Quick Cleaners, Incorporated (QCI), has been in business for several years. It specializes in cleaning houses but has somesmall business clients as well.a. Issued $14,000 of QCI stock for cash.b. Incurred $650 of utilities costs this month and will pay them next month.c. Incurred and paid wages for the current month, totaling $1,800.d. Performed cleaning services on account worth $2,850.e. Some of Quick Cleaners's equipment was repaired at a total cost of $234. The company paid the full amount at the timethe repair work was done.Required:1. Prepare journal entries for the above transactions, which occurred during a recent month.2. Determine QCI's preliminary net income.

Account means the systematic record of various transactions entered by businesses. Income statement…

Answered: Quick Cleaners, Incorporated (QCI), has…

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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The Brick Company had cash sales of $226,200 for Year 1, its first year of operation. On April 2, the company purchased 164 units of inventory at $175 per unit. On September 1, an additional 123 units were purchased for $193 per unit The company had 68 units on hand at the end of the year. The company's income tax rate is 40 percent All transactions are cash transactions. Required a. The preceding paragraph describes five accounting events: (1) a sales transaction, (2) the first purchase of inventory, (3) a second purchase of inventory, (4) the recognition of cost of goods sold expense, and (5) the payment of income tax expense. Record the amounts of each event in horizontal statements models like the following ones, assuming first a FIFO and then a LIFO cost flow b. Compute net income using FIFO. c. Compute net income using LIFO.
1. Adriana Diaz invested $50,000 cash to start an appliance repair business. 2. Hired an employee to be paid $400 per week, starting tomorrow. 3. Paid two years’ rent in advance, $7,200. 4. Paid the worker’s weekly wage. 5. Recorded revenue earned and received for the week, $1,500
Toren Inc. employs one person to run its solar management company. The employee’s gross income for the month of May is $8,000. Payroll for the month of May is as follows: FICA Social Security tax rate at 6.2%, FICA Medicare tax rate at 1.45%, federal income tax of $440, state income tax of $80, health-care insurance premium of $210, and union dues of $50. The employee is responsible for covering 30% of his or her health insurance premium. A. Record the journal entry to recognize employee payroll for the month of May, dated May 31, 2017. Round your answers to the nearest whole dollar. If an amount box does not require an entry, leave it blank. May 31 B. Record remittance of the employee's salary with cash on June 1. Round your answers to the nearest whole dollar. If an amount box does not require an entry, leave it blank. June 1
Journal entries?
Griffin Air Transport Service, Incorporated, providing air delivery service for businesses, has been in operation for three years. The following transactions occurred in February: February 1 Paid $235 for rent of hangar space in February. February 2 Purchased fuel costing $570 on account for the next flight to Dallas. February 4 Received customer payment of $850 to ship several items to Philadelphia next month. February 7 Flew cargo from Denver to Dallas; the customer paid $860 for the air transport. February 10 Paid $190 for an advertisement in the local paper to run on February 19. February 14 Paid pilot $2,400 in wages for flying in January (recorded as expense in January). February 18 Flew cargo for two customers from Dallas to Albuquerque for $4,200; one customer paid $1,100 cash and the other asked to be billed. February 25 Purchased on account $2,630 for a supply of spare parts for the planes. February 27 Declared a $150 cash dividend to be paid in March. Required: Prepare…
Safe Home provides house-sitting for people while they are away on vacation. Some of its customers pay immediately after the job is finished. Some customers ask that the business send them a bill. As of the end of the year, Safe Home has collected $1,130 from cash-paying customers. Safe Home's remaining customers owe the business $320. Safe Home recorded $1,130 of service revenue for the year. Cash basis If Safe Home had recorded their service revenue using the other method, how much service revenue would they have recorded for the year? Splendid Occasions received $2,080 for services to be performed for the next 8 months on March 31 and recorded this transaction using the Unearned Revenue account. Accrual basis If Splendid Occasions had recorded their service revenue using the other method, how much service revenue would they have recorded for the year?
