Financial Accounting
15th Edition
ISBN: 9781337272124
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 1, Problem 3E
a)
To determine
Identify the given transactions and their associated entities.
b)
To determine
Explain the business transaction.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Big Sky Sports sells hunting and fishing equipment and provides guided hunting and fishing
trips. Big Sky Sports is owned and operated by Joe Flannery, a well-known sports enthusiast
and hunter. Joe's wife, Pam, owns and operates Glacier Boutique, a women's clothing store
Joe and Pam have established a trust fund to finance their children's college education. The
trust fund is maintained by Kalispell State Bank in the name of the children, Trey and Brooke
a. For each of the following transactions, identify which of the entities listed should
record the transaction in its records:
Entities
Glacier Boutique
G
Kalispell State Bank
Big Sky Sports
К
В
X
None of the above
1. Pam deposited a $2,000 personal check in the trust fund at Kalispell State Bank
2. Pam purchased two dozen spring dresses from a Spokane designer for a special
spring sale
3. Joe paid a breeder's fee for an English Springer Spaniel to be use
guide dog
4. Pam authorized the trust fund to purchase mutual fund shares
as a…
Big Sky Sports sells hunting and fishing equipment and provides guided hunting and fishingtrips. Big Sky Sports is owned and operated by Joe Flannery, a well-known sports enthusiastand hunter. Joe’s wife, Pam, owns and operates Glacier Boutique, a women’s clothing store.Joe and Pam have established a trust fund to finance their children’s college education. Thetrust fund is maintained by Kalispell State Bank in the name of the children, Trey and Brooke.a. For each of the following transactions, identify which of the entities listed shouldrecord the transaction in its records:
1. Pam deposited a $2,000 personal check in the trust fund at Kalispell State Bank.2. Pam purchased two dozen spring dresses from a Spokane designer for a specialspring sale.3. Joe paid a breeder’s fee for an English Springer Spaniel to be used as a huntingguide dog.4. Pam authorized the trust fund to purchase mutual fund shares.5. Joe paid a local doctor for his annual physical, which was required by the…
Business entity conceptBig Sky Sports sells hunting and fishing equipment and provides guided hunting and fishing trips. Big Sky Sports is owned and operated by Joe Flannery, a well-known sports enthusiast and hunter. Joe’s wife, Pam, owns and operates Glacier Boutique, a women's clothing store. Joe and Pam have established a trust fund to finance their children's college education. The trustfund is maintained by Kalispell State Bank in the name of the children, Trey and Brooke.
a. For each of the following transactions, identify which of the entities listed should record the transaction in its records:
Entities
G
Glacier Boutique
K
Kalispell State Bank
B
Big Sky Sports
X
None of the above
1. Pam deposited a $2,000 personal check in the trust fund at Kalispell State Bank.2. Pam purchased two dozen spring dresses from a Spokane designer for a special spring sale.3. Joe paid a breeder's fee for an English Springer Spaniel to be used as a hunting guide dog.4. Pam authorized…
Chapter 1 Solutions
Financial Accounting
Ch. 1 - Prob. 1DQCh. 1 - Prob. 2DQCh. 1 - Prob. 3DQCh. 1 - Josh Reilly is the owner of Dispatch Delivery...Ch. 1 - On July 12, Reliable Repair Service extended an...Ch. 1 - Prob. 6DQCh. 1 - Describe the difference between an account...Ch. 1 - A business had revenues of 679,000 and operating...Ch. 1 - A business had revenues of 640,000 and operating...Ch. 1 - The financial statements are interrelated. (a)...
