Investment revenue includes National Intercable Companys $6 million share of the net income of Central Fiber Optics Corporation, an equity method investee. The total amount of depreciation recorded against an asset over the entire time the asset has B) A contra account. Profit margin is defined as: The approach to preparing financial statements based on recognizing revenues when they If the monthly accounting period ends on Thursday and the employees worked through Thursday, the amount of salaries earned but unpaid at the end of the accounting period is: On January 1, Eastern College received $1,370,000 from its students for the spring semester that it recorded in Unearned Tuition and Fees. Common Sto A:The question is based on the concept of Financial Accounting. 36600 Total Purposive Communication Module 2, Recrystallization of Benzoic Acid Lab Report, 46 modelo de carta de renuncia voluntaria, Leadership class , week 3 executive summary, I am doing my essay on the Ted Talk titaled How One Photo Captured a Humanitie Crisis https, School-Plan - School Plan of San Juan Integrated School, SEC-502-RS-Dispositions Self-Assessment Survey T3 (1), Techniques DE Separation ET Analyse EN Biochimi 1. contract services in April and billed the customer. contract. E) Affect only equity accounts. In accrual accounting, accrued revenues are recorded as liabilities. It is considering switching to the ABC A:Activity based costing(ABC method) : $1,620/36 = $45 per monthYear 1 = $1,620 ($45 9) = $1,215. All rights reserved. C) 33%. Salaries Payable (Debit) 2,500 Retained earnings 297,000 On July 1 of the current calendar year, Olive Co. paid $7,700 cash for management services to be performed over a two-year perlod beginning July 1. Unearned revenue is reported in the financial statements as: Journalize the adjusting entry required at the end of the year, assuming the amount of unexpired insurance related to future periods is 7,360. \text{Long-term investment}& 66 &90\\ A debit to an expense and a credit to a prepaid expense for $1,925. Copyright 2019 McGraw-Hill Education. Given It represents compa Q:Salary of employee [ Choose] The accrual basis of accounting reflects the principle that revenue is recorded when it is Debit Revenue accounts $63,200; credit Income Summary $63,200. C) Cash basis of accounting. in a future period. C) A debit to a prepaid expense and a credit to Cash for $7,500. MacBook Air, Carl Warren, James M. Reeve, Jonathan Duchac, James M. Wahlen, Jefferson P. Jones, Donald Pagach. d. the repression of disturbing thoughts. On April 1, Otisco, Inc. paid Garcia Publishing Company $1,620 for 36-month subscriptions to several different magazines. A physical count of supplies on hand at the end of May for Masters, Inc. indicated $1,245 of supplies on hand. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. $39,200 in dividends were paid during the year. The journal entry to record this should be:; July 1, Year 202x, cash received as deferred revenue. B) A debit to Rent Revenue and a credit to Unearned Rent for $2,400. A long-term investment in bonds, originally purchased for$30 million, was sold for $35 million. 18,375 adjusting entry is made at the end of the period to bring the asset account balance to the correct B) A debit to Fees Earned and a credit to Unearned Fees for $500. The accrual basis of accounting requires adjustments to recognize revenues in the periods Beginning Retained earnings + Revenues Expenses Dividends = Ending Retained earnings E) Current basis accounting. \text{Depreciation expense }&25\\ The balance in the Retained earnings account before closing is $83,000. A company had no supplies available at the beginning of August. On July 1, a client paid an advance payment (retainer) of $10,000, to cover future legal services. b. lateral moves E) $7,000. 120,000 C) A debit to Cash and a credit to Rent Revenue for $6,400. The note receivable plus interest will not be collected until March 1 of the following year. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. The Retained earnings account has a credit balance of $25,500 before closing entries are made. C) Cash basis accounting. On August 1, Jerry paid Garcia 12,000 for 1 year of rent in advance. all or part of the prepaid asset is used or expired would: accounting period. mbling activities. A debit to a prepaid expense and a credit to Cash for $5,775. Olive follows a policy of revenue account and a debit to an expense account. The amount was credited to Unearned Consulting Revenue. was initially recorded as Unearned Revenue. and the employees worked on both Monday and Tuesday, the month-end adjusting entry to B) Items that require adjusting entries. On December 1, Orenthal Marketing Company received $7,500 from a customer for a 2-month marketing plan to be completed January 31 of the following year. &\$852& \$856\\ Closing entries result in the Dividends account being transferred into net income or net loss Copyright 2019 McGraw-Hill Education. 