Questions and Answers of Fundamental Accounting Principles 25th

Refer to Spin Master’s statement of cash flows shown in Appendix II. What activity comprised the largest financing activity resulting in cash outflows for the year ended December 31, 2020?
Middleton Supplies Inc. had sales revenue of $805,000 during 2023. Accounts receivable at the beginning of the year were $20,000 but were $24,000 at the end of the year. How much cash was collected
Drum Holdings Inc. collected $737,000 cash from customers during 2023. If beginning accounts receivable were $41,000 and credit sales totalled $705,000, what was the balance in ending accounts
Organic Gardening Ltd. had operating expenses of $968,000 during 2023. Accrued liabilities at the beginning of the year were $27,000, and were $36,000 at the end of the year. Assuming all debits and
The chapter-opening vignette indicated that Jenn Harper follows the cash flow of her business very closely. Why do you think it is imperative for business owners to strictly manage their cash
Eco Play Ltd., with its head office in Vancouver, manufactures enviro-friendly, safe playground equipment for elementary schools. Its 2023 balance sheet and income statement follow.Assume that the
Alberta Playground Inc. produces, markets, distributes, and installs durable playground equipment. It is a new, growing playground distributor in Canada, and is hoping to expand to other provinces
The 2023 financial statements of Outdoor Waterworks Inc. follow:Assume all sales were on credit. Also assume the long-term note payable is due in 2026, with no current portion. On the December 31,
On December 31, 2023, University Security Inc. showed the following:RequiredPart 1:Calculate book value per common share and preferred share at December 31, 2023, assuming $0 being paid out in 2022
On December 31, 2023, Warner Publishing Inc. showed the following:RequiredPart 1:Calculate book value per common share and preferred share at December 31, 2023, assuming no dividends were declared
Silver Bullet Slide Company calculated the ratios shown below for 2023 and 2022:*F = Favourable; U = UnfavourableRequired1. Identify whether the change in the ratios from 2022 to 2023 is favourable
Calculate trend percentages for the following items using 2019 as the base year. Then state whether the situation shown by the trends appears to be favourable or unfavourable. Sales Cost of goods
Web Structure Inc. calculated the ratios shown below for 2023 and 2022:*F = Favourable; U = UnfavourableRequired1. Identify whether the change in the ratios from 2022 to 2023 is favourable (F) or
Refer to the information in Exercise 17-9 and calculate the days’ sales in inventory for Furniture Retailers and Custom Furniture Corp for 2023 (round to two decimal places). Which company has the
The following data are taken from the comparative balance sheets of Duncan Data Storage Company. Calculate the accounts receivable turnover for 2023 and 2022 (round to two decimal places). Is the
Which assets are included in calculating the quick ratio?
Calculate and interpret the days’ sales uncollected for 2023 and 2022 based on the following selected information for Lumbar Cushions Company (round to two decimal places): Accounts receivable Net
Western Grass Inc. Equity Section of Balance Sheet December 31, 2023Contributed capital:RequiredUsing the information provided, calculate book value per common share assuming:a. There are no
Livingston Lumber Company begins the year with $200,000 of goods in inventory. At year-end, the amount in inventory has increased to $230,000. Cost of goods sold for the year is $1,600,000. Calculate
In the chapter-opening vignette, it was mentioned that Flow Beverage Corp. had a significant increase in year over year return on investment (ROI) for 2021. Why should investors be evaluating
Calculate the gross profit ratio for 2023 and evaluate the result against the industry average in Exhibit 17.11, explaining why it compares favourably or unfavourably (round to two decimal places).
Calculate the return on total assets for 2023 and evaluate the result against the industry average in Exhibit 17.11, explaining why it compares favourably or unfavourably (round to two decimal
Calculate the return on common shareholders’ equity for 2023 and evaluate the result against the industry average in Exhibit 17.11, explaining why it compares favourably or unfavourably (round to
Calculate the book value per common share for 2023 and evaluate the result against the industry average in Exhibit 17.11, explaining why it compares favourably or unfavourably (round to two decimal
Calculate the earnings per share for 2023 and evaluate the result against the industry average in Exhibit 17.11, explaining why it compares favourably or unfavourably (round to two decimal places).