Ch. 1 - On February 3, Clairemont Repair Service extended...Ch. 1 - On March 31, Higgins Repair Service extended an...Ch. 1 - Terry Fleming is the owner and operator of...Ch. 1 - Fritz Evans is the owner and operator of...Ch. 1 - Bridgeport Delivery Service is owned and operated...Ch. 1 - Interstate Delivery Service is owned and operated...Ch. 1 - The revenues and expenses of Adventure Travel...Ch. 1 - The revenues and expenses of Sentinel Travel...Ch. 1 - Using the income statement for Adventure Travel...Ch. 1 - Using the income statement for Sentinel Travel...Ch. 1 - Using the following data for Adventure Travel...Ch. 1 - Using the following data for Sentinel Travel...Ch. 1 - A summary of cash flows for Adventure Travel...Ch. 1 - A summary of cash flows for Sentinel Travel...Ch. 1 - The following data were taken from Mesa Companys...Ch. 1 - The following data were taken from Alvarado...Ch. 1 - The following is a list of well-known companies:...Ch. 1 - A fertilizer manufacturing company wants to...Ch. 1 - Prob. 3ECh. 1 - Prob. 4ECh. 1 - The total assets and total liabilities (in...Ch. 1 - Determine the missing amount for each of the...Ch. 1 - Annie Rasmussen is the owner and operator of Go44,...Ch. 1 - Indicate whether each of the following is...Ch. 1 - Describe how the following business transactions...Ch. 1 - Prob. 10ECh. 1 - Indicate whether each of the following types of...Ch. 1 - The following selected transactions were completed...Ch. 1 - Teri West operates her own catering service....Ch. 1 - The income statement of a proprietorship for the...Ch. 1 - Four different proprietorships, Jupiter, Mars,...Ch. 1 - From the following list of selected items taken...Ch. 1 - From the following list of selected items taken...Ch. 1 - Financial information related to Udder Products...Ch. 1 - Dairy Services was organized on August 1, 2019. A...Ch. 1 - One item is omitted in each of the following...Ch. 1 - Prob. 21ECh. 1 - Prob. 22ECh. 1 - Indicate whether each of the following activities...Ch. 1 - A summary of cash flows for Ethos Consulting Group...Ch. 1 - We-Sell Realty, organized August 1, 2019, is owned...Ch. 1 - Prob. 26ECh. 1 - Prob. 27ECh. 1 - On June 1 of the current year, Chad Wilson...Ch. 1 - The amounts of the assets and liabilities of...Ch. 1 - Seth Feye established Reliance Financial Services...Ch. 1 - Prob. 4PACh. 1 - DLite Dry Cleaners is owned and operated by Joel...Ch. 1 - The financial statements at the end of Wolverine...Ch. 1 - Amy Austin established an insurance agency on...Ch. 1 - The amounts of the assets and liabilities of...Ch. 1 - Jose Loder established Bronco Consulting on August...Ch. 1 - On April 1, 2019, Maria Adams established Custom...Ch. 1 - Bevs Dry Cleaners is owned and operated by Beverly...Ch. 1 - The financial statements at the end of Atlas...Ch. 1 - Peyton Smith enjoys listening to all types of...Ch. 1 - Marco Brolo is one of three partners who own and...Ch. 1 - Colleen Fernandez, president of Rhino Enterprises,...Ch. 1 - Prob. 4CPCh. 1 - Prob. 5CPCh. 1 - Prob. 6CP
Knowledge Booster
Similar questions
- Henry O’Donnell created an Inter Vivos trust fund. He owns a large department store in Higgins, Utah. He also owns a tract of land adjacent to the store used as an extra parking lot when the store is having a sale and during the Christmas season. O’Donnell expects the land to appreciate in value and eventually be sold for an office complex or additional stores. O’Donnell places this land into a charitable lead trust, which will hold the land for 10 years until O’Donnell’s son is 21. At that time, title will transfer to the son. The store will pay rent to use the land during the interim. The income generated each year from this usage will be given to a local church. The land is currently valued at $320,000. During the first year of this arrangement, the trustee records the following cash transactions: Prepare all journal entries for this trust fund including the entry to create the trust.arrow_forwardHenry O’Donnell created an inter vivos trust fund. He owns a large department store in Higgins, Utah. He also owns a tract of land adjacent to the store used as an extra parking lot when the store is having a sale and during the Christmas season. O’Donnell expects the land to appreciate in value and eventually be sold for an office complex or additional stores.O’Donnell places this land into a charitable lead trust, which will hold the land for 10 years until O’Donnell’s son is 21. At that time, title will transfer to the son. The store will pay rent to use the land during the interim. The income generated each year from this usage will be given to a local church. The land is currently valued at $320,000.During the first year of this arrangement, the trustee records the following cash transactions: Cash inflows:Rental income . . . . . . . . . . . . . $60,000Cash outflows:Insurance . . . .. . . . . . . . . . . . . . $ 4,000Property taxes . . . . . . . . . . . . . . . . 