Question 1

On January 1,2019,the balance in the prepaid insurance account was $2,500.On December 31,2019,after the 2019 adjusting entries were made,the balance of the prepaid insurance account was $1,200.During 2019,cash payments for insurance premiums amounted to $5,000,which was debited to the prepaid insurance account.Prepare the adjusting entry,which must have been made at December 31,2019.

Accepted Answer

The answer of On January 1,2019,the balance in the prepaid...

Question 2

The comparative balance sheets of Titan Company for the years ended December 31,2019 and 2020,reported the following selected amounts:
  The 2020 income statement reported the following:
  A.Calculate the total amount of office supplies purchased during 2020.
B.Calculate the total amount of rent collected during 2020.
C.In what section of the statement of cash flows would the payments for office supplies appear?
D.In what section of the statement of cash flows would the collection for rents appear?

Accepted Answer

The answer of The comparative balance sheets of Titan Company...

Question 3

On September 1,2019,Fast Track,Inc.was started with $30,000 invested by the owners as contributed capital.On September 30,2019,the accounting records contained the following amounts:
  Prepare an income statement for September for the first month of Fast Track's operation.Ignore income taxes.

Accepted Answer

The answer of On September 1,2019,Fast Track,Inc.was started with $30,000...

Question 4

The adjusted trial balance of Tahoe Company at the end of the accounting year,December 31,2019,showed the following:
  A.Prepare all the required closing entries for Tahoe Company at December 31,2019.
B.Calculate the 2019 ending balance in retained earnings.

Accepted Answer

The answer of The adjusted trial balance of Tahoe Company...

Question 5

On September 1,2019,Fast Track,Inc.was started with $30,000 invested by the owners as contributed capital.On September 30,2019,the accounting records contained the following amounts:
  Prepare a balance sheet for Fast Track,Inc.as of September 30,2019.

Accepted Answer

The answer of On September 1,2019,Fast Track,Inc.was started with $30,000...

Question 6

Johnson Corporation is completing the accounting information processing cycle at the end of the fiscal year,June 30,2019.Johnson has provided the following trial balances as of June 30,2019:
  A.Reconstruct the adjusting entries and prepare a brief explanation of each.
B.What is the amount of net income?
C.Calculate earnings per share (EPS)assuming 1,000 shares of common stock are outstanding.

Accepted Answer

The answer of Johnson Corporation is completing the accounting information...

Question 7

Air Cargo Company recorded the following adjusting entries at the end of the accounting year,December 31,2019:
  Before these adjusting entries were recorded,a partial unadjusted trial balance reflected the following:
  Prepare the closing entries for Air Cargo Company at December 31,2019.

Accepted Answer

The answer of Air Cargo Company recorded the following adjusting...

Question 8

The results or a balance on one financial statement may affect the results or a balance on another financial statement.
Prepare a response to the following items.
A.Describe how the income statement is related to the statement of stockholders' equity.
B.Describe how the statement of stockholders' equity is related to the balance sheet.
C.Describe how the statement of cash flows is related to the balance sheet.

Accepted Answer

The answer of The results or a balance on one...

Question 9

Modern Mother Magazine (MMM)has received cash subscriptions on April 1,2019 in the amount of $3,600,000 for the next three years.The year-end for MMM is December 31,2019.Magazine delivery occurs monthly and started on April 1,2019.These were the only subscription sales for the year.
Answer the following questions for the year ended December 31,2019.
A.What amount of cash should be reported for the year on the statement of cash flows?
B.What amount of subscriptions revenue should be reported on the income statement?
C.What amount would be reported as unearned subscriptions revenue on the balance sheet as of December 31,2019?

Accepted Answer

The answer of Modern Mother Magazine (MMM)has received cash subscriptions...

Question 10

For each of the following transactions,indicate the direction of effects of the adjusting entry on the elements of the balance sheet and income statement.Using the following format,indicate + for increase,- for decrease,and NE for no effect.Do not leave any blank spaces.
Transactions:
A.Wages of $5,800 have been earned,but not paid to employees at the end of the year.
B.Supplies in the amount of $2,000 were used during the year,which are currently recorded in the office supplies (inventory)account.
C.Interest has accrued on a note payable.

Accepted Answer

The answer of For each of the following transactions,indicate the...

Question 11

What does the total asset turnover ratio measure and how is it calculated? Give two examples of transactions that decrease the ratio.

Accepted Answer

The answer of What does the total asset turnover ratio...

