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Ashford ACC 205 COMPLETE / ENTIRE / FULL CLASS

Week 1 Accounting Equation. As you have learned in this week’s readings, the Accounting Equation is Assets = Liabilities + Owners’ Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to dem
rozy's insight:

http://courseassignment.com/ashford-acc-205-complete-entire-full-class

Ashford ACC 205 ACC/205 ACC205: Principles of Accounting I COMPLETE / ENTIRE / FULL CLASS

Week 1

Accounting Equation. As you have learned in this week’s readings, the Accounting Equation is Assets = Liabilities + Owners’ Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to demonstrate the validity of the Accounting Equation.

Review several of your peers’ posts and identify some core components that you feel should be included in every transaction. Respond to at least two of your peers and provide recommendations to extend their thinking. Challenge your peers by asking a question that may cause them to reevaluate or add components to their transactions.

Accounts. What does the term account mean? What are the different classifications of accounts? How do the rules for debits and credits impact accounts? Please provide an example of how debits and credits impact accounts.

Guided Response:
Analyze several of your peers’ posts. Let at least two of your peers know if this knowledge could be used in their everyday lives. Is so, how? If not, why not?

Journal

Balance Sheet Journal. The balance sheet is a financial snap shot of a company at a particular point in time. The balance sheet lists the assets, liabilities, and equity of the company. Reflect on your personal financial situation, can you apply the concepts of the balance sheet? What did you learn from this reflection?

Basic Accounting Equations

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.

a. Recognition of normal balances. The following items appeared in the accounting records of Triguero's, a retail music store that also sponsors concerts. Classify each of the items as an asset, liability; revenue; or expense from the company's viewpoint. Also indicate the normal account balance of each item.
The albums, tapes, and CDs held for sale to customers. A long-term loan owed to Citizens Bank. Promotional costs to publicize a concert. Daily receipts for merchandise sold, Amounts due from customers,

Land held as an investment, A new fax machine purchased for office use. Amounts to be paid in 10 days to suppliers. Amounts paid to a mall for rent.

 

b. Basic journal entries. The following transactions pertain to the Jennifer Royall Company:
Apr. 1 Jennifer Royall invested cash of $15,000 and land valued at $10,000 from into the business. 5 Provided $1,200 of services to Jason Ratchford, a client, on account. 9 Paid $250 of salaries to an employee. 14 Acquired a new computer for $3,200, on account. 20 Collected $800 from Jason Ratchford for services provided on April 5. 24 Borrowed $7,500 from BestBanc by securing a six-month loan.
Prepare journal entries (and explanations) to record the preceding transactions and events.

c. Balance sheet preparation.
The following data relate to Preston Company as of December 31, 19XX:
Building $44,000 Accounts receivable $24,000
Cash 17,000 Loan payable 30,000
J. Preston, capital 65,000 Land 21,000
Accounts payable ?
Prepare a balance sheet as of December 31, 19XX.(See Exhibit 1.1 and 1.4)

d. Basic transaction processing. On November 1 of the current year, Richard Parker established a sole proprietorship. The following transactions occurred during the month:
1: Parker invested $19,000 into the business.
2: Paid $9,000 to acquire a used minivan.
3: Purchased $1,800 of office furniture on account.
4: Performed $2,100 of consulting services on account.
5: Paid $300 of repair expenses.
6: Received $800 from clients who were previously billed in item 4.
7: Paid $500 on account to the supplier of office furniture in item 3.
8: Received a $150 electric bill, to be paid next month.
9: Parker withdrew $600 from the business.
10: Received $250 in cash from clients for consulting services rendered.
Instructions
a. Arrange the following asset, liability, and owner’s equity elements of the accounting equation: Cash, Accounts Receivable, Office Furniture, Van, Accounts Payable, Investments/Withdrawals, and Revenues/Expenses. (See Exhibit 5)
b. Record each transaction on a separate line. After all transactions have been recorded, compute the balance in each of the preceding items.
c. Answer the following questions for Parker.
(1) How much does the company owe to its creditors at month-end? On which financial statement(s) would this information be found?
(2) Did the company have a “good” month from an accounting viewpoint? Briefly explain.

e. Transaction analysis and statement preparation. The transactions that follow relate to Burton Enterprises for March 20X1, the company’s first month of activity.
3/1: Joanne Burton, the owner invested $20,000 into the business.
3/4: Performed $2,400 of services on account.
3/7: Acquired a small parcel of land by paying $6,000 cash.
3/12: Received $700 from a client, who was billed previously on March 4.
3/15: Paid $800 to the Journal Herald for advertising expense.
3/18: Acquired $9,000 of equipment from Park Central Outfitters by paying $7,000 down and agreeing to remit the balance owed within the next 2 weeks, (Accounts Payable).
3/22: Received $300 cash from clients for services.
3/24: Paid $1,500 on account to Park Central Outfitters in partial settlement of the balance due from the transaction on March 18.
3/28: Rented a car from United Car Rental for use on March 28. Total charges amounted to $75, with United billing Burton for the amount due.
3/31: Paid $900 for March wages.
3/31: Processed a $600 cash withdrawal from the business for Joanne Burton.
Instructions
a. Determine the impact of each of the preceding transactions on Burton’s assets,
liabilities, and owner’s equity. See exhibit 1.5. Use the following format:
Assets = Liabilities + Owner’s Equity
Cash, Accounts Receivable, Land, Equipment Accounts Payable (+)Investments (+) Revenues
(-) Withdrawals (-) Expenses
a. Record each transaction on a separate line. Calculate balances only after the last transaction has been recorded.
b. Prepare an income statement, a statement of owner’s equity, and a balance sheet, (See Exhibit 1.1, 1.3 and 1.4)

f. Entry and trial balance preparation. Lee Adkins is a portrait artist. The following schedule represents Lee’s combined chart of accounts and trial balance as of May 31.
Account number Account name Debit Credit
110
Cash
$ 2,700
120
Accounts Receivable
12,100
130
Equipment and Supplies
2,800
140
Studio
45,000
210
Accounts Payable
$2,600
310
Lee Adkins, Owners Equity
57,400
320
Lee Adkins, Drawing
30,000
410
Revenue
39,000
510
Advertising Expense
2,300
520
Salaries Expense
2,100
540
Utilities Expense
2,000
$99,000
$99,000

The general ledger also revealed account no. 530, Legal and Accounting Expense. The following transactions occurred during June:
6/2:
Collected $7,500 on account from customers.
6/7:
Sold 25% of the equipment and supplies to a young artist for $700 for cash
6/10:
Received a $500 bill from the accountant for preparing last quarter’s financial statements.
6/15:
Paid $2,100 to creditors on account.
6/27:
Adkins withdrew $1,000 cash for personal use.
6/30:
Billed a customer $3,000 for a portrait painted this month.
a. Record the necessary journal entries for June on page 2 of the company’s general journal. (See Exhibit 2.6) b. Open running balance ledger “T” accounts by entering account titles, account num¬bers, and May 31 balances. (See exhibit 2.3 and 2.4) c. Post the journal entries to the “T” accounts. d. Prepare a trial balance as of June 30. (See exhibit 2.9)

g. Journal entry preparation
On January 1 of the current year, Peter Houston invested $100,000 cash into his company MuniServ. Shortly thereafter, the company ac¬quired selected assets of a bankrupt competitor. The acquisition included land ($15,000), a building ($40,000), and vehicles ($10,000). MuniServ paid $45,000 at the time of the transaction and agreed to remit the remaining balance due of $20,000 (an account payable) by February 15.
During January, the company had additional cash outlays for the following items:
Purchases of store equipment
$4,600
Loan payment
500
Salaries expense
2,300
Advertising expense
700

The January utilities bill of $200 was received on January 31 and will be paid on February 10. MuniServ rendered services to clients on account amounting to $9,400 and $3,700 had been received in settlement.
Instructions Present journal entries that reflect MuniServ's January transactions, starting with the $100,000 investment. (See exhibit 2.6) Compute the total debits, total credits, and ending balance that would be found in the company's Cash account. (Post to “T” Accounts, see exhibit 2.3 and 2.4) Prepare a trail balance as of January 31. (See exhibit 2.9)

WEEK 2

Accounting Cycle. Financial statements are a product of the accounting cycle. Think about two different companies: a manufacturing company, and a retail company. Why would different companies have different accounting cycles? Would you expect the steps of the accounting cycle to be the same for each company? Why, or why not?
Guided Response:
Review several of your peers’ posts and identify what steps of the accounting cycle that you feel are the most critical. Respond to at least two of your peers and provide recommendations to extend their thinking. Challenge your peers by asking a question that may cause them to reevaluate their positions on the accounting cycle.

 Bank Reconciliation. What is the purpose of a bank reconciliation? What are the reasons for differences between the cash reported in the accounting records, and the cash balance in the bank statements?
Analyze several of your peers’ posts. Let at least two of your peers know what happens to the discrepancies between the book balance and the bank balance. Could these differences just be written off?

Assignment - Revenue and Expenses.

 

Week 3

LIFO vs. FIFO. The controller of Sagehen Enterprises believes that the company should switch from the LIFO method to the FIFO method. The controller’s bonus is based on the next income. It is the controller’s belief that the switch in inventory methods would increase the net income of the company. What are the differences between the LIFO and FIFO methods?
Guided Response:
Analyze several of your peers’ posts. Let at least two of your peers know if a company is better off if it switches from a LIFO method to a FIFO method. Explain your reasoning.

Depreciation. A variety of depreciation methods are used to allocate the cost of an asset to all of the accounting periods benefited by the use of the asset. Your client has just purchased a piece of equipment for $100,000. Explain the concept of depreciation. Which of the following depreciation methods would you recommend: straight-line depreciation, double declining balance method, or an alternative method?
Guided Response:
Let at least two of your peers know if a company would use an accelerated depreciation method for their financial statements or their tax returns. Why do you believe this would be the case?
Journal
Inventory Journal. Reflect for a moment on the LIFO (Last in First Out) and FIFO (First in First Out) inventory methods. If you were starting a small manufacturing company, what inventory method do you believe would provide the most accurate financial statements? Why do you believe this is the case?

Assignment : Inventory

a. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows.

Painting                              Cost

1/2 Beginning inventory     Woods   $11,000

4/19 Purchase      Sunset   21,800

6/7 Purchase        Earth      31,200

12/16 Purchase   Moon      4,000

 

Woods and Moon were sold during the year for a total of $35,000. Determine the firm’s

a. cost of goods sold.

b. gross profit.

c. ending inventory.

b. Inventory valuation methods: basic computations. The January beginning inventory of the White Company consisted of 300 units costing $40 each. During the first quarter, purchases were:

Date                       Quantity Cost

1/15                        700                         $45

1/31                        1200                       $48

2/12                        800                         $46

2/27                        650                         $51

 

Sales during the first quarter were.

Date                       Sold

1/19                        500

2/2                          600

2/13                        500

2/28                        100

The White Company uses a perpetual inventory system.

Using the White Company data, fill in the following chart to compare the results obtained under the FIFO, LIFO, and weighted-average inventory methods.

