Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN: 9781285595047
Author: Weil
Publisher: Cengage
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Banksia Company completed the following transactions during 2018-2019. The annual accounting
period ends 30 June 2019.
a)
Purchased inventory on credit at cost of AUD 16,800; perpetual inventory system is used.
Received a customer deposit of AUD 18,000 from ABC Ltd for services to be rendered in the
b)
future.
c)
Borrowed AUD 900,000 from the bank on 1 March 2019 by giving the bank a six-month, 9%
interest bearing note payable.
Performed AUD 8,000 of the services paid for by ABC Ltd; the rest will be rendered in August
d)
2019.
Received the electricity bill for AUD 24,200, which will be paid in early July.
On 1 June 2019 received rent in advance of AUD 21,600 from XYZ Ltd for a 3 month lease of
premises from 1 June until 31 August 2019.
Wages accrued in the last weekly payroll amounted to AUD 23,000 and will be paid on 5 July
f)
2019.
Required:
1)
Prepare the journal entries for each of these transactions.
2)
Prepare all adjusting entries required on 30 June 2019.
Black Ltd commenced trading on 1 September Year 3 and is preparing its accounts for the year ended 31 August Year 4. During its
first year of trading the company pays total telephone company invoices of £4,300. The three-month invoice paid in July Year 4
includes calls of £1,200 for the quarter up to 30 June Year 4 and advance rental of £960 for the quarter to 30 September Year 4.
The invoice received in October Year 4 includes calls of £840 for the quarter up to 30 September Year 4 and advance rental of
£1,200 for the quarter to 31 December Year 4.
What is the telephone expense to be recorded in the income statement for the first year of trading?
D
a) £5,180
b) £4,300
c) £4,860
d) £4,540
Black Ltd commenced trading on 1 September Year 3 and is preparing its accounts
for the year ended 31 August Year 4. During its first year of trading the company
pays total telephone company invoices of £4,300. The three-month invoice paid in
July Year 4 includes calls of £1,200 for the quarter up to 30 June Year 4 and advance
rental of £960 for the quarter to 30 September Year 4. The invoice received in
October Year 4 includes calls of £840 for the quarter up to 30 September Year 4 and
advance rental of £1,200 for the quarter to 31 December Year 4.
What is the telephone expense to be recorded in the income statement for the first
year of trading?
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- Tyrell Co. entered into the following transactions involving short-term liabilities. Purchased $35,000 of merchandise on credit from Locust, terms n/30. Replaced the April 20 account payable to Locust with a 90-day, 8%, $35,000 note payable along with paying $0 in cash. Borrowed $66,000 cash from NBR Bank by signing a 120-day, 12%, $66,000 note payable. Paid the amount due on the note to Locust at the maturity date. Paid the amount due on the note to NBR Bank at the maturity date. Borrowed $36,000 cash from Fargo Bank by signing a 60-day, 8%, $36,000 note payable. Recorded an adjusting entry for accrued interest on the note to Fargo Bank. Paid the amount due on the note to Fargo Bank at the maturity date. Prepare journal entries for all the preceding transactions and events.arrow_forwardIn January, Lily Bhd sold goods at a quoted price of RM10,000 with a credit term of 2/10, net 90. Show the journal entries and amount to be measured in the receivables account; i)When cash discount of 2% is to be applied. ii)At initial measurement iii)During the year, a customer of Lily Bhd was deemed uncollectable. Give examples of any five situations where a debtor can be declared as Uncollectable Receivables.arrow_forwardThe following are selected 2019 transactions of Kelly Company a. October 1: Purchased inventory from Sid Corporation on account $100,000. Kelly records purchases gross and uses a periodic system. b. November 1: Issued a $60,000 6-month 10% note to Sid in payment of account. c. November 1: Borrowed $80,000 from FB Bank by signing a 15 month, zero interest bearing $110,000 note. Required: 1. Prepare the journal entries for the transactions above. 2. Prepare the adjusting entries as at December 2019arrow_forward
