3. Mr. Ahmad has established a small craft shop in Salalah. Presented below is two of accounting proceduresand practices in his business. For each of these items, list and explain the assumption, principle, informationcharacteristic, or modifying convention that is violated.a. Mr. Ahmad purchased a new home computer for personal use with company money, chargingmiscellaneous expense.b. A machine, that cost OMR 4,000, is reported at its current market value of OMR 4,500.

Accounting principles are general rules and guidelines that the company follows while recording and…

Answered: 3. Mr. Ahmad has established a small…

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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Helen Hernandez, president of Double H Enterprises, applied for a $175,000 loan from Great Nations Bank. The bank requested financial statements as a basis for granting the loan. Helen instructed her accountant to provide the bank with a balance sheet, but to omit the other financial statements because her business incurred a net loss last year. Helen contends that as the owner of the business, it is her right to withhold certain financial statements from the bank. Do you agree with Helen? Why or why not? What type of information would banks require from a loan applicant and why would the loan officer request this information?
Splish Corporation, which manufactures shoes, hired a recent college graduate to work in its accounting department. On the first day of work, the accountant was assigned to total a batch of invoices with the use of an adding machine. Before long, the accountant, who had never before seen such a machine, managed to break the machine. Splish Corporation gave the machine plus $388 to Blossom Business Machine Company (dealer) in exchange for a new machine. Assume the following information about the machines. Splish Corp. (Old Machine) Blossom Co. (New Machine) Machine $331 $308 Accumulated depreciation 160 –0– Fair value 97 485 For each company, prepare the necessary journal entry to record the exchange. (The exchange has commercial substance.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit Splish…
Adam and David are two entrepreneurs who agreed to form a corporation ("A&D") to operate a car repair shop in the Boston region. They began business on January 1, 2021 with the following transactions occurred during the month of January. Prepare journal entries, T-accounts, and a balance sheet as of January 31, 2021 for A&D. Organize your T-accounts by following the order of assets, liabilities, equity, revenues, and expenses. Each T-account should start with a beginning balance and end with an ending balance for each reporting period. (Note: for T-accounts, you may use a table like the one below. Create a table using the "Insert" or "Table" function in the ribbon. Cells can be merged from the "Table" function in the ribbon. You can access more format functions when you click the three dots on the right side above the text entry box.) Name of account 1 Name of account 2 Name of account 3 1. (a) Adam contributed $100,000 to A&D in exchange for 1,000 shares of A&D common stock. (b) David…
(answer in text form please (without image), Note: .Every entry should have narration please)
[The following information applies to the questions displayed below.] While completing undergraduate school work in information systems, Dallin Bourne and Michael Banks decided to start a technology support company called eSys Answers. During year 1, they bought the following assets and incurred the following start-up fees: Year 1 Assets Purchase Date Basis Computers (5-year) October 30, Year 1 $ 16,400 Office equipment (7-year) October 30, Year 1 10,000 Furniture (7-year) October 30, Year 1 5,800 Start-up costs October 30, Year 1 19,520 In April of year 2, they decided to purchase a customer list from a company providing virtually the same services, started by fellow information systems students preparing to graduate. The customer list cost $12,520, and the sale was completed on April 30. During their summer break, Dallin and Michael passed on internship opportunities in an attempt to really grow their business into something they could do full time after graduation.…
hich of the following is leakages from the circular flow in a closed economy? a. household saving and government spending b. government spending and business investment c. household saving and net taxes d. household saving and business investment
Ian bought some goods in May for $600 and sold them in the following August for $950.For the financial year ending on 30 June,which of the following statements is correct? A.Ian has expenses amounting to $600 B.Ian has assets of $600 C.Ian has revenues amounting to $950 D.Ian has a profit of $350
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Ian bought some goods in May for $600 and sold them in the following August for $950.For the financial year ending on 30 June,which of the following statements is correct? A.Ian has expenses amounting to $600 B.Ian has assets of $600 C.Ian has revenues amounting to $950 D.Ian has a profit of $350 （Why A is correct and D is incorrect?)
Jessica Grewal decided to open a food truck business, the Samosa Shack. She encountered the following transactions in managing her equipment over the first 2 years of her business. April 1, 2021 October 1, 2021 December 31, 2021 April 1, 2022 December 31, 2022 March 31, 2023 Purchased food truck for $84,000 and paid $8,400 to have a commercial oven installed. Other costs that she incurred are $8,400 for insurance on the truck for the first year, and $3,000 to have the truck painted with her Samosa Shack logo. Jessica estimates that the truck would last 5 years and have a $12,000 residual value. The oven is also expected to last 5 years and have a $600 residual value. The oven broke down and cost $1,800 to repair. Recorded the adjusting entry for depreciation and insurance. Replaced all of the tires with all-season tires for $1,800 and paid another year of insurance for $8,400. Recorded the adjusting entry for depreciation and insurance. Jessica was exhausted from the food truck…

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