FIFO           LIFO   Weighted Average

 

Goods available for sale                       $           $              $

Ending inventory, March 31

Cost of goods sold

c. Perpetual inventory system: journal entries. At the beginning of 20X3, Beehler Company implemented a computerized perpetual inventory system. The following transactions occurred:

•               Purchases on account: 500 units @ $4 =  $2,000

•               Sales on account: 300 units @ $5 = $1,500

•               Purchases on account: 600 units @ $5 =  $3,000

•               Sales on account: 300 units @ $5 = $1,500

a. Prepare journal entries for the above purchases and sales.

b. Calculate the balance in the firm’s Inventory account.

d. Inventory valuation methods: computations and concepts. Wave Riders Surfboard Company began business on January 1 of the current year. Below are the transactions for the year

1/3:         Purchase 100 boards  @ $125

3/17:       Sold 50 boards @ $250

4/3:         Purchase 200 boards  @ $135

5/17:       Sold 75 boards @ $250

6/3:         Purchase 100 boards  @ $145

1/3:         Purchase 100 boards  @ $155

3/17:       Sold 300 boards @ $250

1/3:         Purchase 100 boards  @ $140

Wave Riders uses a perpetual inventory system.

Instructions

a. Calculate cost of goods sold, ending inventory, and gross profit under each of the following inventory valuation methods:

•               First-in, first-out

•               Last-in, first-out

•               Weighted average

b. Which of the three methods would be chosen if management’s goal is to

(1) produce an up-to-date inventory valuation on the balance sheet?

(2) approximate the physical flow of a sand and gravel dealer?

 

e. Depreciation methods. Betsy Ross Enterprises purchased a delivery van for $30,000 in January 20X7. The van was estimated to have a service life of 5 years and a residual value of $6,000. The company is planning to drive the van 20,000 miles annually. Compute depreciation expense for 20X8 by using each of the following methods:

a. Units-of-output, assuming 17,000 miles were driven during 20X8

b. Straight-line

c. Double-declining-balance

f. Depreciation computations. Alpha Alpha Alpha, a college fraternity, purchased a new heavy-duty washing machine on January 1, 20X3. The machine, which cost $1,000, had an estimated residual value of $100 and an estimated service life of 4 years (1,800 washing cycles). Calculate the following:

a. The machine’s book value on December 31, 20X5, assuming use of the straight-line depreciation method

b. Depreciation expense for 20X4, assuming use of the units-of-output depreciation method. Actual washing cycles in 20X4 totaled 500.

c. Accumulated depreciation on December 31, 20X5, assuming use of the double-declining-balance depreciation method.

g. Depreciation computations: change in estimate. Aussie Imports purchased a specialized piece of machinery for $50,000 on January 1, 20X3. At the time of acquisition, the machine was estimated to have a service life of 5 years (25,000 operating hours) and a residual value of $5,000. During the 5 years of operations (20X3 – 20X7), the machine was used for 5,100, 4,800, 3,200, 6,000, and 5,900 hours, respectively.

Instructions

a. Compute depreciation for 20X3 – 20X7 by using the following methods: straight line, units of output, and double-declining-balance.

b. On January 1, 20X5, management shortened the remaining service life of the machine to 20 months. Assuming use of the straight-line method, compute the company’s depreciation expense for 20X5.

c. Briefly describe what you would have done differently in part (a) if Aussie Imports had paid $47,800 for the machinery rather than $50,000 In addition, assume that the company incurred $800 of freight charges $1,400 for machine setup and testing, and $300 for insurance during the first year of use.

Week 4

Current Liability. What is a current liability? From the perspective of a user of financial statements, why do you believe current liabilities are separated from long-term liabilities? Based on your current experience as well as any additional research you may have done, provide two examples of situations where businesses collect monies from customers and employees and report these amounts as a current liability.

 Client Recommendations. A client comes to you thinking about starting a consulting business. Your client is specifically interested in what type of entity should be created for this new business. Based on your readings, or any additional research you may have done, discuss the advantages and disadvantages of the following: sole proprietorship, partnership, and corporation. Based on these advantages and disadvantages, provide a clear recommendation to your client.

Future Obligations Journal. The current liability section of the balance sheet lists the liabilities that are due within the next 12 months. Reflecting on your current financial situation, apply the concept of current liabilities. What does this analysis tell you about your future obligations? What did you learn from this experience?

Assignment : Liability

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.
a. Payroll accounting. Assume that the following tax rates and payroll information pertain to Brookhaven Publishing: Social Security taxes: 6% on the first $55,000 earned Medicare taxes: 1.5% on the first $130,000 earned Federal income taxes withheld from wages: $7,500 State income taxes: 5% of gross earnings Insurance withholdings: 1% of gross earnings State unemployment taxes: 5.4% on the first $7,000 earned Federal unemployment taxes: 0.8% on the first $7,000 earned
The company incurred a salary expense of $50,000 during February. All employees................................................

Week 5

 

Ratios. Ratios provide the users of financial statements with a great deal of information about the entity. Do ratios tell the whole story? How could liquidity ratios be used by investors to determine whether or not to invest in a company?

Guided Response:

Let at least two of your peers know how debt service ratios can be used by a lender in determining whether or not to lend money to a company.

Profit Margin.

 

Year Ending December 2012

Year Ending December 2011

Year Ending December 2010

Revenues

40,000

35,000

33,000

Operating Expenses

Salaries

15,000

10,000

9,000

Maintenance and Repairs

6,000

9,000

10,000

Rental Expense

2,500

2,500

2,500

Depreciation

2,000

2,000

2,000

Fuel

4,000

3,500

2,500

Total Operating Expenses

29,500

27,000

26,000

Operating Income

10,500

8,000

7,000

Sales and Administrative Expenses

6,000

4,000

3,000

Interest Expense

2,500

2,000

1,000

Net Income

2,000

2,000

3,000

      

 

Above is a comparative income statement for Cecil, Inc. for the years 2010, 2011, and 2012. Calculate the profit margin for each of these years. Comment on the profit margin trend.

Guided Response:

Let at least two of your peers know what you changes you would recommend to improve the net margin of the company.

 

Most Important Ratio Journal. Reflect for a moment on the ratios (working capital, current ratio, quick ratio, debt to asset, debt to equity, times interest earned, gross margin, and net margin) presented this week. If you were considering investing in a company, what ratio would be the most important to you? Formulate and argument to defend your position.

Assignment : Financial Ratios

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.
a. Liquidity Ratios. Edison, Stagg, and Thornton have the following financial information at the close of business on July 10:
Edison Stagg Thornton Cash $4,000 $2,500 $1,000
Short-term investments 3,000 2,500 2,000
Accounts receivable 2,000 2,500 3,000
Inventory 1,000 2,500 4,000
Prepaid expenses 800 800 800
Accounts payable 200 200 200
Notes payable: short-term 3,100 3,100 3,100
Accrued payables 300 300 300
Long-term liabilities 3,800 3,800 3,800
Instructions Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why?

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ACC 205 ACC205: Principles of Accounting I COMPLETE / ENTIRE / FULL CLASS

Week 1 Accounting Equation. As you have learned in this week’s readings, the Accounting Equation is Assets = Liabilities + Owners’ Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to dem
rozy's insight:

http://courseassignment.com/ACC-205-ACC205-COMPLETE-ENTIRE-FULL-CLASS-Principles-of-Accounting-I

Ashford ACC 205 ACC/205 ACC205: Principles of Accounting I COMPLETE / ENTIRE / FULL CLASS

Week 1

Accounting Equation. As you have learned in this week�s readings, the Accounting Equation is Assets = Liabilities + Owners� Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to demonstrate the validity of the Accounting Equation.

Review several of your peers� posts and identify some core components that you feel should be included in every transaction. Respond to at least two of your peers and provide recommendations to extend their thinking. Challenge your peers by asking a question that may cause them to reevaluate or add components to their transactions.

Accounts. What does the term account mean? What are the different classifications of accounts? How do the rules for debits and credits impact accounts? Please provide an example of how debits and credits impact accounts.

Guided Response:
Analyze several of your peers� posts. Let at least two of your peers know if this knowledge could be used in their everyday lives. Is so, how? If not, why not?

Journal

Balance Sheet Journal. The balance sheet is a financial snap shot of a company at a particular point in time. The balance sheet lists the assets, liabilities, and equity of the company. Reflect on your personal financial situation, can you apply the concepts of the balance sheet? What did you learn from this reflection?

Basic Accounting Equations

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.

a. Recognition of normal balances. The following items appeared in the accounting records of Triguero's, a retail music store that also sponsors concerts. Classify each of the items as an asset, liability; revenue; or expense from the company's viewpoint. Also indicate the normal account balance of each item.
The albums, tapes, and CDs held for sale to customers. A long-term loan owed to Citizens Bank. Promotional costs to publicize a concert. Daily receipts for merchandise sold, Amounts due from customers,

Land held as an investment, A new fax machine purchased for office use. Amounts to be paid in 10 days to suppliers. Amounts paid to a mall for rent.

 

b. Basic journal entries. The following transactions pertain to the Jennifer Royall Company:
Apr. 1 Jennifer Royall invested cash of $15,000 and land valued at $10,000 from into the business. 5 Provided $1,200 of services to Jason Ratchford, a client, on account. 9 Paid $250 of salaries to an employee. 14 Acquired a new computer for $3,200, on account. 20 Collected $800 from Jason Ratchford for services provided on April 5. 24 Borrowed $7,500 from BestBanc by securing a six-month loan.
Prepare journal entries (and explanations) to record the preceding transactions and events.

c. Balance sheet preparation.
The following data relate to Preston Company as of December 31, 19XX:
Building $44,000 Accounts receivable $24,000
Cash 17,000 Loan payable 30,000
J. Preston, capital 65,000 Land 21,000
Accounts payable ?
Prepare a balance sheet as of December 31, 19XX.(See Exhibit 1.1 and 1.4)

d. Basic transaction processing. On November 1 of the current year, Richard Parker established a sole proprietorship. The following transactions occurred during the month:
1: Parker invested $19,000 into the business.
2: Paid $9,000 to acquire a used minivan.
3: Purchased $1,800 of office furniture on account.
4: Performed $2,100 of consulting services on account.
5: Paid $300 of repair expenses.
6: Received $800 from clients who were previously billed in item 4.
7: Paid $500 on account to the supplier of office furniture in item 3.
8: Received a $150 electric bill, to be paid next month.
9: Parker withdrew $600 from the business.
10: Received $250 in cash from clients for consulting services rendered.
Instructions
a. Arrange the following asset, liability, and owner�s equity elements of the accounting equation: Cash, Accounts Receivable, Office Furniture, Van, Accounts Payable, Investments/Withdrawals, and Revenues/Expenses. (See Exhibit 5)
b. Record each transaction on a separate line. After all transactions have been recorded, compute the balance in each of the preceding items.
c. Answer the following questions for Parker.
(1) How much does the company owe to its creditors at month-end? On which financial statement(s) would this information be found?
(2) Did the company have a �good� month from an accounting viewpoint? Briefly explain.

e. Transaction analysis and statement preparation. The transactions that follow relate to Burton Enterprises for March 20X1, the company�s first month of activity.
3/1: Joanne Burton, the owner invested $20,000 into the business.
3/4: Performed $2,400 of services on account.
3/7: Acquired a small parcel of land by paying $6,000 cash.
3/12: Received $700 from a client, who was billed previously on March 4.
3/15: Paid $800 to the Journal Herald for advertising expense.
3/18: Acquired $9,000 of equipment from Park Central Outfitters by paying $7,000 down and agreeing to remit the balance owed within the next 2 weeks, (Accounts Payable).
3/22: Received $300 cash from clients for services.
3/24: Paid $1,500 on account to Park Central Outfitters in partial settlement of the balance due from the transaction on March 18.
3/28: Rented a car from United Car Rental for use on March 28. Total charges amounted to $75, with United billing Burton for the amount due.
3/31: Paid $900 for March wages.
3/31: Processed a $600 cash withdrawal from the business for Joanne Burton.
Instructions
a. Determine the impact of each of the preceding transactions on Burton�s assets,
liabilities, and owner�s equity. See exhibit 1.5. Use the following format:
Assets = Liabilities + Owner�s Equity
Cash, Accounts Receivable, Land, Equipment Accounts Payable (+)Investments (+) Revenues
(-) Withdrawals (-) Expenses
a. Record each transaction on a separate line. Calculate balances only after the last transaction has been recorded.
b. Prepare an income statement, a statement of owner�s equity, and a balance sheet, (See Exhibit 1.1, 1.3 and 1.4)

f. Entry and trial balance preparation. Lee Adkins is a portrait artist. The following schedule represents Lee�s combined chart of accounts and trial balance as of May 31.
Account number Account name Debit Credit
110
Cash
$ 2,700
120
Accounts Receivable
12,100
130
Equipment and Supplies
2,800
140
Studio
45,000
210
Accounts Payable
$2,600
310
Lee Adkins, Owners Equity
57,400
320
Lee Adkins, Drawing
30,000
410
Revenue
39,000
510
Advertising Expense
2,300
520
Salaries Expense
2,100
540
Utilities Expense
2,000
$99,000
$99,000

