Financial Accounting
3rd Edition
ISBN: 9780133791129
Author: Jane L. Reimers
Publisher: Pearson Higher Ed
expand_more
expand_more
format_list_bulleted
Concept explainers
Textbook Question
Chapter 1, Problem 48PA
Analyze business transactions and the effect on the financial statements. (LO 4). Using transactions a–j in P1-47A, answer the following questions:
Requirements
- 1. What is the cash balance at the end of Buck’s first month of business?
- 2. Does the company have any liabilities at the end of the first month of business? If so, how much?
- 3. Which assets will appear on the
balance sheet at the end of Buck’s first month of business? - 4. Did the company generate a net income or a net loss for its first month of business? How much?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Rosie Dry Cleaning was started on January 1, Year 1. It experienced the following events during its first two years of operation:
Events Affecting Year 1
1. Provided $45,000 of cleaning services on account.
2. Collected $39,000 cash from accounts receivable.
3. Adjusted the accounting records to reflect the estimate that uncollectible accounts expense would be 1 percent of the cleaning
revenue on account.
Events Affecting Year 2
1. Wrote off a $300 account receivable that was determined to be uncollectible.
2. Provided $62,000 of cleaning services on account.
3. Collected $61,000 cash from accounts receivable.
4. Adjusted the accounting records to reflect the estimate that uncollectible accounts expense would be 1 percent of the cleaning
revenue on account.
1.
1- An income statement is one of the three (along with balance sheet and statement of cash flows) major financial statements that reports a company's financial performance over a specific accounting period. Distinguish the differences between single-step and multiple-step income statement?
2- A certificate of deposits is a savings account to which you deposit your money for a fixed amount of time, be it one month or five years and a money market account combines the features of savings and checking accounts. Which one will you prefer and why?
6. Which of the following is a record of all the account balances at the year end, and is used to
prepare the final accounts?
O aAral batanoe
O b) A statement of financial position
O c)A statement of cash flows
O dj income statement
Chapter 1 Solutions
Financial Accounting
Ch. 1 - 1. What is the main purpose of a business? 2....Ch. 1 - Prob. 2YTCh. 1 - 1. What are the two sources of financing for a...Ch. 1 - 1. What are revenues and expenses? 2. What are the...Ch. 1 - 1. What are the two parts of shareholders equity?...Ch. 1 - Prob. 6YTCh. 1 - Prob. 7YTCh. 1 - Prob. 1QCh. 1 - Prob. 2QCh. 1 - Prob. 3Q
Ch. 1 - Prob. 4QCh. 1 - What are the advantages of the corporate form of...Ch. 1 - What are the disadvantages of the corporate form...Ch. 1 - Prob. 7QCh. 1 - Prob. 8QCh. 1 - What are the basic financial statements? Describe...Ch. 1 - What makes the income statement different from the...Ch. 1 - Prob. 11QCh. 1 - What type of activities relate to what the firm is...Ch. 1 - Prob. 2MCQCh. 1 - Prob. 3MCQCh. 1 - Prob. 4MCQCh. 1 - Prob. 5MCQCh. 1 - Online Pharmacy Company borrowed 5,000 cash from...Ch. 1 - Prob. 7MCQCh. 1 - During its first year of business, West Company...Ch. 1 - Interest is the cost of a. purchasing inventory....Ch. 1 - Prob. 10MCQCh. 1 - Classify business transactions. (LO 2). For each...Ch. 1 - Identify balance sheet items. (LO 4). Classify the...Ch. 1 - Calculate owners equity. (LO 4). Doughnut Company...Ch. 1 - Prob. 4SEACh. 1 - Prob. 5SEACh. 1 - Calculate owners equity. (LO 4). Pasta Enterprises...Ch. 1 - Super Shop had a retained earnings balance of...Ch. 1 - Prob. 8SEBCh. 1 - Prob. 9SEBCh. 1 - Breck Company shows 80,000 worth of assets on its...Ch. 1 - Prob. 11SEBCh. 1 - For each of the following, calculate the missing...Ch. 1 - Prob. 13SEBCh. 