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business
fundamental accounting principles
Fundamental Accounting Principles Volume 1 17th Canadian Edition Kermit D. Larson, Heidi Dieckmann, John Harris - Solutions
B52 Skate Training prepares adjustments annually and showed the following on its June 30, 2023, year-end:Additional information available at year-end:a. The Prepaid Arena Rental of $182,000 was paid on February 1, 2023. It represents seven months of rent on the arena.b. A count of the Repair
The following three situations require adjusting journal entries to prepare financial statements as of April 30, 2023. For each situation, present the adjusting entry and the entry that would be made to record the payment of the accrued liability during May 2023.1. The company has a $370,000 note
Rainbow Janitorial Services follows the approach of recording prepaid expenses as expenses and unearned revenues as revenues. Rainbow’s unadjusted trial balance for the year ended October 31, 2023, follows.Additional information:1. On October 31, a physical count revealed cleaning supplies on
The following events occurred for a company during the last two months of its fiscal year ended December 31, 2023:Nov. 1 Paid $4,500 for future newspaper advertising.1 Paid $7,800 for insurance through October 31 of the following year.30 Received $6,600 for future services to be provided to a
The following occurred for a company during the last two months of its fiscal year ended May 31, 2023:Apr. 1 Paid $7,200 for future consulting services.1 Paid $1,920 for insurance through March 31 of the following year.30 Received $7,500 for future services to be provided to a customer.May 1 Paid
Pradeep has agreed to pay to Banco National $10,000 plus interest of $400 on June 30, 2023. The interest represents 8% of $10,000 for half of a year (January 1 through June 30).a. What is the journal entry to record the new borrowing?b. What is the journal entry to record the interest expense after
Following are two income statements for Javelin Company for the month ended December 31, 2023. Column B was prepared before any adjusting entries were recorded and column D includes the effects of adjusting entries. The company records cash receipts and disbursements related to unearned and prepaid
Yara Clothing (Yara), a retail store at the mall, hires a number of employees to work 7 days a week. Yara owes its employees wages for the period of December 27, 2023 to January 9, 2024 (14 days) for $5,600. The wages owed are equal each day and the employees will be paid on January 11, 2024. Yara
On December 31, 2023, Beautiful Brows Salon received its business cellphone bill for December (Dec. 1 to Dec. 31) usage of $2,000. It must be paid by January 15, 2024.a. To prepare the 2023 annual financial statements, record the adjusting entry on December 31, 2023.b. Record the payment of the
Classic Customs began operations on December 1, 2023. In setting up the bookkeeping procedures, the company decided to debit expense accounts when the company prepays its expenses and to credit revenue accounts when customers pay for services in advance. Prepare journal entries for items (a)
The following information has been taken from Out Loud Comedy Club’s unadjusted and adjusted trial balances at October 31, 2023.Given this trial balance information, prepare the adjusting journal entries. Unadjusted Adjusted Debit Credit Debit Credit $2,350 Prepaid insurance $3,100 Interest
Foster Company initially records prepaid and unearned items in income statement accounts. Given Foster Company’s practices, what is the appropriate adjusting entry for each of the following at November 30, 2023, the end of the company’s first accounting period?a. There are unpaid salaries of
Tiger Computer provided $17,000 of services to customers in the month of March 2023. On March 31, 2023, Tiger Computer has not yet billed or collected payment for the $17,000. On April 16, $12,000 of these were collected.a. Using the accrual basis of accounting, explain whether Tiger Computer
The following account information appeared on the adjusted trial balance for Ucore Sales as of December 31, 2023. The accounts are listed in alphabetical order.Required1. Prepare a classified multiple-step income statement for Ucore Sales, like Exhibit 5.13.2. Prepare a single-step income
On July 1, 2023, Amy Young created a new self-storage business called Young Co. These events occurred during the company’s first month:July 1 Young invested $40,000 cash and land and buildings worth $320,000 and $240,000, respectively.2 Rented equipment by paying $3,600 rent for the first month.5
On June 1, 2023, Sam Near created a new travel agency called Tours-For-Less. These activities occurred during the company’s first month:June 1 Near created the new company by investing $40,000 cash, $5,000 of furniture, and computer equipment worth $60,000.2 The company rented furnished office