The general ledger also revealed account no. 530, Legal and Accounting Expense. The following transactions occurred during June:
6/2:
Collected $7,500 on account from customers.
6/7:
Sold 25% of the equipment and supplies to a young artist for $700 for cash
6/10:
Received a $500 bill from the accountant for preparing last quarter�s financial statements.
6/15:
Paid $2,100 to creditors on account.
6/27:
Adkins withdrew $1,000 cash for personal use.
6/30:
Billed a customer $3,000 for a portrait painted this month.
a. Record the necessary journal entries for June on page 2 of the company�s general journal. (See Exhibit 2.6) b. Open running balance ledger �T� accounts by entering account titles, account num�bers, and May 31 balances. (See exhibit 2.3 and 2.4) c. Post the journal entries to the �T� accounts. d. Prepare a trial balance as of June 30. (See exhibit 2.9)

g. Journal entry preparation
On January 1 of the current year, Peter Houston invested $100,000 cash into his company MuniServ. Shortly thereafter, the company ac�quired selected assets of a bankrupt competitor. The acquisition included land ($15,000), a building ($40,000), and vehicles ($10,000). MuniServ paid $45,000 at the time of the transaction and agreed to remit the remaining balance due of $20,000 (an account payable) by February 15.
During January, the company had additional cash outlays for the following items:
Purchases of store equipment
$4,600
Loan payment
500
Salaries expense
2,300
Advertising expense
700

The January utilities bill of $200 was received on January 31 and will be paid on February 10. MuniServ rendered services to clients on account amounting to $9,400 and $3,700 had been received in settlement.
Instructions Present journal entries that reflect MuniServ's January transactions, starting with the $100,000 investment. (See exhibit 2.6) Compute the total debits, total credits, and ending balance that would be found in the company's Cash account. (Post to �T� Accounts, see exhibit 2.3 and 2.4) Prepare a trail balance as of January 31. (See exhibit 2.9)

WEEK 2

Accounting Cycle. Financial statements are a product of the accounting cycle. Think about two different companies: a manufacturing company, and a retail company. Why would different companies have different accounting cycles? Would you expect the steps of the accounting cycle to be the same for each company? Why, or why not?
Guided Response:
Review several of your peers� posts and identify what steps of the accounting cycle that you feel are the most critical. Respond to at least two of your peers and provide recommendations to extend their thinking. Challenge your peers by asking a question that may cause them to reevaluate their positions on the accounting cycle.

 Bank Reconciliation. What is the purpose of a bank reconciliation? What are the reasons for differences between the cash reported in the accounting records, and the cash balance in the bank statements?
Analyze several of your peers� posts. Let at least two of your peers know what happens to the discrepancies between the book balance and the bank balance. Could these differences just be written off?

Assignment - Revenue and Expenses.

 

Week 3

LIFO vs. FIFO. The controller of Sagehen Enterprises believes that the company should switch from the LIFO method to the FIFO method. The controller�s bonus is based on the next income. It is the controller�s belief that the switch in inventory methods would increase the net income of the company. What are the differences between the LIFO and FIFO methods?
Guided Response:
Analyze several of your peers� posts. Let at least two of your peers know if a company is better off if it switches from a LIFO method to a FIFO method. Explain your reasoning.

Depreciation. A variety of depreciation methods are used to allocate the cost of an asset to all of the accounting periods benefited by the use of the asset. Your client has just purchased a piece of equipment for $100,000. Explain the concept of depreciation. Which of the following depreciation methods would you recommend: straight-line depreciation, double declining balance method, or an alternative method?
Guided Response:
Let at least two of your peers know if a company would use an accelerated depreciation method for their financial statements or their tax returns. Why do you believe this would be the case?
Journal
Inventory Journal. Reflect for a moment on the LIFO (Last in First Out) and FIFO (First in First Out) inventory methods. If you were starting a small manufacturing company, what inventory method do you believe would provide the most accurate financial statements? Why do you believe this is the case?

Assignment : Inventory

a. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows.

Painting                              Cost

1/2 Beginning inventory     Woods   $11,000

4/19 Purchase      Sunset   21,800

6/7 Purchase        Earth      31,200

12/16 Purchase   Moon      4,000

 

Woods and Moon were sold during the year for a total of $35,000. Determine the firm�s

a. cost of goods sold.

b. gross profit.

c. ending inventory.

b. Inventory valuation methods: basic computations. The January beginning inventory of the White Company consisted of 300 units costing $40 each. During the first quarter, purchases were:

Date                       Quantity Cost

1/15                        700                         $45

1/31                        1200                       $48

2/12                        800                         $46

2/27                        650                         $51

 

Sales during the first quarter were.

Date                       Sold

1/19                        500

2/2                          600

2/13                        500

2/28                        100

The White Company uses a perpetual inventory system.

Using the White Company data, fill in the following chart to compare the results obtained under the FIFO, LIFO, and weighted-average inventory methods.

FIFO           LIFO   Weighted Average

 

Goods available for sale                       $           $              $

Ending inventory, March 31

Cost of goods sold

c. Perpetual inventory system: journal entries. At the beginning of 20X3, Beehler Company implemented a computerized perpetual inventory system. The following transactions occurred:

�               Purchases on account: 500 units @ $4 =  $2,000

�               Sales on account: 300 units @ $5 = $1,500

�               Purchases on account: 600 units @ $5 =  $3,000

�               Sales on account: 300 units @ $5 = $1,500

a. Prepare journal entries for the above purchases and sales.

b. Calculate the balance in the firm�s Inventory account.

d. Inventory valuation methods: computations and concepts. Wave Riders Surfboard Company began business on January 1 of the current year. Below are the transactions for the year

1/3:         Purchase 100 boards  @ $125

3/17:       Sold 50 boards @ $250

4/3:         Purchase 200 boards  @ $135

5/17:       Sold 75 boards @ $250

6/3:         Purchase 100 boards  @ $145

1/3:         Purchase 100 boards  @ $155

3/17:       Sold 300 boards @ $250

1/3:         Purchase 100 boards  @ $140

Wave Riders uses a perpetual inventory system.

Instructions

a. Calculate cost of goods sold, ending inventory, and gross profit under each of the following inventory valuation methods:

�               First-in, first-out

�               Last-in, first-out

�               Weighted average

b. Which of the three methods would be chosen if management�s goal is to

(1) produce an up-to-date inventory valuation on the balance sheet?

(2) approximate the physical flow of a sand and gravel dealer?

 

e. Depreciation methods. Betsy Ross Enterprises purchased a delivery van for $30,000 in January 20X7. The van was estimated to have a service life of 5 years and a residual value of $6,000. The company is planning to drive the van 20,000 miles annually. Compute depreciation expense for 20X8 by using each of the following methods:

a. Units-of-output, assuming 17,000 miles were driven during 20X8

b. Straight-line

c. Double-declining-balance

f. Depreciation computations. Alpha Alpha Alpha, a college fraternity, purchased a new heavy-duty washing machine on January 1, 20X3. The machine, which cost $1,000, had an estimated residual value of $100 and an estimated service life of 4 years (1,800 washing cycles). Calculate the following:

a. The machine�s book value on December 31, 20X5, assuming use of the straight-line depreciation method

b. Depreciation expense for 20X4, assuming use of the units-of-output depreciation method. Actual washing cycles in 20X4 totaled 500.

c. Accumulated depreciation on December 31, 20X5, assuming use of the double-declining-balance depreciation method.

g. Depreciation computations: change in estimate. Aussie Imports purchased a specialized piece of machinery for $50,000 on January 1, 20X3. At the time of acquisition, the machine was estimated to have a service life of 5 years (25,000 operating hours) and a residual value of $5,000. During the 5 years of operations (20X3 � 20X7), the machine was used for 5,100, 4,800, 3,200, 6,000, and 5,900 hours, respectively.

Instructions

a. Compute depreciation for 20X3 � 20X7 by using the following methods: straight line, units of output, and double-declining-balance.

b. On January 1, 20X5, management shortened the remaining service life of the machine to 20 months. Assuming use of the straight-line method, compute the company�s depreciation expense for 20X5.

c. Briefly describe what you would have done differently in part (a) if Aussie Imports had paid $47,800 for the machinery rather than $50,000 In addition, assume that the company incurred $800 of freight charges $1,400 for machine setup and testing, and $300 for insurance during the first year of use.

Week 4

Current Liability. What is a current liability? From the perspective of a user of financial statements, why do you believe current liabilities are separated from long-term liabilities? Based on your current experience as well as any additional research you may have done, provide two examples of situations where businesses collect monies from customers and employees and report these amounts as a current liability.

 Client Recommendations. A client comes to you thinking about starting a consulting business. Your client is specifically interested in what type of entity should be created for this new business. Based on your readings, or any additional research you may have done, discuss the advantages and disadvantages of the following: sole proprietorship, partnership, and corporation. Based on these advantages and disadvantages, provide a clear recommendation to your client.

Future Obligations Journal. The current liability section of the balance sheet lists the liabilities that are due within the next 12 months. Reflecting on your current financial situation, apply the concept of current liabilities. What does this analysis tell you about your future obligations? What did you learn from this experience?

Assignment : Liability

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.
a. Payroll accounting. Assume that the following tax rates and payroll information pertain to Brookhaven Publishing: Social Security taxes: 6% on the first $55,000 earned Medicare taxes: 1.5% on the first $130,000 earned Federal income taxes withheld from wages: $7,500 State income taxes: 5% of gross earnings Insurance withholdings: 1% of gross earnings State unemployment taxes: 5.4% on the first $7,000 earned Federal unemployment taxes: 0.8% on the first $7,000 earned
The company incurred a salary expense of $50,000 during February. All employees................................................

Week 5

 

Ratios. Ratios provide the users of financial statements with a great deal of information about the entity. Do ratios tell the whole story? How could liquidity ratios be used by investors to determine whether or not to invest in a company?

Guided Response:

Let at least two of your peers know how debt service ratios can be used by a lender in determining whether or not to lend money to a company.

Profit Margin.

 

Year Ending December 2012

Year Ending December 2011

Year Ending December 2010

Revenues

40,000

35,000

33,000

Operating Expenses

Salaries

15,000

10,000

9,000

Maintenance and Repairs

6,000

9,000

10,000

Rental Expense

2,500

2,500

2,500

Depreciation

2,000

2,000

2,000

Fuel

4,000

3,500

2,500

Total Operating Expenses

29,500

27,000

26,000

Operating Income

10,500

8,000

7,000

Sales and Administrative Expenses

6,000

4,000

3,000

Interest Expense

2,500

2,000

1,000

Net Income

2,000

2,000

3,000

      

 

Above is a comparative income statement for Cecil, Inc. for the years 2010, 2011, and 2012. Calculate the profit margin for each of these years. Comment on the profit margin trend.

