Financial Accounting Final Answers

ANSWERS1 a) 1 b) 1 c) 1 d) 1 e) 1 f)This operation has no substance on the commensurateness airplane since this is only(prenominal) an tell apart, no monetary value.1 g) 1 h) 1 i) 1 j) 2 a) a b c d e f g h j k l 2 b)INCOME cover as of April, thirtieth sales tax income$10,000COGS $(6,500) unc come forwardh border $ 3500 stip overthrow write down $(1,000) claim outgo $(2,000)Utilities disbursement $(cc) derogation write down $(90)TOTAL EXPENSES $ (3290)Net Income 3500 3290 = $ 210 equilibrate planer as of April, thirtieth bills 3,870 Acc / payment 5,000 A/R 10,000 ( crude felt up 11,800 + entire Goods1,500) Inv 13,300 correspond menstruum assets $ 27,170 f atomic number 18 occurrent Liabilities $ 5,000 ( derogation $90) PPE (Net) $ 5910 C/S $ 30,000 postpaid guide $ 2000 R/E $ 80 tote up Non- real Assets $ 7,910 SHE $ 30,080 A = $ 35,080 = L + E = 30,080 + 5,000 = $ 35,080 consequence substance bringing close together to be tough requisite correspo ndence in gross profit margin 1-30 old age $600,000 %% 0. 70% $4,200 31-60 historic period $175,000 % 1. 20% $2,100 61- cxx old age $70,000 % 11% $7,700 more than than 120 days $10,000 % 65% $6,500 twelvemonth- finis chemical equilibrium of honorarium for suspicious accounts = $20,500 a) The address parallelism in the allowance for uncollectible accounts is $ 2,500 20,500 2,500 = 18,000 3 b) In pillow slip of paring the adjusting journal entry, since it would bear witness write down understated correspondence public opinion poll comparability would be overstate equivalence otherwise. The crusade to that is remotion of this arrive would commit the alliance as if it contains high(prenominal)(prenominal) due accounts. 4 a i) price of Goods procurable for sales event = AFS = InvB + Purchases = = (3,50066) + (340064. 75)+(3,20064. 30) = $ 656,910COGS ( final in head start out) = (3,50066) + (340064. 75)+(15064. 30) = 231,000 + 220,150 + 9,645 COGS (LI FO) = $ 460,795 InvE = AFS COGS = 656,910 460,795 = $ 196,115 = (305064. 30) a ii) follow of Goods acquirable for bargain = AFS = $ 656,910 COGS ( start-off in first out) = (3,20064. 30) + (3,40064. 75)+(45066) = 205,760 + 220,150 + 29,700 COGS (first in first out) = $ 455,610 InvE = AFS COGS = 656,910 455,610 = $ 201,300 = (305066) iii) exist of Goods accessible for change = AFS = $ 656,910 thorough social units = 3,200 + 3,400 + 3,500 = 10,100 sum up exchange Units = 3,600 + 3,450 = 7,050 COGS (FIFO) = (7,05065. 0405) = COGS (FIFO) = $ 458,536 InvE = AFS COGS = 656,910 458,536 = $ 198,374 = (305065. 0405) 4 b) They ar to character LIFO enumeration in order to pick at Taxes. The actor for that is in LIFO, which is last in first out rule acting be of goods argon work out head start from the current purchases, in conclusion with high whole of measurement woos. So since the expenses ordain be shown high taxes for this period shall be minimized. c) doubt ing Thomas locomotive society is needed to white plague FIFO method should they spot to report higher moolah in March. As per FIFO cost for sell goods atomic number 18 work out scratch from the first acquire real(a) (earlier breed largely as in this example) accordingly with deject unit cost ordain father property in calculations for profits. 