Survey Of Accounting
5th Edition
ISBN: 9781259631122
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Chapter 2, Problem 12E
Exercise 2-12 Effect of an error on financial statements
On April 1, 2018, Maine Corporation paid $18,000 cash in advance for a one-year lease on an office building. Assume that Maine records the prepaid rent as an asset and that the books are closed on December 31.
Required
a. Show the payment for the one-year lease and the related
b. Assume that Maine Corporation failed to record the adjusting entry to reflect using the office building. How would the error affect the company’s 2018 income statement and
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Question 6On 30 June, the end of its financial year, Aarav Ltd completed an age analysis of itsaccounts receivable and determined that an allowance for doubtful debts of $12 320was needed in order to report accounts receivable at their estimated collectableamount in the Balance Sheet.Required(a) Prepare the general journal entry to record bad debts expense assuming that theAllowance for Doubtful Debts account currently has a $1940 credit balance(narration not required).(b) Prepare an entry to write off an account receivable from V. Vijay for $781(narration not required).
(c) From the following information, determine the amount of cash received fromcustomers during 2019-20:Accounts receivable (30-Jun-2019) $81 000Accounts receivable (30-Jun-2020) $76 000Sales (Credit) $350 000
(d) From the following information, determine the amount of purchases for the year:Beginning inventory $ 60 000Ending inventory 90 000Cost of sales 130 000
(e) If wages expense for the year is $480 000, wages…
Answer 7-10
Question
Part A
Albert Trading Limited used the statement of financial position approach to estimate the
impairment loss of receivable. An aging of account receivable at 31 December 2019 revealed
that S68,000 of the S835,000 outstanding accounts receivable will prove uncollectible. The
Allowance for Impairment has a debit balance of $6,200 prior to adjustment.
Required:
(Explanation of the Journal Entry is not required)
Prepare an adjusting entry on 31 December 2019 to recognize the impairment loss of receivable.
Part B
On 12 January 2020, Peter Lee, a major customer, declared bankruptey, and Albert Trading,
determined that a receivable from Peter Lee in the amount of $3,400 was worthless.
Required:
(Explanation of the Journal Entry is not required)
Prepare the joumal entry required by Albert Trading in this situation.
Chapter 2 Solutions
Survey Of Accounting
Ch. 2 - 1. What does accrual accounting attempt to...Ch. 2 - 2. Define recognition. How is it independent of...Ch. 2 - 3. What does the term deferral mean?Ch. 2 - 4. If cash is collected in advance of performing...Ch. 2 - Prob. 5QCh. 2 - 6. What effect does the issue of common stock have...Ch. 2 - 7. How does the recognition of revenue on account...Ch. 2 - 8. Give an example of an asset source transaction....Ch. 2 - 9. When is revenue recognized under accrual...Ch. 2 - 10. Give an example of an asset exchange...
Ch. 2 - 11. What is the effect on the right side of the...Ch. 2 - Prob. 12QCh. 2 - Prob. 13QCh. 2 - Prob. 14QCh. 2 - Prob. 15QCh. 2 - Prob. 16QCh. 2 - 17. Why may net cash flow from operating...Ch. 2 - Prob. 18QCh. 2 - Prob. 19QCh. 2 - 20. What is the difference between a cost and an...Ch. 2 - Prob. 21QCh. 2 - Prob. 22QCh. 2 - 23. What does the term expense mean?Ch. 2 - Prob. 24QCh. 2 - 25. What is the purpose of the statement of...Ch. 2 - Prob. 26QCh. 2 - 27. Why is the balance sheet dated as of a...Ch. 2 - 28. In what order are assets listed on the balance...Ch. 2 - Prob. 29QCh. 2 - Prob. 30QCh. 2 - 31. What types of accounts are closed at the end...Ch. 2 - 32. Give several examples of period costs.Ch. 2 - 33. Give an example of a cost that can be directly...Ch. 2 - Prob. 34QCh. 2 - Prob. 1ECh. 2 - Exercise 2-2 Effect of accrued expenses on the...Ch. 2 - Prob. 3ECh. 2 - Prob. 4ECh. 2 - Prob. 5ECh. 2 - Prob. 6ECh. 2 - Prob. 7ECh. 2 - Prob. 8ECh. 2 - Exercise 2-9 Supplies on financial statements Yard...Ch. 2 - Prob. 10ECh. 2 - Exercise 2-11 Prepaid items on financial...Ch. 2 - Exercise 2-12 Effect of an error on financial...Ch. 2 - Exercise 2-13 Unearned items on financial...Ch. 2 - Prob. 14ECh. 2 - Prob. 15ECh. 2 - Prob. 16ECh. 2 - Prob. 17ECh. 2 - Prob. 18ECh. 2 - Prob. 19ECh. 2 - Prob. 20ECh. 2 - Exercise 2-21 Adjusting the accounts Norell Inc....Ch. 2 - Prob. 22ECh. 2 - Prob. 23ECh. 2 - Prob. 24ECh. 2 - Prob. 25ECh. 2 - Prob. 26ECh. 2 - Exercise 2-27 Identifying transaction type and...Ch. 2 - Exercise 2-27A Effect of accounting events on the...Ch. 2 - Prob. 29ECh. 2 - Exercise 2-29A Identifying source, use, and...Ch. 2 - Prob. 31ECh. 2 - Problem 2-32 Recording events in a horizontal...Ch. 2 - Problem 2-37A Effect of adjusting entries on the...Ch. 2 - Prob. 34PCh. 2 - Prob. 35PCh. 2 - Problem 2-36 Identifying and arranging elements on...Ch. 2 - Problem 2-37 Missing information in financial...Ch. 2 - Problem 2-38 Events for two complete accounting...Ch. 2 - Prob. 1ATCCh. 2 - ATC 2-3 Research Assignment Identifying accruals...Ch. 2 - ATC 2-4 Writing Assignment Revenue Recognition and...
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