6,000Paving…arrow_forwardAmanda graduated summa cum laude in marketing from State University. As an honor student, she was a member of Beta Gamma Sigma, an honorary business fraternity. She has agreed to donate $250,000 to State University if it uses the proceeds to build a fraternity house for Beta Gamma Sigma. In addition, she has agreed to donate the money only if it is deductible as a charitable contribution. Determine whether Amanda’s donation qualifies as a charitable contribution.arrow_forward
- Karen White helped organize a charity fund to help cover the medical expenses of a friend of hers who was seriously injured in a bicycle accident. The fund was named Vicky Hill Recovery Fund (VHRF). Karen contributed $1,000 of her own money to the fund. The $1,000 was paid to WKUX, a local radio station that designed and played an advertising campaign to educate the public as to the need for help. The campaign resulted in the collection of $20,000 cash. VHRF paid $12,000 to Mercy Hospital to cover Vicky's outstanding hospital cost. The remaining $8,000 was contributed to the National Cyclist Fund. Required Identify the entities that were mentioned in the scenario and explain what happened to the cash accounts of each entity that you identify. Entities Mentioned Vicky Hill Recovery Fu Karen White Effect On Cash for cash contributions, $21,000 for payment of advertising, $1,000 payment for hospital bills, $12,000 for donation to National Cyclist Fund, $8,000 by contribution, $1,000arrow_forwardKaren White helped organize a charity fund to help cover the medical expenses of a friend of hers who was seriously injured in a bicycle accident. The fund was named Vicky Hill Recovery Fund (VHRF). Karen contributed $1,000 of her own money to the fund. The $1,000 was paid to WKUX, a local radio station that designed and played an advertising campaign to educate the public as to the need for help. The campaign resulted in the collection of $20,000 cash. VHRF paid $12,000 to Mercy Hospital to cover Vicky's outstanding hospital cost. The remaining $8,000 was contributed to the National Cyclist Fund. Required Identify the entities that were mentioned in the scenario and explain what happened to the cash accounts of each entity that you identify. Entities Mentioned Vicky Hill Recovery Fund Karen White WKUX Public Mercy Hospital National Cyclist Fund Increase Decrease Effect On Cash for cash contributions, $21,000 for payment of advertising, $1,000 ayment for hospital bills, $12,000 or…arrow_forwardMr. Madoff decides to form an animal shelter for dogs and cats. On May 1, (the Happiest day in my mom's life), he made the following transactions: 1. On 5/1, he invested $350,000.00 of his own funds to form Redemption Services, LLC. He also borrows $100,000.00 from Chase Bank and he deposits the cash into the business. He deposits all of the funds into the First Redemption Bank. 2. On 5/1, he paid $9,600.00 for insurance for 12 months. 3. On 5/1, he paid $21,000 for a security system on Account. The equipment has a 3-year useful life and a salvage value of $3,000.00. In addition, it costs $500.00 per month for the monitoring service. 4. On 5/2, he paid $3,000.00 for rent for the month. 5. On 5/3, he paid $1,500.00 for dog and cat food. 6. On 5/5, he bought $2,450.00 of pet supplies on Account. 7. On 5/10, he transfers $75,000.00 to Pope Francis Bank. 8. On 5/12, he transfers $1,000.00 to form a petty cash account. 9. On 5/14, he paid out $2,500.00 in wages to his employees. Employees…arrow_forward
- Shuan is a huge college football fan. In the past, he has always bought football tickets on the street from ticket scalpers. This year he decided to join the university’s ticket program, which require a $2,000 contribution to the university for the “right” to purchase tickets. Shaun will then pay $400 per season ticket. He understands that the price paid for the season tickets is not tax deductible as a charitable contribution. However, contribution to a university is typically tax deductible. use an available tax service to determine how much, if any, of Shaun’s $2,000 contribution for the right to purchase ticket is tax deductible. Write a memo communicating the results of your research.arrow_forwardHeather and Dan Holt met while both were employed in the interior trim and upholstery department of an auto manufacturer. After their marriage, they decided to earnsomeextra income by doing small jobs involving