$5,320 $ 8,600 $2,460 (m)

4,810
(a)
7,000
(g)
2,010
$ 510 $ 1,600 (h) $ 450 (n)
$1,780 $15,400 $ 200
510 (b) 1,600 (i) 450
190
(c)
1,000 ( 1250)
(o)
$2,100 (d) $16,000 $ 1900 (p)
$2,100 (e) $16,000 (j) $1,900
$ 600 (f) $ 2,000 $1,300
2,100 16,000
(k)
1900
(q)
$2,700 $18,000 (l) $3,200 (r)
It's important to prepare the income statement before the balance sheet because the income statement
includes all transactions that impact a business. A balance sheet just shows the position of a company on a
specific date.
Total assets
Balance Sheet
Beginning balance
Net income
Less withdrawals
Ending balance
Income Statement
Expenses
Statement of Owner's Equity
Chapter 1, P 2.
1. Financial statements completed
Liabilities
Owner's equity
Set C
Revenues
Set A Set B
2. User insight: Income statement discussed
Net income
Owner's capital
Total liabilities and owner's equity
Ch1 P2
Amount
$ 750
400
600
750
$2,500
Amount
$ 300
750
400
600
$2,050
Chapter 2, E 4.
1. Purchases recognized on date shipped
Order
b july 10
Date Received Date Shipped
Total July purchases
c july 16
d july 23
e july 27
Date Received
2. Purchases recognized on date received
Order Date Shipped
july 22
d july 30
a july
Total July purchases
5
b july 15
c
Ch2 E4
= +
=
Chapter 2, E 5.
Assets = Liabilities
Expenses
+
Owner's Equity
M. Powel, Capital
M. Powell,
Withdrawals
+ Revenues
$ $ $
$ $
Ch2 E5
[Pg #]
Post.
Ref. Debit Credit
Ref. Debit Debit Credit
13 8,000
Ref. Debit Debit Credit
Ref. Debit Debit Credit
Chapter 2, E 18.
General Journal
Date Description
[Account Name] [Acct #]
Post.
Balance
Date Item Credit
General Ledger
Dec. Balance
Balance
Date Item Credit
Post.
[Account Name] [Acct #]
[Account Name] [Acct #]
Post.
Date Item
Balance
Credit
Ch2 E18
Bal.
Bal.
Bal.
Chapter 2, P 3.
1. T accounts set up
2.
Transactions recorded in the accounts (be sure to put the transaction letter beside the amounts
for easy identification)
Bal.
Accounts Receivable
Computers Office Equipment Accounts Payable
Bal.
C. Dahlen, Capital C. Dahlen, Withdrawals Tuition Revenue
Salaries Expense Utilities Expense Rent Expense
Cash Supplies
Repair Expense Advertising Expense
Ch2 P3 (1)
Chapter 2, P 3. (Continued)
3. Trial balance prepared
Star Office Training
Trial Balance
(Current Date)
4. User Insight: Transactions "f" and "j" examined
Ch2 P3 (2)
Total expenses
For the Month Ended August 31, 2011
Alvin Cleaning Company
Statement of Owner's Equity
Subtotal
Chapter 3, E 10.
For the Month Ended August 31, 2011
Alvin Cleaning Company
Income Statement
Net income
Revenue
Expenses
Ch3 E10 (1)
Owner's Equity
Liabilities
Balance Sheet
August 31, 2011
Chapter 3, E 10. (Continued)
Assets
Alvin Cleaning Company
Ch3 E10 (2)
[Subtotal]
[Subtotal]
[Subtotal]
Chapter 3, E 13.
Cash payments for insurance during 2010
Cash receipts from fees during 2010
Cash payments for wages during 2010
Ch3 E13
Debit Credit Debit Credit Debit Credit Debit Credit
10,072 10,072 10,072
29,314 29,314 29,314
5,340 h 816 1 3,060 3,096 3,096
14,700 2 13,270 1,430 1,430
2,460 3 2,274 186 186
15,000 15,000 15,000
196,000 196,000 196,000
53,400 4 14,400 67,800 67,800
103,800 103,800 103,800
30,900 5 15,450 46,350 46,350
15,900 15,900 15,900
10,800 6 2,700 13,500 13,500