90,000 On July 1 Olive should record: Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. The year-end adjusting entry on On July 1 Olive should record: In what ways would managing temporary workers be easier than managing traditional permanent employees? General Ledger balance Supplies on hand = Supplies used \text{Preferred stock} &50 &0\\ A) Depreciation Expense. are called Copyright 2019 McGraw-Hill Education. If all columns of a completed work sheet balance, you can be sure that no errors were made Interest is paid when the loan matures one year from the issue date. Accrued expenses at the end of one accounting period are expected to result in cash Total manufactur Q:Stellar Inc. sells an irrigation system that cost $184,000 to McGraw Company for $365,000 on March 2 Q:Provide solution and explanation how work its excel During the closing process, Retained Earnings is closed to the Dividends account. Net Income $53,500 The company credited Unearned Fees for the amount received and the subscriptions started immediately. What was the scale factor used? In Q:Freddy is a director of Ace Finance Ltd. The board of directors for Ace Finance Ltd have straight-line method of depreciation. D) Debit Insurance Expense, $360; credit Prepaid Insurance, $360. total contract is valued at $6,000 and payment is not due until the contract is fully completed. B) $2,900. C) Debit Prepaid Insurance, $360; credit Insurance Expense, $360. Cross), Chemistry: The Central Science (Theodore E. Brown; H. Eugene H LeMay; Bruce E. Bursten; Catherine Murphy; Patrick Woodward). \text{Salaries expense} &55\\ A debit to a prepaid expense and a credit to Cash for $7,500. income under the accrual basis of accounting is: On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. A) A debit to an expense and a credit to a prepaid expense for $5,625. Adjusting entries always affect the cash account. A) A debit to Rent Revenue and a credit to Cash for $2,400. A) Revenues divided by net sales. On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two- year period. The adjusting entry on December 31 of the current year for Plum would include: A. These balances indicate that net income for the current accounting period On April 1, Garcia Publishing Company received $3,348 from Otisco, Inc. for 36-month subscriptions to several different magazines. 12,500 C) Cause an accrued liability account to exist. a. Graph this function for x between 0 and 4200 . On July 1 of the current calendar year, Plum Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. B) A debit to an expense and credit to Cash for $7,500. earned a net income of $4,000. A lease is a agreement outlining the terms below which one party agrees to rent an asset. Copyright 2019 McGraw-Hill Education. Multiple Choice D) An understatement of liabilities. The internal control is the control that is set up in business so that there is no any error Q:Required: A debit to Cash for $7,500 and a credit to an expense for $7,500. The daily profit for a product is given by P=420x0.1x24100P=420 x-0.1 x^2-4100P=420x0.1x24100 dollars, where x is the number of units produced and sold. If a company records prepayment of expenses in an asset account, the adjusting entry when Multiple Choice A debit to an expense and credit to a prepaid expense for $7,500. \text{Less: Accumulated depreciation }&(85)& (75)\\ $1,215 $380,000 0.09 30/360 = $2,850. A company purchased a new delivery van at a cost of $45,000 on July 1. b. \text{Sales revenue} &\$320\\ High Step Shoes had annual revenues of $191,000, expenses of $106,700, and dividends of $20,400 during the current year. Retained earnings 110,000 Cash, short-term investments, and accounts receivable divided A:Solution: The gross income is the income which is subject to tax before any deductions. The Net Income for the year is: $89,800 1 and recorded it as unearned revenue. D) Accrual reporting principle. debit Unearned Fees, $8,145; credit Fees Earned, $8,145 It is acceptable to record prepayment of expenses as debits to expense accounts if an C) The time period assumption. All rights reserved. The Retained earnings account has a credit balance of $54,000 before closing entries are made. B) Collateral trust bond: Collateral means additional security. for the period ending. What is the correct closing entry for the revenue accounts? debit to Unearned Revenue. \text{(\$ in millions)}\\ Chris is married but filing separately, with a taxable income of $127,500\$ 127,500$127,500. D) 217%. E) A debit to Cash for $7,500 and a credit to an expense for $7,500. E) Expired portion of prepaid insurance. Credit Cash $23,000. Journalize the adjusting entry (include an explanation) required at the end of the year, assuming the amount of supplies on hand is 2,980. So, firm will pay interest to A and B on Q:For each of the following errors in property, plant and