Question 1
On September 1, Roshek Office Supply had an inventory of 31 calculators at a cost of $17 each. The company uses a perpetual inventory system. During September, the following transactions occurred.
Sept. 6 Purchased 92 calculators at $29 each from Harlow Co. terms 2/10, n/30.
Sept. 9 Paid freight of $184 on calculators purchased from Harlow Co.
Sept. 10 Returned 4 calculators to Harlow Co. for $124 credit (including freight) because they did not meet specifications.
Sept. 12 Sold 31 calculators costing $31 (including freight) for $46 each to Village Book Store, terms n/30.
Sept. 14 Granted credit of $46 to Village Book Store for the return of one calculator that was not ordered.
Sept. 20 Sold 49 calculators costing $31 for $50 each to Dixie Card Shop, terms n/30.
Journalize the September transactions. (Record entries in the order displayed in the problem statement. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date Account Titles and Explanation Debit Credit
(To record credit sale.)
(To record cost of merchandise sold.)
(To record merchandise returned.)
(To record cost of merchandise returned.)
(To record credit sale.)
(To record cost of merchandise sold.)
Question 2
Twix Company Company had the following account balances at year-end: Cost of Goods Sold $63,840; Inventory $17,440; Operating Expenses $31,200; Sales Revenue $126,720; Sales Discounts $1,140; and Sales Returns and Allowances $1,750. A physical count of inventory determines that merchandise inventory on hand is $13,380.
(a) Prepare the adjusting entry necessary as a result of the physical count. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Account Titles and Explanation Debit Credit
(b) Prepare closing entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Account Titles and Explanation Debit Credit
Question 3
In its income statement for the year ended December 31, 2014, Michael Company reported the following condensed data.
Operating expenses $ 770,140 Interest revenue $ 33,970
Cost of goods sold 1,292,860 Loss on disposal of plant assets 17,420
Interest expense 72,840 Net sales 2,413,640
(a) Prepare a multiple-step income statement. (List other revenues before other expenses.)
MICHAEL COMPANY
Income Statement
For the Year Ended December 31, 2014
b) Prepare a single-step income statement.
MICHAEL COMPANY
Income Statement
For the Year Ended December 31, 2014
Question 4
The trial balance of Roman Company at the end of its fiscal year, August 31, 2014, includes these accounts: Inventory $25,740; Purchases $149,830; Sales Revenue $194,950; Freight-in $4,470; Sales Returns and Allowances $3,200; Freight-out $1,660; and Purchase Returns and Allowances $6,290. The ending inventory is $19,160.
Prepare a cost of goods sold section for the year ending August 31 (periodic inventory).
Question 5
The trial balance of Mr. Rosiak Fashion Center contained the following accounts at November 30, the end of the company's fiscal year.
Mr. Rosiak Fashion Center
Trial Balance
November 30, 2014
Debit Credit
Cash $ 12,672
Accounts Receivable 31,672
Inventory 48,672
Supplies 6,200
Equipment 136,972
Accumulated Depreciation—Equipment $ 23,000
Notes Payable 54,972
Accounts Payable 52,472
Common Stock 57,944
Retained Earnings 38,000
Dividends 8,000
Sales Revenue 759,172
Sales Returns and Allowances 12,800
Cost of Goods Sold 501,372
Salaries and Wages Expense 132,028
Advertising Expense 28,372
Utilities Expense 14,091
Maintenance and Repairs Expense 12,100
Freight-out 16,700
Rent Expense 23,909
Totals $985,560 $985,560
Adjustment data:
1. Supplies on hand totaled $2,100.
2. Depreciation is $11,500 on the equipment.
3. Interest of $4,091 is accrued on notes payable at November 30.
4. Inventory actually on hand is $48,492.
Complete the worksheet.
MR. ROSIAK
Worksheet
For the Year Ended November 30, 2014
Account Titles Trial Balance Adjustments Adj. Trial Balance Income Statement Balance Sheet
Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.
Cash 12,672
Accounts Receivable 31,672
Inventory 48,672
Supplies 6,200
Equipment 136,972
Accum. Depreciation—Equipment 23,000
Notes Payable 54,972
Accounts Payable 52,472
Common Stock 57,944
Retained Earnings 38,000
Dividends 8,000
Sales Revenue 759,172
Sales Returns and Allowances 12,800
Cost of Goods Sold 501,372
Salaries and Wages Expense 132,028
Advertising Expense 28,372
Utilities Expense 14,091
Maintenance and Repairs Expense 12,100
Freight-out 16,700
Rent Expense 23,909
Totals 985,560 985,560
Supplies Expense
Depreciation Expense
Interest Expense
Interest Payable
Totals
Net Loss
Totals
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