1 - M Company had a retained earnings balance of 4,200...Ch. 1 - Prob. 15EACh. 1 - Analyze business transactions using the accounting...Ch. 1 - Prob. 17EACh. 1 - Prob. 18EACh. 1 - Enter each transaction below into the accounting...Ch. 1 - Prob. 20EACh. 1 - For each of the transactions given, tell whether...Ch. 1 - Prob. 22EACh. 1 - Enter each transaction into the accounting...Ch. 1 - Prob. 24EACh. 1 - Relationship between income statement and balance...Ch. 1 - Bob started a pool cleaning business on the first...Ch. 1 - Prob. 27EACh. 1 - Retained earnings and cash. (LO 4). Checkmate...Ch. 1 - Prob. 29EACh. 1 - Prob. 30EBCh. 1 - Prob. 31EBCh. 1 - Prob. 32EBCh. 1 - Prob. 33EBCh. 1 - Prob. 34EBCh. 1 - Classify business transactions. (LO 2). For each...Ch. 1 - Prob. 36EBCh. 1 - Prob. 37EBCh. 1 - Enter each transaction into the accounting...Ch. 1 - Prob. 39EBCh. 1 - Prob. 40EBCh. 1 - Frank Frock started a consulting business on the...Ch. 1 - Prob. 42EBCh. 1 - Prob. 43EBCh. 1 - Prob. 44EBCh. 1 - Prob. 45PACh. 1 - Prob. 46PACh. 1 - Prob. 47PACh. 1 - Analyze business transactions and the effect on...Ch. 1 - Prob. 49PACh. 1 - Analyze business transactions and prepare the...Ch. 1 - Prob. 51PACh. 1 - Prob. 52PBCh. 1 - Analyze business transactions using the accounting...Ch. 1 - Prob. 54PBCh. 1 - Prob. 55PBCh. 1 - Prob. 56PBCh. 1 - Prob. 57PBCh. 1 - Prob. 58PBCh. 1 - Prob. 1FSACh. 1 - Prob. 2FSACh. 1 - Prob. 3FSACh. 1 - What is the Walt Disney Companys key objective? Go...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Select the financial statement to which the item belongs. Items a. The change in retained earnings due to net income and dividends. b. Amount of cash received from borrowing money from a local bank. c. Revenue from sales to customers during the year. d. Total amounts owed to workers at the end of the year. Financial Statementsarrow_forwardRequired information [The following information applies to the questions displayed below) The following transactions apply to Jova Company for Year 1, the first year of operation: 1. Issued $20,000 of common stock for cash. 2. Recognized $60,000 of service revenue earned on account. 3. Collected $54,000 from accounts receivable. 4. Paid operating expenses of $37,800. 5. Adjusted accounts to recognize uncollectible accounts expense. Jova uses the allowance method of accounting for uncollectible accounts and estimates that uncollectible accounts expense will be 2 percent of sales on account The following transactions apply to Jova for Year 2 1. Recognized $67,500 of service revenue on account. 2. Collected $62,000 from accounts receivable 3. Determined that $800 of the accounts receivable were uncollectible and wrote them off 4. Collected $300 of an account that had previously been written off. 5. Paid $47,500 cash for operating expenses. 6. Adjusted the accounts to recognize…arrow_forward1. If Tom wants to know the amount that Subway owes to its creditors at year end, he should look on the company's: а. Balance Sheet b. Income Statement с. Statement of Stockholders' Equity d. Statement of Cash Flows 2. If Tom wants to know the amount of profit that Subway earned in the most recent fiscal year, he should look on the company's: а. Balance Sheet b. Income Statement Statement of Stockholders' Equity d. Statement of Cash Flows с. 3. Which of the following statements is TRUE? The Statement of Stockholders' Equity reports a company’s Sales revenue. b. Dividends are shown as an asset on the Balance Sheet. The Income Statement classifies cash inflows and outflows as Operating, Investing, and Financing. d. The Balance Sheet shows a company's financial position at a particular point in time. а. с.arrow_forward
- What are the steps to complete the T-account for each transaction while making use of the each account balance provided in the first table? Problem#9. Required information [The following information applies to the questions displayed below.] At January 1 (beginning of its fiscal year), Conover, Inc., a financial services consulting firm, reported the following account balances (in thousands, except for par and market value per share): Cash $ 1,990 Accounts payable $ 300 Short-term investments 500 Unearned revenue 1,410 Accounts receivable 3,660 Salaries Payable 960 Supplies 240 Short-term note payable 870 Prepaid expenses 4,810 Common stock ($1 par value) 140 Office equipment 1,620 Additional paid-in capital 6,650 Accumulated depreciation-office equipment* (390) Retained earnings 2,100 *This account has a credit balance…arrow_forwardTo know the financial positon of a business as on today, you need ________________________. Balance Sheet drawn as on today Balance Sheet of latest financial year Balance Sheet of last two years Income Statement and Cash Flow Statement as on todayarrow_forwardWhich of the following transactions is affecting the current asset of accounts receivable? a. Sold merchandise to customers on account b. Received cash from issuance of common stock c. Received cash from customers for this month’s sales d. Paid balance on account for last month’s inventory purchasesarrow_forward
