Accounting Warren Reeve Duchac 26th Edition Chapter 1

Accounting 10th Edition warren, reeve, duchac

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Accounting 10th Edition warren, reeve, duchac

1. 1. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< PRACTICE EXERCISES PE 5–1A $162,300 ($32,800 + $379,500 – $250,000) PE 5–1B $490,000 ($375,000 + $815,000 – $700,000) PE 5–2A Cost of merchandise sold: Merchandise inventory, June 1................................. $ 35,500 Purchases .................................................................. $384,000 Less: Purchases returns and allowances.............. $ 11,000 Purchases discounts .................................... 3,000 14,000 Net purchases ........................................................... $370,000 Add freight in ............................................................. 6,000 Cost of merchandise purchased ........................ 376,000 Merchandise available for sale ................................. $ 411,500 Less merchandise inventory, June 30...................... 40,500 Cost of merchandise sold ......................................... $371,000 PE 5–2B Cost of merchandise sold: Merchandise inventory, August 1............................. $ 120,000 Purchases .................................................................. $780,000 Less: Purchases returns and allowances.............. $20,000 Purchases discounts .................................... 10,000 30,000 Net purchases ........................................................... $750,000 Add freight in ............................................................. 5,000 Cost of merchandise purchased ........................ 755,000 Merchandise available for sale ................................. $875,000 Less merchandise inventory, August 31.................. 150,000 Cost of merchandise sold ......................................... $725,000 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
2. 2. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< PE 5–3A a. Accounts Receivable ................................................................... 41,000 Sales ....................................................................................... 41,000 Cost of Merchandise Sold ........................................................... 22,500 Merchandise Inventory .......................................................... 22,500 b. Cash .............................................................................................. 40,590 Sales Discounts ........................................................................... 410 Accounts Receivable ............................................................. 41,000 PE 5–3B a. Accounts Receivable ................................................................... 16,000 Sales ....................................................................................... 16,000 Cost of Merchandise Sold ........................................................... 9,600 Merchandise Inventory .......................................................... 9,600 b. Cash .............................................................................................. 15,680 Sales Discounts ........................................................................... 320 Accounts Receivable ............................................................. 16,000 PE 5–4A a. $19,800. Purchase of $21,500 less the return of $1,500 less the discount of $200 [($21,500 – $1,500) × 1%]. b. Accounts Payable PE 5–4B a. $4,410. Purchase of $8,000 less the return of $3,500 less the discount of $90 [($8,000 – $3,500) × 2%)]. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
3. 3. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< PE 5–6A Saddlebag Co. journal entries: Cash ($17,500 – $350 + $600) ................................................................ 17,750 Sales Discounts ($17,500 × 2%) ............................................................ 350 Accounts Receivable—Bioscan Co. ($17,500 + $600) ................... 18,100 Bioscan Co. journal entries: Accounts Payable—Saddlebag Co. ($17,500 + $600) .......................... 18,100 Merchandise Inventory ($17,500 × 2%) .......................................... 350 Cash ($17,500 – $350 + $600) ......................................................... 17,750 PE 5–7A Oct. 31 Cost of Merchandise Sold....................................................... 80,250 Merchandise Inventory ..................................................... 80,250 Inventory shrinkage ($975,000 – $894,750). EXERCISES Ex. 5–1 a. $318,000 ($795,000 – $477,000) b. 40% ($318,000 ÷ $795,000) c. No. If operating expenses are less than gross profit, there will be a net income. On the other hand, if operating expenses exceed gross profit, there will be a net loss. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
4. 4. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Ex. 5–6 a. Net sales: $5,105,000 ($5,280,000 – $100,000 – $75,000) b. Gross profit: $2,105,000 ($5,105,000 – $3,000,000) Ex. 5–8 PAPER PLUS COMPANY Income Statement For the Year Ended June 30, 2010 Revenues: Net sales ..................................................................................... $6,500,000 Rent revenue .............................................................................. 100,000 Total revenues........................................................................ $6,600,000 Expenses: Cost of merchandise sold .......................................................... $4,000,000 Selling expenses ........................................................................ 750,000 Administrative expenses ........................................................... 500,000 Interest expense ......................................................................... 30,000 Total expenses ....................................................................... 5,280,000 Net income .......................................................................................... $1,320,000 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
