西方財務(wù)會計課后答案(第四章)

CHAPTER4CompletionoftheAccountingCycleASSIGNMENTCLASSIFICATIONTABLEBrief

A

BStudyObjectives*1.Prepareaworksheet.

Questions1,2,3,4,

Exercises1,2,3

Exercises1,2,4,5

Problems1A,2A,3A,

Problems1B,2B,3B,5

4A,5A

4B,5B*2.Explaintheprocessofclosingthebooks.*3.Describethecontentand

6,7,11,128,9

4,5,67

3,6,8,113,6

1A,2A,3A,4A,5A1A,2A,3A,

1B,2B,3B,4B,5B1B,2B,3B,purposeofapost-closingtrialbalance.

4A,5A

4B,5B*4.Statetherequiredsteps

10,11,12

8

11

5A

5Bintheaccountingcycle.*5.Explaintheapproachesto

13

9

9

6Apreparingcorrectingentries.*6.Identifythesectionsofaclassifiedbalancesheet.

14,15,16,17,18,19,

10

2,7,10

1A,2A,3A,4A,5A

1B,2B,3B,4B,5B20*7.Preparereversingentries.

10,21,22

11

11*Note:AllasteriskedQuestions,Exercises,andProblemsrelatetomaterialcontainedintheappendix*tothechapter.4-1ASSIGNMENTCHARACTERISTICSTABLEProblem

Difficulty

TimeAllottedNumber1A

DescriptionPrepareaworksheet,financialstatements,andadjusting

LevelSimple

(min.)40?50andclosingentries.2A

Completeworksheetandpreparefinancialstatements,

Moderate

50?60closingentries,andpost-closingtrialbalance.3A

Preparefinancialstatements,closingentries,andpost-

Moderate

40?50closingtrialbalance.4A

Completeworksheet;prepareaclassifiedbalancesheet,

Moderate

50?60adjustingandclosingentries,andpost-closingtrialbalance.5A6A

Completeallstepsintheaccountingcycle.Analyzeerrorsandpreparecorrectingentriesandtrial

ComplexModerate

70?9040?50balance.1B

Prepareaworksheet,financialstatements,andadjusting

Simple

40?50andclosingentries.2B

Completeworksheetandpreparefinancialstatements,

Moderate

50?60closingentries,andpost-closingtrialbalance.3B

Preparefinancialstatements,closingentries,andpost-

Moderate

40?50closingtrialbalance.4B

Completeworksheet;prepareaclassifiedbalancesheet,

Moderate

50?60adjustingandclosingentries,andpost-closingtrialbalance.5B

Completeallstepsintheaccountingcycle.

Complex

70?90ComprehensiveProblem:Chapters2to44-2BLOOM'STAXONOMYTABLE4-3CorrelationChartbetweenBloom’sTaxonomy,StudyObjectivesandEnd-of-ChapterExercisesandProblemsKnowledgeComprehensionBE4-1Q4-1Q4-2Q4-3Q4-4Q4-5BE4-3Q4-7BE4-4BE4-5BE4-6E4-3E4-6E4-3E4-6P4-2AE4-11P4-5AP4-5BBE4-9E4-9P4-6ABE4-10E4-2E4-7E4-10P4-2AP4-3AP4-2BP4-3BP4-1AP4-4AP4-5AP4-1BQ4-22BE4-11E4-11InterpretingFinancialReportingFinancialGroupDecisionCaseComparativeAnalysisStatementsGlobalFocusCookieCommunicationChronicleExploringtheWebResearchCaseEthicsCaseExploringtheWebP4-4BP4-5BP4-3AP4-1AP4-2BP4-4AP4-3BP4-5AP4-1BP4-4BP4-5BE4-8P4-2AP4-3AP4-2BP4-3BE4-11P4-1AP4-4AP4-5AP4-1BP4-4BP4-5BE4-1E4-2P4-2AP4-3AP4-2BP4-3BBE4-2E4-4E4-5P4-1AP4-4AP4-5AP4-1BP4-4BP4-5BApplicationAnalysisSynthesisEvaluationStudyObjective*1.Prepareaworksheet.*2.ExplaintheprocessofclosingQ4-6thebooks.Q4-11Q4-12*3.Describethecontentandpurposeofapost-closingtrialbalance.Q4-11Q4-12BE4-8Q4-13Q4-10Q4-8Q4-9BE4-7Q4-17Q4-18Q4-19Q4-20Q4-10Q4-21*4.Statetherequiredstepsintheaccountingcycle.*5.Explaintheapproachestopreparingcorrectingentries.*6.Identifythesectionsofaclas-Q4-14sifiedbalancesheet.Q4-15CorrelationChartbetweenBloom’sTaxonomy,StudyObjectivesandEnd-of-ChapterExercisesandProblemsKnowledgeComprehensionBE4-1Q4-1Q4-2Q4-3Q4-4Q4-5BE4-3Q4-7BE4-4BE4-5BE4-6E4-3E4-6E4-3E4-6P4-2AE4-11P4-5AP4-5BBE4-9E4-9P4-6ABE4-10E4-2E4-7E4-10P4-2AP4-3AP4-2BP4-3BP4-1AP4-4AP4-5AP4-1BQ4-22BE4-11E4-11InterpretingFinancialReportingFinancialGroupDecisionCaseComparativeAnalysisStatementsGlobalFocusCookieCommunicationChronicleExploringtheWebResearchCaseEthicsCaseExploringtheWebP4-4BP4-5BP4-3AP4-1AP4-2BP4-4AP4-3BP4-5AP4-1BP4-4BP4-5BE4-8P4-2AP4-3AP4-2BP4-3BE4-11P4-1AP4-4AP4-5AP4-1BP4-4BP4-5BE4-1E4-2P4-2AP4-3AP4-2BP4-3BBE4-2E4-4E4-5P4-1AP4-4AP4-5AP4-1BP4-4BP4-5BApplicationAnalysisSynthesisEvaluationStudyObjective*1.Prepareaworksheet.*2.ExplaintheprocessofclosingQ4-6thebooks.Q4-11Q4-12*3.Describethecontentandpurposeofapost-closingtrialbalance.Q4-11Q4-12BE4-8Q4-13Q4-10Q4-8Q4-9BE4-7Q4-17Q4-18Q4-19Q4-20Q4-10Q4-21*4.Statetherequiredstepsintheaccountingcycle.*5.Explaintheapproachestopreparingcorrectingentries.*6.Identifythesectionsofaclas-Q4-14sifiedbalancesheet.Q4-15Q4-16*7.Preparereversingentries.BroadeningYourPerspectiveANSWERSTOQUESTIONS.5.