- Question Topic– Analysing business transactions. The following table contains several business transactions for the current month. Required: Identify the names of which accounts are affected, how they are affected (+/-, increase or decrease), and the element of the financial statement of these accounts (A, L, OE, R, E).arrow_forwardUse the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] Simon Company's year-end balance sheets follow. At December 31 Current Year 1 Year Ago 2 Years Ago Assets $ 39,900 56,491 58,411 4,616 256,082 $ 33,783 $ 39,888 71,898 89,474 10,785 286,555 Cash Accounts receivable, net Merchandise inventory 97,913 125,594 10,989 Prepaid expenses Plant assets, net 310,097 $ 578,376 Total assets $ 498,600 $ 415,500 Liabilities and Equity Accounts payable Long-term notes payable Common stock, $10 par value Retained earnings $ 144,016 109,822 $ 81,735 113,531 $ 54,298 91,826 163,500 105,876 163,500 161,038 163,500 139,834 Total liabilities and equity $ 578,376 $ 498,600 $ 415,500 For both the current year and one year ago, compute the following ratios: Exercise 17-9 (Algo) Analyzing risk and capital structure LO P3 The company's income statements for the current year and one year ago, follow. For Year Ended December 31…arrow_forwardNow let us study an example that involves an opening Balance Sheet. opening ledgerrecording of transactions made defined period and balancing the ledgerperiod.accounts at the end of period: Majid Maingal had the following assets and liabilities on March 2005:Cash Hand Rs. 2.345: Cash at Bank Rs. 19,815; Stock RS. 46, 780;Debtors: Nasim Jamali RS. 21,730; Omar Baluchi Rs. 24,670; Furniture RS. 24,500;Creditors: Quetta Traders. Rs. 39.840; Loan from IDBP. Rs. 25,000 Draw up his opening balance sheet and calculate his capital. Open suitable ledger account post his opening Balance Sheet. Then record the following transaction in his ledger: 1. Bought goods on credit from Quetta Traders Rs. 13,5002. Paid carriage expenses in cash, Rs. 9503. Sold goods on credit to Nasim Jamali, Rs. 16,1004. Goods returned by Nasim Jamali Rs. 2,1005. Sold goods against cheque. Rs. 7,2506. Returned goods to Quetta Traders, Rs. 2,5007. Paid wages by cheque, Rs.1,7608. Sold goods against cash."Rs. 2,3909. Issued…arrow_forward
- 1) To know the financial positon of a business as on today, you need ________________________. A)Balance Sheet drawn as on today b)Balance Sheet of latest financial year c)Balance Sheet of last two years d)ncome Statement and Cash Flow Statement as on today unanswered 2)Your company is following January to December as accounting year. On 1 July, you paid Rs. 6 million towards insurance of factory building and equipment for one year period (till next year June 30). The accounting entry is ______________________. a)Asset (Cash) – 6; Asset (Prepaid Insurance) + 3; Expenses (Insurance) -3 b)Asset (Cash) – 6; Asset (Prepaid Insurance) - 3; Expenses (Insurance) -3 c)Asset (Cash) – 3; Expenses (Insurance) -3 d)Asset (Cash) – 6; Liabilities (Prepaid Insurance) - 3; Expenses (Insurance) -3 3) Mercury Ltd. issues Rs. 10 shares at a premium of Rs. 90. Totally 1 million shares were issued and subscribed fully. Entire amount is collected. How this transaction will appear in the financial…arrow_forwardRequired: Using the following categories, Indicate the effects of the following transactions. Indicate the accounts affected and the amounts. (Enter any decreases to Assets, Liabilities, or Stockholders Equity with a minus sign.) a. During the period, customer balances are written off in the amount of $11,800. b. At the end of the period, bad debt expense is estimated to be $9,800. 3. Assets Liabilities Stockholders' Equityarrow_forwardShow effects of the above transactions on the accounting equation using the following format. Assume the note payable is to be repaid within the yeararrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education
The ACCOUNTING EQUATION For BEGINNERS; Author: Accounting Stuff;https://www.youtube.com/watch?v=56xscQ4viWE;License: Standard Youtube License