FUND.ACCT.PRIN.
25th Edition
ISBN: 9781260247985
Author: Wild
Publisher: RENT MCG
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Chapter 1, Problem 13E
To determine
Introduction: The financial statements of a company include a
To identify: The transaction that best suits the explanation.
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Activity: Following are the accounting transactions relating to Mr. P’s business. Use the accounting equation to show their effect on his assets, liabilities and capital.
Purchased goods from A on credit 5,000
Sold goods for cash 10,000
Paid to A 2,000
Sold goods to B on credit 3,000
Paid into Bank 6,000
Paid to A by cheque 1,000
Received from B a cheque for 2,000
C. Comparative Financial data for the two companies are shown below:
Cash
Accounts Receivable
Inventories
Prepaid Expenses
Other Assets (net)
Current Liabilities
Mortgage Payable
Owner's Equity
Sales (all on credit)
Gross Profit rate on Sales
Number of Business days, 360
TIKTAK CORP.
P67,832
a. Inventory Turnover
b. Average age of inventory
c. Accounts receivable turnover
84,480
71,280
12,000
353,388
126,694
50,000
412,286
844,800
32.5%
METATA CORP.
P 17,100
27,600
26,496
3,000
173,124
48,392
100,000
98,928
165,600
20%
Required:
1. Determine which of the two companies has the more liquid current assets by developing the
following ratios:
d. Average collection period
2. Determine which of the two companies has the more total liquid assets.
3. Determine which of the two companies is generally more stable.
The following table shows the effects of transactions through 5 on the assets, liabilities, and equity of Mulan's Boutique. Match each
transaction with its probable description.
1.
2.
3.
4.
5.
1
Cash
$ 28,000 +
4,700
3.
4.
5.
Transaction
1.
0
0
1,070
2,250
$ 24,480
A
Assets
Accounts
Receivable
$ 0
0
0
2,250
0
2,250
$ 0
715
Supplies
$ 3,700
0
1,070
0
0
$ 4,770
Description
+++
Land
$ 22,500
4,700
0
0
0
0
$ 27,200
Liabilities
+
+
Accounts Payable +
$0
0
1,070
0
1,070
0
$ 0
Equity
Mulan,
Capital
$ 54,200 +
10
0
0
0
0
$ 54,200
Revenues
0
0
2,250
0
0
$ 2,250
Chapter 1 Solutions
FUND.ACCT.PRIN.
Ch. 1 - Prob. 1QSCh. 1 - Prob. 2QSCh. 1 - Prob. 3QSCh. 1 - Prob. 4QSCh. 1 - Prob. 5QSCh. 1 - Prob. 6QSCh. 1 - This icon highlights assignments that enhance...Ch. 1 - Prob. 8QSCh. 1 - Prob. 9QSCh. 1 - Prob. 10QS
Ch. 1 - Prob. 11QSCh. 1 - Identifying items with financial statements P2...Ch. 1 - P2
Classify each of the following items as...Ch. 1 - P2
Classify each of the following items as assets...Ch. 1 - Preparing an income statement P2...Ch. 1 - Prob. 16QSCh. 1 - Prob. 17QSCh. 1 - Prob. 18QSCh. 1 - Prob. 19QSCh. 1 - Prob. 20QSCh. 1 - Prob. 21QSCh. 1 - Prob. 1ECh. 1 - Exercise 1-2 Identifying accounting users and uses...Ch. 1 - Prob. 3ECh. 1 - Prob. 4ECh. 1 - Prob. 5ECh. 1 - Prob. 6ECh. 1 - Prob. 7ECh. 1 - Prob. 8ECh. 1 - Prob. 9ECh. 1 - Prob. 10ECh. 1 - Prob. 11ECh. 1 - Prob. 12ECh. 1 - Prob. 13ECh. 1 - Prob. 14ECh. 1 - Prob. 15ECh. 1 - Prob. 16ECh. 1 - Prob. 17ECh. 1 - Prob. 18ECh. 1 - Prob. 19ECh. 1 - Prob. 20ECh. 1 - Prob. 21ECh. 1 - Prob. 22ECh. 1 - Prob. 23ECh. 1 - Prob. 24ECh. 1 - Prob. 25ECh. 1 - Prob. 1PSACh. 1 - Prob. 2PSACh. 1 - Prob. 3PSACh. 1 - Prob. 4PSACh. 1 - Prob. 5PSACh. 1 - Prob. 6PSACh. 1 - Prob. 7PSACh. 1 - Prob. 8PSACh. 1 - Prob. 9PSACh. 1 - Prob. 10PSACh. 1 - Prob. 11PSACh. 1 - Prob. 1PSBCh. 1 - Prob. 2PSBCh. 1 - Prob. 3PSBCh. 1 - Prob. 4PSBCh. 1 - Prob. 5PSBCh. 1 - Prob. 6PSBCh. 1 - Prob. 7PSBCh. 1 - Prob. 8PSBCh. 1 - Prob. 9PSBCh. 1 - Prob. 10PSBCh. 1 - Prob. 11PSBCh. 1 - On October 1. 2019, Santana Rev launched a...Ch. 1 - Prob. 1AACh. 1 - Prob. 2AACh. 1 - Prob. 3AACh. 1 - Prob. 1DQCh. 1 - Technology is increasingly used to process...Ch. 1 - Prob. 3DQCh. 1 - What are at least three questions business owners...Ch. 1 - Prob. 5DQCh. 1 - Describe the internal role of accounting for...Ch. 1 - Identify three type of services typically offered...Ch. 1 - Prob. 8DQCh. 1 - Why is accounting described as a service activity?Ch. 1 - What are some accounting-related professions?Ch. 1 - Prob. 11DQCh. 1 - Prob. 12DQCh. 1 - Prob. 13DQCh. 1 - A business reports its own office stationary on...Ch. 1 - Why is the revenue recognition principle needed?...Ch. 1 - Prob. 16DQCh. 1 - Prob. 17DQCh. 1 - What events or transactions change equity?Ch. 1 - Prob. 19DQCh. 1 - What do accountants mean by the term revenue?Ch. 1 - 21. Define net income and explain its...Ch. 1 - Identify the four basics financial statements of a...Ch. 1 - Prob. 23DQCh. 1 - 24. Give two examples of expenses a business might...Ch. 1 - Prob. 25DQCh. 1 - Prob. 26DQCh. 1 - Prob. 27DQCh. 1 - Prob. 28DQCh. 1 - Prob. 1BTNCh. 1 - Prob. 2BTNCh. 1 - Visit the EDGAR database at SEC.gov. Access the...Ch. 1 - Prob. 4BTN
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