Monthly Archives: May 2013

Esplanade Company’s credit sales have the following historical pattern

ACCOUNTING Esplanade Company’s credit sales have the following historical pattern: 70% Collected in the month of sale 15% Collected in the first month after sale 10% Collected in the second month after sale 4% Collected in the third month after … Continue reading

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On January 1, 20X1, Prange Company acquired 80% of the common stock of Seaman Company for $500,000

ACCOUNTING On January 1, 20X1, Prange Company acquired 80% of the common stock of Seaman Company for $500,000. On this date Seaman had total owners’ equity of $400,000. Any excess of cost over book value is attributable to patent, which … Continue reading

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Jensen Company forecasts a need for 200,000 pounds of cotton in May

ACCOUNTING Jensen Company forecasts a need for 200,000 pounds of cotton in May. On April 11, the company acquires a call option to buy 200,000 pounds of cotton in May at a strike price of $0.3765 per pound for a … Continue reading

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North Shore Railroad operates between Chicago and upper Michigan and Wisconsin

ACCOUNTING North Shore Railroad operates between Chicago and upper Michigan and Wisconsin. Dallas Ingold, purchasing manager of North Shore Railroad, anticipates the price of diesel fuel will increase over the next few months. On September 4th, Ingold purchased an out-of-the-money … Continue reading

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PR 8-5A Oneida Furniture Company deposits all cash receipts each Wednesday and Friday in a night depository, after banking hours

ACCOUNTING PR 8-5A Bank reconciliation and entries Oneida Furniture Company deposits all cash receipts each Wednesday and Friday in a night depository, after banking hours. The data required to reconcile the bank statement as of June 30 have been taken … Continue reading

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PR 8-3A The cash account for Online Medical Co. at June 30, 2012, indicated a balance of $9,375

ACCOUNTING PR 8-3A Bank reconciliation and entries The cash account for Online Medical Co. at June 30, 2012, indicated a balance of $9,375. The bank statement indicated a balance of $10,760 on June 30, 2012. Comparing the bank statement and … Continue reading

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PR 8-2A Picasso Restoration Company completed the following selected transactions during August 2012

ACCOUNTING PR 8-2A Transactions for petty cash, cash short and over Picasso Restoration Company completed the following selected transactions during August 2012: Aug. 1. Established a petty cash fund of $750. 10. The cash sales for the day, according to … Continue reading

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PR22-4A The Controller of Santa Fe Housewares Inc. instructs you to prepare a monthly cash budget for the next three months

ACCOUNTING PR22-4A Cash Budget The Controller of Santa Fe Housewares Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budget information: March April May Sales 70,000 84,000 92,000 Manufacturing … Continue reading

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The budget director of Feathered Friends Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for October 2012

ACCOUNTING The budget director of Feathered Friends Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for October 2012 a. Estimated sales for … Continue reading

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Blythe Industries Inc. expects to maintain the same inventories at the end of 2012 as at the beginning of the year

ACCOUNTING Blythe Industries Inc. expects to maintain the same inventories at the end of 2012 as at the beginning of the year. The total of all production costs for the year is therefore as, summed to be equal to the … Continue reading

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