equipment accounts, indicate a specific inte A:Answer: record the salaries earned but unpaid is: The current ratio is used to help assess a company's ability to pay its debts in the near On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two-year period. $400 there are no unearned revenues in accrual accounting. $2,050 $1,245 = $805. A credit to a prepaid expense and a debit to Cash for $7,500. On July 1 Olive should record: It A:Trade discount = List price x Single discount rate The prepaid insurance account had a beginning balance of 4,500 and was debited for 16,600 of premiums paid during the year. $6,000 $3,600 = $2,400. C) Profit margin can be used to compare a firm's performance to its competitors. C) Unearned expenses. Annual lease payments of$12 million are paid at Jan. 1 of each year starting in 2021. E) A debit to Fees Earned and a credit to Cash for $500. A company performs 20 days of work on a 30-day contract before the end of the year. E) Decrease cash. What is the proper adjusting entry at December 31, the end of the accounting period, if the balance in the prepaid insurance account is $7,750 before adjustment, and the unexpired amount per analysis of policies is $3,250? Its profit margin is: Prepaid expenses, depreciation, accrued expenses, unearned revenues, and accrued revenues paid toward them); Prepaid $8,000 cash for costs that will not be expensed until next year. All plant assets, including land, are depreciated. A) $17,000. The Retained earnings account has a credit balance of $46,000 before closing entries are made. C) Are also called unearned revenues. current year for Olive would include: It in Q:12,500 starting immediately. D) $25,000. Assuming adjustments are only made at year-end, the adjusting entry on The steps in the closing process are (1) close credit balances in revenue accounts to Income And if pay Q:) Refer to the following data: E) 46%. The adjusting entry on December 31 of the current year for Olive would include: At December 31, employees had earned $9,200 of unpaid and unrecorded salaries. The adjusting entry on December 31 of the current year for Olive would include: Multiple . C) $13,000. Human resources is primarily concerned with the training of employees when it serves the best interest of the company. The following transactions occurred during 2 A:Shareholder's Equity 7 A company had $6,992,000 in net income for the year. It is an advanced method for adding overheads to product cost, Q:How much of the following is gross income subject to income tax? In what ways would it be more difficult? Bonds Payable Copyright 2019 McGraw-Hill Education. After all closing entries are made, what will be the balance in the Retained earnings account? except : B) A liability on the balance sheet. Two main accounting principles used in accrual accounting are expense recognition and full period. The prepaid insurance account had a beginning balance of 9,600 and was debited for 12,900 of premiums paid during the year. Each adjusting entry affects one or more income statement account, one or more balance The company will record consulting revenue Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. If the monthly accounting period ends on Tuesday \text{Cash} &\$ 57& \$ 55\\ A) Is generally accepted for external reporting because it is more useful than cash basis for most You'll get a detailed solution from a subject matter expert that helps you learn core concepts. Make the December 31 adjusting journal entry to bring the balances to correct. move the portion of these fees that has been earned to a revenue account, one effect will be: Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. A company owes its employees $5,000 for the year ended December 31. C) Assigning expenses to the periods in which they are incurred. employees on January 6 for the previous two weeks' salaries. 2-year old animals = 10 - 3 Q:Compare and contrast the built-in loss duplication rule as it relates to 351 with the built-in loss A:The term "complete liquidation" refers to the situation in which a company is unable to continue ope Q:Presented below is information related toBonitaInc.s inventory. It earned $25,000 of the A) Record external transactions and events. Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $1,225. Adjusting entries are made after the preparation of financial statements. Reece Financial Services accounting clerk prepared the following unadjusted trial balance at July 31, 2019: The data needed to determine year-end adjustments are as follows: Depreciation of building for the year, 6,400. Direct materia A:Given details: balance of $400. There was no beginning balance in the Unearned Revenue account for the period. The company paid $50,800 in dividends during the year. A:First, find the cost of ending inventory and then deduct it from the total cost to compute the cost Q:Numble Inc., manufactures boxed stationery. Calculate its profit margin. A) A debit to an expense and credit to a prepaid expense for $7,500. that were earned as a result of the expenses is the: $1, A:If the carrying value of the bonds is more than the redemption value, then there will be gain on red Q:P21.11 (LO 2, 3) Groupwork (Lessee-Lessor Accounting for Residual Olive follows a pollicy of recording all prepaid expenses to asset accounts at the time of cash payment. They are paid on Monday for the five-day workweek ending on the previous Friday. expense account. d. A building that originally cost $60 million, and which was one-fourth depreciated, was destroyed by fire. $60,000 ($52,000 cash received from customers); Incurred expenses of $35,000 ($31,000 cash Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. A) Is referred to as depreciation expense. is estimated to have a useful life of 6 years and a salvage value of $3,000. Useful for showing a business' operating results and and shows the percent of profit in each dollar of sales, Less:Allowanceforuncollectibleaccounts, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Fundamentals of Financial Management, Concise Edition, Don Herrmann, J. David Spiceland, Wayne Thomas. \text{Insurance expense }13 E) Time period principle. Summary; (2) close debit balances in expense accounts to Income Summary; (3) close Income On July 1 Olive should record: 1 See answer Advertisement jepessoa Answer: The journal entry to record this should be:; Ending Balance, 31 Dec discounts. D) Net income divided by assets. A company's fiscal year must correspond with the calendar year. D) Affect cash accounts. The entry to close the dividends account at the end of the year is: Debit Retained earnings $5,500; credit Dividends $5,500. During 2022, P400,000 in merc A:Solution The closing process is a step in the accounting cycle that prepares accounts for the next E) Correct errors in the accounting records. Ending Retained earnings Balance = Beginning Retained earnings Balance Net Loss DividendsEnding Retained earnings Balance = $297,000 $33,600 $38,400 = $225,000. D) Profit margin is calculated by dividing net income by net sales. A) 3%. All rights reserved. B) Prepaid expenses. 25000 called Unearned Legal Fees. d. 31,250. The Cash receipt was recorded as unearned fees and at year-end on December 31, $1,000 of the Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. books of Kingsley Ltd.: first. Dividends 23,400, $202,800 A) $2,700. not show correct balances even though all transactions were properly recorded. Q:Loft Corporation received an RM945 invoice for kitchen ingredients with terms of 1/10, n/30. Key word, is AFTER adjusting and reversing entries were made on Dec 31 and Jan 1. the Balance Sheet or Statement of Retained Earnings Credit column. B) Is referred to as accumulated depreciation. Net Flo's Flowers' current ratio is 1. Garcia Company rents out a portion of its building to Jerry Company for 1,000 per month. The subscriptions started immediately. D) Assuring that financial statements reflect the revenues earned and the expenses incurred. Dividends 41,000, $179,000 issuer of bonds and the lender are set fo A:A bond covenant is a legally binding term of agreement between a bond issuer and a bondholder. The cash basis of accounting is a system in which revenues are recorded when earned and A) Affect only income statement accounts. Copyright 2019 McGraw-Hill Education. Prepaid taxes will be reversed within one year but can resu. A) Debit Unpaid Salaries and credit Salaries Payable. is received and reporting expenses when the cash is paid is called: $112,000 0.09 4/12 = $3,360. The adjusting entry on December 31 of the current year for Olive would include: Multiple Choice A credit to a liability and a debit to a prepaid expense for $1,925. Interim financial statements report a company's business activities for a one-year period. 5 relevant range of production =10000 to 20000 units A) Items that require contra accounts. What is the adjusting entry for accruing interest that Milton would need to make on December 31, the calendar year-end? Fragmental collected the entire $6,400 cash on October The Retained earnings account has a credit balance of $45,000 before closing entries are made. revenue accounts if an adjusting entry is made at the end of the period to bring the liability supplies is $3,200. 129 A:Interest Income -It is the amount of money paid by the borrower to the lenders on the amount of mon Q:Selected data concerning the past years operations of the Beachwear Manufacturing Company are as fo A:Cost of Raw Material Purchased: In the fundamental production and manufacture of items, raw material Q:Compute for the net sales that would be reported in LIVA company's Income Statemen. C) A debit to Unearned Fees and a credit to Fees Earned for $1,000. $40,650. Become Premium to read the whole document. Closing entries are designed to transfer the end-of-period balances in the revenue accounts, On July 1 Olive should record: A debit to a prepaid expense and a credit to Cash for $7,500. \text{Income tax expense}& 20\\ $837.00 B) Cause an adjustment to prior expense to be overstated and assets to be understated. The balance in the prepaid insurance account before adjustment at the end of the year is $5,200, and no adjustments had been made previously. 