Financial Accounting
4th Edition
ISBN: 9781259307959
Author: J. David Spiceland, Wayne M Thomas, Don Herrmann
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 3, Problem 3.5BP
To determine
To prepare: The income statement of Company O for the year ended December 31, 2018.
To determine
To prepare: The statement of
To determine
To prepare: The classified
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Magio Company manufactures kitchen equipment used in hospitals. They distribute their products directly to the customer and, for the year ending 2019, they reported the following revenues and expenses.
Sales Revenue
$983,000
Cost of Goods Sold
489,000
Operating Expenses
243,000
Use this information to construct an income statement for the year 2019.
Magio Company
Income Statement
For Year Ending 2019
Vindows constructs and installs windows for new homes. The sales staff are having a meeting and reviewing the following
information to determine how to help reduce days' sales uncollected.
Accounts receivable
Net sales
2023
2022
2021
$ 634,000 $492,000 $ 414,000
6,590,000 5,714,000 4,985,000
Required:
a. Calculate the days sales uncollected for 2021 to 2023 and identify whether the trend is favourable or unfavourable (Round the
final answer to 2 decimal places. Do not round intermediate calculation. Use 365 days a year)
Days' sales uncollected
2023
+
35 07 days
2022
31 55 days
2021
30 36 days Unfavorable
Seve
-. What can a salesperson do to improve days' sales uncollected? (You may select more than one answer. Single click the box with
me question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the bo
or a wrond answer.)
Magio Company manufactures kitchen equipment used in hospitals.
They distribute their products directly to the customer and, for the
year ending 2019, they reported these revenues and expenses. Use
this information to calculate the gross profit for the year 2019.
Magio Company data
Revenue and Expenses
Sales revenue
Cost of Goods Sold
Operating expenses
Amount
$864,183
$496,357
$196,815
Chapter 3 Solutions
Financial Accounting
Ch. 3 - Prob. 1RQCh. 3 - 2.Discuss the major principle that describes...Ch. 3 - 3.Samantha is a first-year accounting student. She...Ch. 3 - 4.Describe when revenues and expenses are...Ch. 3 - Rip Side of Question 7 5.Executive Lawn provides...Ch. 3 - Prob. 6RQCh. 3 - Prob. 7RQCh. 3 - Consider the information in Question 7. Using...Ch. 3 - Prob. 9RQCh. 3 - There are two basic types of adjusting...
Ch. 3 - 11.Provide an example of a prepaid expense. The...Ch. 3 - Provide an example of a deferred revenue. The...Ch. 3 - 13.Provide an example of an accrued expense. The...Ch. 3 - Provide an example of an accrued revenue. The...Ch. 3 - Sequoya Printing purchases office supplies for 75...Ch. 3 - Jackson Rental receives its September utility bill...Ch. 3 - 17.Global Printing publishes several types of...Ch. 3 - At the end of May, Robertson Corporation has...Ch. 3 - Fill in the blank associated with each adjusting...Ch. 3 - Prob. 20RQCh. 3 - Prob. 21RQCh. 3 - Prob. 22RQCh. 3 - Prob. 23RQCh. 3 - Prob. 24RQCh. 3 - Describe the debits and credits for the three...Ch. 3 - In its first four years of operations, Chance...Ch. 3 - Prob. 27RQCh. 3 - Prob. 28RQCh. 3 - Determine revenues to be recognized (LO31) Below...Ch. 3 - Prob. 3.2BECh. 3 - Prob. 3.3BECh. 3 - Analyze the impact of transactions on the balance...Ch. 3 - Prob. 3.5BECh. 3 - At the beginning of May, Golden Gopher Company...Ch. 3 - Record the adjusting entry for prepaid rent (LO33)...Ch. 3 - Prob. 3.8BECh. 3 - Prob. 3.9BECh. 3 - Record the adjusting entry for deferred revenue...Ch. 3 - Prob. 3.11BECh. 3 - Midshipmen Company borrows 15,000 from Falcon...Ch. 3 - Prob. 3.13BECh. 3 - For each of the following accounts, indicate...Ch. 3 - Prob. 3.15BECh. 3 - Prob. 3.16BECh. 3 - Prob. 3.17BECh. 3 - The following account balances appear in the 2018...Ch. 3 - Prob. 3.19BECh. 3 - Prob. 3.20BECh. 3 - Consider the following situations: 1.American...Ch. 3 - Consider the following situations: 1.American...Ch. 3 - Refer to the situations discussed in E31....Ch. 3 - Differentiate cash-basis expenses from...Ch. 3 - Prob. 3.5ECh. 3 - Listed below are all the steps in the accounting...Ch. 3 - Prob. 3.7ECh. 3 - Prob. 3.8ECh. 3 - Prob. 3.9ECh. 3 - Prob. 3.10ECh. 3 - Refer to the information in E310. Calculate the...Ch. 3 - Prob. 3.12ECh. 3 - Below are transactions for Hurricane Company...Ch. 3 - Prepare an adjusted trial balance (LO33, 34) The...Ch. 3 - Prob. 3.15ECh. 3 - Prob. 3.16ECh. 3 - Prob. 3.17ECh. 3 - Prob. 3.18ECh. 3 - Prob. 3.19ECh. 3 - On January 1, 2018, Red Flash Photography had the...Ch. 3 - Prob. 3.21ECh. 3 - Consider the following transactions. Required: For...Ch. 3 - Prob. 3.2APCh. 3 - Record adjusting entries (LO3-3) The information...Ch. 3 - Crimson Tide Music Academy offers lessons in...Ch. 3 - Prob. 3.5APCh. 3 - The year-end financial statements of Rattlers Tax...Ch. 3 - Complete the accounting cycle after adjusting...Ch. 3 - The general ledger of Red Storm Cleaners at...Ch. 3 - The general ledger of Zips Storage at January 1,...Ch. 3 - Consider the following transactions. Required: For...Ch. 3 - Prob. 3.2BPCh. 3 - Prob. 3.3BPCh. 3 - Prob. 3.4BPCh. 3 - Prob. 3.5BPCh. 3 - FIGHTING ILLINI Income Statement Service revenue...Ch. 3 - Prob. 3.7BPCh. 3 - The general ledger of Pipers Plumbing at January...Ch. 3 - The general ledger of Jackrabbit Rentals at...Ch. 3 - You may refer to the opening story of Tony and...Ch. 3 - Prob. 3.2APFACh. 