Guided Response:

Let at least two of your peers know what you changes you would recommend to improve the net margin of the company.

 

Most Important Ratio Journal. Reflect for a moment on the ratios (working capital, current ratio, quick ratio, debt to asset, debt to equity, times interest earned, gross margin, and net margin) presented this week. If you were considering investing in a company, what ratio would be the most important to you? Formulate and argument to defend your position.

Assignment : Financial Ratios

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.
a. Liquidity Ratios. Edison, Stagg, and Thornton have the following financial information at the close of business on July 10:
Edison Stagg Thornton Cash $4,000 $2,500 $1,000
Short-term investments 3,000 2,500 2,000
Accounts receivable 2,000 2,500 3,000
Inventory 1,000 2,500 4,000
Prepaid expenses 800 800 800
Accounts payable 200 200 200
Notes payable: short-term 3,100 3,100 3,100
Accrued payables 300 300 300
Long-term liabilities 3,800 3,800 3,800
Instructions Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why?

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Ashford ACC 205 ACC/205 ACC205 Week 5 Assignment Final Paper

Focus of the Final Paper


Write a five- to seven-page financial statement analysis of a public company, formatted according to APA style as outlined in the Ashford Writing Center. In this analysis, you will discuss the financial health of this company
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Ashford ACC 205 ACC/205 ACC205 Week 5 Assignment Final Paper

Focus of the Final Paper


Write a five- to seven-page financial statement analysis of a public company, formatted according to APA style as outlined in the Ashford Writing Center. In this analysis, you will discuss the financial health of this company with the ultimate goal of making a recommendation to other investors. Your paper should consist of the following sections: introduction, company overview, horizontal analysis, ratio analysis, final recommendation, and conclusions. Your paper needs to include a minimum of two scholarly resources in addition to the textbook as references.
Here is a breakdown of the sections within the body of the assignment:
Company Overview
Provide a brief overview of your company (one to two paragraphs at most). What industry is it in? What are its main products or services? Who are its competitors?
Horizontal Analysis of Income Statement and Balance Sheet
Prepare a three-year, horizontal analysis of the income statement and balance sheet of your selected company. Discuss the importance and meaning of horizontal analysis. Discuss both the positive and negative trends presented in your company.
Ratio Analysis
Calculate the current ratio, quick ratio, cash to current liabilities ratio, over a two-year period. Discuss and interpret the ratios that you calculated. Discuss potential liquidity issues based on your calculations of the current and quick ratios. Are there any factors that could be erroneously influencing the results of the ratios? Discuss liquidity issues of competitive companies within the same industry.
Recommendation
Based on your analysis, would you recommend an individual invest in this company? What strengths do you see? What risks do you see? It is perfectly acceptable to state that you would recommend avoiding this company, as long as you provide support for your position.

Writing the Final Paper
The Final Paper:
1. Must be five to seven double-spaced pages in length, and formatted according to APA style as outlined in the Ashford Writing Center.
2. Must include a title page with the following:
a. Title of paper
b. Student�s name
c. Course name and number
d. Instructor�s name
e. Date submitted
3. Must begin with an introductory paragraph that has a succinct thesis statement.
4. Must address the topic of the paper with critical thought.
5. Must end with a conclusion that reaffirms your thesis.
6. Must document all sources in APA style, as outlined in the Ashford Writing Center.
7. Must include a separate reference page, formatted according to APA style as outlined in the Ashford Writing Center.

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Ashford ACC 205 ACC/205 ACC205 Week 3 Assignment Inventory

nventory

a. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows.

Painting Cost

1/2 Beginning invent
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Ashford ACC 205 ACC/205 ACC205  Week 3 Assignment Inventory

Inventory

a. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows.

Painting                              Cost

1/2 Beginning inventory     Woods   $11,000

4/19 Purchase      Sunset   21,800

6/7 Purchase        Earth      31,200

12/16 Purchase   Moon      4,000

 

Woods and Moon were sold during the year for a total of $35,000. Determine the firm�s

a. cost of goods sold.

b. gross profit.

c. ending inventory.

b. Inventory valuation methods: basic computations. The January beginning inventory of the White Company consisted of 300 units costing $40 each. During the first quarter, purchases were:

Date                       Quantity Cost

1/15                        700                         $45

1/31                        1200                       $48

2/12                        800                         $46

2/27                        650                         $51

 

Sales during the first quarter were.

Date                       Sold

1/19                        500

2/2                          600

2/13                        500

2/28                        100

The White Company uses a perpetual inventory system.

Using the White Company data, fill in the following chart to compare the results obtained under the FIFO, LIFO, and weighted-average inventory methods.

FIFO           LIFO   Weighted Average

 

Goods available for sale                       $           $              $

Ending inventory, March 31

Cost of goods sold

c. Perpetual inventory system: journal entries. At the beginning of 20X3, Beehler Company implemented a computerized perpetual inventory system. The following transactions occurred:

�               Purchases on account: 500 units @ $4 =  $2,000

�               Sales on account: 300 units @ $5 = $1,500

�               Purchases on account: 600 units @ $5 =  $3,000

�               Sales on account: 300 units @ $5 = $1,500

a. Prepare journal entries for the above purchases and sales.

b. Calculate the balance in the firm�s Inventory account.

d. Inventory valuation methods: computations and concepts. Wave Riders Surfboard Company began business on January 1 of the current year. Below are the transactions for the year

1/3:         Purchase 100 boards  @ $125

3/17:       Sold 50 boards @ $250

4/3:         Purchase 200 boards  @ $135

5/17:       Sold 75 boards @ $250

6/3:         Purchase 100 boards  @ $145

1/3:         Purchase 100 boards  @ $155

3/17:       Sold 300 boards @ $250

1/3:         Purchase 100 boards  @ $140

Wave Riders uses a perpetual inventory system.

Instructions

a. Calculate cost of goods sold, ending inventory, and gross profit under each of the following inventory valuation methods:

�               First-in, first-out

�               Last-in, first-out

�               Weighted average

b. Which of the three methods would be chosen if management�s goal is to

(1) produce an up-to-date inventory valuation on the balance sheet?

(2) approximate the physical flow of a sand and gravel dealer?

 

e. Depreciation methods. Betsy Ross Enterprises purchased a delivery van for $30,000 in January 20X7. The van was estimated to have a service life of 5 years and a residual value of $6,000. The company is planning to drive the van 20,000 miles annually. Compute depreciation expense for 20X8 by using each of the following methods:

a. Units-of-output, assuming 17,000 miles were driven during 20X8

b. Straight-line

c. Double-declining-balance

f. Depreciation computations. Alpha Alpha Alpha, a college fraternity, purchased a new heavy-duty washing machine on January 1, 20X3. The machine, which cost $1,000, had an estimated residual value of $100 and an estimated service life of 4 years (1,800 washing cycles). Calculate the following:

a. The machine�s book value on December 31, 20X5, assuming use of the straight-line depreciation method

b. Depreciation expense for 20X4, assuming use of the units-of-output depreciation method. Actual washing cycles in 20X4 totaled 500.

c. Accumulated depreciation on December 31, 20X5, assuming use of the double-declining-balance depreciation method.

g. Depreciation computations: change in estimate. Aussie Imports purchased a specialized piece of machinery for $50,000 on January 1, 20X3. At the time of acquisition, the machine was estimated to have a service life of 5 years (25,000 operating hours) and a residual value of $5,000. During the 5 years of operations (20X3 � 20X7), the machine was used for 5,100, 4,800, 3,200, 6,000, and 5,900 hours, respectively.

Instructions

a. Compute depreciation for 20X3 � 20X7 by using the following methods: straight line, units of output, and double-declining-balance.

b. On January 1, 20X5, management shortened the remaining service life of the machine to 20 months. Assuming use of the straight-line method, compute the company�s depreciation expense for 20X5.

c. Briefly describe what you would have done differently in part (a) if Aussie Imports had paid $47,800 for the machinery rather than $50,000 In addition, assume that the company incurred $800 of freight charges $1,400 for machine setup and testing, and $300 for insurance during the first year of use.

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Ashford ACC 205 ACC205 Week 5 Final Paper

Focus of the Final Paper


Write a five- to seven-page financial statement analysis of a public company, formatted according to APA style as outlined in the Ashford Writing Center. In this analysis, you will discuss the financial health of this company
rozy's insight:

http://courseassignment.com/acc-205-week-5-final-acc205

Ashford ACC 205 ACC205 Week 5 Final Paper

Focus of the Final Paper


Write a five- to seven-page financial statement analysis of a public company, formatted according to APA style as outlined in the Ashford Writing Center. In this analysis, you will discuss the financial health of this company with the ultimate goal of making a recommendation to other investors. Your paper should consist of the following sections: introduction, company overview, horizontal analysis, ratio analysis, final recommendation, and conclusions. Your paper needs to include a minimum of two scholarly resources in addition to the textbook as references.
Here is a breakdown of the sections within the body of the assignment:
Company Overview
Provide a brief overview of your company (one to two paragraphs at most). What industry is it in? What are its main products or services? Who are its competitors?
Horizontal Analysis of Income Statement and Balance Sheet
Prepare a three-year, horizontal analysis of the income statement and balance sheet of your selected company. Discuss the importance and meaning of horizontal analysis. Discuss both the positive and negative trends presented in your company.
Ratio Analysis
Calculate the current ratio, quick ratio, cash to current liabilities ratio, over a two-year period. Discuss and interpret the ratios that you calculated. Discuss potential liquidity issues based on your calculations of the current and quick ratios. Are there any factors that could be erroneously influencing the results of the ratios? Discuss liquidity issues of competitive companies within the same industry.
Recommendation
Based on your analysis, would you recommend an individual invest in this company? What strengths do you see? What risks do you see? It is perfectly acceptable to state that you would recommend avoiding this company, as long as you provide support for your position.

Writing the Final Paper
The Final Paper:
1. Must be five to seven double-spaced pages in length, and formatted according to APA style as outlined in the Ashford Writing Center.
2. Must include a title page with the following:
a. Title of paper
b. Student�s name
c. Course name and number
d. Instructor�s name
e. Date submitted
3. Must begin with an introductory paragraph that has a succinct thesis statement.
4. Must address the topic of the paper with critical thought.
5. Must end with a conclusion that reaffirms your thesis.
6. Must document all sources in APA style, as outlined in the Ashford Writing Center.
7. Must include a separate reference page, formatted according to APA style as outlined in the Ashford Writing Center.

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ACC 205 ACC205: Principles of Accounting I COMPLETE / ENTIRE / FULL CLASS

Week 1 Accounting Equation. As you have learned in this week’s readings, the Accounting Equation is Assets = Liabilities + Owners’ Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to dem
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Ashford ACC 205 ACC/205 ACC205: Principles of Accounting I COMPLETE / ENTIRE / FULL CLASS

Week 1

Accounting Equation. As you have learned in this week�s readings, the Accounting Equation is Assets = Liabilities + Owners� Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to demonstrate the validity of the Accounting Equation.

Review several of your peers� posts and identify some core components that you feel should be included in every transaction. Respond to at least two of your peers and provide recommendations to extend their thinking. Challenge your peers by asking a question that may cause them to reevaluate or add components to their transactions.

Accounts. What does the term account mean? What are the different classifications of accounts? How do the rules for debits and credits impact accounts? Please provide an example of how debits and credits impact accounts.

Guided Response:
Analyze several of your peers� posts. Let at least two of your peers know if this knowledge could be used in their everyday lives. Is so, how? If not, why not?

