Questions and Answers of Corporate Financial Accounting

AT&T Inc. (T) is a leading global provider of telecommunication services. Facebook, Inc. (FB) is a major worldwide social media company. AT&T has a lengthy history and was founded by
The comparative balance sheet of Coulson, Inc. at December 31, 20Y2 and 20Y1, is as follows:The noncurrent asset, noncurrent liability, and stockholders’ equity accounts for 20Y2 are as
List the errors you find in the following statement of cash flows. The cash balance at the beginning of the year was $240,000. All other amounts are correct, except the cash balance at the end of the
On the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cash flows: ACCOUNT Land ACCOUNT NO. Balance Date Item Debit Credit Debit
Morrow Enterprises Inc. manufactures bathroom fixtures. Morrow Enterprises’ stockholders’ equity accounts, with balances on January 1, 20Y6, are as follows:Common Stock, $20 stated value (500,000
The treasury stock in Discussion Question 7 is resold for $3,750,000.a. What is the effect on the corporation’s revenue of the period?b. What is the effect on stockholders’ equity?Question 7A
Campbell Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $30,000,000 of 10-year, 10% bonds at a market (effective) interest rate of 9%, receiving cash of $31,951,110.
On July 1, 20Y1, Danzer Industries Inc. issued $50,000,000 of 10-year, 8% bonds at a market (effective) interest rate of 10%, receiving cash of $43,768,920. Interest on the bonds is payable
Moss Co. issued $42,000,000 of five-year, 11% bonds, with interest payable semiannually, at a market (effective) interest rate of 9%. Determine the present value of the bonds payable using the
Pinder Co. produces and sells high-quality video equipment. To finance its operations, Pinder issued $25,000,000 of five-year, 7% bonds, with interest payable semiannually, at a market (effective)
Assume the same data as in Exercise 11-10, except that the current interest rate is 12%. Will the present value of your winnings using an interest rate of 12% be more than the present value of your
On January 1, you win $50,000,000 in the state lottery. The $50,000,000 prize will be paid in equal installments of $6,250,000 over eight years. The payments will be made on December 31 of each year,
Determine the present value of $200,000 to be received at the end of each of four years, using an interest rate of 7%, compounded annually, as follows:a. By successive computations, using the present
Averill Products Inc. reported the following on the company’s income statement in 20Y8 and 20Y9:a. Determine the times interest earned ratio for 20Y8 and 20Y9. Round to one decimal place.b. Is the
Using the bond from Basic Exercise 11-2, journalize the first interest payment and the amortization of the related bond discount.Basic Exercise 11-2On the first day of the fiscal year, a company
The following data for Throwback Industries Inc. relate to the payroll for the week ended December 9.Employees Mantle and Williams are office staff, and all of the other employees are sales
Ehrlich Co. began business on January 2. Salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required
The payroll register of Heritage Co. indicates $4,200 of social security withheld and $1,050 of Medicare tax withheld on total salaries of $70,000 for the period. Federal withholding for the period
The following transactions and adjusting entries were completed by Legacy Furniture Co. during a three-year period. All are related to the use of delivery equipment. The double-declining-balance
Assume the same facts as in Exercise 9-23, except that the book value of the press traded in is $108,500.(a) What is the amount of cash given?(b) What is the gain or loss on the exchange?Exercise
Select financial statement data for two recent years for Davenport Company are as follows:a. Determine the fixed asset turnover ratio for 20Y4 and 20Y5.b. Does the change in the fixed asset turnover
Determine the due date and the amount of interest due at maturity on the following notes: Date of Note Face Amount Interest Rate Term of Note January 5* February 15* May 19 August 20 October 19 120
Casebolt Company wrote off the following accounts receivable as uncollectible for the first year of its operations ending December 31:Customer ............................... AmountShawn Brooke
The following selected transactions were taken from the records of Rustic Tables Company for the year ending December 31:June 8. Wrote off account of Kathy Quantel, $8,440.Aug. 14. Received $3,000 as
The following selected transactions were taken from the records of Shipway Company for the first year of its operations ending December 31:Apr. 13. Wrote off account of Dean Sheppard, $8,450.May 15.