No.Aworksheetisnotapermanentaccountingrecord.Theuseofaworksheetisanoptionalstepintheaccountingcycle.Theworksheetismerelyadeviceusedtomakeiteasiertoprepareadjustingentriesandthefinancialstatements.Theamountshownintheadjustedtrialbalancecolumnforanaccountequalstheaccountbalanceintheledgerafteradjustingentrieshavebeenjournalizedandposted.Thenetincomeof$12,000willappearintheincomestatementdebitcolumnandthebalancesheetcreditcolumn.Anetlosswillappearintheincomestatementcreditcolumnandthebalancesheetdebitcolumn.Formalfinancialstatementsareneededbecausethecolumnardataarenotproperlyarrangedandclassifiedforstatementpurposes.Forexample,thedividendsaccountislistedwithassets.6.

(1)(2)(3)(4)

(Dr)Individualrevenueaccountsand(Cr)IncomeSummary.(Dr)IncomeSummaryand(Cr)Individualexpenseaccounts.(Dr)IncomeSummaryand(Cr)RetainedEarnings(fornetincome).(Dr)RetainedEarningsand(Cr)Dividends.3.

IncomeSummaryisatemporaryaccountthatisusedintheclosingprocess.Theaccountisdebitedforexpensesandcreditedforrevenues.Thedifference,eithernetincomeorloss,isthenclosedtotheretainedearningsaccount.Thepost-closingtrialbalancecontainsonlybalancesheetaccounts.Itspurposeistoprovetheequalityofthepermanentaccountbalancesthatarecarriedforwardintothenextaccountingperiod.Theaccountsthatwillnotappearinthepost-closingtrialbalanceareDepreciationExpense;Dividends;andServiceRevenue.Areversingentryistheexactopposite,bothinamountandinaccounttitles,ofanadjustingentryandismadeatthebeginningofthenewaccountingperiod.Reversingentriesareanoptionalstepintheaccountingcycle.Thestepsthatinvolvejournalizingare:(1)journalizethetransactions,(2)journalizetheadjustingentries,and(3)journalizetheclosingentries.Thethreetrialbalancesarethe:(1)trialbalance,(2)adjustedtrialbalance,and(3)post-closingtrialbalance.Correctingentriesdifferfromadjustingentriesbecausethey:(1)arenotarequiredpartoftheaccountingcycle,(2)maybemadeatanytime,and(3)mayaffectanycombinationofaccounts.4-4QuestionsChapter4(Continued)*14.

Thestandardclassificationsinabalancesheetare:AssetsCurrentAssetsLong-termInvestmentsProperty,Plant,andEquipmentIntangibleAssets

LiabilitiesandStockholders’EquityCurrentLiabilitiesLong-termLiabilitiesStockholders’Equity*15.*16.*17.*18.

Acompany’soperatingcycleistheaveragetimerequiredtogofromcashtocashinproducingrevenues.Currentassetsarecashandotherresourcesthatarereasonablyexpectedtoberealizedincashorsoldorconsumedinthebusinesswithinoneyearofthebalancesheetdateorthecompany’soperatingcycle,whicheverislonger.Currentassetsarelistedintheorderoftheirliquidity.Long-terminvestmentsareresourcesthatcanberealizedincash.However,theconversionintocashisnotexpectedwithinoneyearortheoperatingcycle,whicheverislonger.Property,plant,andequipmentaretangibleresourcesofarelativelypermanentnaturethatareusedinthebusinessandnotintendedforsale.Themajordifferencesbetweencurrentliabilitiesandlongterm-liabilitiesare:DifferenceSourceofpayment.Timeofexpectedpayment.Natureofitems.