5. 5. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Ex. 5–11 a. EL DORADO FURNISHINGS COMPANY Income Statement For the Year Ended March 31, 2010 Revenue from sales: Sales ....................................................................... $2,550,000 Less: Sales returns and allowances ................... $160,000 Sales discounts ......................................... 40,000 200,000 Net sales ........................................................... $2,350,000 Cost of merchandise sold ............................................ 1,400,000 Gross profit................................................................... $ 950,000 Expenses: Selling expenses .................................................... $ 410,000 Administrative expenses ....................................... 250,000 Total expenses ................................................. 660,000 Income from operations ............................................... $ 290,000 Other expense: Interest expense ..................................................... 15,000 Net income .................................................................... $ 275,000 b. The major advantage of the multiple-step form of income statement is that relationships such as gross profit to sales are indicated. The major disadvantages are that it is more complex and the total revenues and expenses are not indicated, as is the case in the single-step income statement. Ex. 5–13 a. Cash .............................................................................................. 18,500 Sales ....................................................................................... 18,500 Cost of Merchandise Sold ........................................................... 11,000 Merchandise Inventory .......................................................... 11,000 b. Accounts Receivable ................................................................... 12,000 Sales ....................................................................................... 12,000 Cost of Merchandise Sold ........................................................... 7,200 Merchandise Inventory .......................................................... 7,200 c. Cash .............................................................................................. 115,200 Sales ....................................................................................... 115,200 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
6. 6. Cost of Merchandise Sold ........................................................... 70,000 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Merchandise Inventory .......................................................... 70,000 d. Cash .............................................................................................. 45,000 Sales ....................................................................................... 45,000 Cost of Merchandise Sold ........................................................... 27,000 Merchandise Inventory .......................................................... 27,000 e. Credit Card Expense .................................................................... 5,600 Cash ....................................................................................... 5,600 Ex. 5–26 a. Accounts Receivable—Bitone Co. ............................................. 23,400 Sales ....................................................................................... 23,400 Cost of Merchandise Sold ........................................................... 14,000 Merchandise Inventory .......................................................... 14,000 b. Sales Returns and Allowances .................................................... 4,400 Accounts Receivable—Bitone Co. ........................................ 4,400 Merchandise Inventory ................................................................ 2,600 Cost of Merchandise Sold ..................................................... 2,600 c. Cash .............................................................................................. 18,620 Sales Discounts ........................................................................... 380 Accounts Receivable—Bitone Co. ........................................ 19,000 Ex. 5–27 a. Merchandise Inventory ................................................................ 23,400 Accounts Payable—Summit Co. .......................................... 23,400 b. Accounts Payable—Summit Co. ................................................ 4,400 Merchandise Inventory .......................................................... 4,400 c. Accounts Payable—Summit Co. ................................................ 19,000 Cash ....................................................................................... 18,620 Merchandise Inventory .......................................................... 380 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
7. 7. Ex. 5–31 2010 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Mar. 31 Sales .................................................................................. 2,550,000 Income Summary ........................................................ 2,550,000 31 Income Summary .............................................................. 2,275,000 Sales Discounts .......................................................... 40,000 Sales Returns and Allowances................................... 160,000 Cost of Merchandise Sold .......................................... 1,400,000 Selling Expenses ........................................................ 410,000 Administrative Expenses............................................ 250,000 Interest Expense ......................................................... 15,000 31 Income Summary .............................................................. 275,000 Retained Earnings ...................................................... 275,000 31 Retained Earnings............................................................. 50,000 Dividends .................................................................... 50,000 PROBLEMS Prob. 5–3A Aug. 1 Accounts Receivable—Tomahawk Co. ........................... 12,500 Sales ............................................................................ 12,500 1 Cost of Merchandise Sold................................................. 7,500 Merchandise Inventory ............................................... 7,500 2 Cash ................................................................................... 21,400 Sales ............................................................................ 20,000 Sales Tax Payable ....................................................... 1,400 2 Cost of Merchandise Sold................................................. 13,100 Merchandise Inventory ............................................... 13,100 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
