ACCT 1201 Chapter 2: Chapter 2 Exercises 1 Solutions.docx

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peachherring115

13 Feb 2014

School

Northeastern University

Department

Accounting

Course

ACCT 1201

Professor

Ronen Gal-or

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Listed below are cyclical transactions for pacioli company (a new company) for the month of january, 2011. Record each as necessary in general journal format. Received ,000 cash for the issuance of 20,000 common shares of stock. Each share of stock has a par value. Purchased land and building for a cash cost of ,000 and. Purchased equipment at a cost of ,000 with a down payment of ,000 and a signed note payable for the balance. Hired three (3) new employees at an annual salary of. Borrowed ,000 from the local bank, signing an interest-bearing note to be repaid in one year. Sold an unused plot of land at cost for ,000. Signed a one (1)-year lease to rent out an unused portion of the building at ,000 per month. Made a ,000 payment on the note signed on january 5.

Related Questions

The net changes in the balance sheet accounts of Eusey, Inc. forthe year 2011 are shown below:
Account Debit Credit
Cash dr $ 265,600
Accounts receivable cr $ 64,000
Allowance for doubtful accounts cr 14,000
Inventory dr 287,200
Prepaid expenses dr 40,000
Long-term investments cr 144,000
Land dr 300,000
Buildings dr 600,000
Machinery dr 100,000
Office equipment cr 28,000
Accumulated depreciation:
Buildings cr 24,000
Machinery dr 20,000
Office equipment dr 12,000
Accounts payable dr 233,200
Accrued liabilities cr72,000
Dividends payable cr 128,000
Bonds payable cr 940,000
Preferred stock ($50 par) dr 60,000
Common stock ($10 par) cr 156,000
Additional paid-in capitalâcommon cr 247,200
Retained earnings cr 60,800
Totals $1,898,000 $1,898,000

Additional information:
1.Unaudited Income Statement Data for Year Ended December 31,2011
Income before extraordinary items $420,000
Extraordinary losses: Condemnation of land $132,000
Loss from redemption of preferred stock 20,000 (152,000)
Net income $268,000
2. Cash dividends of $128,000 were declared December 15, 2011,payable January 15, 2012. A 5% stock dividend was issued March 31,2011, when the market value was $22.00 per share.
3. The long-term investments were sold at a $4,000 loss.
4. A building and land which cost $480,000 and had a book value of$300,000 were sold for $400,000. The cost of the land, included inthe cost and book value above, was $20,000.
5. The following entry was made to record an exchange of an oldmachine for a new one:
Machinery dr 160,000
Accumulated DepreciationâMachinery dr 40,000
Machinery cr 60,000
Bonds Payable cr 140,000
6. A fully depreciated copier machine which cost $28,000 waswritten off.
7. Preferred stock of $60,000 par value was redeemed for $80,000;the loss was charged against earnings.
8. The company issued 12,000 shares of its common stock on June 15,2011 for $27 a share. A $2 per share broker underwriting fee wasrecognized as part of Professional Fees Expense in the operatingsection of the income statement. There were 87,600 sharesoutstanding on December 31, 2011.
9. Bonds were issued at 104 on December 31, 2011. The premium wascredited to Interest Revenue.
10. Land that was condemned had a book value of $240,000.

Requirements:
1. Prepare a properly formatted and complete statement of cashflows using the indirect method. Ignore tax effects.

champagnedog807

I need detailed help with steps on how the fair value of netassets acquired of $515,000 was calculated :

NOTE : PARENTHESIS MEAN CREDIT BALANCE

On January 1, 2015 , Marshall Company acquired 100% of theoutsanding common stock of Tucker Company. To acquire these shares,Marshall issued $200,000 in long term liabilities and 20,000 sharesof common stock having a par value of $10 per share. Marshall paid$30,000 to accountants, lawyers, and brokers for assistance inacquistion and another $12,000 in connection with stock issuancecosts.

Prior to these transactions, the balance sheets for the twocompanies were as follows :

Marshall Company Book Value ;

Cash : $60,000

Receivables : $270,000

Inventory : $360,000

Land : $200,000

Buildings (net) : $420,000

Equipment (net) : $160,000

Accounts Payable : $(150,000)

Long Term Liabilities : $(430,000)

Common Stock $1 par value (110,000)

Additional Paid In Capital : $(360,000)

Retained Earnings 1/1/15 : (420,000)

Tucker Company Book Value :

Cash : $20,000

Receivables : $90,000

Inventory : $140,000

Land : $180,000

Buildings (net ) :$220,000

Equipment (net ) $50,000

Accounts Payable : (40,000)

Long Term Liabilities : (200,000)

Common Stock $20 par value : (120,000)

Additional Paid In Capital : 0

Retaineed Earnings 1/1/15 : (340,000)

