CASH -220 A/P -220 ADD QUESTION HEREESSAY 0 POINTS MODIFY REMOVEQUE...

7. Cash -220

A/P -220

Add Question Here

Essay

0 points

Modify

Remove

Question From the following list of accounts taken from Lamar’s accounting records, identify those that would appear on the Income Statement.

(a)

Rent Expense

(b)

Land

(c)

Capital

(d)

Fees Earned

(e)

Withdrawal

(f)

Wages Expense

(g)

Investment

Answer

(a), (d), (f)

Question Identify which of the following accounts appear on a balance sheet.

(a)

Cash

(b)

Fees Earned

(c)

Joe Brown, Capital

(d)

Wages Payable

(e)

Rent Expense

(f)

Prepaid Advertising

(g)

Land

Answer

(a), (c), (d), (f), (g)

Question Indicate whether each of the following activities would be reported on the Statement of Cash Flows as an Operating Activity, an Investing

Activity, a Financing Activity, or does not appear on the Cash Flow Statement.

(a)

Cash paid for building

(b)

Cash paid to suppliers

(c)

Cash paid for owner's withdrawal

(d)

Cash received from customers

(e)

Cash received from the owner's investment

(f)

Cash received from the sale of a building

(g)

Borrowed cash from a bank

Answer

(a)

Investing

(b)

Operating

(c)

Financing

(d)

Operating

(e)

Financing

(f)

Investing

(g)

Financing

Question For each of the following, determine the amount of net income or net loss for the year.

(a)

Revenues for the year totaled $88,500 and expenses totaled $40,500. The owner made an additional investment of $15,000 during

the year.

(b)

Revenues for the year totaled $175,000 and expenses totaled $220,500. The owner withdrew $40,000 during the year.

(c)

Revenues for the year totaled $109,000 and expenses totaled $46,000. The owner invested an additional $12,000 and withdrew

$16,000 during the year.

(d)

Revenues for Konner Co. totaled $223,800 and expenses totaled $221,300. Cash withdrawals of $35,000 were paid during the year.

Answer

(a)

$48,000 net income ($88,500 - $40,500)

(b)

$45,500 net loss ($175,000 - $220,500)

(c)

$63,000 net income ($109,000 - $46,000)

(d)

$2,500 net income ($223,800 - $221,300)

Question The total assets and total liabilities of Paul’s Pools, a proprietorship, at the beginning and at the end of the current fiscal year are as

follows:

Jan. 1

Dec. 31

Total assets

$280,000

$475,000

Total liabilities

205,000

130,000

(a)

Determine the amount of net income earned during the year. The owner did not invest any additional assets in the business

during the year and made no withdrawals.

(b)

Determine the amount of net income during the year. The assets and liabilities at the beginning and at the end of the year are

unchanged from the amounts presented above. However, the owner withdrew $53,000 in cash during the year (no additional

investments).

(c)

Determine the amount of net income earned during the year. The assets and liabilities at the beginning and at the end of the

year are unchanged from the amounts presented above. However, the owner invested an additional $35,000 in cash in the

business in June of the current fiscal year (no withdrawals).

(d)

Determine the amount of net income earned during the year. The assets and liabilities at the beginning and at the end of the

year are unchanged from the amounts presented above. However, the owner invested an additional $12,000 in cash in August

of the current fiscal year and made twelve monthly cash withdrawals of $1,500 each during the year.

Answer

(a)

Owner's equity at end of year ($475,000 - $130,000)

$345,000

Owner's equity at beginning of year ($280,000 - $205,000)

75,000

Net

income

$270,000

(b)

Increase in owner's equity as in (a)

$270,000

Add

withdrawals

53,000

Net

income

$323,000

(c)

Increase in owner's equity as in (a)

$270,000

Deduct additional investment

35,000

Net

income

$235,000

(d)

Increase in owner's equity as in (a)

$270,000

Add withdrawals ($1,500 x 12)

18,000

$288,000

Deduct additional investment

12,000

Net

income

$276,000

Question Selected transaction data of a business for September are summarized below. Determine the following amounts for September: (a)

total revenue, (b) total expenses, (c) net income.

Service sales charged to customers on account during September

$33,000

Cash received from cash customers for services performed in September

28,000

Cash received from customers on account during September:

Services performed and charged to customers prior to September

13,000

Services performed and charged to customers during September

18,000

Expenses incurred prior to September and paid during September

6,500

Expenses incurred and paid in September

36,250

Expenses incurred in September but not paid in September

5,000

Expenses for supplies used and insurance (not included above) applicable to September

2,000

Answer

(a)

$61,000 ($33,000 + $28,000)

(b)

$43,250 ($36,250 + $5,000 + $2,000)

(c)

$17,750 ($61,000 - $43,250)

from the business. The amounts of the various assets, liabilities, revenues, and expenses are as follows:

Accounts payable

$ 10,250

Accounts receivable

45,950

Cash

19,390

Fees earned

60,500

Insurance expense

1,275

Land

85,400

Miscellaneous expense

1,210

Prepaid insurance

3,000

Rent expense

9,000

Salary expense

20,300

Supplies

900

Supplies expense

525

Utilities expense

2,800

Present, in good form, (a) an income statement for March, (b) a statement of owner's equity for March, and (c) a balance sheet as of March 31.

Answer

(a)

Cook’s Catering Company

Income Statement

For the Month Ended March 31, 2011

Fees earned

$60,500

Operating expenses:

Salary expense

$20,300

Rent expense

9,000

Utilities expense

2,800

Supplies expense

525

Insurance expense

1,275

Miscellaneous expense

1,210

Total operating expenses

35,110

Net income

$25,390

(b)

Statement of Owner's Equity

Norton Cook, capital, March 1, 2011

$150,000

Net income for the month

$ 25,390

Less withdrawals

31,000

Decrease in owner's equity

5,610

Norton Cook, capital, March 31, 2011

$144,390

(c)

Balance Sheet

March 31, 2011

Assets

Liabilities

Cash

$ 19,390

Accounts payable

$ 10,250

Accounts receivable

45,950

Prepaid insurance

3,000

Owner's Equity

Supplies

900

Norton Cook, capital

144,390

Land

85,400 Total

liabilities

and

Total assets

$154,640

owner's equity

$154,640

Question Simpson Designers began operations on April 1, 2011. The financial statements for Simpson Designers are shown below for the month

ended April 30, 2011 (the first month of operations). Determine the missing amounts for letters (a) through (o).

Simpson Designers

For the Month Ended April 30, 2011

Fees earned

$27,000

Wages expense

$5,250

Rent expense

(a)

Supplies expense

4,600

Utilities expense

400

Miscellaneous expense

1,250

Total operating expenses

(b)

Net income

$ (c)

Lori Simpson, capital, April 1, 2011

0

Investment on April 1, 2011

$35,000

Net income for April

(d)

$ (e)

Less withdrawals

6,000

Increase in owner's equity

(f)

Lori Simpson, capital, April 30, 2011

$38,100

April 30, 2011

Cash

$ (g)

Accounts payable

$ (i)

Supplies

8,100 Owner's

Equity

Land

(h)

Lori Simpson, capital

(j)

Total assets

$55,900

Total liabilities and

owner's equity

$(k)

Statement of Cash Flows

Cash flows from operating activities:

Cash received from customers

$23,000

Deduct cash payments for expenses and payments to