Outdoor Play Inc. reported the following facts in its 2023 annual report: net sales of $9,683 million for 2022 and $9,050 million for 2023; total end-of-year assets of $10,690 million for 2022 and
Family Co. manufactures books. It buys significant quantities of supplies from various vendors in order to make its quality products. Calculate Family’s accounts payable turnover for 2023 and 2022
Refer to the financial statements in Appendix II for Spin Master and calculate the percentage change in revenue from December 31, 2019, to December 31, 2020.
Refer to the financial statements in Appendix II for Spin Master and calculate the percentage change in non-current liabilities from December 31, 2019 to December 31, 2020.
Calculate the profit margin for 2023 and evaluate the result against the industry average in Exhibit 17.11, explaining why it compares favourably or unfavourably (round to two decimal places).
Olinda Corporation has a gain from the sale of discontinued operations before tax of $34,000 and a $18,250 loss from operating a discontinued business segment. The tax rate is 30 percent. Income from
Zing Cell Phone Company entered into the following transactions involving current liabilities during 2023 and 2024:Required1. Determine the maturity dates of the three notes just described.2. Present
Zest Company is a Montreal HR firm. Its condensed income statement for the year ended November 30, 2023, is shown below.The liabilities reported on the November 30, 2023, balance sheet were:1.
Sunnyside Solar Consultants provided $180,000 of consulting services to Delton Developments on April 14, 2023, on account.RequiredJournalize Sunnyside’s April 14 transaction including applicable
Eyelash Extension Co.’s liabilities as reported on the June 30, 2023, balance sheet are shown below, along with its statement of changes in equity.Jan is selling the business. A potential buyer has
Modern Electronics Company purchases merchandise inventory from several suppliers. On April 1, 2023, Modern Electronics purchased from Speedy Supplies $100,000 of inventory on account. On May 15,
Refer to the balance sheet for Spin Master Corp. in Appendix II. What percentage is Trade Payable and Accrued Liabilities at December 31, 2020, of the total current liabilities? of total liabilities?
What amount does Recipe Unlimited Corporation, in Appendix II, report as long-term debt as at December 31, 2020? In what accounting period will the current portion of this amount be paid?
Designer Architects had the following additional information at its November 30, 2023, year-end:a. The Unearned Revenue account showed a balance of $62,000, which represented four months of services
On September 3, 2023, Reynolds Retailers, operating out of Nunavut, sold $14,700 of goods for cash with a cost of $12,380. Record Reynolds’s entries, including all appropriate sales taxes.
Laser Tag Palace has two employees and the payroll register showed the following information for the biweekly pay period ended March 23, 2023:*These values are based on assumed payroll
Western Refrigeration borrowed $230,000 to purchase inventory on September 15, 2023 for 45 days at 6% interest by signing a note. On December 6, 2023, Western Refrigeration sold an industrial fridge
Jackson Textiles had an outstanding account in the amount of $14,800 owing to Huang Manufacturing. On October 1, 2023, Huang agreed to convert Jackson’s account to an 8%, 45-day note having a face
Sarah’s Pottery and Gift store had the following transactions:a. On November 15, 2023, Katie from the small office business Custom Graphics contacted Sarah to purchase gift cards for the holiday
Appleton Electronics Company purchases merchandise inventory from several suppliers. On October 1, 2023, Appleton Electronics purchased from Digital Wiring $40,000 of inventory on account. On
Sask Tractor borrowed $320,000 to purchase inventory on September 17, 2023 for 60 days at 6% interest by signing a note. On December 6, 2023, Sask Tractor sold a tractor for cash of $24,000 (cost
What is the benefit of a company like Pebble Technology Corp., discussed in the Decision Insight previously in this chapter, raising funds through a crowdfunding program such as Kickstarter as
Real People Sporting (RPS) Co-op introduced a loyalty program in 2023. Every customer who signed up would receive 1% of their total purchases as a cheque, each February for the previous year, that
On December 11, 2023, the Sydney Company borrowed $42,000 and signed a 60-day, 5.5% note payable. Calculate the accrued interest payable on December 31, 2023.
Golden Wedding Dress Company designs custom wedding dresses for brides to be. The person preparing the adjusting entries at year-end was unable to complete the adjustments due to illness. You have
Vision Wear’s product warranties state that defective glasses will be replaced free of charge for the life of the product. Vision Wear estimates that 2% of the pairs of glasses sold will require
Home-style Wool Company knits clothing from merino wool and sells online and at craft fairs. Gina takes deposits for custom orders. The person preparing the adjusting entries at year-end left for a
Mercedes Boats borrowed $220,000 on September 15, 2023, for 45 days at 7% interest by signing a note.1. On what date will this note mature?2. How much interest expense is created by this note?3.