Journal

Balance Sheet Journal. The balance sheet is a financial snap shot of a company at a particular point in time. The balance sheet lists the assets, liabilities, and equity of the company. Reflect on your personal financial situation, can you apply the concepts of the balance sheet? What did you learn from this reflection?

Basic Accounting Equations

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.

a. Recognition of normal balances. The following items appeared in the accounting records of Triguero's, a retail music store that also sponsors concerts. Classify each of the items as an asset, liability; revenue; or expense from the company's viewpoint. Also indicate the normal account balance of each item.
The albums, tapes, and CDs held for sale to customers. A long-term loan owed to Citizens Bank. Promotional costs to publicize a concert. Daily receipts for merchandise sold, Amounts due from customers,

Land held as an investment, A new fax machine purchased for office use. Amounts to be paid in 10 days to suppliers. Amounts paid to a mall for rent.

 

b. Basic journal entries. The following transactions pertain to the Jennifer Royall Company:
Apr. 1 Jennifer Royall invested cash of $15,000 and land valued at $10,000 from into the business. 5 Provided $1,200 of services to Jason Ratchford, a client, on account. 9 Paid $250 of salaries to an employee. 14 Acquired a new computer for $3,200, on account. 20 Collected $800 from Jason Ratchford for services provided on April 5. 24 Borrowed $7,500 from BestBanc by securing a six-month loan.
Prepare journal entries (and explanations) to record the preceding transactions and events.

c. Balance sheet preparation.
The following data relate to Preston Company as of December 31, 19XX:
Building $44,000 Accounts receivable $24,000
Cash 17,000 Loan payable 30,000
J. Preston, capital 65,000 Land 21,000
Accounts payable ?
Prepare a balance sheet as of December 31, 19XX.(See Exhibit 1.1 and 1.4)

d. Basic transaction processing. On November 1 of the current year, Richard Parker established a sole proprietorship. The following transactions occurred during the month:
1: Parker invested $19,000 into the business.
2: Paid $9,000 to acquire a used minivan.
3: Purchased $1,800 of office furniture on account.
4: Performed $2,100 of consulting services on account.
5: Paid $300 of repair expenses.
6: Received $800 from clients who were previously billed in item 4.
7: Paid $500 on account to the supplier of office furniture in item 3.
8: Received a $150 electric bill, to be paid next month.
9: Parker withdrew $600 from the business.
10: Received $250 in cash from clients for consulting services rendered.
Instructions
a. Arrange the following asset, liability, and owner�s equity elements of the accounting equation: Cash, Accounts Receivable, Office Furniture, Van, Accounts Payable, Investments/Withdrawals, and Revenues/Expenses. (See Exhibit 5)
b. Record each transaction on a separate line. After all transactions have been recorded, compute the balance in each of the preceding items.
c. Answer the following questions for Parker.
(1) How much does the company owe to its creditors at month-end? On which financial statement(s) would this information be found?
(2) Did the company have a �good� month from an accounting viewpoint? Briefly explain.

e. Transaction analysis and statement preparation. The transactions that follow relate to Burton Enterprises for March 20X1, the company�s first month of activity.
3/1: Joanne Burton, the owner invested $20,000 into the business.
3/4: Performed $2,400 of services on account.
3/7: Acquired a small parcel of land by paying $6,000 cash.
3/12: Received $700 from a client, who was billed previously on March 4.
3/15: Paid $800 to the Journal Herald for advertising expense.
3/18: Acquired $9,000 of equipment from Park Central Outfitters by paying $7,000 down and agreeing to remit the balance owed within the next 2 weeks, (Accounts Payable).
3/22: Received $300 cash from clients for services.
3/24: Paid $1,500 on account to Park Central Outfitters in partial settlement of the balance due from the transaction on March 18.
3/28: Rented a car from United Car Rental for use on March 28. Total charges amounted to $75, with United billing Burton for the amount due.
3/31: Paid $900 for March wages.
3/31: Processed a $600 cash withdrawal from the business for Joanne Burton.
Instructions
a. Determine the impact of each of the preceding transactions on Burton�s assets,
liabilities, and owner�s equity. See exhibit 1.5. Use the following format:
Assets = Liabilities + Owner�s Equity
Cash, Accounts Receivable, Land, Equipment Accounts Payable (+)Investments (+) Revenues
(-) Withdrawals (-) Expenses
a. Record each transaction on a separate line. Calculate balances only after the last transaction has been recorded.
b. Prepare an income statement, a statement of owner�s equity, and a balance sheet, (See Exhibit 1.1, 1.3 and 1.4)

f. Entry and trial balance preparation. Lee Adkins is a portrait artist. The following schedule represents Lee�s combined chart of accounts and trial balance as of May 31.
Account number Account name Debit Credit
110
Cash
$ 2,700
120
Accounts Receivable
12,100
130
Equipment and Supplies
2,800
140
Studio
45,000
210
Accounts Payable
$2,600
310
Lee Adkins, Owners Equity
57,400
320
Lee Adkins, Drawing
30,000
410
Revenue
39,000
510
Advertising Expense
2,300
520
Salaries Expense
2,100
540
Utilities Expense
2,000
$99,000
$99,000

The general ledger also revealed account no. 530, Legal and Accounting Expense. The following transactions occurred during June:
6/2:
Collected $7,500 on account from customers.
6/7:
Sold 25% of the equipment and supplies to a young artist for $700 for cash
6/10:
Received a $500 bill from the accountant for preparing last quarter�s financial statements.
6/15:
Paid $2,100 to creditors on account.
6/27:
Adkins withdrew $1,000 cash for personal use.
6/30:
Billed a customer $3,000 for a portrait painted this month.
a. Record the necessary journal entries for June on page 2 of the company�s general journal. (See Exhibit 2.6) b. Open running balance ledger �T� accounts by entering account titles, account num�bers, and May 31 balances. (See exhibit 2.3 and 2.4) c. Post the journal entries to the �T� accounts. d. Prepare a trial balance as of June 30. (See exhibit 2.9)

g. Journal entry preparation
On January 1 of the current year, Peter Houston invested $100,000 cash into his company MuniServ. Shortly thereafter, the company ac�quired selected assets of a bankrupt competitor. The acquisition included land ($15,000), a building ($40,000), and vehicles ($10,000). MuniServ paid $45,000 at the time of the transaction and agreed to remit the remaining balance due of $20,000 (an account payable) by February 15.
During January, the company had additional cash outlays for the following items:
Purchases of store equipment
$4,600
Loan payment
500
Salaries expense
2,300
Advertising expense
700

The January utilities bill of $200 was received on January 31 and will be paid on February 10. MuniServ rendered services to clients on account amounting to $9,400 and $3,700 had been received in settlement.
Instructions Present journal entries that reflect MuniServ's January transactions, starting with the $100,000 investment. (See exhibit 2.6) Compute the total debits, total credits, and ending balance that would be found in the company's Cash account. (Post to �T� Accounts, see exhibit 2.3 and 2.4) Prepare a trail balance as of January 31. (See exhibit 2.9)

WEEK 2

Accounting Cycle. Financial statements are a product of the accounting cycle. Think about two different companies: a manufacturing company, and a retail company. Why would different companies have different accounting cycles? Would you expect the steps of the accounting cycle to be the same for each company? Why, or why not?
Guided Response:
Review several of your peers� posts and identify what steps of the accounting cycle that you feel are the most critical. Respond to at least two of your peers and provide recommendations to extend their thinking. Challenge your peers by asking a question that may cause them to reevaluate their positions on the accounting cycle.

 Bank Reconciliation. What is the purpose of a bank reconciliation? What are the reasons for differences between the cash reported in the accounting records, and the cash balance in the bank statements?
Analyze several of your peers� posts. Let at least two of your peers know what happens to the discrepancies between the book balance and the bank balance. Could these differences just be written off?

Assignment - Revenue and Expenses.

 

Week 3

LIFO vs. FIFO. The controller of Sagehen Enterprises believes that the company should switch from the LIFO method to the FIFO method. The controller�s bonus is based on the next income. It is the controller�s belief that the switch in inventory methods would increase the net income of the company. What are the differences between the LIFO and FIFO methods?
Guided Response:
Analyze several of your peers� posts. Let at least two of your peers know if a company is better off if it switches from a LIFO method to a FIFO method. Explain your reasoning.

Depreciation. A variety of depreciation methods are used to allocate the cost of an asset to all of the accounting periods benefited by the use of the asset. Your client has just purchased a piece of equipment for $100,000. Explain the concept of depreciation. Which of the following depreciation methods would you recommend: straight-line depreciation, double declining balance method, or an alternative method?
Guided Response:
Let at least two of your peers know if a company would use an accelerated depreciation method for their financial statements or their tax returns. Why do you believe this would be the case?
Journal
Inventory Journal. Reflect for a moment on the LIFO (Last in First Out) and FIFO (First in First Out) inventory methods. If you were starting a small manufacturing company, what inventory method do you believe would provide the most accurate financial statements? Why do you believe this is the case?

Assignment : Inventory

a. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows.

Painting                              Cost

1/2 Beginning inventory     Woods   $11,000

4/19 Purchase      Sunset   21,800

6/7 Purchase        Earth      31,200

12/16 Purchase   Moon      4,000

 

Woods and Moon were sold during the year for a total of $35,000. Determine the firm�s

a. cost of goods sold.

b. gross profit.

c. ending inventory.

b. Inventory valuation methods: basic computations. The January beginning inventory of the White Company consisted of 300 units costing $40 each. During the first quarter, purchases were:

Date                       Quantity Cost

1/15                        700                         $45

1/31                        1200                       $48

2/12                        800                         $46

2/27                        650                         $51

 

Sales during the first quarter were.

Date                       Sold

1/19                        500

2/2                          600

2/13                        500

2/28                        100

The White Company uses a perpetual inventory system.

Using the White Company data, fill in the following chart to compare the results obtained under the FIFO, LIFO, and weighted-average inventory methods.

FIFO           LIFO   Weighted Average

 

Goods available for sale                       $           $              $

Ending inventory, March 31

Cost of goods sold

c. Perpetual inventory system: journal entries. At the beginning of 20X3, Beehler Company implemented a computerized perpetual inventory system. The following transactions occurred:

�               Purchases on account: 500 units @ $4 =  $2,000

�               Sales on account: 300 units @ $5 = $1,500

�               Purchases on account: 600 units @ $5 =  $3,000

�               Sales on account: 300 units @ $5 = $1,500

a. Prepare journal entries for the above purchases and sales.

b. Calculate the balance in the firm�s Inventory account.

d. Inventory valuation methods: computations and concepts. Wave Riders Surfboard Company began business on January 1 of the current year. Below are the transactions for the year

1/3:         Purchase 100 boards  @ $125

3/17:       Sold 50 boards @ $250

4/3:         Purchase 200 boards  @ $135

5/17:       Sold 75 boards @ $250

6/3:         Purchase 100 boards  @ $145

1/3:         Purchase 100 boards  @ $155

3/17:       Sold 300 boards @ $250

1/3:         Purchase 100 boards  @ $140

Wave Riders uses a perpetual inventory system.

Instructions

a. Calculate cost of goods sold, ending inventory, and gross profit under each of the following inventory valuation methods:

�               First-in, first-out

�               Last-in, first-out

�               Weighted average

b. Which of the three methods would be chosen if management�s goal is to

(1) produce an up-to-date inventory valuation on the balance sheet?

(2) approximate the physical flow of a sand and gravel dealer?