Question 12

Determine the effect of the following errors on the financial statements.Code your answers as follows and do not leave any blank spaces.
O: If the error results in an overstatement of the financial statement component.
U: If the error results in an understatement of the financial statement component.
N: If the error does not affect the financial statement component.
Error 1: A company failed to adjust the prepaid insurance account for insurance that was used during the period.
Revenue _____
Expenses _____
Net income _____
Assets _____
Liabilities _____
Stockholders' equity _____
Error 2: A company failed to record depreciation expense at year-end.
Revenue _____
Expenses _____
Net income _____
Assets _____
Liabilities _____
Stockholders' equity _____
Error 3: A company did not adjust the unearned revenue account for revenue earned during
the year.
Revenue _____
Expenses _____
Net income _____
Assets _____
Liabilities _____
Stockholders' equity _____

Accepted Answer

The answer of Determine the effect of the following errors...

Question 13

On July 1,2019,Bass Company paid a two-year insurance premium.On that date the following journal entry was made:
  The annual accounting period ends on December 31,2019.
A.How much of the premium should be reported as expense on the 2019 income statement?
B.What is the amount of prepaid insurance that should be reported on the balance sheet at December 31,2019?
C.Prepare the adjusting entry that should be made on December 31,2019,assuming no adjusting entries have been made during the year.

Accepted Answer

The answer of On July 1,2019,Bass Company paid a two-year...

Question 14

On September 1,2019,Fast Track,Inc.was started with $30,000 invested by the owners as contributed capital.On September 30,2019,the accounting records contained the following amounts:
  Prepare a statement of stockholders' equity for September,the first month of operation.Ignore income taxes.

Accepted Answer

The answer of On September 1,2019,Fast Track,Inc.was started with $30,000...

Question 15

At December 31,2019,the following adjusting entries were recorded in the accounts of ABD Company.
  There were no other accrued receivables or payables on ABD's books in 2019.
Calculate the balances in the following accounts immediately after the closing entries were posted.

Accepted Answer

The answer of At December 31,2019,the following adjusting entries were...

Question 16

On December 31,2019,the manager of Jordan Creek Apartments noticed that four tenants had not paid their December rent amounting to $500 each.What is the adjusting entry required on December 31,2019?

Accepted Answer

The answer of On December 31,2019,the manager of Jordan Creek...

Question 17

Explain how adjusting entries provide for potential manipulation by managers.In addition,discuss how compensation arrangements may result in incentives for such manipulation to occur.

Accepted Answer

The answer of Explain how adjusting entries provide for potential...

Question 18

Determine the effect of the following errors on the financial statements.Code your answers as follows and do not leave any blank spaces.
O: If the error results in an overstatement of the financial statement component.
U: If the error results in an understatement of the financial statement component.
N: If the error does not affect the financial statement component.
Error 1: A company failed to record accrued wage expense at year-end.
Revenue _____
Expenses _____
Net income _____
Assets _____
Liabilities _____
Stockholders' equity _____
Error 2: A company failed to accrue revenue earned at year-end.
Revenue _____
Expenses _____
Net income _____
Assets _____
Liabilities _____
Stockholders' equity _____
Error 3: A company recorded revenue when cash was received from a customer for services to be provided in the future.
Revenue _____
Expenses _____
Net income _____
Assets _____
Liabilities _____
Stockholders' equity _____

Accepted Answer

The answer of Determine the effect of the following errors...

Quiz 4: Adjustments,financial Statements,and the Quality of Earnings

On September 1,2019,Fast Track,Inc.was started with $30,000 invested by the owners as contributed capital.On September 30,2019,the accounting records contained the following amounts: Prepare an income statement for September for the first month of Fast Track's operation.Ignore income taxes.

The adjusted trial balance of Tahoe Company at the end of the accounting year,December 31,2019,showed the following: A.Prepare all the required closing entries for Tahoe Company at December 31,2019. B.Calculate the 2019 ending balance in retained earnings.

On September 1,2019,Fast Track,Inc.was started with $30,000 invested by the owners as contributed capital.On September 30,2019,the accounting records contained the following amounts: Prepare a balance sheet for Fast Track,Inc.as of September 30,2019.

Air Cargo Company recorded the following adjusting entries at the end of the accounting year,December 31,2019: Before these adjusting entries were recorded,a partial unadjusted trial balance reflected the following: Prepare the closing entries for Air Cargo Company at December 31,2019.

What does the total asset turnover ratio measure and how is it calculated? Give two examples of transactions that decrease the ratio.

On September 1,2019,Fast Track,Inc.was started with $30,000 invested by the owners as contributed capital.On September 30,2019,the accounting records contained the following amounts: Prepare a statement of stockholders' equity for September,the first month of operation.Ignore income taxes.

At December 31,2019,the following adjusting entries were recorded in the accounts of ABD Company. There were no other accrued receivables or payables on ABD's books in 2019. Calculate the balances in the following accounts immediately after the closing entries were posted.

On December 31,2019,the manager of Jordan Creek Apartments noticed that four tenants had not paid their December rent amounting to $500 each.What is the adjusting entry required on December 31,2019?

Explain how adjusting entries provide for potential manipulation by managers.In addition,discuss how compensation arrangements may result in incentives for such manipulation to occur.