Assume Pebble Inc. on October 15 purchased $2,500 of merchandise on credit. The next day, it recorded sales of $1,700; cost of sales was $1,200. Record the October 15 and October 16 entries assuming
Wang Corp. estimates income tax expense to be $285,600 for the year 2023. Record estimated income tax for January on January 31, 2023, and the payment on February 1, 2023.
Snowbot Snow Removal Company of Halifax purchased some snowplow equipment on March 10, 2023, that had a cost of $150,000 (ignore GST/PST). Show the journal entries that would record this purchase and
Shefford Cutlery extends a lifetime replacement warranty on all units sold. Using past experience, the company estimates that 0.5% of units sold will be returned and require replacement at an average
Trista and Co. borrowed $180,000 on December 1, 2023, for 90 days at 5% interest by signing a note to buy jewellery inventory.1. On what date will this note mature?2. How much interest expense is
During 2023, Victory Bubble Tea House recorded $36,000 in estimated income taxes on the last day of each month and made the payment on the 15th of the following month. On December 31, 2023,
On April 15, 2023, Dallas Consulting borrowed $17,000 to pay the tax bill owing, for 45 days at 9% interest by signing a note.1. On what date will this note mature?2. How much interest expense is
Brar Maintenance Company showed the following adjusted trial balance information for its December 31, 2023, year-end.*Assume all accounts have a normal balance. **$146,000 of the note payable is due
Superior Skateboard Company, located in Ontario, is preparing adjusting entries at December 31, 2023. An analysis reveals the following:a. During December, Superior sold 6,500 skateboards that carry
Music Media Ltd. prepares statements quarterly.Part A:Required1. Based on 2022 results, Music’s estimated tax liability for 2023 is $285,960. Music will accrue 1/12 of this amount at the end of
On October 6, 2023, Norwood Co., an office equipment supplier, sold a copier for cash of $21,000 (cost $13,900) with a two-year parts and labour warranty. Based on prior experience, Norwood expects
Mackenzie Corp. is preparing the December 31, 2023, year-end financial statements. Following are selected unadjusted account balances:Additional information:a. $10,800 of income tax was accrued
On January 2, 2021, Wavepoint Systems, a cell phone manufacturer, installed a computerized machine in its factory at a cost of $169,200. The machine’s useful life was estimated at four years or a
Times TeleCom’s PPE subledger at January 1, 2023, appeared as follows:Additional information: 1 The company calculates depreciation and amortization to the nearest whole month. 2 S/L =
Two years ago, on March 1, 2021, General Recycling Management Systems purchased five used trucks and debited the Trucks account for the total cost of $180,000. The estimated useful life and residual
Westfair Foods Partial Balance Sheet December 31, 20231The machinery was purchased on January 1, 2018, and is depreciated to the nearest whole month using the straight-line method. Its total
Refer to the balance sheet for Recipe Unlimited Corporation in Appendix II. What amount did it report as goodwill at December 31, 2020?
Refer to the balance sheet for Indigo in Appendix II. What amount did it report as intangible assets at December 31, 2020?