The July 31, 2023, unadjusted trial balance for Daimler Tours after its first month of operations is shown below:Required1. Enter the unadjusted trial balance onto a work sheet.2. Using the following additional information, enter the adjustments into the work sheet (the Chart of Accounts in
The March 31, 2023, unadjusted trial balance for Silva Rentals after its first year of operations is shown below:Required1. Enter the unadjusted trial balance onto a work sheet.2. Using the following additional information, enter the adjustments into the work sheet (the Chart of Accounts in
The following closing entries were prepared for Greenway Gardening Services regarding the year ended October 31, 2023:Required1. Prepare an income statement based on the information provided.2. Calculate the post-closing balance in the capital account at October 31, 2023, given that the adjusted
Using the information in Problem 4-6B, prepare an income statement and a statement of changes in equity for the year ended December 31, 2023, and a classified balance sheet at December 31, 2023. The owner made no additional investments during the year. A $2,500 payment on the long-term notes
Silver Star Automotive showed the following account balances at October 31, 2023, after posting the closing entries. Prepare the post-closing trial balance. Cash Bal. Capital Expenses Bal. 40 5 40 15 50 8 8 -0- Bal. Accounts Receivable Unearned Revenue Bal. 20 10 Bal. Withdrawals 5 5 Bal.
Pure Plant Beauty is a sole proprietorship that has a developed a new line of skin care and makeup that uses natural and organic ingredients. The company showed the following adjusted account balances on April 30, 2023. Prepare and post the closing entries. Assets 250 Withdrawals 20 Income
Using the adjusted trial balance in Problem4-4A, prepare the income statement and statement of changes in equity for the year ended December 31, 2023, and the classified balance sheet at December 31, 2023.Data From Problem 4-4AThe adjusted trial balance for Lloyd Construction as of December 31,
Warden Repairs showed the following adjusted account balances on October 31, 2023. Prepare and post the closing entries. Assets 250 Withdrawals 20 Income Summary Liabilities 110 Revenue 100 Capital 200 Expenses 140
The adjusted trial balance for Destination Wedding Photo as of December 31, 2023, follows:An analysis of other information reveals that Destination Wedding Photo is required to make a $49,000 payment on the long-term notes payable during 2024. Also, David Sale invested $83,000 cash early in the
Improv Club (IC) features entertaining improvisational theatre performances. The theatre features a range of shows and talented performers. IC prepares financial statements on an annual basis. The following year-end accounts as of December 31, 2023 are listed in alphabetical order and have normal
The adjusted trial balance for Lloyd Construction as of December 31, 2023, follows:An analysis of other information reveals that Lloyd Construction is required to make a $41,500 payment on the long-term notes payable during 2024. The notes receivable are due May 1, 2025. Also, Amar Lloyd invested
Using the information from Problem 4-2B, prepare an income statement and a statement of changes in equity for the year ended December 31, 2023, and a classified balance sheet at December 31, 2023. The owner made no investments during the year.Data From Problem 4-2BThe adjusted trial balance for
Using the information from Problem 4-2A, prepare an income statement and a statement of changes in equity for the year ended December 31, 2023, and a classified balance sheet at December 31, 2023. There were no investments by the owner during the year.Data From Problem 4-2AMY Autobody’s adjusted
Following is the adjusted trial balance, with accounts in alphabetical order, for TRN Magazine as at January 31, 2023:RequiredPrepare the closing entries. Accounts receivable Accumulated depreciation, equipment Cash Depreciation expense, equipment Equipment Interest income Rent expense Salaries
You are the accountant at Stephos Greek Taverna. After completing the December 31, 2023 financial statements, you need to post the closing entries to prepare for the 2024 year. Start the process by completing the following table.Required1. Identify whether the following accounts are temporary or
The adjusted trial balance for Dillan’s Tailoring Services on December 31, 2023, appears as follows:Required1. Prepare closing entries.2. Prepare a post-closing trial balance. No. 101 Cash 125 Store supplies 128 Prepaid insurance Account 167 Equipment 168 Accumulated depreciation, equipment 201
GolfLink is a golf course company with clubs in ten provinces. Listed here is part of the comparative balance sheet at December 31, 2024, showing the following assets and liabilities, in alphabetical order:RequiredPart 1a. Calculate total current assets at December 31, 2023, and December 31,
