Question 1

The accountant for Franklin Company prepared the following list of account balances from the company's records for the year ended December 31,2011:
 $\begin{array}{llll}
\text { FeesEarned } & \$ 165,000 & \text { Cash } & \$ 30,000 \
\text { Accounts Receivable } & 14,000 & \text { Selling Expenses } & 44,000 \
\text { Equipment } & 64,000 & \text { Capital Stock } & 7,000 \
\text { Accounts Payable } & 22,000 & \text { Retained Earnings } & 23,000 \
\text { Salaries \& Wages Expense } & 40,000 & \text { Prepaid Rent } & 2,000 \
\text { Dividends } & 5,000 & \text { Income Taxes Expense } & 13,000 \
\text { Salaries \& Wages Payable } & 15,000 & \text { Rent Expense } & 20,000
\end{array}$ 
Determine the total liabilities at the end of 2011 for Franklin Company.

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Question 2

What information does the income statement give to business users?

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Question 3

At the end of its accounting period,December 31,2011,Hsu's Financial Services has assets of $575,000 and stockholders' equity of $335,000.Using the accounting equation and considering each case independently,determine the following amounts.
a.Hsu's liabilities as of December 31,2011.
b.Hsu's liabilities as of December 31,2012,assuming that assets increased by $56,000 and stockholders' equity decreased by $32,000.
c.Net income or net loss during 2012,assuming that as of December 31,2012,assets were $592,000,liabilities were $450,000,and there were no additional capital stock sales or dividends paid in 2012.

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Question 4

Explain the interrelationship between the balance sheet and the statement of cash flows.

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Question 5

The Austin Land Company sold land for $85,000 in cash.The land was originally purchased for $65,000.At the time of the sale,$40,000 was still owed to Regions Bank.After the sale,The Austin Land Company paid off the loan.Explain the effect of the sale and the payoff of the loan on the accounting equation.

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Question 6

The total assets and the total liabilities of a business at the beginning and at the end of the year appear below.During the year,the company paid $55,000 in cash dividends and issued an additional $33,000 of capital stock.
 $\begin{array}{llll}
 & \text { Asssets } & \text { Liabilities } \
\text { Beginning of year }& \$ 305,000 & \$ 200,000 \
\text { End of year } & 365,000 & 230,000
\end{array}$ 
Calculate the net income for the year.

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Question 7

Simpson Auto Body Repair purchased $20,000 of machinery.The company paid $8,000 in cash at the time of the purchase and signed a promissory note for the remainder to be paid in four monthly installments.

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Question 8

The accountant for Franklin Company prepared the following list of account balances from the company's records for the year ended December 31,2011:
 $\begin{array}{llll}
\text { FeesEarned } & \$ 165,000 & \text { Cash } & \$ 30,000 \
\text { Accounts Receivable } & 14,000 & \text { Selling Expenses } & 44,000 \
\text { Equipment } & 64,000 & \text { Capital Stock } & 7,000 \
\text { Accounts Payable } & 22,000 & \text { Retained Earnings } & 23,000 \
\text { Salaries \& Wages Expense } & 40,000 & \text { Prepaid Rent } & 2,000 \
\text { Dividends } & 5,000 & \text { Income Taxes Expense } & 13,000 \
\text { Salaries \& Wages Payable } & 15,000 & \text { Rent Expense } & 20,000
\end{array}$ 
Determine the total assets at the end of 2011 for Franklin Company.

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Question 9

On July 1 of the current year,the assets and liabilities of Wong Company are as follows: Cash,$27,000;Accounts Receivable,$12,300;Supplies,$3,100;Land,$35,000;Accounts Payable,$13,900.What is the amount of stockholders' equity as of July 1 of the current year?

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Question 10

Match between columns
                        Premises: wages expense
accounts receivable
accounts payable
dividends
land
capital stock

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Question 11

Indicate how the following transactions affect the accounting equation:
(a)The purchase of supplies on account.
(b)The purchase of supplies for cash.
(c)Cash dividends paid to stockholders.
(d)Revenues received in cash.
(e)Revenues received on account.

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Question 12

The accountant for Franklin Company prepared the following list of account balances from the company's records for the year ended December 31,2011:
 $\begin{array}{llll}
\text { FeesEarned } & \$ 165,000 & \text { Cash } & \$ 30,000 \
\text { Accounts Receivable } & 14,000 & \text { Selling Expenses } & 44,000 \
\text { Equipment } & 64,000 & \text { Capital Stock } & 7,000 \
\text { Accounts Payable } & 22,000 & \text { Retained Earnings } & 23,000 \
\text { Salaries \& Wages Expense } & 40,000 & \text { Prepaid Rent } & 2,000 \
\text { Dividends } & 5,000 & \text { Income Taxes Expense } & 13,000 \
\text { Salaries \& Wages Payable } & 15,000 & \text { Rent Expense } & 20,000
\end{array}$ 
Based on this information,is Franklin Company profitable? Explain your answer by including net income or loss.

