Dan Watson started a small merchandising business in Year 1. The business experienced the following events during its first year ofoperation. Assume that Watson uses the perpetual inventory system.a. Acquired $30,000 cash from the issue of common stock.b. Purchased inventory for $18,000 cash.c. Sold inventory costing $15,000 for $32,000 cash.Required:a. Record the events in a horizontal financial statements model.b. Prepare an income statement for Year 1 (use the multistep format).c. What is the amount of total assets at the end of the period?Complete this question by entering your answers in the tabs below.Required ARequired BTotal assetsRequired CWhat is the amount of total assets at the end of the period?

The accounting equation states that assets are equal to the sum of the liabilities and equity. The…

Answered: Dan Watson started 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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Powell Company began the Year 3 accounting period with $44,000 cash, $90,000 inventory. $64,000 common stock, and $70,000 retained earnings. During Year 3, Powell experienced the following events: 1. Sold merchandise costing $60,000 for $103,500 on account to Prentise Furniture Store. 2. Delivered the goods to Prentise under terms FOB destination. Freight costs were $1,100 cash. 3. Received returned goods from Prentise. The goods cost Powell $4,400 and were sold to Prentise for $6,600. 4. Granted Prentise a $3,400 allowance for damaged goods that Prentise agreed to keep. 5. Collected partial payment of $84,500 cash from accounts receivable. Required: a. Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specifically, record the amounts of the events into the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or…
4 Recreational Equipment, Inc., commonly known as REI, is an American retail and outdoor recreation services corporation. REI uses a periodic inventory system. The following are some inventory transactions for the month of May for REI: 1. REI purchased inventory on account for $5,000. Freight charges of $300 were paid in cash. 2. REI returned some of the inventory purchased in transaction (1). The cost of the inventory was $600 and REI's account was credited by the supplier. 3. Inventory costing $2,800 was sold for $5,200 in cash. Required: Please prepare the necessary journal entries to record these transactions. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet 1 2 3 4 5 Record the merchandise purchased on account for $5,000. Transaction 1a Note: Enter debits before credits. General Journal Debit Credit >
A merchandiser uses a perpetual inventory system. The beginning Retained Earnings balance of the merchandiser was $140,000. During the year, Sales Revenue amounted to $75,000, Cost of Goods Sold was $45,000, and all other expenses totaled $10,000. The company declared and paid $25,000 as dividends. The ending balance of Retained Earnings would be OA. $160,000 OB. $135,000 OC. $140,000 OD. $185,000 GOVE
Huluduey Corporation's comparative balance sheet for current assets and liabilities was as follows: Dec. 31, 2012 Dec. 31, 20Y1 $12,700 $12,400 59,500 60,200 28,600 28,300 28,000 26,000 This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the question below. Accounts receivable Inventory Accounts payable Dividends payable X Open spreadsheet Adjust net income of $120,100 for changes in operating assets and liabilities to arrive at net cash flows from operating activities. 120,300 X Feedback Check My Work Once you have calculated the changes in the current operating assets and liabilities determine what impact those changes would have on cash. For example if accounts receivable has increased from last year to this year does that mean the company has collected more cash or less cash? If accounts payable has decreased does that mean the company has more cash or less cash?
Prepare a journal entry for the following transactions of Ken Merchandising.
required: a) Prepare the Stock Ledger card using the WAC method under perpetual system. b) Calculate the total amount of purchases. c) Calculate the cost of goods sold. d) Calculate the gross profit or loss made if the selling price of the dress is $15 each. e) Calculate the amount of closing stock. please answer this question I need a help on this.
nces Required information [The following information applies to the questions displayed below.] Powell Company began the Year 2 accounting period with $40,000 cash, $86,000 inventory, $60,000 common stock, and $66,000 retained earnings. During Year 2, Powell experienced the following events: 1. Sold merchandise that cost $58,000 for $99,500 on account to Prentise Furniture Store. 2. Delivered the goods to Prentise under terms FOB destination. Freight costs were $900 cash. 3. Received returned goods from Prentise. The goods cost Powell $4,000 and were sold to Prentise for $5,900. 4. Granted Prentise a $3,000 allowance for damaged goods that Prentise agreed to keep. 5. Collected partial payment of $81,000 cash from accounts receivable. Required a. Record the events in general journal format. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list
Ayayai Depot sells mobile devices and accessories. During September, the following transactions occurred. 1. James Johnson bought a $100 gift card for his uncle Robert Johnson. 2. Sold $50 of merchandise to Samuel Johnson, who used his gift card for payment. (Omit the entry for cost of goods sold.) 3. Performed a physical count of inventory and determined the correct value of inventory should be $13,000. The unadjusted balance in the Inventory account was $10,000. Prepare the entries to record the transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Sr. No. Account Titles and Explanation Debit Credit 1. 2. 3. (To adjust inventory to physical count)
The Marchetti Soup Company entered into the following transactions during the month of June ( purchansed wwentory on account for $205,000 (assume Marchetti uses a perpetual inventory system), (2) paid $52.000 in salanes to employees tor work pertomed dunng the month; (3) sold merchandise that cost $144,000 to credit customers for $260,000, (4) collected $240,000 in cash trom ereda customers, and (5) paid suppliers of inventory $185,000. Post the above transactions to the below T-accounts. Assume that the opening balances in each of the accounts in zero except for cash, accounts receivable, and accounts payable that had opening balances of $71,000, $55,000, anvd $34,000, respectively. (Enter the transaction number in the column next to the amount.) Beg bal Beg bat End bal. End. bal. Inventory Accounts payable Beg. bal Beg bal End, bal End. bal.
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