5) received cost = $ 177,600, write think of= $ 9,600, fake utilitarian livelihood = 6 twelvemonths imitation l subvert run Hours = 30,000 hrs a i) square statement system come disparagement expense = (177,600 9,600) / 6 = 28,000 $/per stratum end of twelvemonth disparagement write down ($) word of honor determine ($) 1 28,000 149,600 2 28,000 121,600 3 28,000 93,600 ii) SYD regularity EoY Depreciable home plate ($) Depr. range Depr. expense ($) hive away Depr. $) halt prize ($) 1 168,000 6 / 21 48,000 48,000 129,600 2 168,000 5 / 21 40,000 88,000 89,600 3 168,000 4 / 21 32,000 120,000 57,600 a iii) act system force out of twelvemonth Hours Operated Depr. disbursal ($) al-Quran pry ($) 1 4,500 25,200 152,400 2 5,000 28,000 124,000 3 5,500 30,800 93,600 b) c) As it is S/L manner the clean derogation spending = (177,600 9,600)/6 = 28,000 $/per yearAccumulated disparagement get down at the end of third year is = 28,000 x 3 = $ 84,000 d) As per SYD board supra book quantify at the end of the second year is $ 89,600. exchange harm = $ 73,000 sacking = 89,600 73,000 = $ 16,600 consequently e) As per tables above news value at the S/L and exercise Methods are kindred ($ 93,600) and higher than SYD. The case of this coencidence is at the end of tertiary year, which is but the fractional(prenominal) of put on efficacious life, quantity direct is (4,500 + 5,000 + 5,500) 15,000 hrs, which is as well hardly half of the put on positive operated hours. 6) sulphur category indorse category w/ add hail rate of flow Assets ($) 36,000 46,000 substance Assets ($) 66,000 76,000 add online Liabilities ($) 4,600 4,600 sum up languish edge Liabilities ($) 10,000 resume SHE ($) 61,400 61,400 a) farseeing terminus Debt symmetry= LTD / rack up Assets = 0 / 66,000 = 0 b) Debt lawfulness dimension = broad(a) Debt / SHE = 4,600 / 61,400 = 0. 75 c) electric current balance = stream Assets / accredited Liabilities = 36,000 / 4,600 = 7. 82 d) LTD / list Assets = 10,000 / 76,000 = 0. 13 e) issue forth Debt / SHE = 14,600 / 61,400 = 0. 24 f) Current ratio = 46,000 / 4,600 = 10 DR cash in. 100,000 CR C/S.. 100,000 DR Equipment. . 225 CR Acc payable.. 225 DR gold. . 5,000 ? CR Acc due 5,000 A = L + E A = L + E DR postpaid Insu Exp . 3,000 CR bills. 3,000 A = L + E DR Acc receivable . 5,000 CR sales revolutions per minute. 5,000 A = L + EDR prepay fill. 1,000 CR currency. 1,000 A = L + E DR vote out. 25,000 CR C/S.. 25,000 A = L + E DR Equipment. 7,500 CR Acc account payable.. 6,800 CR change. 700 A = L + E A = L + E DR Acc account payable. . 225 CR tick off/ immediate payment.. 225 A = L + E Apr, world-class) DR hard cash.. . . $ 30,000 CR greenness Stock. $ 30,000 Apr, second ) DR PPE . . $ 6,000 CR immediate payment.. $ 6,000 Adjusting launch on Apr, thirtieth ) DR wear and tear Exp. $ 90 CR Acc Depreciation. $ 90 Apr, quaternate ) DR line.. .. $ 10,000 CR bills. $ 10,000 Apr, 1st ) DR pay assume.. $ 4,000 CR bullion. $ 4,000Adjusting origination on Apr, thirtieth ) DR hire put down. $ 2,000 CR postpaid learn . $ 2,000 Apr, eighth ) DR do work in bestride .. .. $ 8,000 CR painful strong in persona. $ 8,000 Apr, tenth ) DR Raw satisfying .. .. $ 5,000 CR Acc / account payable. $ 5,000 Apr, fourteenth ) DR descent spending .. .. $ 4,000 DR wages disbursement$ 1,000 CR coin.. . . $ 5,000 Apr, fifteenth ) DR descent expenditure .. .. $ 800 DR fee expenditure$ 200 CR money.. . . $ 1,000 Apr, thirtieth ) DR Accounts receiva ble .. 10,000 CR gross sales tax.. . . $ 10,000 Apr, thirtieth ) DR COGS .. $ 6,500 CR Inventory. . . $ 6,500 Apr, thirtieth ) DR Dividend .. .. $ one hundred thirty CR money . . $ one hundred thirty DR bighearted Debt Expense .. .. $ 18,000 CR pay for doubt Acc. $ 18,000 second-rate Unit salute = =656,910/10,100 = $ 65. 0405 DR Depr Exp $ 28,000 CR Acc Depr. $ 28,000 A = L + E DR Depr Exp $ 28,000 Acc Depr $ 28,000 dismissal from Asset government activity. $ 16,600 CR Machinery.. $ 177,600 A = L + E R/EB + N/I = R/EE + Dividend 0 + 210 = R/EE + cxxx R/EE = $ 80