9,396 9,396 9,396
8,340 7 2,980 5,360 5,360
72,000 72,000 72,000
128,730 128,730 128,730
30,000 30,000 30,000
283,470 283,470 283,470
28,800 7 2,980 31,780 31,780
h 816 816 816
120,600 i 1,920 122,520 122,520
44,400 44,400 44,400
31,050 31,050 31,050
7,200 7,200 7,200

1 3,060 3,060 3,060

2 13,270 13,270 13,270
3 2,274 2,274 2,274
4 14,400 14,400 14,400
5 15,450 15,450 15,450
6 2,700 2,700 2,700
i 1,920 1,920 1,920
59,742 59,742
625,836 625,836 56,870 56,870 661,122 661,122 316,066 316,066 404,798 404,798
Account Name Debit
Accounts Payable
Unearned Lockbox Fees
Mortgage Payable
Land
Credit
Reed Delivery ServiceWork SheetFor the Year Ended August 31, 2010
Chapter 4, P 4.
1. Work sheet completed
Trucks
Cash
Accounts Receivable
Prepaid Insurance
Delivery Supplies
Office Supplies
Depreciation ExpenseBuilding
Delivery Service Revenue
Lockbox Fees Earned
Truck Drivers' Wages Expense
Delivery Supplies Expense
Accumulated DepreciationTrucks
Office Equipment
Accumulated DepreciationOffice
Equipment
N. Reed, Capital
Trial Balance Adjustments Trial Balance Income Statement Balance Sheet
Adjusted
Office Supplies Expense
N. Reed, Withdrawals
Building
Accumulated DepreciationBuilding
Office Salaries Expense
Gas, Oil, and Truck Repairs Expense
Interest Expense
Insurance Expense
Depreciation ExpenseTrucks
Depreciation ExpenseOffice Equipment
Wages Payable
Net Income
$283,470
32,596
$316,066
122,520
44,400
31,050
7,200
3,060
13,270
2,274
14,400
15,450
2,700
256,324
$ 59,742
$ 128,730
( 30,000)
$ 98,730
59,742
$ 158,472
Income Statement
For the Year Ended August 31, 2010
Revenues
Delivery Service Revenue
Lockbok Fees
Total revenues
Interest Expense
Insurance
Delivery Service Revenue
Office Supplies
Depreciation-Building
Chapter 4, P 4. (Continued)
2. Income statement, statement of owner's equity, and balance sheet prepared
Reed Delivery Service
Total expenses
Expenses
Truck Driver Wages
Office Salaries
Gas Oil and Repairs
Depreciation-Tuck
Depreciation-Office Equipment
Net income
Beginning Balance
Withdrawls
Subtotal
Net Income
N. Reed, Capital, August 31, 2010
Reed Delivery Service
Statement of Owner's Equity
For the Year Ended August 31, 2010
Ch4 P 4 (2)
$ 10,072
$ 29,314
$ 3,096
$ 1,430
$ 186
$ 15,000
$196,000
67,800
128,200
$103,800
46,350
57,450
$15,900
13,500
2,400
$247,148
$ 9,396
$ 5,360
$ 72,000
$ 1,920
$ 88,676
$158,472
158,472
$247,148
August 31, 2010
A/D Building
Trucks
Reed Delivery Service
Balance Sheet
Cash
A/R
Prepaid Insurance
Land
Building
Office Equipment
Chapter 4, P 4. (Continued)
Assets
A/D Trucks
Total liabilities and owner's equity
Delivery Supplies
Office Supplies
Mortgage Payable
Wages Payable
Total liabilities
A/D-Office Equipment
Total assets
Owner's Equity
Capital
Total owner's equity
Liabilities
Accounts Payable
Unearned Lockbox Fees
Ch4 P 4 (3)
Debit Credit
31 3,060
3,060
31 13,270
13,270
$14,700 $1,430 = $13,270
31 2,274
2,274
=
31 14,400
14,400
31 15,450
15,450
31 2,700
2,700
31 2,980
2,980
31 816
816
31 1,920
1,920
3. Adjusting, closing, and reversing entries prepared
Delivery Expense
Aug. Insurance Expense
Expired Insurance
Date Description
Depreciation
Chapter 4, P 4. (Continued)
2010
General Journal
Adjusting entries:
Prepaid Insurance
Office supplies remaining
Delivery Supplies
To record Inv of Unused Delivery Supplies
Office Supplies Expense
Office Supplies
To record Estimated Depreciation
Unearned Lockbox Fees
Acc. Depreciation-Building
Depreciation
