!!!!!! Topic 2! Question 1:!

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1 Topic 2 Question 1: Robert McPhill formed a proprietorship to provide engineering and construction work. His jobs typically involve building and designing barking lots and Drives. Robert provided the following information about the company's operation. Evaluate the transactions and prepare journal entries. Jan. 2 nd. Robert McPhill invested $ 200,000 cash in his company. Jan. 4 th. Purchased equipment s on account for $ 40,000. Jan. 12 th. Received $ 30,000 from customers for services rendered. Jan. 14 th. Purchased computers and relative supplies for $ 11,000. Jan. 15 th. Received a bill for construction supplies used in the amount of $ 9,000. Jan. 18 th. Provided $ 64,000 for services on account. Jan. 20 th. Paid employees $ 24,000 for wages earned. Jan. 21 st. McPhill hired a financial analyst and agreed to pay her a monthly salary of $ 32,000. Jan. 22 nd. Collected %60 of the amount due for the work provided on Jan 18 th. Jan. 23 rd. Paid %30 of the amount due on the equipment purchase on Jan 4 th. Jan. 25 th. Purchased construction supplies for cash in the amount of $ 12,000. Jan. 31 st. Robert McPhill took one of the company's computers for his personal use. The device worth $ 3,000.

2 Question 2: The following are the manual journal entries maintained by Leeann Moore for her new established information technology services and consulting firm. She was very busy. Thus, she could not install the firm's computerised accounting system and kept these manual entries. She requires you, as her newly employed accountant, to prepare a ledger for the company's accounts as a primary step to begin the process of transitioning the balances of these accounts into the computerised system. General Journal Date Description Debit Credit 2 Jan 12 Cash 3,000,000 Leeann Moore's Capital 3,000,000 4 Jan 12 Equipments Loan Payable 6 Jan 12 Accounts Receivable Fees Earned 7 Jan 12 Supplies Expense Accounts Payable 11 Jan 12 Accounts Payable Cash 15 Jan 12 Wages Expense Cash 17 Jan 12 Cash Accounts Receivable 18 Jan 12 Cash Fees Earned 20 Jan 12 Supplies Expense Accounts Payable 31 Jan 12 Wages Expense Cash 31 Jan 12 Loan Payable Interest Expense Cash 600, , , ,000 30,000 30,000 30,000 30, , , , , , ,000 60,000 60, , , ,000 6, ,000

3 Question 3: The following transactions affect cash, accounts payable, accounts receivable, expenses and revenues accounts. Use T accounts to determine the ending balances for accounts payable, accounts receivable and to analyze the effects of each transaction on these accounts. Notice that at the beginning of the period the balance for the accounts receivable was $ 108,600, Accounts payable $ 62,550, and cash was $ 170, $ 30,460 of cash, received for services provided to customers. 2. Purchased supplies on account supplies in the amount of $ 4,800 (directly used). 3. Collecting $ 38,820 for previous receivables that were not collected in the past. 4. Paid $ 1,526 for utilities costs. 5. Accounts payable of $ 47,800 was paid. 6. Services on account were provided to customers in the amount of $ 97,308.

4 Question 4: M.T consulting Trail Balance June 30, 2009 Accounts Debit Credit Cash Accounts receivable 20,000 Equipment 8000 Accounts payable 6000 Capital stock 50,000 Revenue Rent expense 2000 Travel expense 2400 Salary expense 6000 Supply expense 1500 Owner's Drawings 2000 Total Prepare the Income Statement and Balance Sheet.

5 Question 5: Evaluate the next transactions and prepare journal entries and the adjusting entries by the end of the period in December The firm has purchased 18-month insurance policy on June 1, 2012 for 9000 S.R. 2. The firm started the year with a 10,000 S.R of supplies (this was already recorded at the beginning balance), and purchased during the year 15,000 S.R in supplies and discovered that only 6500 S.R on hand supplies by the end of The firm paid the amount of 1200 S.R to rent a lorry. The rental period began on 16 th of December, 2012 and ends on 14 th of February, 2013.

6 Question 6: The M.D Company needs your help with preparing the end of the year adjusting entries at December 31 for the following transactions December, 20,000,000 S.R was the amount of the loan borrowed with an 8% per annum interest rate. The loan with interest is due in 3 months December, 90,000 S.R is the amount due for the services provided to Quick Company December, 10,640 unpaid labor hours the average hour rate is 34 S.R ,000 S.R was the estimated amount for utilities used during December, (bills to be received in January).

7 Question 7: Kiki Motors is a centre that offers repair services for cars. Use the following information to prepare the adjusting entries in December 31, The records show that depreciation for equipments is $ 61, As of December 31, 2012, accrued interest on a loan that owed by Kiki is $ 10, As of December 31, 2012, $ 27,400 of services on account have been provided by Kiki. 4- On July 1, 2012, Kiki has purchased a one year insurance policy for $ 12, Kiki started the year with $ 18,952 of supplies (this was already recorded at the beginning balance), and purchased during the year $ 62,500 of supplies. By the end of 2012, the supplies account revealed an ending balance of $ 6, An amount of $ 32,461 of the unearned revenues was actually earned in December 31, 2012, as the services have been provided by Kiki. 7- Kiki agreed with an advertising company on a plan for multiple sign locations around the city. On April 1, 2012, Kiki agreed to prepay the full price of $ 13,000 to leave the signs up for 13 months.