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Question 13

Amos Moving Services' account balances at March 31,2014,the end of the current year,are listed below. The Retained Earnings balance was $180,000 at April 1,2013,the beginning of the current year.
 $\begin{array}{llll}
\text { AccountsPayable } & \$ 2,000 & \text { Miscellaneous Expense } & \$ 1,030 \
\text { Accounts Receivable } & 10,340 & \text { Office Expense } & 1,240 \
\text { Cash } & 21,420 & \text { Sipplies } & 1,670 \
\text { FeesEarned } & 73,450 & \text { Wages Expense } & 23,550 \
\text { Land } & 47,000 & \text { Dividends } & 16,570 \
\text { Building } & 157,630 & \text { Capital Stock } & 25,000
\end{array}$ 
Based on the data provided for Amos Moving Services,prepare an income statement for the current year ended March 31,2014.

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Question 14

Amos Moving Services' account balances at March 31,2014,the end of the current year,are listed below.The Retained Earnings balance was $180,000 at April 1,2013,the beginning of the current year.
 $\begin{array}{llll}
\text { AccountsPayable } & \$ 2,000 & \text { Miscellaneous Expense } & \$ 1,030 \
\text { Accounts Receivable } & 10,340 & \text { Office Expense } & 1,240 \
\text { Cash } & 21,420 & \text { Sipplies } & 1,670 \
\text { FeesEarned } & 73,450 & \text { Wages Expense } & 23,550 \
\text { Land } & 47,000 & \text { Dividends } & 16,570 \
\text { Building } & 157,630 & \text { Capital Stock } & 25,000
\end{array}$ 
Based on the data provided for Amos Moving Services,prepare a balance sheet for the current year ended March 31,2014.

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Question 15

What are the three sections of the statement of cash flows?

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Question 16

Given the following: Beginning retained earnings $ 58,000
Ending retained earnings $ 30,000
Dividends declared and paid $ 25,000
Calculate net income or net loss.

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Question 17

There are four transactions that affect stockholders' equity.
(a)What are the two types of transactions that increase stockholders' equity?
(b)What are the two types of transactions that decrease stockholders' equity?

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Question 18

Discuss the characteristics of a LLC (Limited liability company).

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Question 19

a. A vacant lot acquired for $83,000 cash is sold for $127,000 in cash.What is the effect of the sale on the total amount of the seller's (1)assets, (2)liabilities,and (3)stockholders' equity?
b.Assume that the seller owes $52,000 on a loan for the land.After receiving the $127,000 cash in (a),the seller pays the $52,000 owed.What is the effect of the payment on the total amount of the seller's (1)assets, (2)liabilities,and (3)stockholders' equity?

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Question 20

Amos Moving Services' account balances at March 31,2014,the end of the current year,are listed below.The Retained Earnings balance was $180,000 at April 1,2013,the beginning of the current year.
 $\begin{array}{llll}
\text { AccountsPayable } & \$ 2,000 & \text { Miscellaneous Expense } & \$ 1,030 \
\text { Accounts Receivable } & 10,340 & \text { Office Expense } & 1,240 \
\text { Cash } & 21,420 & \text { Sipplies } & 1,670 \
\text { FeesEarned } & 73,450 & \text { Wages Expense } & 23,550 \
\text { Land } & 47,000 & \text { Dividends } & 16,570 \
\text { Building } & 157,630 & \text { Capital Stock } & 25,000
\end{array}$ 
Based on the data provided for Amos Moving Services,prepare a retained earnings statement for the year ended March 31,2014.

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Quiz 1: Introduction to Accounting and Business

What information does the income statement give to business users?

Explain the interrelationship between the balance sheet and the statement of cash flows.

Simpson Auto Body Repair purchased $20,000 of machinery.The company paid $8,000 in cash at the time of the purchase and signed a promissory note for the remainder to be paid in four monthly installments.

On July 1 of the current year,the assets and liabilities of Wong Company are as follows: Cash,$27,000;Accounts Receivable,$12,300;Supplies,$3,100;Land,$35,000;Accounts Payable,$13,900.What is the amount of stockholders' equity as of July 1 of the current year?

Indicate whether each of the following represents an asset,liability,or stockholder's equity item.

Indicate how the following transactions affect the accounting equation: (a)The purchase of supplies on account. (b)The purchase of supplies for cash. (c)Cash dividends paid to stockholders. (d)Revenues received in cash. (e)Revenues received on account.

What are the three sections of the statement of cash flows?

Given the following: Beginning retained earnings $ 58,000 Ending retained earnings $ 30,000 Dividends declared and paid $ 25,000 Calculate net income or net loss.

There are four transactions that affect stockholders' equity. (a)What are the two types of transactions that increase stockholders' equity? (b)What are the two types of transactions that decrease stockholders' equity?

Discuss the characteristics of a LLC (Limited liability company).