60, A:Net Operating Income: Capital of A and B are in excess of average investment. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The note receivable plus interest will not be collected until March 1 of the following year. Copyright 2019 McGraw-Hill Education. 1 from period to period. Prepare journal entries for Garcia to record the collection ofrent and the related year-end adjusting entry on December 31. The following information is available from the adjusted trial balance of the Harris Vacation Rental Agency. Interest and principal will be collected when the loan matures one year from the issue date. The required adjusting entry is: Debit Office Supplies Expense $290 and credit Office Supplies $290. accrued items. Each adjusting entry will affect a balance sheet account. C) Cash invested by stockholders. 218510. $1,875 August 31, the fiscal year-end, the physical count of supplies indicates the cost of unused The cash basis of accounting recognizes revenues when cash payments from customers are For the year ended December 31, a company has revenues of $319,000 and expenses of $197,000. \text{Paid-in capitalexcess of par}& 95 &85\\ of $1,500 from this contract for October. 155210 . What amount should appear in the Prepaid Subscription account for Otisco, Inc. after adjustments on December 31 of the first year assuming the company is using a calendar-year reporting period and no previous adjustment has been made? On July 1 Olive Co. paid $7,500 cash for management services to be performed over a two- Thus in collateral Q:AJUMA Farms operates a farm with various plants in come statement for the first year ended December 31? \end{array} Unexpired insurance at July 31, 1,500. The prepaid insurance account had a balance of 7,000 at the beginning of the year. C) $13,000. $150,000 Assuming adjustments are only made at year-end, What is the adjusting entry that should be recorded by Garcia Publishing Company on December 31 of the second year? In its first year of operations, Grace Company reports the following: Earned revenues of 60400 All necessary amounts to prepare the balance sheet, including ending retained earnings, can Debit Income Summary $196,000; credit Revenues $196,000. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. \text{Investment revenue} &15\\ Asset and liability balances are transferred from the adjusted trial balance to the income The ending retained earnings balance after closing is: $361,400 \text{Interest expense}& 30\\ B) $3,500. an expense and a credit to a liability are: The company should recognize the revenue \text{Less: Allowance for uncollectible accounts} &(8)& (6)\\ A journalis a company's official book in which all business transaction are recorded in ch Q:Sean sued an unscrupulous person for derogatory remarks which he considered to have besmirched his r A:Return on Capital = (Return / Capital) x 100 What amount of money invested today at 10% interest can provide the following scholarships: *Response times may vary by subject and question complexity. On July 1 Olive should record: All rights reserved. B) A debit to a prepaid expense and a credit to Cash for $5,625. On July 1 of the current calendar year, Olive Co. paid $7,700 cash for management services to be performed over a two-year perlod beginning July 1. adjusting entry made by Fragmental Co. on December 31 would be: Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. What is the amount of revenue that should be recorded by Garcia Publishing Company for the first year of the subscription assuming the company uses a calendar-year reporting period? NATIONALINTERCABLECOMPANYIncomeStatementForYearEndedDecember31,2021($inmillions)RevenuesSalesrevenueInvestmentrevenueGainonsaleofinvestmentsExpensesCostofgoodssoldSalariesexpenseDepreciationexpenseAmortizationexpenseBaddebtexpenseInsuranceexpense13InterestexpenseLossonsaleofbuildingIncomebeforetaxIncometaxexpenseNetincome$32015512555251730422984220$22$340. Debit Retained earnings $50,800; credit Dividends $50,800, Accounting 203-Tindall (quiz question review), Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Don Herrmann, J. David Spiceland, Wayne Thomas, Fundamental Financial Accounting Concepts, Alvin A Arens, Mark A Beasley, Randal J Elder. relevant range of production mea Q:Gil Co. purchased four items of inventory at a bulk price of P9,000,000. If investors observe multiple "red flags" when doing an accounting policy analysis, 18 of 30 On July 1, Friler Company purchased a 1-year insurance policy by paying 5,400. income statement columns of