8 Question 8: The following information about Maze Company: The incurred and recorded amount of salary expense was 2,625,000 $ and rental revenue was 14,400,000$. As of December 31, 2008 the company owes additional salaries in the amount of 45,000$ the accrued rent due from customers was 300,000$. Required: 1. Prepare the adjusting entries for salaries and rent. 2. Determine the total salaries expense and total rent revenue.

9 Question 9: The following trial balance for Albert Art Gallery does not show the necessary adjustments as described below: Albert Art Gallery Trail balance As of Dec Cash Supplies Display equipment Loan payable Capital stock Revenues Rent expense Salaries expense Interest expense Utilities expense Debit 64,400 23,765 52,500 38,500 84,000 1,750 18,900 Credit 26,250 87, ,065 Total 283, ,815 The equipment was purchased around the beginning of the year, with a 5-year life and no salvage value. Its costs should be depreciated equally over its life. Albert is to receive commissions for the art sold in the amount of 62,650. This revenue has not been recorded, but the artists will be making the payment soon. Supplies on hand at the end of the year were 11,900.

10 The rent of December has not been paid yet 3,500. Required: 1. Prepare the necessary adjusting entries. 2. Determine the adjusted balances of the accounts by using T accounts. 3. Prepare the adjusted trial balance.

11 Question 10: Provided the following information: Capital Stock 102,500 Wage expense 92,500 Revenue 225,000 Cash 22,500 Utilities expense 15,000 Beginning retained earning 27,500 Rent expense 25,000 Accounts payable 10,000 Equipment 200,000 Dividends 12,500 Accounts receivable 47,500 Notes payable 50,000 Prepare the following statements: income, retained earnings, and balance sheet for the year ending in Dec 31, 2007.

12 Question 11: Ahmad Company provided the following information for the ending year of Dec 31, Capital stock 375,000 Wage expense 60,000 Revenue 120,000 Rent expense 33,000 Beginning retained earning 133,500 Utilities expense 16,500 Accounts payable 18,750 Dividends 3750 Notes payable 75,000 Determine: 1. Net income for the period ending in Total assets. If the assets included accounts receivable of 7500 S.R for services provided in 2012, which has been excluded in the revenue amount. How would this affect your answer in 1?

13 Question 12: Al-Dar Company provided the following information: Total liabilities 900,000 S.R 1,300,000 S.R Required: compute the net income for the ending year of Dec 31, 2012 in the following cases: a. No dividends paid, no additional capital was raised. b. Paid 300,000 S.R dividends, no additional capital was raised. c. No dividends paid, additional capital was raised through shares in the amount of 1,500,000 S.R. d. Paid 300,000 S.R dividends, additional capital was raised through shares in the amount of 1,150,000 S.R. Dec 31, 2011 Dec 31, 2012 Total Assets 2,500,000 S.R 3,800,000 S.R

14 Question 13: The Madar Company was established in 2009, with capital stock of 350,000 S.R. provided the following information: Revenues, ,000 Dividends, ,500 Total equity 31 Dec, ,000 Total liabilities 31 Dec, ,000 Retained earning Dec 31, Expenses, Retained earning Dec 31, ,000 Dividends, ,000 Compute the net income for the years ending Dec 31, 2009, 2010, 2011.

15 Question 14: This is the adjusted trail balance on December 31, 2007 for Adam s company: Adam Company Adjusted trail balance As of December 31, 2007 Cash Accounts receivable Supplies Equipment Accumulated depreciation Accounts payable Loan payable Capital stock Retained earnings Dividends Revenues Rent expense Salaries expense Supplies expense Interest expense Depreciation expense Debit 80,100 53,325 16, ,825 45, , ,100 40,500 16,650 22,725 Credit 90,900 77, , , ,500 1,076,400 Total 1,808,100 1,808,100 Required: 1. Prepare the necessary closing entries. 2. Use T-accounts to determine the balances for the accounts.

16 Question 15: Al-Bader Company was established in 2002, and has requested your help in completing the missing amounts for each year. Note: begin by solving the missing amounts in 2002, and then continue to following years. Also, 2002 was the first year for the business, so retained earning beginning balance is zero. Al-Bader Company Income statement For the years ending in Dec, 31 xxxx Revenues: Services to 100,000 50,000 customers Expenses: Wages Interest - 1,500 58,500 1,500 2,500 Total expenses Net income 20,000

17 Al-Bader Company Statement of Retained Earnings For the year ending Dec, 31, xxxx Beginning retained earning Plus: Net Income 20,000 12,500 Less: Dividends 15,000 Ending retained earning 30,000

18 Assets: Cash Accounts receivable 32,500 Al-Bader Company Balance Sheet December 31, xxxx ,000 25,000 Land 90,000 90,000 90,000 Total assets Liabilities: Interest payable Loan payable Total liabilities Stockholder s equity: Capital stock Retained earnings Total stockholders equity Total liabilities and 5,000 5, , ,500 15, , ,000 equity 149, ,000

1. Which of the following elements are found on the income statement?

1. Which of the following elements are found on the income statement? ACCT 301 Pre-Course Assignment for Extra Credit (15 questions -15 Extra Credit Points) Please submit your answers (a Word file with one answer highlighted for each question) to the assignment submission