canvas, vinyl, and upholstered products. Their work was considered excellent, and at the urging of their customers, they decided to go into business for themselves, operating out of the basement of the house they owned. To do this, they invested $120,000 cash in their business. They spent $10,500 for a sewing machine (expected life 10 years) and $12,000 for other miscelianeous tools and equipment (expected life 5 years). They undertook only custom work, with the customers purchasing the required materials, to avoid stocking any inventory other than supplies. Generally, they required an advance deposit on all jobs. The business seemed successful from the start, as the Holts received orders from many customers. But they felt something was wrong. They worked hard and charged…arrow_forwardNatalie Bryan, a single adult who lives at 425 Flathead Way, Kalispell, Montana 59901, has three adult children (Daniel Bryan, Amanda Green, and Samantha Cruz). During the year, Natalie makes the following gifts to the children: To Daniel. Office building, I Helena acquired in 2011 at a cost of $900,000, current value $1,900,000. To Amanda. Rental cabins in Whitefish inherited in 2009 (value $1,000,000) from her father, current value $1,800,000. To Samantha. Vacation lodge on Flathead Lake acquired in 2015 at a cost of $800,000, current value $1,900,000. Requirements: Prepare 2022 gift tax return (Form 709) for Natalie (Social Security number 112-45-6787) to compute the total taxable gifts (line 3) for her; stop with line 3 of page 1, but complete page 2 and 3 of the return. Natalie made no taxable gifts in prior years.arrow_forward
- Mulroy Inc. is a company that owns 5 car dealerships. On October 25, 2021 the owner, Jack Mulroy pledged to contribute a new Ford Explorer to a local charity’s raffle for their annual fundraiser. The fundraiser will be held on November 30, 2021 at which time the car will be delivered to the winner of the raffle. Mulroy, Inc. delivered the Ford Explorer as pledged to the winner on November 30, 2021. The accountant for Mulroy is unsure if the Contribution should be recognized as an expense in October when the pledge was made or in November when the car was delivered. Accounting Issue: When should Mulroy recognize the contribution? Your Interpretation of the Guidance: Mulroy Inc. should recognize the contribution in October 2021 November 2021arrow_forwardLisa Duncan, a junior in college, has been seeking ways to earn extra spending money. As an active sports enthusiast, Lisa plays tennis regularly at the Phoenix Tennis Club, where her family has a membership. The president of the club recently approached Lisa with the proposal that she manage the club’s tennis courts. Lisa’s primary duty would be to supervise the operation of the club’s 4 indoor and 10 outdoor courts, including courtreservations. In return for her services, the club would pay Lisa $325 per week, plus Lisa could keep whatever she earned from lessons. The club and Lisa agreed to a one-month trial, after which both would consider an arrangement for the remaining two years of Lisa’s college career. On this basis, Lisa organized Serve-N-Volley. During September 2019, Lisa managed the tennis courts and entered into the following transactions:a. Opened a business account by depositing $950.b. Paid $300 for tennis supplies (practice tennis balls, etc.).c. Paid $275 for the…arrow_forwardI'm not understanding this. Can someone please help and explain? THANK YOU! An inter vivos trust was created by Isaac Posney. Isaac owned a large department store in Juggins, Utah. Adjacent to the store, Isaac also owned a tract of land that was used as an extra parking lot when the store was having a sale or during the Christmas season. Isaac expected the land to appreciate in value and eventually be sold for an office complex or additional stores. Isaac placed the land into a charitable lead trust, which would hold the land for ten years until Isaac's son would turn 21. At that time, title would be transferred to the son. The store will pay rent to use the land during the interim. The income generated each year from this usage will be given to a local church. The land was currently valued at $416,000. During the first year of this arrangement, the trustee recorded the following cash transactions: Cash inflow: Rental income $78,000 Cash outflows:…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Financial AccountingAccountingISBN:9781337272124Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENT
Financial Accounting
Accounting
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Individual Income Taxes
Accounting
ISBN:9780357109731
Author:Hoffman
Publisher:CENGAGE LEARNING - CONSIGNMENT