Acc Depreciation- Office Equipment
Depreciation
To record Estimated Depreciation
Acc. Depreciation Truck
To record Estimated Depreciation
Wages
Wages Payable
To record wages owed
Lockbox Fees Earned
To record Lockbox fees earned
Lockbox Fees Earned
Unearned Lockbox Fees
To record unearned fees.
Ch4 P 4 (4)
Debit Credit
31 283,470
32,596
316,066
31
122,520
44,400
31,050
7,200
3,060
13,270
2,274
14,400
15,450
2,700
31
31
General Journal
Date Description
Chapter 4, P 4. (Continued)
Closing entries:
Income Summary
2010
Aug. Delivery Service Revenue
Lockbox Fees
To record Closing Entries to Inc Summary
Income Summary
Wages
Salaries
Gas, Oil
Interest
Insurance
Delivery
Office Supplies
Depreciation
Depreciation
Depreciation
To record Closing Entries to Inc Summary
Ch4 P 4 (5)
Property, plant, and equipment
Intangible assets
(continued)
June 30, 2011
Total current assets
Total assets
Total property, plant, and equipment
Investments
Chapter 5, P 3.
Assets
Mike's Hardware Company
Balance Sheet
Current assets
Ch5 P3 (1)
Owner's Equity
Chapter 5, P 3. (Continued)
Current liabilities
Total liabilities and owner's equity
Total liabilities
Total owner's equity
Liabilities
Total current liabilities
Long-term liabilities
Ch5 P3 (2)
3. User insight: Ratios discussed
a.
=
b.
=
Chapter 5, P 3. (Continued)
2. Liquidity and profitability measures computed
=
Current Ratio =
=
Debt to Equity
Ratio
=
Ch5 P3 (3)
1 1,000
1,000
3 400
400
10 588
12
600
$1,000 $400
$600 x 2%
$600 $12
11 1,600
1,600
31 1,600
1,600
+ # # =
Chapter 6, E 6.
Mar. Accounts Receivable
Accounts Receivable
Sales-Penkas Co
To record Sales 2/10 n 30 FOB Shipping
Returns and Allowances
Accounts Receivable
Ro record return of items-Penkas
Accounts Receivable:
Cash
Sales Discounts
To record net amount collected Penkas
Accounts Receivable
= $600
Discount:
= $12
= $588
Payment:
Sales-Penkas Co
To record Sales 2/10 n 30 FOB Shipping
Cash
Accounts Receivable
$1,600
Record Collection-no discount
The total amount received from Penkas Company (debits to the Cash account):
$1,600
Ch6 E6
Year 1 Year 2 Year 3
Year 1 Year 2 Year 3
Ending inventory
Cost of goods sold
Beginning inventory
Purchases
Cost of goods available for sale
Chapter 8, E 8.
1. Cost of goods sold computed by FIFO method
2. Cost of goods sold computed by LIFO method
Purchases
Beginning inventory
Cost of goods available for sale
Ending inventory
Cost of goods sold
Ch8 E8
days
times
Chapter 9, SE 2.
Receivable Turnover =
720000
90000
=
$8
times
$90,000
=
$720,000
= 8.0
Days' Sales
Uncollected
=
8.0
=
365
= 45.6 days
Ch9 SE2
$69,800 $65,000
6,400 2,400
$63,400 $62,600
a. x x =
b. x x =
c. x x =
d. x x =
e. x x =
Chapter 9, E 12.
Accounts Receivable
Bal. 65,000 Collection 2,400
Sale 7,200
Bal. 69,800 Write-off 4,800
Bal. 65,000
Bal. 2,400
Allowance for Uncollectible Accounts
Write-off 4,800 Bal. 6,400
Chapter 9, E 13.
Before
Write-off
After
Write-off
Accounts receivable
Allowance for uncollectible accounts
Net accounts receivables
.1
.12
.09
.15
.06
$ 77,520.00 $1,938.00
$ 36,720.00 $374.50
$ 54,400.00
.17
$ 61,000.00 $439.20
.25
.1667
.08
.333
$1,088.22
$102,000.00 $5,095.00
Ch9 E12 to E13
To find the present value of the purchase transaction:
yes, good investment
$62,753.00 present value of net cash flows
30,000.00
less machine purchase price
$ 32,753.00 net present value of transaction
$ 5,200.00 annual net cash flow
12.060 factor from present value table
Chapter 10, E 14.
x

