $25,000 to the partnership. Nick owns land worth $28,000 and a small building worth $75,000, which he transfers to the partnership. There is a long-term mortgage of $20,000
The financial statements of Louis Vuitton are presented in Appendix F. Instructions for accessing and using the company’s complete annual report, including the notes to the financial statements, are also provided in Appendix F.Instructions(a) What were the total current liabilities for the
Amazon.com Inc.’s financial statements are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions for accessing and using the complete annual reports of Amazon and Wal-Mart, including the notes to the financial statements, are also
PepsiCo, Inc.’s financial statements are presented in Appendix B. Financial statements of The Coca-Cola Company are presented in Appendix C. Instructions for accessing and using the complete annual reports of PepsiCo and Coca-Cola, including the notes to the financial statements, are also
The financial statements of Apple Inc. are presented in Appendix A. Instructions for accessing and using the company’s complete annual report, including the notes to the financial statements, are also provided in Appendix A.InstructionsRefer to Apple’s financial statements and answer the
The following payroll liability accounts are included in the ledger of Harmon Company on January 1, 2017.FICA Taxes Payable...................................................................................$ 760.00Federal Income Taxes
Mann Hardware has four employees who are paid on an hourly basis plus timeand-a-half for all hours worked in excess of 40 a week. Payroll data for the week ended March 15, 2017, are presented below.Abel and Hager are married. They claim 0 and 4 withholding allowances, respectively. The following
Employee earnings records for Slaymaker Company reveal the following gross earnings for four employees through the pay period of December 15.For the pay period ending December 31, each employee’s gross earnings is $4,500. The FICA tax rate is 7.65% on gross earnings of
Suppose the following financial data were reported by 3M Company for 2016 and 2017 (dollars in millions).Instructions(a) Calculate the current ratio and working capital for 3M for 2016 and 2017.(b) Suppose that at the end of 2017, 3M management used $200 million cash to pay off $200 million of
Gallardo Co. is involved in a lawsuit as a result of an accident that took place September 5, 2017. The lawsuit was filed on November 1, 2017, and claims damages of $1,000,000.Instructions(a) At December 31, 2017, Gallardo’s attorneys feel it is remote that Gallardo will lose the lawsuit. How
Betancourt Company sells automatic can openers under a 75-day warranty for defective merchandise. Based on past experience, Betancourt estimates that 3% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a
Moreno Company publishes a monthly sports magazine, Fishing Preview. Subscriptions to the magazine cost $20 per year. During November 2017, Moreno sells 15,000 subscriptions beginning with the December issue. Moreno prepares financial statements quarterly and recognizes subscription revenue at the
C.S. Lewis Company had the following transactions involving notes payable.July 1, 2017 Borrows $50,000 from First National Bank by signing a 9-month, 8% note.Nov. 1, 2017 Borrows $60,000 from Lyon County State Bank by signing a 3-month, 6% note.Dec. 31, 2017 Prepares adjusting entries.Feb. 1, 2018
Data for Beth Corbin are presented in BE11-7. Prepare the journal entries to record (a) Beth’s pay for the period and (b) the payment of Beth’s wages. Use January 15 for the end of the pay period and the payment date.BE11-7Beth Corbin’s regular hourly wage rate is $16, and she receives an
Beth Corbin’s regular hourly wage rate is $16, and she receives an hourly rate of $24 for work in excess of 40 hours. During a January pay period, Beth works 45 hours. Beth’s federal income tax withholding is $95, she has no voluntary deductions, and the FICA tax rate is 7.65%. Compute Beth
Turner Container Company is suffering declining sales of its principal product, nonbiodegradeable plastic cartons. The president, Robert Griffin, instructs his controller, Alexis Landrum, to lengthen asset lives to reduce depreciation expense. A processing line of automated plastic extruding
Pinson Company and Estes Company are two proprietorships that are similar in many respects. One difference is that Pinson Company uses the straight-line method and Estes Company uses the declining-balance method at double the straight-line rate. On January 2, 2015, both companies acquired the
Amazon.com, Inc.’s financial statements are presented in Appendix D. Financial statements of Wal-Mart Stores, Inc. are presented in Appendix E. Instructions for accessing and using the complete annual reports of Amazon and Wal-Mart, including the notes to the financial statements, are also
PepsiCo, Inc.’s financial statements are presented in Appendix B. Financial statements of The Coca-Cola Company are presented in Appendix C. Instructions for accessing and using the complete annual reports of PepsiCo and Coca-Cola, including the notes to the financial statements, are also
The financial statements of Apple Inc. are presented in Appendix A. Instructions for accessing and using the company’s complete annual report, including the notes to the financial statements, are also provided in Appendix A.InstructionsRefer to Apple’s financial statements and answer the
Due to rapid turnover in the accounting department, a number of transactions involving intangible assets were improperly recorded by Goins Company in 2017.1. Goins developed a new manufacturing process, incurring research and development costs of $136,000. The company also purchased a patent for
The intangible assets section of Sappelt Company at December 31, 2017, is presented below.Patents ($70,000 cost less $7,000 amortization)......................................$63,000Franchises ($48,000 cost less $19,200
In recent years, Avery Transportation purchased three used buses. Because of frequent turnover in the accounting department, a different accountant selected the depreciation method for each bus, and various methods were selected. Information concerning the buses is summarized as follows.For the
Pryce Company owns equipment that cost $65,000 when purchased on January 1, 2014. It has been depreciated using the straight-line method based on estimated salvage value of $5,000 and an estimated useful life of 5 years.InstructionsPrepare Pryce Company’s journal entries to record the sale of the
Terry Wade, the new controller of Hellickson Company, has reviewed the expected useful lives and salvage values of selected depreciable assets at the beginning of 2017. His findings are as follows.All assets are depreciated by the straight-line method. Hellickson Company uses a calendar year in
Linton Company purchased a delivery truck for $34,000 on January 1, 2017. The truck has an expected salvage value of $2,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 15,000 in 2017 and 12,000 in 2018.Instructions(a) Compute
Yello Bus Lines uses the units-of-activity method in depreciating its buses. One bus was purchased on January 1, 2017, at a cost of $148,000. Over its 4-year useful life, the bus is expected to be driven 100,000 miles. Salvage value is expected to be $8,000.Instructions(a) Compute the depreciable

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Accounting Principles 12th edition Jerry Weygandt, Paul Kimmel, Donald Kieso - Solutions

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