The adjusted trial balance at April 30, 2023, for Zhang Co. follows.Required1. Prepare the four closing entries.2. Prepare a post-closing trial balance. 101 Cash 106 Accounts receivable 153 Trucks 154 Accumulated depreciation, trucks 193 Franchise 201 Accounts payable 209 Salaries payable 233
Sarda Electrical Servicing began operations two years ago. Its adjusted account balances at December 31, 2023, are listed alphabetically below. The owner, Nymeth Sarda, made a $20,000 investment early in the year just ended December 31, 2023.Required1. Prepare an income statement, statement of
On January 20, 2023, Jennifer Nelson, the staff accountant for Newby Enterprises, is feeling pressure to complete the preparation of the annual financial statements. The president of the company has said he needs up-to-date financial statements to share with several bankers on January 21 at a
Information from the December 31, 2023, year-end unadjusted trial balance of Woodstock Store is as follows:Additional information:1. The balance on January 1, 2023, in the Store Supplies account was $480. During the year, $1,235 of store supplies were purchased and debited to the Store Supplies
Information from the March 31, 2023, year-end unadjusted trial balance of The Online Store is as follows:Additional information:1. Supplies inventory at year-end, $920.2. The balance in the Prepaid Rent account represents a six-month contract effective November 1, 2022.3. Depreciation on the store
The following adjusted trial balance information was taken from the end of the July 31, 2023, fiscal year for Brilliant Sales:Brilliant Sales uses a perpetual inventory system.Required1. Prepare a classified multiple-step income statement for use by internal users (like Exhibit 5.13).2. Prepare a
The following amounts appeared on the Mullen Company’s adjusted trial balance in alphabetical order as of November 30, 2023, the end of its fiscal year:A physical count shows that the cost of the ending inventory is $6,100.Required1. Calculate the company’s net sales for the year.2. Calculate
For each situation given, calculate cost of goods sold and identify whether the information provided reflects a perpetual or periodic inventory system.a. Merchandise Inventory shows a balance at January 1, 2023, of $170, the Purchases account has a balance of $700 at December 31, 2023, and a
Assume that Volleyball Pro Equipment had $900,000 of sales during each of three consecutive years, and it purchased merchandise costing $500,000 during each of the years. It also maintained a $200,000 inventory from the beginning to the end of the three-year period. However, it made an error at the
The following list of accounts is taken from the December 31, 2023, unadjusted trial balance of Perdu Sales, a business that is owned by Eldon Perdu.Additional information:Accrued sales salaries amount to $3,200. Prepaid selling expenses of $5,200 have expired. Depreciation for the period is
Willard Company established a $400 petty cash fund on September 9, 2023. On September 30, the fund had $159.40 in cash along with receipts for these expenditures: transportation-in, $32.45; office supplies, $113.55; and repairs expense, $87.60. Willard uses the perpetual method to account for
The following information was available to reconcile Shanghai Company’s book balance of Cash with its bank statement balance as of February 28, 2023.1. The bank statement at February 28 indicated a balance of $23,620. The general ledger account for Cash showed a balance at February 28 of
From the following alphabetized list of adjusted account balances, prepare the current asset section of Biotech’s December 31, 2023, balance sheet. Account Accounts receivable.......... Allowance for doubtful accounts.. Bad debt expense... Cash....... Machinery........... Office supplies. Prepaid
Swiss Supplies showed the following selected adjusted balances at its December 31, 2022, year-end:During 2023, the following selected transactions occurred:1. Sales totalled $2,800,000, of which 25% were cash sales (cost of sales $1,804,000).2. Sales returns were $108,000, half regarding credit
The following information is available regarding the accounts receivable of Club Fit Holdings at August 31, 2023:*All services are performed on terms of n/60. Assume all sales occurred on the last day of the month.Club Fit estimates uncollectability of accounts receivable using the following
Outer Armour (OA) is a company that sells high quality outerwear. OA has accepted two notes receivables from customers and has a December 31, 2023 year-end.Note Receivable A On September 1, 2023, OA accepted a $690,000, six-month note receivable with an interest rate of 6%. Interest and the
On August 26, 2018, Race World International purchased a piece of equipment for a total of $426,000. The PPE subledger shows the following information regarding the equipment:Early in 2023, it was determined that the useful life of the metal frame should be adjusted to a remaining life of 20 years