 

e. Depreciation methods. Betsy Ross Enterprises purchased a delivery van for $30,000 in January 20X7. The van was estimated to have a service life of 5 years and a residual value of $6,000. The company is planning to drive the van 20,000 miles annually. Compute depreciation expense for 20X8 by using each of the following methods:

a. Units-of-output, assuming 17,000 miles were driven during 20X8

b. Straight-line

c. Double-declining-balance

f. Depreciation computations. Alpha Alpha Alpha, a college fraternity, purchased a new heavy-duty washing machine on January 1, 20X3. The machine, which cost $1,000, had an estimated residual value of $100 and an estimated service life of 4 years (1,800 washing cycles). Calculate the following:

a. The machine�s book value on December 31, 20X5, assuming use of the straight-line depreciation method

b. Depreciation expense for 20X4, assuming use of the units-of-output depreciation method. Actual washing cycles in 20X4 totaled 500.

c. Accumulated depreciation on December 31, 20X5, assuming use of the double-declining-balance depreciation method.

g. Depreciation computations: change in estimate. Aussie Imports purchased a specialized piece of machinery for $50,000 on January 1, 20X3. At the time of acquisition, the machine was estimated to have a service life of 5 years (25,000 operating hours) and a residual value of $5,000. During the 5 years of operations (20X3 � 20X7), the machine was used for 5,100, 4,800, 3,200, 6,000, and 5,900 hours, respectively.

Instructions

a. Compute depreciation for 20X3 � 20X7 by using the following methods: straight line, units of output, and double-declining-balance.

b. On January 1, 20X5, management shortened the remaining service life of the machine to 20 months. Assuming use of the straight-line method, compute the company�s depreciation expense for 20X5.

c. Briefly describe what you would have done differently in part (a) if Aussie Imports had paid $47,800 for the machinery rather than $50,000 In addition, assume that the company incurred $800 of freight charges $1,400 for machine setup and testing, and $300 for insurance during the first year of use.

Week 4

Current Liability. What is a current liability? From the perspective of a user of financial statements, why do you believe current liabilities are separated from long-term liabilities? Based on your current experience as well as any additional research you may have done, provide two examples of situations where businesses collect monies from customers and employees and report these amounts as a current liability.

 Client Recommendations. A client comes to you thinking about starting a consulting business. Your client is specifically interested in what type of entity should be created for this new business. Based on your readings, or any additional research you may have done, discuss the advantages and disadvantages of the following: sole proprietorship, partnership, and corporation. Based on these advantages and disadvantages, provide a clear recommendation to your client.

Future Obligations Journal. The current liability section of the balance sheet lists the liabilities that are due within the next 12 months. Reflecting on your current financial situation, apply the concept of current liabilities. What does this analysis tell you about your future obligations? What did you learn from this experience?

Assignment : Liability

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.
a. Payroll accounting. Assume that the following tax rates and payroll information pertain to Brookhaven Publishing: Social Security taxes: 6% on the first $55,000 earned Medicare taxes: 1.5% on the first $130,000 earned Federal income taxes withheld from wages: $7,500 State income taxes: 5% of gross earnings Insurance withholdings: 1% of gross earnings State unemployment taxes: 5.4% on the first $7,000 earned Federal unemployment taxes: 0.8% on the first $7,000 earned
The company incurred a salary expense of $50,000 during February. All employees................................................

Week 5

 

Ratios. Ratios provide the users of financial statements with a great deal of information about the entity. Do ratios tell the whole story? How could liquidity ratios be used by investors to determine whether or not to invest in a company?

Guided Response:

Let at least two of your peers know how debt service ratios can be used by a lender in determining whether or not to lend money to a company.

Profit Margin.

 

Year Ending December 2012

Year Ending December 2011

Year Ending December 2010

Revenues

40,000

35,000

33,000

Operating Expenses

Salaries

15,000

10,000

9,000

Maintenance and Repairs

6,000

9,000

10,000

Rental Expense

2,500

2,500

2,500

Depreciation

2,000

2,000

2,000

Fuel

4,000

3,500

2,500

Total Operating Expenses

29,500

27,000

26,000

Operating Income

10,500

8,000

7,000

Sales and Administrative Expenses

6,000

4,000

3,000

Interest Expense

2,500

2,000

1,000

Net Income

2,000

2,000

3,000

      

 

Above is a comparative income statement for Cecil, Inc. for the years 2010, 2011, and 2012. Calculate the profit margin for each of these years. Comment on the profit margin trend.

Guided Response:

Let at least two of your peers know what you changes you would recommend to improve the net margin of the company.

 

Most Important Ratio Journal. Reflect for a moment on the ratios (working capital, current ratio, quick ratio, debt to asset, debt to equity, times interest earned, gross margin, and net margin) presented this week. If you were considering investing in a company, what ratio would be the most important to you? Formulate and argument to defend your position.

Assignment : Financial Ratios

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.
a. Liquidity Ratios. Edison, Stagg, and Thornton have the following financial information at the close of business on July 10:
Edison Stagg Thornton Cash $4,000 $2,500 $1,000
Short-term investments 3,000 2,500 2,000
Accounts receivable 2,000 2,500 3,000
Inventory 1,000 2,500 4,000
Prepaid expenses 800 800 800
Accounts payable 200 200 200
Notes payable: short-term 3,100 3,100 3,100
Accrued payables 300 300 300
Long-term liabilities 3,800 3,800 3,800
Instructions Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why?

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Ashford ACC 205 ACC/205 ACC205: Principles of Accounting I COMPLETE / ENTIRE / FULL CLASS ( 2013 Syllabus )

Week 1

Accounting Equation. As you have learned in this week’s readings, the Accounting Equation is Assets = Liabilities + Owners’ Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to demons
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Ashford ACC 205 ACC/205 ACC205: Principles of Accounting I COMPLETE / ENTIRE / FULL CLASS

Week 1

Accounting Equation. As you have learned in this week�s readings, the Accounting Equation is Assets = Liabilities + Owners� Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to demonstrate the validity of the Accounting Equation.

Review several of your peers� posts and identify some core components that you feel should be included in every transaction. Respond to at least two of your peers and provide recommendations to extend their thinking. Challenge your peers by asking a question that may cause them to reevaluate or add components to their transactions.

Accounts. What does the term account mean? What are the different classifications of accounts? How do the rules for debits and credits impact accounts? Please provide an example of how debits and credits impact accounts.

Guided Response:
Analyze several of your peers� posts. Let at least two of your peers know if this knowledge could be used in their everyday lives. Is so, how? If not, why not?

Journal

Balance Sheet Journal. The balance sheet is a financial snap shot of a company at a particular point in time. The balance sheet lists the assets, liabilities, and equity of the company. Reflect on your personal financial situation, can you apply the concepts of the balance sheet? What did you learn from this reflection?

Basic Accounting Equations

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.

a. Recognition of normal balances. The following items appeared in the accounting records of Triguero's, a retail music store that also sponsors concerts. Classify each of the items as an asset, liability; revenue; or expense from the company's viewpoint. Also indicate the normal account balance of each item.
The albums, tapes, and CDs held for sale to customers. A long-term loan owed to Citizens Bank. Promotional costs to publicize a concert. Daily receipts for merchandise sold, Amounts due from customers,

Land held as an investment, A new fax machine purchased for office use. Amounts to be paid in 10 days to suppliers. Amounts paid to a mall for rent.

 

b. Basic journal entries. The following transactions pertain to the Jennifer Royall Company:
Apr. 1 Jennifer Royall invested cash of $15,000 and land valued at $10,000 from into the business. 5 Provided $1,200 of services to Jason Ratchford, a client, on account. 9 Paid $250 of salaries to an employee. 14 Acquired a new computer for $3,200, on account. 20 Collected $800 from Jason Ratchford for services provided on April 5. 24 Borrowed $7,500 from BestBanc by securing a six-month loan.
Prepare journal entries (and explanations) to record the preceding transactions and events.

c. Balance sheet preparation.
The following data relate to Preston Company as of December 31, 19XX:
Building $44,000 Accounts receivable $24,000
Cash 17,000 Loan payable 30,000
J. Preston, capital 65,000 Land 21,000
Accounts payable ?
Prepare a balance sheet as of December 31, 19XX.(See Exhibit 1.1 and 1.4)

d. Basic transaction processing. On November 1 of the current year, Richard Parker established a sole proprietorship. The following transactions occurred during the month:
1: Parker invested $19,000 into the business.
2: Paid $9,000 to acquire a used minivan.
3: Purchased $1,800 of office furniture on account.
4: Performed $2,100 of consulting services on account.
5: Paid $300 of repair expenses.
6: Received $800 from clients who were previously billed in item 4.
7: Paid $500 on account to the supplier of office furniture in item 3.
8: Received a $150 electric bill, to be paid next month.
9: Parker withdrew $600 from the business.
10: Received $250 in cash from clients for consulting services rendered.
Instructions
a. Arrange the following asset, liability, and owner�s equity elements of the accounting equation: Cash, Accounts Receivable, Office Furniture, Van, Accounts Payable, Investments/Withdrawals, and Revenues/Expenses. (See Exhibit 5)
b. Record each transaction on a separate line. After all transactions have been recorded, compute the balance in each of the preceding items.
c. Answer the following questions for Parker.
(1) How much does the company owe to its creditors at month-end? On which financial statement(s) would this information be found?
(2) Did the company have a �good� month from an accounting viewpoint? Briefly explain.

e. Transaction analysis and statement preparation. The transactions that follow relate to Burton Enterprises for March 20X1, the company�s first month of activity.
3/1: Joanne Burton, the owner invested $20,000 into the business.
3/4: Performed $2,400 of services on account.
3/7: Acquired a small parcel of land by paying $6,000 cash.
3/12: Received $700 from a client, who was billed previously on March 4.
3/15: Paid $800 to the Journal Herald for advertising expense.
3/18: Acquired $9,000 of equipment from Park Central Outfitters by paying $7,000 down and agreeing to remit the balance owed within the next 2 weeks, (Accounts Payable).
3/22: Received $300 cash from clients for services.
3/24: Paid $1,500 on account to Park Central Outfitters in partial settlement of the balance due from the transaction on March 18.
3/28: Rented a car from United Car Rental for use on March 28. Total charges amounted to $75, with United billing Burton for the amount due.
3/31: Paid $900 for March wages.
3/31: Processed a $600 cash withdrawal from the business for Joanne Burton.
Instructions
a. Determine the impact of each of the preceding transactions on Burton�s assets,
liabilities, and owner�s equity. See exhibit 1.5. Use the following format:
Assets = Liabilities + Owner�s Equity
Cash, Accounts Receivable, Land, Equipment Accounts Payable (+)Investments (+) Revenues
(-) Withdrawals (-) Expenses
a. Record each transaction on a separate line. Calculate balances only after the last transaction has been recorded.
b. Prepare an income statement, a statement of owner�s equity, and a balance sheet, (See Exhibit 1.1, 1.3 and 1.4)

f. Entry and trial balance preparation. Lee Adkins is a portrait artist. The following schedule represents Lee�s combined chart of accounts and trial balance as of May 31.
Account number Account name Debit Credit
110
Cash
$ 2,700
120
Accounts Receivable
12,100
130
Equipment and Supplies
2,800
140
Studio
45,000
210
Accounts Payable
$2,600
310
Lee Adkins, Owners Equity
57,400
320
Lee Adkins, Drawing
30,000
410
Revenue
39,000
510
Advertising Expense
2,300
520
Salaries Expense
2,100
540
Utilities Expense
2,000
$99,000
$99,000