Refer to the statements of cash flows for Spin Master in Appendix II. What was the amount of depreciation and amortization for 2019 and 2020? Where will you look to find the explanation of the
Refer to the information in Problem 9-5B. Redo the question assuming that depreciation for partial periods is calculated using the half-year convention.Data From Problem 9-5BTundra Tours runs tundra
Keith Scott and David Dawson agreed to share the annual profit or losses of their corporate law partnership as follows: If the partnership earned a profit, the first $60,000 would be allocated 40% to
On November 1, 2023, Harris, Davis, and Tallis formed Restore, a home renovation business, by contributing $56,000 in cash, $91,000 of equipment, and a truck worth $42,000, respectively. The partners
Jenn Smith and Mike Yang have a small business consulting partnership. They share profits and losses as detailed in their partnership agreement that gave Jenn a salary allowance of $115,000 and Mike
On June 1, 2023, Jill Bow and Aisha Adams formed a partnership to open a gluten-free commercial bakery, contributing $292,000 cash and $384,000 of equipment, respectively. The partnership also
Leung, Lidder, and Lang have shared an equal stake as partners in a sports bar for the past three years. The partnership is being dissolved, as Leung is moving to England and leaving the firm. Lidder
The partnership agreement of lawyers Jenny Nelmida and Fei Abella provides for a two-thirds/one-third sharing of profit but says nothing about losses. The first year of partnership operations
Keith Williams and Brian Adams were students when they formed a partnership several years ago for a part-time business called Music Works. Adjusted trial balance information for the year ended
Suppose on March 12, 2023, Kate agrees to pay Ramos and Bailey $12,000 each for a one-third interest in the existing Ramos–Bailey partnership. At the time Kate is admitted, each partner has a
Liam and Katano formed a partnership to open a sushi restaurant by investing $95,000 and $105,000, respectively. They agreed to share profit based on an allocation to Liam of an annual salary
Gale, McLean, and Lux are partners of Burgers and Brew Company with capital balances as follows: Gale, $97,000; McLean, $95,000; and Lux, $160,000. The partners share profit and losses in a 3:2:5
On April 1, 2023, Harry Regal and Meghan Merle formed a partnership in Alberta, renting reusable moving boxes.Net Income during the year was $177,000 and was in the Income Summary account.Required1.
On February 1, 2023, Tessa Williams and Audrey Xie formed a partnership in Ontario. Williams contributed $80,000 cash and Xie contributed land valued at $120,000 and a small building valued at
Bill Ace and Dennis Bud are partners in an urban restaurant called Salt. Profit for the year ended March 31, 2023, is $120,000.a. How much profit should be allocated to each partner assuming there is
On April 1, 2022, Guy Comeau and Amelie Lavoi formed a partnership in Ontario.Net Income during the year was $560,000 and was in the Income Summary account.On April 1, 2023 Travis Roberts invested
Lisa Montgomery and Joel Chalmers established a coffee bean distribution business. Their partnership shared profits and losses based on an agreement that gave Lisa a salary allowance of $45,000 and
On July 1, 2022, Alleya Amrick and Breanne Balas formed a partnership to make crafts and sell them online.Required1. Prepare journal entries for the following dates:a. July 1, 2022b. June 20, 2023c.
Zeller, Acker, and Benton are partners with capital balances as follows: Zeller, $95,000; Acker, $80,000; and Benton, $158,000. The partners share profit and losses in a 3:2:5 ratio. Dent is admitted
Leslie Bjorn, Jason Douglas, and Tom Pierce have an architect firm and share profit(losses) in a 3:1:1 ratio. They decide to liquidate their partnership on March 31, 2023. The balance sheet appeared
Ramos and Bailey have a frozen yogurt shop in Victoria, BC. They are equal partners, with $30,000 in each of their partnership capital accounts. Bailey’s sister Kate is admitted to the partnership
Trish Craig and Ted Smith have a bio-energy and consulting business and share profit and losses in a 3:1 ratio. They decide to liquidate their partnership on December 31, 2023, when the balance sheet
On June 17, 2023, Bishop agrees to invest $30,000 into an online custom T-shirt print shop business for a 40% interest in total partnership equity. At the time Bishop is admitted, the existing
Barth, Holt, and Tran have been partners of a ski, snowboard, and mountain bike shop in Whistler, BC, called Storm. Based on the partnership agreement, they share profit and losses in a 6:2:2 ratio.
On April 21, 2023, Wilson agrees to invest $30,000 into Quest, a land development partnership in Niagara-on-the-Lake, for a 20% interest in total partnership equity. At the time Wilson is admitted,
Brenda Roberts, Lacy Peters, and Aarin MacDonald are partners in RPM Dance Studios. They share profit and losses in a 40:40:20 ratio. Aarin retires from the partnership on October 14, 2023, and
Hector, Wilson, and Stuart are partners in What’s Your Beef?, a local vegan burger chain, with capital balances of $25,000, $40,000, and $35,000, respectively. Based on their partnership agreement,
Oliver, Peter, and Wendell are partners in NewTech Company, an R&D firm specializing in cloud storage. Their capital balances are $30,000, $22,000, and $15,000, respectively, on November 23,
Martha Wheaton, Bess Chen, and Sam Smith were partners in an urban Calgary tea shop called Wake and showed the following account balances as of December 31, 2023:Due to difficulties, the partners

Showing 300 - 400 of 1250