The following information was taken from the December 31, 2023, annual report of WestCon Developments.Required1. Calculate accounts receivable turnover and days sales outstanding for the year 2023. (Round the answer to two decimal places.)2. Compare your calculations in (1) to the industry average
Tobias Eaden started a sole proprietorship named Sky High Ads. A customer’s message can be displayed on an airplane banner across the city. Sky High Ads had the following business activities during the month of November 2023:Nov 1 Invested $200,000 cash and aircraft equipment with a $50,000 fair
Carlos Young started an engineering firm called Young Engineering. He began operations in March 2023 and completed seven transactions, including his initial investment of $17,000 cash. After these transactions, the ledger included the following accounts with their normal
Peters Consulting completed these transactions during June 2023:June 2 Trevor Peters, the sole proprietor, invested $46,000 cash and office equipment with a $24,000 fair value in the business.4 Purchased land and a small office building. The land was worth $268,000 and the building was worth
Designer Dry Cleaning showed the following information for its first and second months just ended, March and April of 2023:*Christopher Dior made a $10,000 investment during March and had withdrawals of $1,000 in March and $25,100 in April.RequiredUse the information provided to complete a
Review the Spin Master balance sheet for fiscal year-end December 31, 2020, in Appendix III. Identify four different asset accounts and three different liability accounts. This appendix includes financial statement information from Spin Master Corporation, Recipe Unlimited Corporation, and Indigo
Atlas Advertising showed the following selected transactions for the month ended March 31, 2023:Mar. 1 Purchased a new portable building, paying cash of $75,000 and signing a five-year note payable for the balance of $300,000.1 Purchased six months of insurance to begin March 1; paid $5,700.2 Made
Abe Factor opened a new accounting practice called X-Factor Accounting and completed these activities during March 2023:Mar. 1 Invested $50,000 in cash and office equipment that had a fair value of $12,000.1 Prepaid $9,000 cash for three months’ rent for an office.3 Made credit purchases of used
Francis Dhami, Public Accountant, completed these activities during September 2023, the first month of operations:Sept. 1 Began a public accounting practice by investing $48,000 in cash and office equipment having a $11,800 fair value.1 Prepaid cash for three months’ rent in advance on suitable
Review the Recipe Unlimited Corporation balance sheet for fiscal year-end December 31, 2020, in Appendix III. Identify three accounts on the balance sheet that would carry debit balances and three accounts on the balance sheet that would carry credit balances. This appendix includes financial
Elizabeth Wong has strong problem-solving skills and loves to work with people. After becoming a Certified Human Resources Professional (CHRP) and working for several companies, she opened her own business, HR Solutions. She completed the following transactions during May 2023:May 1 Invested
WiCom Servicing completed these transactions during November 2023, its first month of operations:Nov. 1 Tait Unger, the owner, invested $62,000 cash and office equipment that had a fair value of $19,000 in the business.2 Prepaid $21,000 cash for three months’ rent for an office.4 Made credit
CityBnB’s records showed the following beginning balances on July 31, 2023. Using the information provided and the analysis completed in QS 2-6 and QS 2-7, complete the following:Data From QS2-6Douglas Malone started CityBnB, which is a bed and breakfast in Vancouver. CityBnB offers
Paul Sangha began Sangha Consulting on May 1, 2023 and reported the items below at May 31, 2023. Match each numbered item with the part of the balance sheet on which it should be presented. If the item does not appear on the balance sheet, choose (d) and identify on which financial statement(s) the
Tim Roadster began Roadster Servicing on April 1, 2023, and showed the following items after the first month of operations. Match each of these items with the financial statement or statements on which it should be presented. Indicate your answer by writing the letter or letters for the correct
On July 1, 2023, Academic Learning Services entered its second month of operations. On July 31, 2023, Breanne Allarie, the owner, finalized the company’s records that showed the following items. Use this information to prepare a July income statement similar to Exhibit 1.8. Accounts
On November 1, 2023, Jean Higgins started a wedding planning company, Extraordinary Studios. On November 30, 2023, the company’s records showed the following items. Use this information to prepare a November income statement for the business, similar to Exhibit 1.8. Cash Accounts