The general ledger also revealed account no. 530, Legal and Accounting Expense. The following transactions occurred during June:
6/2:
Collected $7,500 on account from customers.
6/7:
Sold 25% of the equipment and supplies to a young artist for $700 for cash
6/10:
Received a $500 bill from the accountant for preparing last quarter�s financial statements.
6/15:
Paid $2,100 to creditors on account.
6/27:
Adkins withdrew $1,000 cash for personal use.
6/30:
Billed a customer $3,000 for a portrait painted this month.
a. Record the necessary journal entries for June on page 2 of the company�s general journal. (See Exhibit 2.6) b. Open running balance ledger �T� accounts by entering account titles, account num�bers, and May 31 balances. (See exhibit 2.3 and 2.4) c. Post the journal entries to the �T� accounts. d. Prepare a trial balance as of June 30. (See exhibit 2.9)

g. Journal entry preparation
On January 1 of the current year, Peter Houston invested $100,000 cash into his company MuniServ. Shortly thereafter, the company ac�quired selected assets of a bankrupt competitor. The acquisition included land ($15,000), a building ($40,000), and vehicles ($10,000). MuniServ paid $45,000 at the time of the transaction and agreed to remit the remaining balance due of $20,000 (an account payable) by February 15.
During January, the company had additional cash outlays for the following items:
Purchases of store equipment
$4,600
Loan payment
500
Salaries expense
2,300
Advertising expense
700

The January utilities bill of $200 was received on January 31 and will be paid on February 10. MuniServ rendered services to clients on account amounting to $9,400 and $3,700 had been received in settlement.
Instructions Present journal entries that reflect MuniServ's January transactions, starting with the $100,000 investment. (See exhibit 2.6) Compute the total debits, total credits, and ending balance that would be found in the company's Cash account. (Post to �T� Accounts, see exhibit 2.3 and 2.4) Prepare a trail balance as of January 31. (See exhibit 2.9)

WEEK 2

Accounting Cycle. Financial statements are a product of the accounting cycle. Think about two different companies: a manufacturing company, and a retail company. Why would different companies have different accounting cycles? Would you expect the steps of the accounting cycle to be the same for each company? Why, or why not?
Guided Response:
Review several of your peers� posts and identify what steps of the accounting cycle that you feel are the most critical. Respond to at least two of your peers and provide recommendations to extend their thinking. Challenge your peers by asking a question that may cause them to reevaluate their positions on the accounting cycle.

 Bank Reconciliation. What is the purpose of a bank reconciliation? What are the reasons for differences between the cash reported in the accounting records, and the cash balance in the bank statements?
Analyze several of your peers� posts. Let at least two of your peers know what happens to the discrepancies between the book balance and the bank balance. Could these differences just be written off?

Assignment - Revenue and Expenses.

 

Week 3

LIFO vs. FIFO. The controller of Sagehen Enterprises believes that the company should switch from the LIFO method to the FIFO method. The controller�s bonus is based on the next income. It is the controller�s belief that the switch in inventory methods would increase the net income of the company. What are the differences between the LIFO and FIFO methods?
Guided Response:
Analyze several of your peers� posts. Let at least two of your peers know if a company is better off if it switches from a LIFO method to a FIFO method. Explain your reasoning.

Depreciation. A variety of depreciation methods are used to allocate the cost of an asset to all of the accounting periods benefited by the use of the asset. Your client has just purchased a piece of equipment for $100,000. Explain the concept of depreciation. Which of the following depreciation methods would you recommend: straight-line depreciation, double declining balance method, or an alternative method?
Guided Response:
Let at least two of your peers know if a company would use an accelerated depreciation method for their financial statements or their tax returns. Why do you believe this would be the case?
Journal
Inventory Journal. Reflect for a moment on the LIFO (Last in First Out) and FIFO (First in First Out) inventory methods. If you were starting a small manufacturing company, what inventory method do you believe would provide the most accurate financial statements? Why do you believe this is the case?

Assignment : Inventory

a. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows.

Painting                              Cost

1/2 Beginning inventory     Woods   $11,000

4/19 Purchase      Sunset   21,800

6/7 Purchase        Earth      31,200

12/16 Purchase   Moon      4,000

 

Woods and Moon were sold during the year for a total of $35,000. Determine the firm�s

a. cost of goods sold.

b. gross profit.

c. ending inventory.

b. Inventory valuation methods: basic computations. The January beginning inventory of the White Company consisted of 300 units costing $40 each. During the first quarter, purchases were:

Date                       Quantity Cost

1/15                        700                         $45

1/31                        1200                       $48

2/12                        800                         $46

2/27                        650                         $51

 

Sales during the first quarter were.

Date                       Sold

1/19                        500

2/2                          600

2/13                        500

2/28                        100

The White Company uses a perpetual inventory system.

Using the White Company data, fill in the following chart to compare the results obtained under the FIFO, LIFO, and weighted-average inventory methods.

FIFO           LIFO   Weighted Average

 

Goods available for sale                       $           $              $

Ending inventory, March 31

Cost of goods sold

c. Perpetual inventory system: journal entries. At the beginning of 20X3, Beehler Company implemented a computerized perpetual inventory system. The following transactions occurred:

�               Purchases on account: 500 units @ $4 =  $2,000

�               Sales on account: 300 units @ $5 = $1,500

�               Purchases on account: 600 units @ $5 =  $3,000

�               Sales on account: 300 units @ $5 = $1,500

a. Prepare journal entries for the above purchases and sales.

b. Calculate the balance in the firm�s Inventory account.

d. Inventory valuation methods: computations and concepts. Wave Riders Surfboard Company began business on January 1 of the current year. Below are the transactions for the year

1/3:         Purchase 100 boards  @ $125

3/17:       Sold 50 boards @ $250

4/3:         Purchase 200 boards  @ $135

5/17:       Sold 75 boards @ $250

6/3:         Purchase 100 boards  @ $145

1/3:         Purchase 100 boards  @ $155

3/17:       Sold 300 boards @ $250

1/3:         Purchase 100 boards  @ $140

Wave Riders uses a perpetual inventory system.

Instructions

a. Calculate cost of goods sold, ending inventory, and gross profit under each of the following inventory valuation methods:

�               First-in, first-out

�               Last-in, first-out

�               Weighted average

b. Which of the three methods would be chosen if management�s goal is to

(1) produce an up-to-date inventory valuation on the balance sheet?

(2) approximate the physical flow of a sand and gravel dealer?

 

e. Depreciation methods. Betsy Ross Enterprises purchased a delivery van for $30,000 in January 20X7. The van was estimated to have a service life of 5 years and a residual value of $6,000. The company is planning to drive the van 20,000 miles annually. Compute depreciation expense for 20X8 by using each of the following methods:

a. Units-of-output, assuming 17,000 miles were driven during 20X8

b. Straight-line

c. Double-declining-balance

f. Depreciation computations. Alpha Alpha Alpha, a college fraternity, purchased a new heavy-duty washing machine on January 1, 20X3. The machine, which cost $1,000, had an estimated residual value of $100 and an estimated service life of 4 years (1,800 washing cycles). Calculate the following:

a. The machine�s book value on December 31, 20X5, assuming use of the straight-line depreciation method

b. Depreciation expense for 20X4, assuming use of the units-of-output depreciation method. Actual washing cycles in 20X4 totaled 500.

c. Accumulated depreciation on December 31, 20X5, assuming use of the double-declining-balance depreciation method.

g. Depreciation computations: change in estimate. Aussie Imports purchased a specialized piece of machinery for $50,000 on January 1, 20X3. At the time of acquisition, the machine was estimated to have a service life of 5 years (25,000 operating hours) and a residual value of $5,000. During the 5 years of operations (20X3 � 20X7), the machine was used for 5,100, 4,800, 3,200, 6,000, and 5,900 hours, respectively.

Instructions

a. Compute depreciation for 20X3 � 20X7 by using the following methods: straight line, units of output, and double-declining-balance.

b. On January 1, 20X5, management shortened the remaining service life of the machine to 20 months. Assuming use of the straight-line method, compute the company�s depreciation expense for 20X5.

c. Briefly describe what you would have done differently in part (a) if Aussie Imports had paid $47,800 for the machinery rather than $50,000 In addition, assume that the company incurred $800 of freight charges $1,400 for machine setup and testing, and $300 for insurance during the first year of use.

Week 4

Current Liability. What is a current liability? From the perspective of a user of financial statements, why do you believe current liabilities are separated from long-term liabilities? Based on your current experience as well as any additional research you may have done, provide two examples of situations where businesses collect monies from customers and employees and report these amounts as a current liability.

 Client Recommendations. A client comes to you thinking about starting a consulting business. Your client is specifically interested in what type of entity should be created for this new business. Based on your readings, or any additional research you may have done, discuss the advantages and disadvantages of the following: sole proprietorship, partnership, and corporation. Based on these advantages and disadvantages, provide a clear recommendation to your client.

Future Obligations Journal. The current liability section of the balance sheet lists the liabilities that are due within the next 12 months. Reflecting on your current financial situation, apply the concept of current liabilities. What does this analysis tell you about your future obligations? What did you learn from this experience?

Assignment : Liability

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.
a. Payroll accounting. Assume that the following tax rates and payroll information pertain to Brookhaven Publishing: Social Security taxes: 6% on the first $55,000 earned Medicare taxes: 1.5% on the first $130,000 earned Federal income taxes withheld from wages: $7,500 State income taxes: 5% of gross earnings Insurance withholdings: 1% of gross earnings State unemployment taxes: 5.4% on the first $7,000 earned Federal unemployment taxes: 0.8% on the first $7,000 earned
The company incurred a salary expense of $50,000 during February. All employees................................................

Week 5

 

Ratios. Ratios provide the users of financial statements with a great deal of information about the entity. Do ratios tell the whole story? How could liquidity ratios be used by investors to determine whether or not to invest in a company?

Guided Response:

Let at least two of your peers know how debt service ratios can be used by a lender in determining whether or not to lend money to a company.

Profit Margin.

 

Year Ending December 2012

Year Ending December 2011

Year Ending December 2010

Revenues

40,000

35,000

33,000

Operating Expenses

Salaries

15,000

10,000

9,000

Maintenance and Repairs

6,000

9,000

10,000

Rental Expense

2,500

2,500

2,500

Depreciation

2,000

2,000

2,000

Fuel

4,000

3,500

2,500

Total Operating Expenses

29,500

27,000

26,000

Operating Income

10,500

8,000

7,000

Sales and Administrative Expenses

6,000

4,000

3,000

Interest Expense

2,500

2,000

1,000

Net Income

2,000

2,000

3,000

      

 

Above is a comparative income statement for Cecil, Inc. for the years 2010, 2011, and 2012. Calculate the profit margin for each of these years. Comment on the profit margin trend.

Guided Response:

Let at least two of your peers know what you changes you would recommend to improve the net margin of the company.

 

Most Important Ratio Journal. Reflect for a moment on the ratios (working capital, current ratio, quick ratio, debt to asset, debt to equity, times interest earned, gross margin, and net margin) presented this week. If you were considering investing in a company, what ratio would be the most important to you? Formulate and argument to defend your position.

Assignment : Financial Ratios

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.
a. Liquidity Ratios. Edison, Stagg, and Thornton have the following financial information at the close of business on July 10:
Edison Stagg Thornton Cash $4,000 $2,500 $1,000
Short-term investments 3,000 2,500 2,000
Accounts receivable 2,000 2,500 3,000
Inventory 1,000 2,500 4,000
Prepaid expenses 800 800 800
Accounts payable 200 200 200
Notes payable: short-term 3,100 3,100 3,100
Accrued payables 300 300 300
Long-term liabilities 3,800 3,800 3,800
Instructions Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why?

 

 

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Ashford ACC 205 ACC/205 ACC205 Week 3 Assignment Inventory

nventory

a. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows.