In marshall's appraisal of tucker, it deemed three accounts tobe undervalued on the subsidiary's books : Inventory by $5,000 ,Land by $20,000, and Buildings by $30,000. Marshall plans tomaintain Tucker's separate legal identity and to operate Tucker asa wholly owned subsidiary .

amaranthimpala915

Create a Multi-Step Income Statement, Statement of Retained Earnings, Classified Balance Sheet and Statement of Cash Flows. These financial statements are being prepared for the fiscal month ending May 31st. Build the financial statements within the given blanks. The month of May's worksheet is to be utilized while creating the financial statements. Additional information folows:

-For the Statement of Retained Earnings, assume a beginning balance in the Retained Earnings account of $366,000. Also assume that $345,500 of dividends were declared.

-For the Classified Balance Sheet, assume that the company only has common stock and that the value of common stock at par value equals $30,200. Further assume that the value of paid-in-capital excess of par on the common stock has a value of $1,560,000.

-For the Statement of Cash Flow assume that the company purchased equipment with $200,000 cash. The company sold land and received $429,000 in cash. Also assume the following ending balances from the last financial period: Cash: $345,091; A/R: $525,000; Inventory: $836,000; Office Supplies: $5,000; A/P: $675,800. Additionally, the company paid cash dividends during the period of $345,500. Create the Statement of Cash Flow using the Indirect Method.

Worksheet for May

	Unadjusted				Adjusted		Income		Bal. Sheet
	Trial Balance		Adjustments		Trial Balance		Statement		Stmt. Own. Equity
Account Title	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.
Cash	250,000				250,000				250,000
Accounts Receivable	280,000				280,000				280,000
Allowance for Doubtful Accounts		12,500		2,415		14,915				14,915
Merchandise Inventory	745,000			5,000	740,000				740,000
Office Supplies	2,300			735	1,565				1,565
Prepaid Insurance	7,000			3,500	3,500				3,500
Land	1,628,803				1,628,803				1,628,803
Building	1,000,000				1,000,000				1,000,000
Accumulated Depreciation - Building		700,000				700,000				700,000
Equipment & Furniture - Warehouse	7,900				7,900				7,900
Accumulated Depreciation - Equip & Furn. - Warehouse		5,643		775		6,418				6,418
Equipment & Furniture - Office	7,421				7,421				7,421
Accumulated Depreciation - Equip & Furn. - Office		2,000		825		2,825				2,825
Accounts Payable		800,000				800,000				800,000
Wages Payable		0				0				0
Interest Payable		2,500				2,500				2,500
Dividends Payable		0				0				0
Unearned Rent		7,400	2,143			5,257				5,257
Notes Payable		200,000				200,000				200,000
Bonds Payable		90,000				90,000				90,000
Mortgage (Warehouse) Payable		197,000				197,000				197,000
Common Stock, $1 Par, 100,000 Authorized; 60,000 shares Issued/Outstanding		30,200				30,200				30,200
Paid In Capital - Excess of Par		1,560,000				1,560,000				1,560,000
Retained Earnings		20,500				20,500		289,574		310,074
Treasury Stock		0			0				0
Sales		1,067,500				1,067,500	1,067,500
Cost of Goods Sold	636,700		5,000		641,700			641,700
Wage Expense (hourly workers)	10,000				10,000			10,000
Salaries Expense (Exempt Staff)	32,100				32,100			32,100
Marketing Expense	64,000				64,000			64,000
Travel and Entertainment Expense	1,250				1,250			1,250
Bad Debt Expense	0		2,415		2,415			2,415
Property Tax Expense	1,455				1,455			1,455
Office Maintenance & Repair Expense	0				0			0
Legal Expenses	6,340				6,340			6,340
Insurance Expense	0		3,500		3,500			3,500
Utilities Expense	2,000				2,000			2,000
Office Supplies Expense	0		735		735			735
Telecommunications Expense	754				754			754
Depreciation Expense - Equip & Furniture - Warehouse	0		775		775			775
Depreciation Expense - Equip & Furniture - Office	0		825		825			825
Rent Income		0		2,143		2,143	2,143
Interest Expense	12,220				12,220			12,220
Total	4,695,243	4,695,243	15,393	15,393	4,699,258	4,699,258	1,069,643	1,069,643	3,919,189	3,919,189
								0		0
Net Income (Loss)							1,069,643	1,069,643	3,919,189	3,919,189

Income Statement
For the Month Ended May 31, 2016
Sales

Statement of Retained Earnings
For the Month Ended May 31, 2016

Balance Sheet
May 31, 2016

Statement of Cash Flow
For the Month Ended May 31, 2016

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ACCT 1201 Chapter 2: Chapter 2 Exercises 1 Solutions.docx

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