Beyond Music provides DJ services for events such as high school dances, weddings, and corporate events. Michael Cantu started the business on June 1, 2023. The June activities resulted in totals at June 30, 2023, as follows (illustrated in accounting equation format):RequiredUse additions and
Larry Power started a new business in the name of Power Electrical on October 1, 2023. During October, a number of activities occurred and the following totals resulted at October 31, 2023 (shown in accounting equation format):RequiredUse additions and subtractions to show the effects of each
At the beginning of June 2023, Brett Wilson created a moving company called Frog Box Company. The company had the following transactions during July, its second month of operations:July 1 Purchased office equipment for $9,000 and a truck for $56,000 by signing a long-term note payable.2 Purchased
Manny Gill is an entrepreneur who started West Secure, a business that provides a number of security guard services. West Secure incurred the following transactions during July 2023, its first month of operations:July 1 The owner, Manny Gill, invested $5,200 cash.10 Purchased $2,700 worth of
After its first month of operations, Paquette Advisors showed the following account balances in its general ledger accounts (T-accounts) as at January 31, 2023.During February, the following transactions occurred:Feb. 1 Performed work for a client and received cash of $8,500.5 Paid $5,000 regarding
Dee Bell Company’s records showed the following April 30, 2023, account balances:Required1. Using the chart of accounts numbering system, assign an account number to each account.2. Using the information provided and the analysis performed in QS 2-9, post the May transactions into the general
Binbutti Engineering, a sole proprietorship, completed the following transactions during July 2023, the third month of operations:July 1 Bob Binbutti, the owner, invested $300,000 cash, office equipment with a value of $12,000, and $90,000 of drafting equipment in the business.2 Purchased land for
Prepare journal entries for the following transactions that occurred during January 2023:January 3 Stan Adams opened a landscaping business by investing $60,000 cash and equipment having a $40,000 fair value.4 Purchased office supplies on credit for $340.6 Received $5,200 for providing landscaping
Precision Laser Centres showed the following selected activities during the month of April 2023. Record the journal entries for the following transactions.April 5 Performed surgery on a customer today and collected $5,200 cash.8 Purchased surgical supplies on credit; $19,600.10 Contacted a
Ike Petrov started a tour company, Tour-Along, on October 1, 2023. The following activities occurred during November, the second month of operations:Nov. 1 Paid $10,000 regarding purchases made on account during October.2 Purchased a $34,000 photocopier, paying $6,000 cash and signing a note
Prepare journal entries for each of the seven transactions posted to the following T-accounts. Provide a short description of each transaction. The first description is done as an example.(a) The owner invested cash, an automobile, and equipment in the business. Cash (a) 7,000 3,600 (b) (e) 2,500
Taylor Smith is a singer who has experienced international success in her career. On May 1, 2023, Taylor started her business, Glitter and Gold Studio, where she teaches singing. The following activities occurred during July, the third month of operations:July 1 Purchased supplies including sheet
Ranjeet Gill is a wedding planner who is one of the best known in her area; she has a high presence at wedding shows and works closely with a wedding dress boutique. On January 1, 2023, Ranjeet started her business called Everything Wedding Planning. The following activities occurred during March,
Tom Keenan is a vacation planner who specializes in outback adventures; he has a high presence at outdoor shows and gets most of his business from there. On May 1, 2023, Tom started his business called Epic Adventures. The following activities occurred during July, the third month of
Sato Inspection Services is in its second month of operations. You have been given the following journal entries regarding its January 2023 transactions.Requireda. Set up the following accounts (use the balance column format) entering the opening balances brought forward from the end of last month,
Prepare journal entries to record the following August 2023 transactions of a new business called For the Love of Pixels.Aug. 1 Joseph Eagle, the owner, invested $20,000 cash and photography equipment with a fair value of $42,000.1 Rented a studio, paying $12,000 for the next three months in