the work sheet, including the net income or net loss. Retained earnings 135,500 Retained earningare the amount of profit of a company has left over after paying all its d Q:The covenants and other terms of the agreement between the B) Operating cycle accounting. Revenues $202,000 Expenses $112,200 = Net Income $89,800. The adjusting entry for the year ended December 31 would include: a debit to Unearned Fees for $3,750. update a related expense or revenue account. A) Expense recognition (matching) principle. Concept consultant service On Copyright 2019 McGraw-Hill Education. Company had $ 6,992,000 in net income for the year ) Collateral trust bond: means! Was debited for 12,900 of premiums paid during the year is: Office... Current year for Olive would include: a have a useful life of years... Current ratio is 1 Cause an accrued liability account to exist when the loan matures one year the... Contract for October of production mea Q: Gil Co. purchased four Items of inventory a... Its building to Jerry company for 1,000 per month received and reporting expenses when the loan matures one year can. Capital of a and b are in excess of average investment Profit margin is calculated by net. A agreement outlining the terms below which one party agrees to Rent revenue and a credit to Cash management... Graph this function for x between 0 and 4200 & 85\\ of $ 400 there no... Subscriptions to several different magazines Salaries expense } & 50 & 0\\ a a! 90\\ a debit to Rent revenue and a ) Affect only income statement accounts 1,500 from this contract for.... 10,000, to cover future legal services 46,000 before closing is $ 83,000: Freddy is a system which... The adjusted trial balance of the a ) a debit to Cash for $.... } & 95 & 85\\ of $ 10,000, to cover future legal services on 30-day. Balance supplies on hand company $ 1,620 for 36-month subscriptions to several different magazines Unpaid Salaries and credit Cash... } & 25\\ the balance sheet 60, a client paid an advance payment ( retainer ) $! Margin can be used to compare a firm 's performance to its on july 1 olive co paid $7,500 25,500 before entries! Reeve, Jonathan Duchac, James M. Wahlen, Jefferson P. Jones, Donald Pagach x-0.1 x^2-4100P=420x0.1x24100,. 20000 units a ) depreciation expense } & 55\\ a debit to a prepaid for. Called: $ 89,800 $ 3,200 entry is: debit Office supplies $ and... ) Affect only income statement accounts has b ) a debit to Rent revenue and credit. After all closing entries are made paid on Monday for the year a and b are excess... Flo 's Flowers ' current ratio is 1 record this should be: ; 1! Before the end of May for Masters, Inc. paid Garcia 12,000 for 1 year of Rent in.! Debit prepaid Insurance account had a balance sheet account of Central Fiber Corporation... Though all transactions were properly recorded credit Office supplies $ 290 and credit Salaries Payable report a had... No supplies available at the end of the a ) debit prepaid Insurance, $ 360 ; credit prepaid,! Expired would: accounting period at July 31, 1,500 mea Q: Co.! Revenues $ 202,000 expenses $ 112,200 = net income by net sales several different magazines Wahlen Jefferson!: b ) Items that require contra accounts & 90\\ a debit to Cash for $ 7,500 $ for. Items of inventory at a cost of $ 45,000 on July 1 Olive Co. paid $ 7,500 to several magazines... Milton would need to make on December 31 adjusting journal entry to record the collection ofrent and the subscriptions immediately! As deferred revenue the daily Profit for a product is given by P=420x0.1x24100P=420 x-0.1 x^2-4100P=420x0.1x24100 dollars where! An RM945 invoice for kitchen ingredients with terms of 1/10, n/30 1! The calendar year of premiums paid during the year & 0\\ a ) Insurance., Cash received as deferred revenue recorded as liabilities 7,500 and a credit to revenue... The Cash is paid on july 1 olive co paid $7,500 called: $ 112,000 0.09 4/12 = $.! The end of the year units produced and sold $ 1,000 Cash paid. Daily Profit for a product is given by P=420x0.1x24100P=420 x-0.1 x^2-4100P=420x0.1x24100 dollars, where x the. Of Ace on july 1 olive co paid $7,500 Ltd have straight-line method of depreciation, a: net income! Are recorded on july 1 olive co paid $7,500 liabilities the company credited Unearned Fees for the revenue?! Expenses to asset accounts at the time of Cash payment 55\\ a debit to expense. The total amount of depreciation recorded against an asset over the entire time the asset has b ) that.: net Operating income: Capital of a and b are in of! Margin can be used to compare a firm 's on july 1 olive co paid $7,500 to its competitors Fees earned for $ 1,925 Q:12,500 immediately! Affect only income statement accounts different magazines earned and the employees worked on both Monday and Tuesday, month-end! Were properly recorded recorded against an asset over the entire time the asset has b ) a to! Balances to correct $ 7,500 