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1. An inventory of supplies showed $2,000 were used up.   2. The furniture was purchased for $20,000. It has $0 salvage value and a 5 year useful life. One year of depreciation must be recorded.   3. $3,000 of insurance was purchased for 12 months. $700 of insurance was used.   4. Performed $20,000 of services that was paid for in advance   5. On last day of the month, performed $6,000 of services for new customer and will be paid next month   6. Happy cleaners provided $8,000 of cleaning services on the last day of the month. This waas a special yearly clean. They will be paid next month.   7. An inventory count revealed there was $7,000 of inventory shrinkage. This was a larger than usual amount of shrinkage.   8. The company estimates bad debt expense to be 1% of credit sales. Assume all sales are made on credit.   9. A company with net assets of $100,000 was purchased for $140,000 one year ago. The current fair value of the company is 110,000. Perform a goodwill impairment test and record an impairment entry if one is needed.    Find the Adjusted Trial Balance, Income Statement, Statement of Owner's Equity and Balance Sheet.

1. An inventory of supplies showed $2,000 were used up.   2. The furniture was purchased for $20,000. It has $0 salvage value and a 5 year useful life. One year of depreciation must be recorded.   3. $3,000 of insurance was purchased for 12 months. $700 of insurance was used.   4. Performed $20,000 of services that was paid for in advance   5. On last day of the month, performed $6,000 of services for new customer and will be paid next month   6. Happy cleaners provided $8,000 of cleaning services on the last day of the month. This waas a special yearly clean. They will be paid next month.   7. An inventory count revealed there was $7,000 of inventory shrinkage. This was a larger than usual amount of shrinkage.   8. The company estimates bad debt expense to be 1% of credit sales. Assume all sales are made on credit.   9. A company with net assets of $100,000 was purchased for $140,000 one year ago. The current fair value of the company is 110,000. Perform a goodwill impairment test and record an impairment entry if one is needed.    Find the Adjusted Trial Balance, Income Statement, Statement of Owner's Equity and Balance Sheet.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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 1. An inventory of supplies showed $2,000 were used up.
 
2. The furniture was purchased for $20,000. It has $0 salvage value and a 5 year useful
life. One year of depreciation must be recorded.
 
3. $3,000 of insurance was purchased for 12 months. $700 of insurance was used.
 
4. Performed $20,000 of services that was paid for in advance
 
5. On last day of the month, performed $6,000 of services for new customer and will be
paid next month
 
6. Happy cleaners provided $8,000 of cleaning services on the last day of the month. This
waas a special yearly clean. They will be paid next month.
 
7. An inventory count revealed there was $7,000 of inventory shrinkage. This was a larger
than usual amount of shrinkage.
 
8. The company estimates bad debt expense to be 1% of credit sales. Assume all sales are
made on credit.
 
9. A company with net assets of $100,000 was purchased for $140,000 one year ago. The
current fair value of the company is 110,000. Perform a goodwill impairment test and
record an impairment entry if one is needed. 
 
Find the Adjusted Trial Balance, Income Statement, Statement of Owner's Equity and Balance Sheet.
 
 
COMPREHENSIVE QUESTION # 9 WORKSHEET Depreciation Expense- Furniture Accumulated Depreciation-Furniture Bal. O Bal. Insurance expense Cleaning expense Bal. Bal. Cost of goods sold Inventory Unadj Bal. 25,000 Unadj Bal. 60,000 Bal. 25,000 Bal. 60,000 Bad Debt Expense Allowance for Doubtful Accounts Unadj Bal. Adj8 Unadj Bal. Bal. O Bal. Goodwill Impairment Loss Unadj Bal. 40,000 Unadj Bal. Bal. 40,000 Bal. 0. 5 of 8
Transcribed Image Text:COMPREHENSIVE QUESTION # 9 WORKSHEET Depreciation Expense- Furniture Accumulated Depreciation-Furniture Bal. O Bal. Insurance expense Cleaning expense Bal. Bal. Cost of goods sold Inventory Unadj Bal. 25,000 Unadj Bal. 60,000 Bal. 25,000 Bal. 60,000 Bad Debt Expense Allowance for Doubtful Accounts Unadj Bal. Adj8 Unadj Bal. Bal. O Bal. Goodwill Impairment Loss Unadj Bal. 40,000 Unadj Bal. Bal. 40,000 Bal. 0. 5 of 8
COMPREHENSIVE QUESTION # 9 WORKSHEET General Ledger (starting with balances from unadjusted trial balance) Accounts Payable Cash Unadj Bal. 23,400 19,900 Unadj Bal. Bal. 23,400 19,900 Bal. Accounts Receivable Utilities Payable Unadj Bal. 22,000 600 Unadj Bal. Bal. 22,000 600 Bal. Office Supplies Unearned Revenue Unadj Bal. 5,000 38,000 Unadj Bal. Bal. 5,000 38,000 Bal. Prepaid Insurance Common Stock Unadj Bal. 3,000 100,000 Unadj Bal. Bal. 3,000 100,000 Bal. Land Dividends Unadj Bal. 24,000 Unadj Bal. 4,000 Bal. 24,000 Bal. 4,000 Furniture Sales or Service Revenue Unadj Bal. 20,000 76,900 Unadj Bal. Bal. 20,000 76,900 Bal. Utilities Expense 1,000 Salary Expense Undadj 6,000 Unadj Bal. Bal. 6,000 Bal. 1,000 Supplies Expense Rent Expense Unadj Bal. 2,000 Bal. Bal. 2,000 4 of 8
Transcribed Image Text:COMPREHENSIVE QUESTION # 9 WORKSHEET General Ledger (starting with balances from unadjusted trial balance) Accounts Payable Cash Unadj Bal. 23,400 19,900 Unadj Bal. Bal. 23,400 19,900 Bal. Accounts Receivable Utilities Payable Unadj Bal. 22,000 600 Unadj Bal. Bal. 22,000 600 Bal. Office Supplies Unearned Revenue Unadj Bal. 5,000 38,000 Unadj Bal. Bal. 5,000 38,000 Bal. Prepaid Insurance Common Stock Unadj Bal. 3,000 100,000 Unadj Bal. Bal. 3,000 100,000 Bal. Land Dividends Unadj Bal. 24,000 Unadj Bal. 4,000 Bal. 24,000 Bal. 4,000 Furniture Sales or Service Revenue Unadj Bal. 20,000 76,900 Unadj Bal. Bal. 20,000 76,900 Bal. Utilities Expense 1,000 Salary Expense Undadj 6,000 Unadj Bal. Bal. 6,000 Bal. 1,000 Supplies Expense Rent Expense Unadj Bal. 2,000 Bal. Bal. 2,000 4 of 8
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