Using the account information shown below, prepare a trial balance at January 31, 2023. Cash 5,000 6,000 2,000 4,000 3,000 1,000 8,000 Brea Vahn, 101 Withdrawals 302 1,000 Vahn Landscaping General Ledger Unearned Equipment 163 9,000 Revenue 401 3,000 8,000 Revenue 233 2,000 Rent Expense
Wilm Schmidt, the owner of Wilm’s Window Washing Services, had difficulty getting the debits to equal credits on the January 31, 2023, trial balance.The following errors were discovered:1. Schmidt did not post a $4,000 purchase of equipment on credit.2. In posting a $1,400 collection from a
Cycle Travel Tours showed the following trial balance information (in alphabetical order) for its first month just ended March 31, 2023:RequiredUse the information provided to complete an income statement, statement of changes in equity, and balance sheet. Account Accounts payable Accounts
On January 1, 2023, Paula Fernandes started a new business called Wicked Dance. Near the end of the year, she hired a new bookkeeper without checking references or requesting an academic transcript. As a result, a number of mistakes have been made in preparing the following trial balance:Paula’s
Willow Window Washing Services prepares adjustments monthly and shows the following selected accounts on its December 31, 2023, unadjusted trial balance:RequiredPrepare the required monthly adjusting entries at December 31, 2023, based on the following additional information:a. The remaining
Media Marketing Services has been operating for several years. It showed the following trial balance information (in alphabetical order) for the month just ended March 31, 2023:*The $122,000 balance includes $35,000 invested by the owner during March.RequiredUsing the information provided, prepare
It’s a week before Frogbox’s October 31, 2023, year-end. You are the personnel director and are reviewing some financial information regarding the March 1, 2021, purchase of office furniture for the Western Region offices totalling $700,000 ($300,000 was paid in cash and the balance was
Camillo’s Cleaning Services is gathering information for its year-end, April 30, 2023. Selected accounts on the April 30, 2023, unadjusted trial balance are reproduced below:RequiredPrepare the required annual adjusting entries at April 30, 2023, based on the following additional information:a.
Lily Zhang started a new business on January 1, 2023, called Zhang Consulting. She develops financial investment plans for young adults. During the business’s first year of operations, the following activities occurred:a. Zhang invested $120,000 cash and office equipment valued at $10,000 in the
The accounting records of Carmen Creek Gourmet Meats show the following assets and liabilities as of the end of 2023 and 2022:During 2023, Carmen Munch, the owner, purchased a small office building and moved the business from rented quarters to the new building. The building and the land it
The accounting records of LeClaire Delivery Services show the following assets and liabilities as of the end of 2023 and 2022:During December 2023 the owner, Jess LeClaire, purchased a small office building and moved the business from rented quarters to the new building. The building and the land
On January 1, 2022, Dog Obedience Training Co entered its second year of operations. This year the business expanded to include doggy daycare because many customers requested the service. On December 31, 2023, the owner Tim Oram finalized the company’s records, which showed the following
On January 1, 2022, Dance Training Co entered its second year of operations. Dance Training Co provides elite personal training courses to dancers who want to work on cruise ships. On December 31, 2023, Jordan Ryan, the owner, finalized the company’s records, which showed the following items.The
On January 1, 2023, Fireworks Fantasia entered its third year of operations. On December 31, 2023, Wes Gandalf, the owner, finalized the company’s records that showed the following items.RequiredPrepare an income statement and statement of changes in equity for the year ended December 31, 2023,
On August 1, 2022, Cross Fitness entered its second year of operations. Cross Fitness provides high-performance group and personal training courses that have been derived from scientific research and exercises used by professional athletes. On July 31, 2023, Jay Grey, the owner, finalized the
Dublin Window Cleaners began operations on January 1, 2022. The owner invested $400,000 during the first year and made no withdrawals. During 2023, the business reported profit of $192,000, owner withdrawals of $104,000, and zero owner investments. In 2024, Dublin Window Cleaners earned profit of
Blue Water Kayak began operations on January 1, 2022. The owner invested $10,000 during the first year and was able to withdraw cash of $42,000 after a successful first year. During 2023, the second year of operations, the business reported profit of $175,000, owner withdrawals of $78,000, and no
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