3 - Prob. 3.3APFACh. 3 - Prob. 3.4APCACh. 3 - Prob. 3.5APECh. 3 - Prob. 3.7APWC
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
- A home gods retailer offers a sales incentive program where customers receive credit towards future purchases based on the dollar amount of their purchases today. For every $10 spent, a customer receives a $1 credit to use in the next 30 days. Based upon historical trends, the firm estimates that 35% of the credits will be redeemed. In the next month, consistent with the firm’s estimate, 35% of the credits were redeemed. The entry recorded to account for the redemption of these credits (excluding the effect of the costs of sales entry): A.) Increases Liabilities, Increases Stockholders’ Equity B.) Increases Liabilities, Reduces Stockholders’ Equity C.) Reduces Liabilities, Reduces Stockholders’ Equity D.) Reduces Liabilities, Increases Stockholders’ Equity C.) No entry neededarrow_forwardMagio Company manufactures kitchen equipment used in hospitals. They distribute their products directly to the customer and, for the year ending 2019, they reported these revenues and expenses. Use this information to calculate the operating income for the year 2019. Magio Company data Revenue and Expenses Sales revenue Cost of Goods Sold Operating expenses Amount $802,343 $453,875 $174,045arrow_forwardReview the following transactions, and prepare any necessary journal entries for Renovation Goods. A. On May 12, Renovation Goods purchases 750 square feet of flooring (Flooring Inventory) at $3.00 per square foot from a supplier, on credit. Terms of the purchase are 2/10, n/30 from the invoice date of May 12. B. On May 15, Renovation Goods purchases 200 measuring tapes (Tape Inventory) at $5.75 per tape from a supplier, on credit. Terms of the purchase are 4/15, n/60 from the invoice date of May 15. C. On May 22, Renovation Goods pays cash for the amount due to the flooring supplier from the May 12 transaction. D. On June 3, Renovation Goods pays cash for the amount due to the tape supplier from the May 15 transaction.arrow_forward
- Drainee purchases direct materials each month. Its payment history shows that 65% is paid in the month of purchase with the remaining balance paid the month after purchase. Prepare a cash payment schedule for January using this data: in December through February, it purchased $22,000, $25,000, and $23,000 respectively.arrow_forwardReview the following transactions for Birdy Birdhouses and record any required journal entries. Sep. 6 Birdy Birdhouses purchases 52 birdhouses at $50 each with cash. Sep. 8 Birdy Birdhouses purchases 90 birdhouses at $30 each on credit. Terms of the purchase are 2/10, n/30, invoice date September 8. Sep. 10 Birdy discovers 10 of the birdhouses are damaged from the Sep. 6 purchase and returns them to the supplier for a full refund. Birdy also discovers that 9 of the birdhouses from the Sep. 8 purchase are painted the wrong color but keeps them since the supplier granted an allowance of $100. Sep. 18 Birdy pays their account in full from the September 8 purchase, less any returns, allowances, and/or discounts. If an amount box does not require an entry, leave it blank. Assume the periodic inventory system is used. Sep.6 Sep. 8 Sep. 10 Refund Sep. 10 Allowance Sep. 18arrow_forwardReview the following transactions for Birdy Birdhouses and record any required journal entries. Sep. 6 Birdy Birdhouses purchases 55 birdhouses at $40 each with cash. Sep. 8 Birdy Birdhouses purchases 80 birdhouses at $45 each on credit. Terms of the purchase are 2/10, n/30, invoice date September 8. Sep. 10 Birdy discovers 10 of the birdhouses are damaged from the Sept 6 purchase and returns them to the supplier for a full refund. Birdy also discovers that 10 of the birdhouses from the Sept 8 purchase are painted the wrong color but keeps them since the supplier granted an allowance of $20 per birdhouse. Sep. 18 Birdy pays their account in full from the September 8 purchase, less any returns, allowances, and/or discounts.arrow_forward
