Assets (A): Assets are those items that provide value for money and future economic benefit for an organization. In simple, it can be referred to as resources possess by a business. Example: Cash, accounts receivable , inventory. Liabilities (L): Liabilities are debt and obligations of a business. These are the claims of creditors and financial institutions against the resources of the business. Example: Accounts payable, long-term debt, and notes payable. Expenses (E): Expenses are the costs that the businesses spend to produce and sell the goods and services to the customers or clients. Example: Cost of goods sold, rent expense, and interest expense. Revenues (R): Revenues are the income or earnings that a business receives for delivering the goods and services. Example: Service revenue, interest revenue, and gain from sale of land. Stockholders’ equity (SE): Stockholders’ equity is owners’ claim on the assets. Example: Common stock and retained earnings . To identify: whether the given item is an asset (A), Liability (L), Stockholders’ equity (SE), Revenue (R), or Expense (E) item.

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Answer 1

Question

Chapter 1, Problem 1.8E

(a)

To determine

Assets (A): Assets are those items that provide value for money and future economic benefit for an organization. In simple, it can be referred to as resources possess by a business. Example: Cash, accounts receivable, inventory.

Liabilities (L): Liabilities are debt and obligations of a business. These are the claims of creditors and financial institutions against the resources of the business. Example: Accounts payable, long-term debt, and notes payable.

Expenses (E): Expenses are the costs that the businesses spend to produce and sell the goods and services to the customers or clients. Example: Cost of goods sold, rent expense, and interest expense.

Revenues (R): Revenues are the income or earnings that a business receives for delivering the goods and services. Example: Service revenue, interest revenue, and gain from sale of land.

Stockholders’ equity (SE): Stockholders’ equity is owners’ claim on the assets. Example: Common stock and retained earnings.

To identify: whether the given item is an asset (A), Liability (L), Stockholders’ equity (SE), Revenue (R), or Expense (E) item.

(b)

To determine

To prepare: An income statement for Incorporation L for the year ended December 31, 2017.

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Boxwood Company sells blankets for $39 each. The following information was taken from the inventory records during May. The company had no beginning inventory on May 1. Boxwood uses a perpetual inventory system.DateBlanketsUnitsCostMay 3Purchase21$1710Sale8 17Purchase36$1920Sale15 23Sale 30Purchase37$20Determine the gross profit for the sale of May 23 using the FIFO inventory costing method.a. $100b. $221c. $95d.$259

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Answer 2

Question

Chapter 1, Problem 1.8E

(a)

To determine

Assets (A): Assets are those items that provide value for money and future economic benefit for an organization. In simple, it can be referred to as resources possess by a business. Example: Cash, accounts receivable, inventory.

Liabilities (L): Liabilities are debt and obligations of a business. These are the claims of creditors and financial institutions against the resources of the business. Example: Accounts payable, long-term debt, and notes payable.

Expenses (E): Expenses are the costs that the businesses spend to produce and sell the goods and services to the customers or clients. Example: Cost of goods sold, rent expense, and interest expense.

Revenues (R): Revenues are the income or earnings that a business receives for delivering the goods and services. Example: Service revenue, interest revenue, and gain from sale of land.

Stockholders’ equity (SE): Stockholders’ equity is owners’ claim on the assets. Example: Common stock and retained earnings.

To identify: whether the given item is an asset (A), Liability (L), Stockholders’ equity (SE), Revenue (R), or Expense (E) item.

(b)

To determine

To prepare: An income statement for Incorporation L for the year ended December 31, 2017.

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Answer 3

Question

Chapter 1, Problem 1.8E

(a)

To determine

Assets (A): Assets are those items that provide value for money and future economic benefit for an organization. In simple, it can be referred to as resources possess by a business. Example: Cash, accounts receivable, inventory.

Liabilities (L): Liabilities are debt and obligations of a business. These are the claims of creditors and financial institutions against the resources of the business. Example: Accounts payable, long-term debt, and notes payable.

Expenses (E): Expenses are the costs that the businesses spend to produce and sell the goods and services to the customers or clients. Example: Cost of goods sold, rent expense, and interest expense.

Revenues (R): Revenues are the income or earnings that a business receives for delivering the goods and services. Example: Service revenue, interest revenue, and gain from sale of land.

Stockholders’ equity (SE): Stockholders’ equity is owners’ claim on the assets. Example: Common stock and retained earnings.

To identify: whether the given item is an asset (A), Liability (L), Stockholders’ equity (SE), Revenue (R), or Expense (E) item.

(b)

To determine

To prepare: An income statement for Incorporation L for the year ended December 31, 2017.

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Answer 4

Question

Chapter 1, Problem 1.8E

(a)

To determine

Assets (A): Assets are those items that provide value for money and future economic benefit for an organization. In simple, it can be referred to as resources possess by a business. Example: Cash, accounts receivable, inventory.