Using the data in Exercise 8-11, assume that the allowance for doubtful accounts for Outlaw Bike Co. had a debit balance of $5,140 as of December 31. Journalize the adjusting entry for uncollectible
Toot Auto Supply distributes new and used automobile parts to local dealers throughout the Midwest. Toot’s credit terms are n/30. As of the end of business on October 31, the following accounts
The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6:1. Cash balance according to the company’s records at August 31, $42,920.2. Cash
Anstead Co. is experiencing a decrease in sales and operating income for the fiscal year ending October 31. Ryan Frazier, controller of Anstead Co., has suggested that all orders received before the
Selected data on inventory, purchases, and sales for Jaffe Co. and Coronado Co. are as follows:Instructions1. Determine the estimated cost of the inventory of Jaffe Co. on February 28 by the retail
Data on the physical inventory of Katus Products Co. as of December 31 follows:Quantity and cost data from the last purchases invoice of the year and the next-to-the-last purchases invoice are
Pappa’s Appliances uses the periodic inventory system. Details regarding the inventory of appliances at January 1, purchases invoices during the year, and the inventory count at December 31 are
The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are shown in Problem 6-1B.Instructions1. Determine the inventory on June 30 and the cost of goods sold
The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are shown in Problem 6-1B.Instructions1. Record the inventory, purchases, and cost of goods sold data in
The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are shown in Problem 6-1B.Instructions1. Record the inventory, purchases, and cost of goods sold data in
The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as follows:Instructions1. Record the inventory, purchases, and cost of goods sold data
Data on the physical inventory of Ashwood Products Company as of December 31 follow:Quantity and cost data from the last purchases invoice of the year and the next-to-the-last purchases invoice are
Dymac Appliances uses the periodic inventory system. Details regarding the inventory of appliances at January 1, purchases invoices during the next 12 months, and the inventory count at December 31
The beginning inventory for Midnight Supplies and data on purchases and sales for a three-month period are shown in Problem 6-1A.Instructions1. Determine the inventory on March 31 and the cost of
The beginning inventory for Midnight Supplies and data on purchases and sales for a three-month period are shown in Problem 6-1A.Instructions1. Record the inventory, purchases, and cost of goods sold
The beginning inventory at Midnight Supplies and data on purchases and sales for a three-month period are shown in Problem 6-1A.Instructions1. Record the inventory, purchases, and cost of goods sold
The following units of a particular item were available for sale during the calendar year:The firm uses the weighted average cost method with a perpetual inventory system. Determine the cost of goods
On the basis of the following data, determine the value of the inventory at the lower of cost or market. Apply lower of cost or market to each inventory item, as shown in Exhibit 10.Exhibit 10
Selected accounts and related amounts for Kanpur Co. for the fiscal year ended June 30, 20Y7, are presented in Problem 5-5B.Instructions1. Prepare a single-step income statement in the format shown
The following selected accounts and their current balances appear in the ledger of Kanpur Co. for the fiscal year ended June 30, 20Y7:Instructions1. Prepare a multiple-step income statement.2.
Selected transactions for Betz Company during July of the current year are listed in Problem 5-1A.InstructionsJournalize the entries to record the transactions of Betz Company for July using the
The following selected transactions were completed during August between Summit Company and Beartooth Co.:Aug. 1. Summit Company sold merchandise on account to Beartooth Co., $48,000, terms FOB
Based on the data presented in Exercise 5-27, journalize the closing entries.Exercise 5-27On March 31, 20Y9, the balances of the accounts appearing in the ledger of Royal Furnishings Company, a
Summary operating data for Custom Wire & Tubing Company during the year ended April 30, 20Y2, are as follows: cost of goods sold, $6,100,000; administrative expenses, $740,000; interest expense,
Based on the data presented in Exercise 5-16, journalize Balboa Co.’s entries for(a) The purchase,(b) The return of the merchandise for credit,(c) The payment of the invoice.
On December 28, 20Y3, Silverman Enterprises sold $18,500 of merchandise to Beasley Co. with terms 2/10, n/30. The cost of the goods sold was $11,200. On December 31, 20Y3, Silverman prepared its
FedEx Corporation (FDX) had the following revenue and expense account balances (in millions) for a recent year ending May 31:a. Prepare an income statement.b. Compare your income statement with the
Triton Consulting is a consulting firm owned and operated by Jayson Neese. The following end of- period spreadsheet was prepared for the year ended April 30, 20Y3:Based on the preceding spreadsheet,
In teams, select a public company that interests you. Obtain the company’s most recent annual report on Form 10-K. The Form 10-K is a company’s annually required filing with the Securities and
The unadjusted trial balance that you prepared for PS Music at the end of Chapter 2 should appear as follows:The data needed to determine adjustments are as follows:• During July, PS Music provided
Reece Financial Services Co., which specializes in appliance repair services, is owned and operated by Joni Reece. Reece Financial Services’ accounting clerk prepared the following unadjusted trial
On May 31, the following data were accumulated to assist the accountant in preparing the adjusting entries for Oceanside Realty:• Fees accrued but unbilled at May 31 are $19,750.• The supplies
On March 31, the following data were accumulated to assist the accountant in preparing the adjusting entries for Potomac Realty:• The supplies account balance on March 31 is $5,620. The supplies on
The following accounts were taken from the unadjusted trial balance of Murray Co., a congressional lobbying firm. Indicate whether or not each account would normally require an adjusting entry. If
If the effect of the debit portion of an adjusting entry is to increase the balance of an asset account, which of the following statements describes the effect of the credit portion of the entry?
Chipotle Mexican Grill, Inc. (CMG) is a quick-service restaurant providing a focused menu of burritos, tacos, and salads. Chipotle’s income statements for the end of two recent years are as
The following preliminary unadjusted trial balance of Ranger Co., a sports ticket agency, does not balance:When the ledger and other records are reviewed, you discover the following:(1) The debits
In teams, select a public company that interests you. Obtain the company’s most recent annual report on Form 10-K. The Form 10-K is a company’s annually required filing with the Securities and
The financial statements at the end of Wolverine Realty’s first month of operations are as follows:InstructionsBy analyzing the interrelationships among the four financial statements, determine the
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