- CMR Stationery located in Marabella, Trinidad, sells a variety of school suppliesincluding several brands of calculators. The business began the first quarter (Januaryto March) of 2018 with 20 (Casio smart) calculators at a total cost of $124,800.During the quarter, the company completed the following transactions relating to the“Casio smart” calculators.January 8: 105 calculators were purchased at a cost of $6,140 each. In addition, thebusiness paid a freight charge of $310 cash on each calculator to have the inventoryshipped from the point of purchase to their warehouse.January 31: The sales for January were 85 calculators which yielded total salesrevenue of $809,030. (25 of these units were sold on account to longstandingcustomers)February 4: A new batch of 70 calculators was purchased at a total cost of$486,500February 10: 6 of the instruments purchased on February 4 were returned to thesupplier, as they were not of the model ordered.February 28: During the month 62 calculators…arrow_forwardCREATE A TRIAL BALANCE AND FINANCIAL STATEMENTS WITH THE FOLLOWING INFORMATION. EVERYTHING IS BELOW INCLUDING PICTURES OF THE PREVIOUS MONTHS FINANCIAL STATEMENTS The following events occur during September: a. Webworks purchases supplies worth $120 on account. b. At the beginning of September, Webworks had 19 keyboards costing $100 each and 110 flash drives costing $10 each. Webworks has decided to use perpetual FIFO to cost its inventory. c. On account, Webworks purchases thirty keyboards for $105 each and fifty flash drives for $11 each. d. Webworks starts and completes five more Web sites and bills clients for $3,000. e. Webworks pays Nancy $500 for her work during the first three weeks of September. f. Webworks sells 40 keyboards for $6,000 and 120 flash drives for $2,400 cash. g. Webworks collects $2,500 in accounts receivable. h. Webworks pays off its salaries payable from August. i. Webworks pays off $5,500 of its accounts payable. j. Webworks pays off $5,000 of its outstanding…arrow_forwardBlue, Inc., sells playground equipment to schools and municipalities. It mails invoices at the end of each month for all goods shipped during that month; credit terms are net 30 days. Sales and accounts receivable data for 2017, 2018, and 2019 follow: Years Ending December 31, 2017: Sales: $1,785,980 Accounts Receivable at year-end: $220,189 2018: Sales: $1,839,559 Accounts Receivable at year-end: $227,896 2019: Sales: $1,986,724 Accounts Receivable at year-end: $267,094 Required: 1. Calculate the rates of increase in sales and in receviables during 2018 and 2019. 2. Do your calculations indicate any potential problems with Blue's receivables? 3. If so, suggest a possible explanation for your findings and indicate what action, if any, would then be needed to bring Blue's financial statements into conformity with GAAP.arrow_forward
- Prepare journal entries to record the following transaction: Ikeo Inc. sold $100,000 of gift cards during the last 2 weeks of December 2020arrow_forwardIdentifying Customer Control and Recording Advance Payment Allstar Inc. sells uniforms and spirit clothing to local school teams. Allen High School placed an order for 80 items for a total selling price of $3,520 on September 14, 2020. The cost of the merchandise to Allstar Inc. is $1,784. To place the order, Allstar Inc. required an $800 down payment on September 14, 2020. Delivery of the order to Allen is completed on October 7, 2020, at which time the remaining balance was collected from Allen. a. Demonstrate the five steps of the revenue recognition process for this scenario. Description of revenue recognition step Application of the revenue recognition step Step 1 Answer Answer Step 2 Answer Answer Step 3 Answer Calculation of transaction price: Answer Step 4 Answer Answer Step 5 Answer Answer b. Record Allstar’s entry on September 14, 2020. Account Name Dr. Cr. Answer Answer Answer Answer…arrow_forwardView Policies Show Attempt History Current Attempt in Progress Whispering Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2020. Jim Alcide, controller for Whispering, has gathered the following data concerning inventory. At May 31, 2020, the balance in Whispering's Raw Materials Inventory account was $428,400, and Allowance to Reduce Inventory to Market had a credit balance of $26,750. Alcide summarized the relevant inventory cost and market data at May 31, 2020, in the schedule below. Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Whispering's May 31, 2020, financial statements for inventory at lower-of-cost-or-market as applied to each item in inventory. Devereaux expressed concern over departing from the…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax CollegePrinciples of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
The KEY to Understanding Financial Statements; Author: Accounting Stuff;https://www.youtube.com/watch?v=_F6a0ddbjtI;License: Standard Youtube License