Liabilities (L): Liabilities are debt and obligations of a business. These are the claims of creditors and financial institutions against the resources of the business. Example: Accounts payable, long-term debt, and notes payable.

Expenses (E): Expenses are the costs that the businesses spend to produce and sell the goods and services to the customers or clients. Example: Cost of goods sold, rent expense, and interest expense.

Revenues (R): Revenues are the income or earnings that a business receives for delivering the goods and services. Example: Service revenue, interest revenue, and gain from sale of land.

Stockholders’ equity (SE): Stockholders’ equity is owners’ claim on the assets. Example: Common stock and retained earnings.

To identify: whether the given item is an asset (A), Liability (L), Stockholders’ equity (SE), Revenue (R), or Expense (E) item.

(b)

To determine

To prepare: An income statement for Incorporation L for the year ended December 31, 2017.

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Answer 5

Chapter 1, Problem 1.8E

(a)

To determine

Assets (A): Assets are those items that provide value for money and future economic benefit for an organization. In simple, it can be referred to as resources possess by a business. Example: Cash, accounts receivable, inventory.

Liabilities (L): Liabilities are debt and obligations of a business. These are the claims of creditors and financial institutions against the resources of the business. Example: Accounts payable, long-term debt, and notes payable.

Expenses (E): Expenses are the costs that the businesses spend to produce and sell the goods and services to the customers or clients. Example: Cost of goods sold, rent expense, and interest expense.

Revenues (R): Revenues are the income or earnings that a business receives for delivering the goods and services. Example: Service revenue, interest revenue, and gain from sale of land.

Stockholders’ equity (SE): Stockholders’ equity is owners’ claim on the assets. Example: Common stock and retained earnings.

To identify: whether the given item is an asset (A), Liability (L), Stockholders’ equity (SE), Revenue (R), or Expense (E) item.

(b)

To determine

To prepare: An income statement for Incorporation L for the year ended December 31, 2017.

Answer 6

Chapter 1, Problem 1.8E

(a)

To determine

Assets (A): Assets are those items that provide value for money and future economic benefit for an organization. In simple, it can be referred to as resources possess by a business. Example: Cash, accounts receivable, inventory.

Liabilities (L): Liabilities are debt and obligations of a business. These are the claims of creditors and financial institutions against the resources of the business. Example: Accounts payable, long-term debt, and notes payable.

Expenses (E): Expenses are the costs that the businesses spend to produce and sell the goods and services to the customers or clients. Example: Cost of goods sold, rent expense, and interest expense.

Revenues (R): Revenues are the income or earnings that a business receives for delivering the goods and services. Example: Service revenue, interest revenue, and gain from sale of land.

Stockholders’ equity (SE): Stockholders’ equity is owners’ claim on the assets. Example: Common stock and retained earnings.

To identify: whether the given item is an asset (A), Liability (L), Stockholders’ equity (SE), Revenue (R), or Expense (E) item.

Answer 7

Chapter 1, Problem 1.8E

(a)

To determine

Assets (A): Assets are those items that provide value for money and future economic benefit for an organization. In simple, it can be referred to as resources possess by a business. Example: Cash, accounts receivable, inventory.

Liabilities (L): Liabilities are debt and obligations of a business. These are the claims of creditors and financial institutions against the resources of the business. Example: Accounts payable, long-term debt, and notes payable.

Expenses (E): Expenses are the costs that the businesses spend to produce and sell the goods and services to the customers or clients. Example: Cost of goods sold, rent expense, and interest expense.

Revenues (R): Revenues are the income or earnings that a business receives for delivering the goods and services. Example: Service revenue, interest revenue, and gain from sale of land.

Stockholders’ equity (SE): Stockholders’ equity is owners’ claim on the assets. Example: Common stock and retained earnings.

To identify: whether the given item is an asset (A), Liability (L), Stockholders’ equity (SE), Revenue (R), or Expense (E) item.

Answer 8

(b)

To determine

To prepare: An income statement for Incorporation L for the year ended December 31, 2017.

Answer 9

(b)

To determine

To prepare: An income statement for Incorporation L for the year ended December 31, 2017.

Answer 10

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Answer 11

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Answer 12

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Answer 13

Ch. 1 - Prob. 1Q Ch. 1 - Prob. 2Q Ch. 1 - Prob. 3Q Ch. 1 - Accounting is ingrained in our society and is...Ch. 1 - Prob. 5Q Ch. 1 - Prob. 6Q Ch. 1 - What are the three main types of business...Ch. 1 - Prob. 8Q Ch. 1 - Prob. 9Q Ch. 1 - Prob. 10Q

Solution Summary: The author identifies assets, liabilities, stockholders' equity, revenue, or Expense (E). Assets provide value for money and future economic benefit for an organization.

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To prepare: An income statement for Incorporation L for the year ended December 31, 2017.

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