Thomas Company has decided to purchase a company vehicle. The accountant was given all of purchase details. Which should be used to record the vehicle in the accounting records? The amount of the loan with the bank. The average selling price of similar vehicles in the area. The manufacturer’s suggested retail price (MSRP). The price negotiated with the dealer.
Thomas Company has decided to purchase a company vehicle. The accountant was given all of purchase details. Which should be used to record the vehicle in the accounting records? The amount of the loan with the bank. The average selling price of similar vehicles in the area. The manufacturer’s suggested retail price (MSRP). The price negotiated with the dealer.
Auditing: A Risk Based-Approach (MindTap Course List)
11th Edition
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Chapter9: Auditing The Revenue Cycle.
Section: Chapter Questions
Problem 4CYBK
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Question
Thomas Company has decided to purchase a company vehicle. The accountant was given all of purchase details. Which should be used to record the vehicle in the accounting records?
The amount of the loan with the bank.
The average selling price of similar vehicles in the area.
The manufacturer’s suggested retail price (MSRP).
The price negotiated with the dealer.
A business will construct its financial statements in a particular order because they are interrelated. This means that items formulated in an earlier statement feed into the subsequent statements, and changes to items on one financial statement can have compounding effects on the overall financial position of a company.
Which of the following is one reason the statement of owner's equity is prepared after the income statement?
Which of the following is one reason the statement of owner's equity is prepared before the balance sheet?
On December 1 of the current year, Rob Elliot invested $35,000 of his cash to form a proprietorship, GGE Enterprises. After all transactions have been entered into the accounting equation , the following are the ending balances for selected items on December 31. On that date, the financial statements were prepared. The statement of owner’s equity for GGE Enterprises reported Rob Elliot’s owner’s equity as of December 31 at $38,445. The balance sheet reported total liabilities and owner’s equity of $56,900.
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Accounts
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Accounts
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Rob Elliot,
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Rob Elliot,
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Fees
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Rent
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Supplies
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Utilities
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Wages
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Miscellaneous
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Cash
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Receivable
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Land
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Payable
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Capital
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Drawing
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Earned
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Expense
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Expense
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Expense
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Expense
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Expense
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? | 8,850 | 16,500 | ? | ? | $6,000.00 | $27,250.00 | $6,400.00 | ? | $4,575.00 | $1,235.00 | $370.00 |
Review the following questions. Place an ‘X’ in the box to indicate which financial statement(s) report the desired information. Enter the amount reported on the financial statement.
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Balance
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Income
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Statement of
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Sheet
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Statement
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Owner’s Equity
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Amount
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What are the total assets owned by GGE Enterprises? |
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How much cash is being held by GGE Enterprises? |
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By what amount did Rob Elliot’s equity increase or decrease during the period? |
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What is the amount of profit or loss during December? |
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What were the total expenses for December? |
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How much expense was reported for supplies? |
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How much does GGE Enterprises owe to its creditors? |
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