Jear's Finess Club provides monthly memberships as well as personal training sessions. The personal trainers eam 50% of the revenue for all personal training sessions. The Feness Club also sels nutrition products. Jean's general ledger accounts indicate the following for the year. The front desk staff wages expense remains the same throughout the year Account Membership revenue Personal training revenue Product sales Amount $143.000 $76.000 $60.000 $35.000 $13,000 OA $214,000 OB. $393,000 OC. $181,000 OD. $287.000 Account Personal trainer wages expense Space rental expense Straight line depreciation expense Rental insurance expense Cost of product sold Front desk staff wages expense If a contribution margin income statement is prepared for the year, what is operating income? Anount $11,000 $4,000 $3,000
Sam Winchstone operates a concrete repair business. His condensed income statement for fiscal December 31, 2021 is shown below: Sales $202,000 Cost of Goods Sold (89,000) Gross Profit 113,000 Operating Expenses (41,000) Employee Bonus (8,000) Convention Costs (6,200) Loss on Sale of Assets (3,400) Net Income $54,400 Other Information: 1. Operating expenses include a $3,000 penalty to a customer for a delay in completing a contract, $6,500 in amortization expense, a $4,500 golf membership for Sam that he uses mainly for clients and $2,600 in meals and entertainment costs. 2. Operating expenses also include $25,000 in wages to his 15 year old brother, Dean. Dean came in on Saturdays to help file paperwork. Sam could have hired an experienced adult from a temporary agency for $4,000. Dean was the only employee for the business for the year. 3. The employee bonus will be paid to Sam on January 31, 2022. 4. Sam travelled to Montreal to attend the Canadian Home Renovators convention where he…
During the month of September, the Bridge City Go-Kart Company had the following business activities: a. On September 1, paid rent on the track facility for six months at a total cost of $25,200. b. On September 1, received $81,000 for season tickets for 12-month admission to the racetrack. c. On September 1, booked the racetrack for a private organization that will use the track one day per month for $8.500 each time, to be paid in the following month. The organization uses the track on September 30. d. On September 1, hired a new manager at a monthly salary of $6.900, to be paid the first Monday following the end of the month. Required: First prepare the journal entry, if any, required to record each of the initial business activities on September 1. Then, prepare the adjusting journal entries, if any, required on September 30. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Shadder is a small company that manufactures knitwear products. It employs approximately 120 staff, all of whom are paid by bank transfer. Permanent factory staff are paid on a weekly basis based on the number of hours worked as evidenced by clock cards. Administration and sales staff are paid a monthly salary. The two directors of the company are also paid a monthly salary. Sales staff are paid a quarterly bonus calculated on the basis of sales. Directors are paid an annual bonus based on profits. During peak production seasons, temporary factory staff are hired through an agency and are paid on a weekly basis, based on their output. Supervisors at Shadder authorise documentation indicating the number of items produced by temporary staff. The agency is then paid by bank transfer and it is responsible for paying the temporary staff and for the deduction of tax and national insurance. You will be performing the audit of the financial statements for the year ending 31 March 2021 and you…
TIMO Ltd sells electronic components to various retailers. For the year 20X1 the following transactions were documented: One of their customers, MIA Ltd ordered 1,000 components on March the 1st for EUR 200 per unit. TIMO Ltd delivered the goods on March 15th and sent an invoice the next day. The cost per unit sold was EUR 120. At the end of the year the accountants got information that TIMO Ltd has been experiencing financial difficulties. Despite multiple attempts to collect payment, TIMO Ltd has not paid its outstanding invoice. Another customer, SHIRIN Ltd ordered 1,500 components in November for EUR 180 per unit. An invoice was sent immediately afterwards. The cost per unit sold was EUR 120. SHIRIN Ltd paid EUR 90,000 at the beginning of December. SHIRIN Ltd is a trustworthy customer. There are no known financial problems. Emma Ltd ordered 600 components in June for EUR 190 per unit. An invoice was sent immediately afterwards. The cost per unit sold was EUR 120. At the end of the…

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