Painting Cost

1/2 Beginning invent
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Ashford ACC 205 ACC205 Week 3 Assignment Inventory

Inventory

a. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows.

Painting                              Cost

1/2 Beginning inventory     Woods   $11,000

4/19 Purchase      Sunset   21,800

6/7 Purchase        Earth      31,200

12/16 Purchase   Moon      4,000

 

Woods and Moon were sold during the year for a total of $35,000. Determine the firm�s

a. cost of goods sold.

b. gross profit.

c. ending inventory.

b. Inventory valuation methods: basic computations. The January beginning inventory of the White Company consisted of 300 units costing $40 each. During the first quarter, purchases were:

Date                       Quantity Cost

1/15                        700                         $45

1/31                        1200                       $48

2/12                        800                         $46

2/27                        650                         $51

 

Sales during the first quarter were.

Date                       Sold

1/19                        500

2/2                          600

2/13                        500

2/28                        100

The White Company uses a perpetual inventory system.

Using the White Company data, fill in the following chart to compare the results obtained under the FIFO, LIFO, and weighted-average inventory methods.

FIFO           LIFO   Weighted Average

 

Goods available for sale                       $           $              $

Ending inventory, March 31

Cost of goods sold

c. Perpetual inventory system: journal entries. At the beginning of 20X3, Beehler Company implemented a computerized perpetual inventory system. The following transactions occurred:

�               Purchases on account: 500 units @ $4 =  $2,000

�               Sales on account: 300 units @ $5 = $1,500

�               Purchases on account: 600 units @ $5 =  $3,000

�               Sales on account: 300 units @ $5 = $1,500

a. Prepare journal entries for the above purchases and sales.

b. Calculate the balance in the firm�s Inventory account.

d. Inventory valuation methods: computations and concepts. Wave Riders Surfboard Company began business on January 1 of the current year. Below are the transactions for the year

1/3:         Purchase 100 boards  @ $125

3/17:       Sold 50 boards @ $250

4/3:         Purchase 200 boards  @ $135

5/17:       Sold 75 boards @ $250

6/3:         Purchase 100 boards  @ $145

1/3:         Purchase 100 boards  @ $155

3/17:       Sold 300 boards @ $250

1/3:         Purchase 100 boards  @ $140

Wave Riders uses a perpetual inventory system.

Instructions

a. Calculate cost of goods sold, ending inventory, and gross profit under each of the following inventory valuation methods:

�               First-in, first-out

�               Last-in, first-out

�               Weighted average

b. Which of the three methods would be chosen if management�s goal is to

(1) produce an up-to-date inventory valuation on the balance sheet?

(2) approximate the physical flow of a sand and gravel dealer?

 

e. Depreciation methods. Betsy Ross Enterprises purchased a delivery van for $30,000 in January 20X7. The van was estimated to have a service life of 5 years and a residual value of $6,000. The company is planning to drive the van 20,000 miles annually. Compute depreciation expense for 20X8 by using each of the following methods:

a. Units-of-output, assuming 17,000 miles were driven during 20X8

b. Straight-line

c. Double-declining-balance

f. Depreciation computations. Alpha Alpha Alpha, a college fraternity, purchased a new heavy-duty washing machine on January 1, 20X3. The machine, which cost $1,000, had an estimated residual value of $100 and an estimated service life of 4 years (1,800 washing cycles). Calculate the following:

a. The machine�s book value on December 31, 20X5, assuming use of the straight-line depreciation method

b. Depreciation expense for 20X4, assuming use of the units-of-output depreciation method. Actual washing cycles in 20X4 totaled 500.

c. Accumulated depreciation on December 31, 20X5, assuming use of the double-declining-balance depreciation method.

g. Depreciation computations: change in estimate. Aussie Imports purchased a specialized piece of machinery for $50,000 on January 1, 20X3. At the time of acquisition, the machine was estimated to have a service life of 5 years (25,000 operating hours) and a residual value of $5,000. During the 5 years of operations (20X3 � 20X7), the machine was used for 5,100, 4,800, 3,200, 6,000, and 5,900 hours, respectively.

Instructions

a. Compute depreciation for 20X3 � 20X7 by using the following methods: straight line, units of output, and double-declining-balance.

b. On January 1, 20X5, management shortened the remaining service life of the machine to 20 months. Assuming use of the straight-line method, compute the company�s depreciation expense for 20X5.

c. Briefly describe what you would have done differently in part (a) if Aussie Imports had paid $47,800 for the machinery rather than $50,000 In addition, assume that the company incurred $800 of freight charges $1,400 for machine setup and testing, and $300 for insurance during the first year of use.

 

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Ashford ACC 205 ACC/205 ACC205 Week 1 Assignment Basic Accounting Equations

Basic Accounting Equations

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.

a. Recognition of normal balances. The following items appear
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Ashford ACC 205 ACC/205 ACC205  Week 1 Assignment Basic Accounting Equations

Basic Accounting Equations

Please complete each of the exercises below in a word document. Save the document, and submit it in the appropriate week using the Assignment Submission button.

a. Recognition of normal balances. The following items appeared in the accounting records of Triguero's, a retail music store that also sponsors concerts. Classify each of the items as an asset, liability; revenue; or expense from the company's viewpoint. Also indicate the normal account balance of each item.
The albums, tapes, and CDs held for sale to customers. A long-term loan owed to Citizens Bank. Promotional costs to publicize a concert. Daily receipts for merchandise sold, Amounts due from customers,

Land held as an investment, A new fax machine purchased for office use. Amounts to be paid in 10 days to suppliers. Amounts paid to a mall for rent.

 

b. Basic journal entries. The following transactions pertain to the Jennifer Royall Company:
Apr. 1 Jennifer Royall invested cash of $15,000 and land valued at $10,000 from into the business. 5 Provided $1,200 of services to Jason Ratchford, a client, on account. 9 Paid $250 of salaries to an employee. 14 Acquired a new computer for $3,200, on account. 20 Collected $800 from Jason Ratchford for services provided on April 5. 24 Borrowed $7,500 from BestBanc by securing a six-month loan.
Prepare journal entries (and explanations) to record the preceding transactions and events.

c. Balance sheet preparation.
The following data relate to Preston Company as of December 31, 19XX:
Building $44,000 Accounts receivable $24,000
Cash 17,000 Loan payable 30,000
J. Preston, capital 65,000 Land 21,000
Accounts payable ?
Prepare a balance sheet as of December 31, 19XX.(See Exhibit 1.1 and 1.4)

d. Basic transaction processing. On November 1 of the current year, Richard Parker established a sole proprietorship. The following transactions occurred during the month:
1: Parker invested $19,000 into the business.
2: Paid $9,000 to acquire a used minivan.
3: Purchased $1,800 of office furniture on account.
4: Performed $2,100 of consulting services on account.
5: Paid $300 of repair expenses.
6: Received $800 from clients who were previously billed in item 4.
7: Paid $500 on account to the supplier of office furniture in item 3.
8: Received a $150 electric bill, to be paid next month.
9: Parker withdrew $600 from the business.
10: Received $250 in cash from clients for consulting services rendered.
Instructions
a. Arrange the following asset, liability, and owner�s equity elements of the accounting equation: Cash, Accounts Receivable, Office Furniture, Van, Accounts Payable, Investments/Withdrawals, and Revenues/Expenses. (See Exhibit 5)
b. Record each transaction on a separate line. After all transactions have been recorded, compute the balance in each of the preceding items.
c. Answer the following questions for Parker.
(1) How much does the company owe to its creditors at month-end? On which financial statement(s) would this information be found?
(2) Did the company have a �good� month from an accounting viewpoint? Briefly explain.

e. Transaction analysis and statement preparation. The transactions that follow relate to Burton Enterprises for March 20X1, the company�s first month of activity.
3/1: Joanne Burton, the owner invested $20,000 into the business.
3/4: Performed $2,400 of services on account.
3/7: Acquired a small parcel of land by paying $6,000 cash.
3/12: Received $700 from a client, who was billed previously on March 4.
3/15: Paid $800 to the Journal Herald for advertising expense.
3/18: Acquired $9,000 of equipment from Park Central Outfitters by paying $7,000 down and agreeing to remit the balance owed within the next 2 weeks, (Accounts Payable).
3/22: Received $300 cash from clients for services.
3/24: Paid $1,500 on account to Park Central Outfitters in partial settlement of the balance due from the transaction on March 18.
3/28: Rented a car from United Car Rental for use on March 28. Total charges amounted to $75, with United billing Burton for the amount due.
3/31: Paid $900 for March wages.
3/31: Processed a $600 cash withdrawal from the business for Joanne Burton.
Instructions
a. Determine the impact of each of the preceding transactions on Burton�s assets,
liabilities, and owner�s equity. See exhibit 1.5. Use the following format:
Assets = Liabilities + Owner�s Equity
Cash, Accounts Receivable, Land, Equipment Accounts Payable (+)Investments (+) Revenues
(-) Withdrawals (-) Expenses
a. Record each transaction on a separate line. Calculate balances only after the last transaction has been recorded.
b. Prepare an income statement, a statement of owner�s equity, and a balance sheet, (See Exhibit 1.1, 1.3 and 1.4)

f. Entry and trial balance preparation. Lee Adkins is a portrait artist. The following schedule represents Lee�s combined chart of accounts and trial balance as of May 31.
Account number Account name Debit Credit
110
Cash
$ 2,700
120
Accounts Receivable
12,100
130
Equipment and Supplies
2,800
140
Studio
45,000
210
Accounts Payable
$2,600
310
Lee Adkins, Owners Equity
57,400
320
Lee Adkins, Drawing
30,000
410
Revenue
39,000
510
Advertising Expense
2,300
520
Salaries Expense
2,100
540
Utilities Expense
2,000
$99,000
$99,000

The general ledger also revealed account no. 530, Legal and Accounting Expense. The following transactions occurred during June:
6/2:
Collected $7,500 on account from customers.
6/7:
Sold 25% of the equipment and supplies to a young artist for $700 for cash
6/10:
Received a $500 bill from the accountant for preparing last quarter�s financial statements.
6/15:
Paid $2,100 to creditors on account.
6/27:
Adkins withdrew $1,000 cash for personal use.
6/30:
Billed a customer $3,000 for a portrait painted this month.
a. Record the necessary journal entries for June on page 2 of the company�s general journal. (See Exhibit 2.6) b. Open running balance ledger �T� accounts by entering account titles, account num�bers, and May 31 balances. (See exhibit 2.3 and 2.4) c. Post the journal entries to the �T� accounts. d. Prepare a trial balance as of June 30. (See exhibit 2.9)

g. Journal entry preparation
On January 1 of the current year, Peter Houston invested $100,000 cash into his company MuniServ. Shortly thereafter, the company ac�quired selected assets of a bankrupt competitor. The acquisition included land ($15,000), a building ($40,000), and vehicles ($10,000). MuniServ paid $45,000 at the time of the transaction and agreed to remit the remaining balance due of $20,000 (an account payable) by February 15.
During January, the company had additional cash outlays for the following items:
Purchases of store equipment
$4,600
Loan payment
500
Salaries expense
2,300
Advertising expense
700

The January utilities bill of $200 was received on January 31 and will be paid on February 10. MuniServ rendered services to clients on account amounting to $9,400 and $3,700 had been received in settlement.
Instructions Present journal entries that reflect MuniServ's January transactions, starting with the $100,000 investment. (See exhibit 2.6) Compute the total debits, total credits, and ending balance that would be found in the company's Cash account. (Post to �T� Accounts, see exhibit 2.3 and 2.4) Prepare a trail balance as of January 31. (See exhibit 2.9)

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