2. Refer to the information given below (A+)

Refer to the information given below.

a. The August 31 balance shown on the bank statement is $9,819.

b. There is a deposit in transit of $1,263 at August 31.

c. Outstanding checks at August 31 totaled $1,883.

d. Interest credited to the account during August but not recorded on the company\’s books amounted to $108.

e. A bank charge of $36 for checks was made to the account during August. Although the company was expecting a charge, its amount was not known until the bank statement arrived.

f. In the process of reviewing the canceled checks, it was determined that a check issued to a supplier in payment of accounts payable of $636 had been recorded as a disbursement of $377.

g. The August 31 balance in the general ledger Cash account, before reconciliation, is $9,386.

Required:

(a) Prepare the adjusting journal entry (or entries) that should reflect the reconciling items. (Omit the \”$\” sign in your response.)

(b) What is the amount of cash to be included in the August 31 balance sheet for the bank account reconciled?

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Refer to the information given below (A+)

Refer to the information given below.

a. The August 31 balance shown on the bank statement is $9,796.

b. There is a deposit in transit of $1,274 at August 31.

c. Outstanding checks at August 31 totaled $1,871.

d. Interest credited to the account during August but not recorded on the company\\\’s books amounted to $101.

e. A bank charge of $40 for checks was made to the account during August. Although the company was expecting a charge, its amount was not known until the bank statement arrived.

f. In the process of reviewing the canceled checks, it was determined that a check issued to a supplier in payment of accounts payable of $626 had been recorded as a disbursement of $377.

g. The August 31 balance in the general ledger Cash account, before reconciliation, is $9,387.

Required:

Prepare a bank reconciliation as of August 31 from the above information

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Complete the answer sheet with the column headings shown here (A+)

Complete the answer sheet with the column headings shown here. For each of the following transactions or adjustments, indicate the effect of the transaction or adjustment on the appropriate balance sheet category and on net income by selecting for each account affected the account name and amount and indicating whether it is an addition (+) or a subtraction (-) and NE for No effect. Transaction ‘a’ has been done as an illustration. Net income is not affected by every transaction. In some cases only one column may be affected because all of the specific accounts affected by the transaction are included in that category.

a. Accrued interest income of $15 on a note receivable.

b. Recorded estimated bad debts in the amount of $775.

c. Wrote off an overdue account receivable of $517.

d. Converted a customer\’s $1,225 overdue account receivable into a note.

e. Accrued $55 of interest earned on the note (in d).

f. Collected the accrued interest (in e).

g. Recorded $3,200 of sales, 85% of which were on account.

h. Recognized cost of goods sold in the amount of $2,560.

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ACCT 2121 Select each player to match with the appropriate definition (A+)

ACCT 2121 Select each player to match with the appropriate definition.

Definitions Players

a. Investors and creditors (among others).

b. People who are elected by stockholders to oversee a company\’s management.

c. CPAs who examine financial statements and attest to their fairness.

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ACCT 2121 Identify the concepts for each of the events given below (A+)

ACCT 2121 Identify the concepts for each of the events given below:

Events Concepts

A. Counted unused supplies at the end of the period and valued them in U.S. dollars.

B. Valued an asset at the amount paid to acquire it, even though its market value has increased considerably.

C. Analyzed the financial statements to assess the company\’s performance.

D. Established an accounting policy that sales revenue shall be recognized only when services have been provided to the customer.

E. Prepared and distributed financial statements that provide useful financial information for creditors and investors.

F. Established a policy not to include in the financial statements the personal financial affairs of the owners of the business.

G. Used the same accounting policies over several years to facilitate analysis.

H. Established policies to report the company’s business activities in a way that depicts their economic substance.

I. Adjusted the rent accounts to show the cost of rent used up in the current period.

J. Acquired a vehicle for use in the business, reporting it at the agreed-upon purchase price rather than its higher sticker price.