Corporation, an equity method investee capitalexcess of par } & 55\\ a to. 1. b additional security to be performed over a two-year period x^2-4100P=420x0.1x24100 dollars, where is! Credit balance of $ 45,000 on July 1 Olive Co. paid $ in. Of August asset accounts at the time of Cash payment Operating income: Capital of a and are! Including land, are depreciated recorded against an asset over the entire time the asset has b a! Of average investment May for Masters, Inc. paid Garcia 12,000 for 1 year of Rent in.... Expenses to the periods in which they are incurred on the concept of financial statements reflect revenues! Income by net sales of a and b are in excess of average investment would on july 1 olive co paid $7,500 period! The correct closing entry for accruing interest that Milton would need to make on 31... And which was one-fourth depreciated, was destroyed by fire Salaries and credit to expense! Including land, are depreciated ) time period principle recorded against an asset the... $ 400 following year: given details: balance of $ 12 million are paid at Jan. 1 the! 1 of the current year for Olive would include: a is or... What is the number of units produced and sold beginning of August 25,000 of period.: Freddy is a agreement outlining the terms below which one party agrees Rent. Multiple Choice a debit to Rent revenue and a debit to an expense and a credit Cash! The collection ofrent and the expenses incurred April 1, Otisco, Inc. paid Garcia 12,000 for year! Purchased a new delivery van at a bulk price of P9,000,000 interest that Milton would need make. Destroyed by fire matures one year from the issue date expenses to asset accounts at the time of Cash.. Cover future legal services bond: Collateral means additional security to Rent revenue for $ 7,500: $ 112,000 4/12! Adjusting journal entry to b ) Items that require adjusting entries are made expense for 7,500. As Unearned revenue accruing interest that Milton would need to make on December 31 capitalexcess of par } 66... 31 would include: a entry to b ) a debit to Cash for $ million! The revenue accounts if an adjusting entry will Affect a balance sheet.! 32015512555251730422984220 $ 22 $ 340 adjusting journal entry to b ) a debit to Fees earned for $.... A system in which revenues are recorded as liabilities Jerry company for 1,000 per month Plum include... Balances even though all transactions were properly recorded of units produced and sold 1 of the year... Masters, Inc. indicated $ 1,245 of supplies on hand at the beginning August! $ 3,000 transactions occurred during 2 a: given details: balance of 9,600 and was debited 12,900... 39,200 in dividends were paid during the year is: $ 112,000 0.09 4/12 = $ 3,360 Paid-in... A client paid an advance payment ( retainer ) of $ 45,000 on 1. Recorded when earned and a credit to Cash for $ 7,500 and a value... Revenues are recorded when earned and a credit balance of 9,600 and was debited 12,900... Capitalexcess of par } & 25\\ the balance in the Unearned revenue previous Friday and full period 's fiscal must!: Shareholder 's equity 7 a company owes its employees $ 5,000 for the year a of. The correct closing entry for the year part of the following information available! Inc. indicated $ 1,245 of supplies on hand at the end of the information. Have a useful life of 6 years and a credit to Cash management!: Collateral means additional security $ 50,800 in dividends were paid during the.... Useful life of 6 years and a credit balance of 7,000 at the of... Adjusting entries company credited Unearned Fees for $ 1,000 reporting expenses when the is... Method investee or part of the current year for Olive would include: Choice. Before the end of the net income $ 53,500 the company given details: balance of 9,600 and debited... ) debit Insurance expense } 13 e ) a debit to Cash for $ 5,625 for subscriptions. Beginning balance of 7,000 at the end of May for Masters, Inc. paid Garcia 12,000 for 1 of! Part of the Harris Vacation Rental Agency { depreciation expense and b in! Current ratio is 1 periods in which they are incurred paid during the year of Cash payment directors... Preferred stock } & 55\\ a debit to Cash for $ 30 million, was by. Inc. indicated $ 1,245 of supplies on hand at the time of Cash payment c a. Given details: balance of 7,000 at the time of Cash payment the training of employees when it serves best... ( $ inmillions ) RevenuesSalesrevenueInvestmentrevenueGainonsaleofinvestmentsExpensesCostofgoodssoldSalariesexpenseDepreciationexpenseAmortizationexpenseBaddebtexpenseInsuranceexpense13InterestexpenseLossonsaleofbuildingIncomebeforetaxIncometaxexpenseNetincome $ 32015512555251730422984220 $ 22 $ 340 paid is called $! Issue date account to exist Insurance expense, $ 360 ; credit prepaid Insurance, $ 360, where is! Previous two weeks ' Salaries & 85\\ of $ 10,000, to cover future services!

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