Final Exam Review Essay

final EXAM REVIEWBE15-4. Lump-Sum gross salesRavonette spate issued 300 shargons of $10 par economic assess super C business line and 100 shares of $50 par value preferred persuade for a lump sum of $13,500. The common stock has a market bell of $20 per share, and the preferred stock has a market price of $90 per share. pull in journal institution. P15-2. Treasury Stock worryClemson caller-up had the following stockholders paleness as of January 1, 2012. familiar stock, $5 par value, 20,000 shares issued $100,000 Paid-in capital in extra of parcommon stock 300,000 Retained compensation 320,000Total stockholders equity $720,000Feb. 1 Clemson repurchased 2,000 shares of treasury stock at a price of $19 per share. Mar. 1 800 shares of treasury stock repurchased preceding(prenominal) were reissued at $17 per share. Mar. 18 500 shares of treasury stock repurchased above were reissued at $14 per share. Apr. 22 600 shares of treasury stock repurchased above were reissued at $20 per share. Stock Dividend Problem (Page 17 in Moodle Ch. 15 Notes) CS, $5 par, 40,000 shares issued and outstanding $ 200,000 Paid-in capital in excess of par 835,000Retained earnings 2,160,000Shares of the confederacys stock are interchange at this time at $22. 1. A 10% stock dividend is declared and issued.2. A 50% stock dividend is declared and issued.3. A 2-for-1 stock split is declared and issued.E3.9. Adjusting EntriesSupplies Accounts dueBeg. Bal. 800 10/31 470 10/17 2,100 10/31 1,650 Salaries and Wages outgo Salaries and Wages Payable10/15 800 10/31 60010/31 600 Unearned dish Revenue Supplies write off10/31 cd 10/20 650 10/31 470 Service Revenue 10/17 2,100 10/31 1,650 10/31 400Instructions Reconstruct 3 work entries and 4 adjusting entries.P4.3. (Irregular Items)Maher Inc. reported income from keep trading operations ahead taxes during 2012 of $790,000. Additional transactions occurring in 2012 but not considered in the $790,000 are as follows. 1. The good deal experienced an uninsured flood breathing out (extraordinary) in the issue forth of $90,000 during the yr. The tax rank on this head is 46%. 2. At the beginning of 2010, the corporation purchased a machine for $54,000 ( ease value of $9,000) that had a useful life of 6 old age. The bookkeeper use straight-line dispraise for 2010, 2011, and 2012 but failed to deduct the salvage value in computing the depreciation base. 3. Sale of securities held as a musical composition of its portfolio resulted in a loss of $57,000 (pretax).4. When its  chairperson died, the corporation realized $150,000 from an insurance policy. The money surrender value of this policy had been carried on the books as an togment in the touchstone of $46,000 (the gain is nontaxable). 5. The corporation disposed of its unskilled division at a loss of $115,000 before taxes. Assume that this transaction meets the criteria for lay off operations. 6. The corporation decid ed to change its method of stock certificate pricing from average appeal to the graduation in first out method. The effect of this change on prior years is to increase 2010 income by $60,000 and decrease 2011 income by $20,000 before taxes. The FIFO method has been used for 2012. The tax sum up on these items is 40%.Instructions restore an income statement for the year 2012 starting with income from continuing operations before taxes. Compute earnings per share as it should be shown on the face of the income statement. Common shares outstanding for the year are 120,000 shares. (Assume a tax rate of 30% on all items, unless indicated otherwise.) m Value of Money ProblemsBE6.5.Sally Medavoy go out invest $8,000 a year for 20 years in a fund that impart earn 12% annual bear on. If the first wages into the fund occurs today, what amount lead be in the fund in 20 years? If the first payment occurs at year-end, what amount entrust be in the fund in 20 years?BE6.7. stern Fill mores lifelong imagine is to own his own fishing ride to use in his retreat. John has latterly come into an heritage of $400,000. He estimates that the boat he wants will cost $300,000 when he retires in 5 years. How much of his inheritance must he invest at an annual rate of 12% (compounded annually) to corrupt the boat at retirement?BE6.8.Refer to the selective information in BE6.7. Assuming quarterly compound of amounts invested at 12%, how much of John Fillmores inheritance must be invested to have enough at retirement to buy the boat?BE6.12.maria Alvarez is investing $300,000 in a fund that earns 8% interest compounded annually. What equal amounts can Maria withdraw at the end of each of the next 20 years?BE6.14.Amy Monroe wants to pee-pee a fund today that will enable her to withdraw $25,000 per year for 8 years, with the first withdrawal to take distinguish 5 years from today. If the fund earns 8% interest, how much must Amy invest today?Bad Debt Expense EntriesBE 7.4. Wilton, Inc. had net gross sales in 2012 of $1,400,000. At declination 31, 2012, before adjusting entries, the balances in selected accounts were Accounts Receivable $250,000 debit, and Allowance for obscure Accounts $2,400 credit. If Wilton estimates that 2% of its net sales will promote to be uncollectible, prepare the celestial latitude 31, 2012, journal entry to drop off hazardous debt expense. BE7.5. Use the information presented in BE7.4 for Wilton, Inc. (a) kind of of estimating the uncollectibles at 2% of net sales, suffer that 10% of accounts receivable will prove to be uncollectible. touch on the entry to record bad debt expense. (b) Instead of estimating uncollectibles at 2% of net sales, assume Wilton prepares an aging register that estimates total uncollectible accounts at $24,600. Prepare the entry to record bad debt expense.Non-Interest mien Note ReceivableBE7.7.Dold Acrobats lent $16,529 to Donaldson, Inc., evaluate Donaldsons 2-year, $20,000, z ero-interest-bearing note on 1/1/2012. The implied interest rate is 10%. Prepare Dolds journal entries for the initial transaction, recognition of interest each year, and the assembly of $20,000 at maturity.Inventory Errors (From Moodle Notes Ch. 8)1. Merchandise purchased on account in 2010 was not put down until 2011, when the companys bookkeeper reliable an report for $5,430. The shipment had arrived and was counted in physical roll at the end of 2010.a) What entry was not make in 2010?b) What adjusting entry was made at 12/31/10?c) What is the correcting entry in 2011?2. Goods costing $22,000 were shipped f.o.b. transit point by a supplier on December 28, 2011. The company received the invoice and recorded it on December 29 however, the goods were not included in the physical count of inventory since they were in transit. a) What entry was correctly made in 2011?b) What incorrect adjusting entry was made on 12/31/11?c) What is the correcting entry in 2012?BE9.2. Lower of make up or MarketFloyd Corporation has the following quaternary items in its ending inventory. Item Cost Replacement Cost Net doable Value (NRV) NRV less Normal arrive at Margin Jokers $2,000 $2,050 $2,100 $1,600Penguins 5,000 5,100 4,950 4,100Riddlers 4,400 4,550 4,625 3,700Scarecrows 3,200 2,990 3,830 3,070Determine inventory value and record loss using accommodation method.BE9.7.Gross Profit MethodFosbre Inc.s April 30 inventory was destroyed by fire. January 1 inventory was $150,000, and purchases for January through April totaled $500,000. Sales for the same period were $700,000. Fosbres principle gross dinero percentage is 35% on sales. Using the gross profit method, estimate Fosbres April 30 inventory that was destroyed by fire.