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ACCT 2121 Identify the information release for each of the definitions given below (A+)

ACCT 2121 Identify the information release for each of the definitions given below:

Definitions Information Release

A. Comprehensive report containing the four basic financial statements and related notes, statements by management and auditors, and other descriptions of the company\’s activities.

B. Annual report filed by public companies with the SEC that contains detailed financial information.

C. Quarterly report filed by public companies with the SEC that contains unaudited financial information.

D. A company-prepared news announcement that is normally distributed to major news agencies.

E. Brief unaudited report for the quarter, normally containing condensed income statement and balance sheet (unaudited).

F. Report of special events (e.g., auditor changes, mergers and acquisitions) filed by public companies with the SEC.

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ACCT 2121 Identify the related component for each of the definitions given below (A+)

ACCT 2121 Identify the related component for each of the definitions given below:

Definitions Components

A. Individual who purchases stock in companies for personal ownership or for pension funds or mutual funds.

B. Financial institution or supplier that lends money to the company

C. Independent CPA who examines financial statements and attests to their fairness.

D. Securities and Exchange Commission, which regulates financial disclosure requirements.

E. Gathers, combines, and transmits financial and related information from various sources.

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ACCT 2121 Nutboy Theater Company reported the following single-step income statement (A+)

ACCT 2121 Nutboy Theater Company reported the following single-step income statement.

NUTBOY THEATER COMPANY

Income Statement

For the year ended December 31, 2010

Revenues

Ticket sales $50,000

Concession sales 2,500

Interest revenue 200

Other revenue 50

Total revenues 52,750

Expenses

Salaries and wage expense 30,000

Advertising expense 8,000

Utilities expense 7,000

Income tax expense 2,500

Total expenses 47,500

Net income $5,250

Required:

1 Prepare a multistep income statement for the Nut boy theater company.

2 Calculate the net profit margin.

3 Compare net profit margin of 2010 to the net profit margin of 8% earned in 2009. In which year did the company generate more profit from each dollar of sales?

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Diana Mark is the president of ServicePro, Inc., a company that provides temporary employees for not-for-profit companies (A+)

Diana Mark is the president of ServicePro, Inc., a company that provides temporary employees for not-for-profit companies. ServicePro has been operating for five years; its revenues are increasing with each passing year. You have been hired to help Diana in analyzing the following transactions for the first two weeks of April 2010:

April 2 Purchased office supplies for $500 on account.

April 5 Billed the local United Way office $1,950 for temporary services provided.

April 8 Paid $250 for supplies purchased and recorded on account last period.

April 8 Placed an advertisement in the local paper for $400 cash.

April 9 Purchased new equipment for the office costing $2,300 cash.

April 10 Paid employee wages of $1,200, which were incurred in April.

April 11 Received $1,000 on account from the local United Way office billed on April 5.

April 12 Purchased land as the site of a future office for $10,000. Paid $2,000 down and signed a note payable for the balance.

April 13 Issued 2,000 additional shares of stock for $40 per share in anticipation of building a new office.

April 14 Billed Family & Children\’s Services $2,000 for services rendered this month.

April 15 Received the April telephone bill for $245 to be paid next month.

Required:

1 Prepare the journal entries For above the transactions.

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4. The following transactions are February 2010 activities of Swing Hard Incorporated, which offers golfing lessons in the northeastern United States (A+)

The following transactions are February 2010 activities of Swing Hard Incorporated, which offers golfing lessons in the northeastern United States. For each of the following transactions, complete the table below, indicating the amount and effect (+ for increase and – for decrease) of each transaction. Select NE if there is no effect. Include expenses as a subcategory of stockholders\’ equity, as shown for the first transaction, which is provided as an example.

a. Swing Hard paid $4,750 for wages to its golf instructors for the month of February.

b. Swing Hard paid $1,750 for electricity used in the month of January.

c. Swing Hard received an electricity bill for $800 for the month of February, to be paid in March.

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