During its first five years of operations, Waterhouse Manufacturing reports net income and pays dividends as...

  

Transcribed Image Text:

During its first five years of operations, Waterhouse Manufacturing reports net income and pays dividends as follows. Year 1 2 4 Net Income $1,700 2,700 3,200 5,400 7,600 Dividends $1,000 1,000 2,000 2,000 3,000 Calculate the balance of retained earnings at the end of each year. Note that retained earnings will always equal $0 at the beginning of year 1. [#18] Below is balance sheet information for five independent situations. Calculate the answer to each. 1. A company reports total assets of $2,000 and total liabilities of $900. What is the amount of stockholders' equity? 2. A company reports total liabilities of $2,400 and stockholders' equity of $1,100. What is the amount of total assets? 3. A company reports total assets of $2,700 and total stockholders' equity of $700. What is the amount of total liabilities? 4. A company reports an increase in assets of $1,700 and an increase in liabilities of $400. What is the amount of the change in stockholders' equity? 5. A company reports an increase in liabilities of $300 and a decrease in stockholders' equity of $800. What is the amount of the change in total assets? [#19] The following transactions occur for the Hamilton Manufacturers. Required: a. Paid $3,900 on account for supplies purchased last period. All supplies were used last month. b. Paid $5,700 cash for advertising in the current period. c. Employees who worked in the current period but will not be paid until the following period, $5,300. [#22] Prepare adjusting journal entries, as needed, for the following items. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) a. The Supplies account shows a balance of $580, but a count of supplies reveals only $270 on hand at year-end. b. The company initially records the payments of all insurance premiums as prepaid insurance. The unadjusted trial balance at year-end shows a balance of $590 in Prepaid Insurance. A review of insurance policies reveals that $190 of insurance is unexpired. c. Employees work Monday through Friday, and salaries of $3,100 per week are paid each Friday. The company's year-end falls on Tuesday. d. At year-end, the company received a utility bill for December's electricity usage of $240 that will be paid in early January. [#24] A company's Cash account shows a balance of $3,450 at the end of the month. Comparing the company's Cash account with the monthly bank statement reveals several additional cash transactions such as bank service fees ($50), an NSF check from a customer ($300), a customer's note receivable collected by the bank ($1,000), and interest earned ($100). Required: Record the necessary entry(ies) to adjust the company's balance for cash. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Record the items that increase AND decrease cash separately. (a) Provide services to customers on account for $4,500. (b) Purchase equipment by signing a note with the bank for $10,000. (c) Pay advertising of $1,500 for the current month. Analyze each transaction and indicate the amount of increases and decreases in the accounting equation. (Decreases to account classifications should be entered as negative amounts.) Transaction Assets (0) (c) Liabilities. Stockholders Equity [#21] For each transaction below, calculate the amount of expense to be recorded in the current period using accrual-basis accounting: [#25] Below is information related to retained earnings for five independent situations. Calculate the answer to each. 6. A company reports an increase in retained earnings of $3,200 and net income of $4,800. What is the amount of dividends? 7. A company reports beginning retained earnings of $1,800, net income of $1,200, and $200 dividends. What is the amount of ending retained earnings? 8. A company reports an increase in retained earnings of $2,500 and dividends of $1,500. What is the amount of net income? 9. A company reports ending retained earnings of $2,700, net income of $900, and dividends of $500. What is the amount of beginning retained earnings? 10. A company reports an increase in retained earnings of $500 and net income of $1,200. What is the amount of dividends? During its first five years of operations, Waterhouse Manufacturing reports net income and pays dividends as follows. Year 1 2 4 Net Income $1,700 2,700 3,200 5,400 7,600 Dividends $1,000 1,000 2,000 2,000 3,000 Calculate the balance of retained earnings at the end of each year. Note that retained earnings will always equal $0 at the beginning of year 1. [#18] Below is balance sheet information for five independent situations. Calculate the answer to each. 1. A company reports total assets of $2,000 and total liabilities of $900. What is the amount of stockholders' equity? 2. A company reports total liabilities of $2,400 and stockholders' equity of $1,100. What is the amount of total assets? 3. A company reports total assets of $2,700 and total stockholders' equity of $700. What is the amount of total liabilities? 4. A company reports an increase in assets of $1,700 and an increase in liabilities of $400. What is the amount of the change in stockholders' equity? 5. A company reports an increase in liabilities of $300 and a decrease in stockholders' equity of $800. What is the amount of the change in total assets? [#19] The following transactions occur for the Hamilton Manufacturers. Required: a. Paid $3,900 on account for supplies purchased last period. All supplies were used last month. b. Paid $5,700 cash for advertising in the current period. c. Employees who worked in the current period but will not be paid until the following period, $5,300. [#22] Prepare adjusting journal entries, as needed, for the following items. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) a. The Supplies account shows a balance of $580, but a count of supplies reveals only $270 on hand at year-end. b. The company initially records the payments of all insurance premiums as prepaid insurance. The unadjusted trial balance at year-end shows a balance of $590 in Prepaid Insurance. A review of insurance policies reveals that $190 of insurance is unexpired. c. Employees work Monday through Friday, and salaries of $3,100 per week are paid each Friday. The company's year-end falls on Tuesday. d. At year-end, the company received a utility bill for December's electricity usage of $240 that will be paid in early January. [#24] A company's Cash account shows a balance of $3,450 at the end of the month. Comparing the company's Cash account with the monthly bank statement reveals several additional cash transactions such as bank service fees ($50), an NSF check from a customer ($300), a customer's note receivable collected by the bank ($1,000), and interest earned ($100). Required: Record the necessary entry(ies) to adjust the company's balance for cash. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Record the items that increase AND decrease cash separately. (a) Provide services to customers on account for $4,500. (b) Purchase equipment by signing a note with the bank for $10,000. (c) Pay advertising of $1,500 for the current month. Analyze each transaction and indicate the amount of increases and decreases in the accounting equation. (Decreases to account classifications should be entered as negative amounts.) Transaction Assets (0) (c) Liabilities. Stockholders Equity [#21] For each transaction below, calculate the amount of expense to be recorded in the current period using accrual-basis accounting: [#25] Below is information related to retained earnings for five independent situations. Calculate the answer to each. 6. A company reports an increase in retained earnings of $3,200 and net income of $4,800. What is the amount of dividends? 7. A company reports beginning retained earnings of $1,800, net income of $1,200, and $200 dividends. What is the amount of ending retained earnings? 8. A company reports an increase in retained earnings of $2,500 and dividends of $1,500. What is the amount of net income? 9. A company reports ending retained earnings of $2,700, net income of $900, and dividends of $500. What is the amount of beginning retained earnings? 10. A company reports an increase in retained earnings of $500 and net income of $1,200. What is the amount of dividends?