Ch10 E14
1.
( x
( x
( x
( x
( x
( x
( x
2. User insight: Additional information identified
)
Medicare tax payable - employer
)
State unemployment tax payable
)
Federal unemployment tax payable
)
Social Security tax payable - employees
)
Social Security tax payable - employer
Medicare tax payable - employees
)
Chapter 10, P 4.

Current liabilities determined
The current liabilities of Garcia Repair Shop as of December 31, 2010, are as
Federal income tax withholding
Total current liabilities
Sales tax payable
)
follows:
Accounts payable
Notes payable
Property taxes payable
Ch10 P4 (1)
=
= =
+
days
times
Days' Payable = = days
= =
Chapter 10, P 4. (Continued)
3. User insight: Liquidity ratios computed and evaluated (cents omitted)
Working Capital
Payables Turnover =
times
=
=
Ch10 P4 (2)
$425,000
* ( =
The costs for all the software should be capitalized and amortized over 5 years- its useful
life $425000/5= 85000 depreciation annually
$425,000 $85,000 years ) $340,000
Chapter 11, SE 10.
Intangible assets
Software*
Ch11 SE10
64,000 64,000 24,000
16,000
22,800
Bal. Bal. 1,200
2,400
Bal. 2,400
1
$40 =
2
$44 =
3
$40 =
4
$38 =
5
=
6
=
1,600 shares $64,000
$
600
600 shares $22,800
Chapter 12, E 13.
Cash Treasury Stock, Common
shares $
shares $26,400
shares
400 shares $16,000
Paid-in Capital, Treasury Stock
26,400
16,000
22,800
1,200
Ch12 E13
60,000
26,000
Bal. 86,000
12,000
Bal. 12,000
Bal.
3,800
Bal. 3,800
1
shares =
2
shares =
3
shares =
6,500 $10 par value $65,000
2,500 $10.00
Bal. 25,000
Dividends Dividends Payable
par value $25,000
15,000 $4 par value $60,000

1. Transactions recorded in T accounts
39,000
Treasury Stock, Common
25,000
Bal. 3,800
Chapter 12, P 1.
79,000 12,000
3,800
Bal.
40,000
12,000 100,000
Cash
79,000
Common Stock
65,000
Additional Paid-in Capital Start-up and Organization Costs
25,000
67,000
Ch12 P1
$100,000
* =
Chapter 12, P 1. (Continued)
2. Stockholders' equity section of balance sheet prepared
Balance Sheet
May 31, 2011
Stockholders' Equity
Total contributed capital
Retained earnings*
Total contributed capital and retained earnings
Dora Corporation
3. User insight: Effects of cash dividend declaration discussed.
Contributed capital
Total stockholders' equity
Ch12 P1(2)
2011
Mar. 1 439,600
39,600
400,000
Aug. 31 17,010
990
18,000
( 6 / )
( 6 / )
=

=
Sept. 1 18,000
18,000
$18,000 $16,000 $2,000
Interest Payable
0.08 12
Cash
To reflect payment of Interest 3/1-8/31 on 9/1
Interest Expense
Premium on Bonds Payable (39600/40)
Interest Payable (400k*.09 * 6/12)
Chapter 13, SE 6.
Cash
To record Interest Expense and amtz of premium
$400,000 0.09 12
$400,000
Premium on Bonds Payable
Bonds Payable
Issuance of Bonds Payable
Ch13 SE6

/ =
Chapter 13, E 16.

1. Current market value of the bonds calculated.
Present value of 20 periodic payments at 4% (8% 2)
(from Table 1*):
2. Gain or loss determined.
Market value (total present value) of bond issue
* From the appendix on present value tables.
(from Table 2*):
Present value of a single payment at the end of 20 periods
with interest compounded semiannually at 4% (8% 2)
Face value
Cash paid
Gain
**
** **
Ch13 E16