8. 8. 5 Accounts Receivable—Epworth Company ...................... 30,000 Sales ............................................................................ 30,000 5 Cost of Merchandise Sold................................................. 19,500 Merchandise Inventory ............................................... 19,500 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< 8 Cash ................................................................................... 12,305 Sales ............................................................................ 11,500 Sales Tax Payable ....................................................... 805 8 Cost of Merchandise Sold................................................. 7,000 Merchandise Inventory ............................................... 7,000 13 Cash ................................................................................... 8,000 Sales ............................................................................ 8,000 13 Cost of Merchandise Sold................................................. 5,000 Merchandise Inventory ............................................... 5,000 14 Accounts Receivable—Osgood Co. ................................ 11,800 Sales ............................................................................ 11,800 14 Cost of Merchandise Sold................................................. 7,000 Merchandise Inventory ............................................... 7,000 15 Cash ................................................................................... 29,700 Sales Discounts ................................................................ 300 Accounts Receivable—Epworth Company 30,000 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
9. 9. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Prob. 5–3A Concluded Aug. 16 Sales Returns and Allowances ......................................... 1,800 Accounts Receivable—Osgood Co. .......................... 1,800 16 Merchandise Inventory ..................................................... 1,000 Cost of Merchandise Sold .......................................... 1,000 18 Accounts Receivable—Horton Company......................... 6,850 Sales ............................................................................ 6,850 18 Accounts Receivable—Horton Company......................... 210 Cash ............................................................................ 210 18 Cost of Merchandise Sold................................................. 4,100 Merchandise Inventory ............................................... 4,100 24 Cash ................................................................................... 9,900 Sales Discounts ................................................................ 100 Accounts Receivable—Osgood Co. .......................... 10,000 28 Cash ................................................................................... 6,923 Sales Discounts ................................................................ 137 Accounts Receivable—Horton Company .................. 7,060 31 Delivery Expense .............................................................. 2,100 Cash ............................................................................ 2,100 31 Cash ................................................................................... 12,500 Accounts Receivable—Tomahawk Co. ..................... 12,500 Sept. 3 Credit Card Expense ......................................................... 980 Cash ............................................................................ 980 10 Sales Tax Payable ............................................................. 1,750 Cash ............................................................................ 1,750 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)
10. 10. PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Prob. 5–4A Oct. 1 Merchandise Inventory ..................................................... 15,900 Accounts Payable—Wood Co. .................................. 15,900 5 Merchandise Inventory ..................................................... 14,150 Accounts Payable—Davis Co. ................................... 14,150 10 Accounts Payable—Wood Co. ......................................... 15,900 Cash ............................................................................ 15,590 Merchandise Inventory ............................................... 310 13 Merchandise Inventory ..................................................... 8,000 Accounts Payable—Folts Co. .................................... 8,000 14 Accounts Payable—Folts Co. .......................................... 1,500 Merchandise Inventory ............................................... 1,500 18 Merchandise Inventory ..................................................... 12,250 Accounts Payable—Lakey Company ......................... 12,250 18 Merchandise Inventory ..................................................... 180 Cash ............................................................................ 180 19 Merchandise Inventory ..................................................... 11,150 Accounts Payable—Noman Co. ................................ 11,150 23 Accounts Payable—Folts Co. .......................................... 6,500 Cash ............................................................................ 6,435 Merchandise Inventory ............................................... 65 29 Accounts Payable—Noman Co. ....................................... 11,150 Cash ............................................................................ 10,927 Merchandise Inventory ............................................... 223 31 Accounts Payable—Lakey Company ............................... 12,250 Cash ............................................................................ 12,250 31 Accounts Payable—Davis Co. ......................................... 14,150 Cash ............................................................................ 14,150 PLEASE VISIT DOWNTR.NET >>>>>>>>lucanhquan90<<<<<<<< Create PDF files without this message by purchasing novaPDF printer (http://www.novapdf.com)

Accounting Warren Reeve Duchac 26th Edition Chapter 1

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