1)
Introduction:
Classes of shares:
• Shares provide partial ownership or a “share” of a corporation. There are two primary classes of shares – Equity
• Equity shares are the class of shares which carry voting rights and equity share holders are the true owners of the company as in the event of dissolution, equity shareholders get last preference in clearing the amounts invested and there is no guarantee of profits will be debited by dividend on an annual basis.
• Preference shares are the class of shares which do not carry voting rights and in the event of dissolution, preference shareholders get first preference in clearing the amounts invested and there is usually guarantee of profits will be debited by dividend on an annual basis.Convertible Preference shares are preference shares that carry the option to be converted into equity shares after certain duration.
Journal Entries
- Journal entries are the first step in recording financial transactions and preparation of financial statements.
- These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.
- Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.
To Prepare:
Record of transactions in
2)
Introduction:
Statement of
• Statement of Retained Earnings is a reconciliatory statement prepared to track the changes in the net balance of retained earnings.
• Statement of Retained Earnings seeks to reconcile the difference between the opening and closing balance of the retained earnings.
• The statement records the opening balance, net income for the year, dividends paid and closing balance of the retained earnings for the reporting period.
To Prepare:
Statement of Retained Earnings
3)
Introduction:
Statement of
• An essential element of the
• When shares are issued, the par value is recorded in the Paid in capital account and if shares are issued at a price greater than the par value, they are said to be issued at a premium. This premium on issue is recorded in the Excess of Paid in Capital over Par value account.
• Retained earnings are the balance of net income for the period after deduction of operating and revenue expenses.
To Prepare:
Statement of Stockholders equity
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Chapter 13 Solutions
Horngren's Accounting
- Custom Cabinetry has one job in process (Job 120) as of June 30; at that time, its job cost sheet reports direct materials of $7,000, direct labor of $3,400, and applied overhead of $2,890. Custom Cabinetry applies overhead at the rate of 85% of direct labor cost. During July, Job 120 is sold (on credit) for $26,000, Job 121 is started and completed, and Job 122 is started and still in process at the end of July. Custom Cabinetry incurs the following costs during July. Job 120 Direct materials used Direct labor used $ 2,300 3,400 Job 121 $ 7,100 4,700 Job 122 $ 2,600 3,700 1. Prepare journal entries for the following July transactions and events a through e. a. Direct materials used. b. Direct labor used. c. Overhead applied. d. Sale of Job 120. e. Cost of goods sold for Job 120. Hint. Job 120 has costs from June and July. 2. Compute the July 31 balances of the Work in Process Inventory and the Finished Goods Inventory accounts. (There were no jobs in Finished Goods Inventory at June…arrow_forwardIn 2014, LL Bean sold 450,000 pairs of boots. At one point in 2014, it had a back order of 100,000. In 2015, LL Bean expects to sell 500,000 pairs of boots. As of late November 2015, it has a back order of 50,000.Question: When would LL Bean see sales revenue from the sale of its back order on the boots?arrow_forwardHelp me to solve this questionsarrow_forward
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- Nonearrow_forwardWhat was her capital gains yield? General accountingarrow_forwardL.L. Bean operates two factories that produce its popular Bean boots (also known as "duck boots") in its home state of Maine. Since L.L. Bean prides itself on manufacturing its boots in Maine and not outsourcing, backorders for its boots can be high. In 2014, L.L. Bean sold about 450,000 pairs of the boots. At one point during 2014, it had a backorder level of about 100,000 pairs of boots. L.L. Bean can manufacture about 2,200 pairs of its duck boots each day with its factories running 24/7. In 2015, L.L. Bean expects to sell more than 500,000 pairs of its duck boots. As of late November 2015, the backorder quantity for Bean Boots was estimated to be about 50,000 pairs. Question:arrow_forward
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