- Tyrell Company entered into the following transactions involving short-term liabilities. Year 1 April 20 Purchased $37,500 of merchandise on credit from Locust, terms n/30. May 19 Replaced the April 20 account payable to Locust with a 90-day, 8 %, $35,000 note payable along with paying $2,500 in cash. July 8 Borrowed $57,000 cash from NBR Bank by signing a 120-day, 11%, $57,000 note payable. _?Paid the amount due on the note to Locust at the maturity date. Paid the amount due on the note to NBR Bank at the maturity date. November 28 Borrowed $24,000 cash from Fargo Bank by signing a 60-day, 9%, $24,000 note payable. December 31 Recorded an adjusting entry for accrued interest on the note to Fargo Bank. Year 2 _?_ Paid the amount due on the note to Fargo Bank at the maturity date. 5. Prepare journal entries for all the preceding transactions and events. Note: Do not round your intermediate calculations. View transaction list < Journal entry worksheet 1 2 3 4 5 6 7 8 Purchased $37,500 of…arrow_forwardRequired information [The following information applies to the questions displayed below.] On January 1, MM Company borrows $400,000 cash from a bank and in return signs an 8% installment note for five annual payments of $100,183 each. Analyze transactions involving issuance of the note and its first annual payment, by showing their effects on the accounting equation- specifically, identify the accounts and amounts (including + or -) for each transaction. Date Assets Llabilities Equity January 1 December 31arrow_forwardTyrell Co. entered into the following transactions involving short-term liabilities. Year 1 Apr. 20 Purchased $40,250 of merchandise on credit from Locust, terms n∕30. May 19 Replaced the April 20 account payable to Locust with a 90-day, 10%, $35,000 note payable along with paying $5,250 in cash. July 8 Borrowed $80,000 cash from NBR Bank by signing a 120-day, 9%, $80,000 note payable. ___?___ Paid the amount due on the note to Locust at the maturity date. ___?___ Paid the amount due on the note to NBR Bank at the maturity date. Nov. 28 Borrowed $42,000 cash from Fargo Bank by signing a 60-day, 8%, $42,000 note payable. Dec. 31 Recorded an adjusting entry for accrued interest on the note to Fargo Bank. Year 2 ___?___ Paid the amount due on the note to Fargo Bank at the maturity date. Required 1. Determine the maturity date for each of the three notes described. 2. Determine the interest due at maturity for each of the three notes. Assume a 360-day year. 3. Determine the interest…arrow_forward
- Skint Limited has an opening bank balance of €1610 on 1 May. During May, the company makes sales of €100,000. Customers are allowed one month's credit (which is availed of by all customers). during April were worth €80,000. During May, Skint Limited incurred the following expenses: Wages & salaries €31389 Monthly rent of €30,000 which is paid annually in advance on 1 January of each year Depreciation of €15,000 Variable Overheads €11067 of which are paid as incurred; and Monthly insurance expenses of €4276 which are paid quarterly in February, May, August and November each year. What is the budgeted closing cash figure at 31 May? Iarrow_forwardWarner Co. entered into the following transactions involving short-term liabilities. Year 1 Apr. 22 Purchased $5,000 of merchandise on credit from Fox-Pro, terms n∕30. May 23 Replaced the April 22 account payable to Fox-Pro with a 60-day, 15% $4,600 note payable along with paying $400 in cash. July 15 Borrowed $12,000 cash from Spring Bank by signing a 120-day, 10%, $12,000 note payable. ___?___ Paid the amount due on the note to Fox-Pro at maturity. ___?___ Paid the amount due on the note to Spring Bank at maturity. Dec. 6 Borrowed $8,000 cash from City Bank by signing a 45-day, 9%, $8,000 note payable. 31 Recorded an adjusting entry for accrued interest on the note to City Bank. Year 2 ___?___ Paid the amount due on the note to City Bank at maturity. Required 1. Determine the maturity date for each of the three notes described. 2. Determine the interest due at maturity for each of the three notes. Assume a 360-day year. 3. Determine the interest expense recorded in the adjusting…arrow_forwardThe following transactions were obtained from the books of wine wholesaler co ltd for the month of March 2021. Mar 1 Balances brought forward: Cash £620; Bank 7,142. Mar 2 The following debtors paid their accounts by cheque, in each case deducting 5 per cent cash discounts:G.Slick £260; Fish £320;T old £420 Mar 4 Paid rent by cheque £430. Mar 6 F. Black lent us £5,000 paying by cheque. Mar 8 We paid the following accounts by cheque in each case deducting a 21/2% cash discount: R. White £720; G. Green £960; L. Flip £1,600. Mar 10 Paid motor expenses in cash £81. Mar 12 J. Pie pays his account of £90, by cheque £88, deducting £2 cash discount. Mar 15 Paid wages in cash £580. Mar 18 The following paid their accounts by cheque, in each case deducting 5 per cent cash discount: A. Pony £540; B. Line & Son £700; T. Owen £520 . Mar 21 Cash withdrawn from the bank £400 for business use. Mar 24 Cash drawings £200. Mar 25 Paid W. Peat his account of £160, by cash £155, having deducted £5 cash…arrow_forward
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