CurrentLiabilitiesExistingcurrentassetsorothercurrentliabilities.Oneyearortheoperatingcycle.Debtspertainingtotheoperatingcycleandothershort-termdebts.

Long-termLiabilitiesOtherthanexistingcurrentassetsorcreatingcurrentliabilities.Beyondoneyearortheoperatingcycle.Mortgages,bonds,andotherlong-termliabilities.*19.

(a)(b)

Theowner’sequitysectionforacorporationiscalledstockholders’equity.Thetwoaccountsandthepurposeofeachare:(1)Capitalstockisusedtorecordinvestmentsofassetsinthebusinessbytheowners(stockholders).(2)Retainedearningsisusedtorecordnetincomeretainedinthebusiness.*20.*21.

Thereportformbalancesheetdiffersfromtheaccountformbalancesheetinthelocationoftheliabilitiesandstockholders’equitysection.Inthereportformthissectionisplacedbelowassets.Intheaccountformthesectionisplacedtotherightofassets.Afterreversingentrieshavebeenmade,thebalanceswillbeInterestPayable,zerobalance;InterestExpense,acreditbalance.*22.

(a)

Jan.10

SalariesExpense

8,000Cash

8,000BecauseoftheJanuary1reversingentrythatcreditedSalariesExpensefor$4,500,SalariesExpensewillhaveadebitbalanceof$3,500whichequalstheexpenseforthecurrentperiod.4-5QuestionsChapter4(Continued)(b)

Jan.10

SalariesPayableSalariesExpenseCash

4,5003,500

8,000NotethatSalariesExpensewillagainhaveadebitbalanceof$3,500.4-6SOLUTIONSTOBRIEFEXERCISESBRIEFEXERCISE4-1Thestepsinusingaworksheetareperformedinthefollowingsequence:(1)prepareatrialbalanceontheworksheet,(2)enteradjustmentdata,(3)enteradjustedbalances,(4)extendadjustedbalancestoappropriatestatementcolumnsand(5)totalthestatementcolumns,computenetincome(loss),andcompletetheworksheet.Fillingintheblanks,theanswersare1,3,4,5,2.ThesolutiontoBRIEFEXERCISE4-2ison8.BRIEFEXERCISE4-3IncomeStatement

BalanceSheetAccount

Dr.Cr.

Dr.Cr.AccumulatedDepreciationDepreciationExpenseCommonStockDividendsServiceRevenueSuppliesAccountsPayableBRIEFEXERCISE4-4

X

X

XX

XXXDec.31313131

ServiceRevenueIncomeSummaryIncomeSummarySalariesExpenseSuppliesExpenseIncomeSummaryRetainedEarningsRetainedEarningsDividends4-7

50,00027,00023,0002,000

50,00023,0004,00023,0002,000BRIEFEXERCISE4-24-8KEOCOMPANYWorkSheetAccountTitles4,00058,00025,000(c)(a)1,2008001,200(c)800(b)1,10025,8001,10080059,100(a)1,200(b)1,1002,800TrialBalanceDr.Cr.AdjustmentsDr.Cr.AdjustedTrialBalanceDr.Cr.IncomeStatementDr.Cr.59,10025,800BalanceSheetDr.Cr.2,8001,1008001,200PrepaidInsuranceServiceRevenueSalariesExpenseAccountsReceivableSalariesPayableInsuranceExpenseKEOCOMPANYWorkSheetAccountTitles4,00058,00025,000(c)(a)1,2008001,200(c)800(b)1,10025,8001,10080059,100(a)1,200(b)1,1002,800TrialBalanceDr.Cr.AdjustmentsDr.Cr.AdjustedTrialBalanceDr.Cr.IncomeStatementDr.Cr.59,10025,800BalanceSheetDr.Cr.2,8001,1008001,200PrepaidInsuranceServiceRevenueSalariesExpenseAccountsReceivableSalariesPayableInsuranceExpenseBRIEFEXERCISE4-5SalariesExpense23,000(2)23,000SuppliesExpense4,000(2)4,000

IncomeSummary(2)27,000(1)50,000(3)23,00050,00050,000RetainedEarnings(4)2,000(3)23,000

ServiceRevenue(1)50,00050,000Dividends2,000(4)2,000Bal.21,000BRIEFEXERCISE4-6July3131

GreenFeeRevenueIncomeSummaryIncomeSummarySalariesExpenseMaintenanceExpenseGreenFeeRevenue

14,60010,700

14,6008,2002,500Date

Explanation

Ref.Debit

Credit

Balance14,6007/31

Closingentry

14,600

0SalariesExpenseDate

Explanation

Ref.Debit

Credit

Balance8,2007/31

Closingentry

8,200

04-9BRIEFEXERCISE4-6(Continued)MaintenanceExpenseDate

Explanation

Ref.Debit

Credit

Balance2,5007/31

Closingentry

2,500

0BRIEFEXERCISE4-7Theaccountsthatwillappearinthepost-closingtrialbalanceare:AccumulatedDepreciationCommonStockSuppliesAccountsPayableBRIEFEXERCISE4-8Thepropersequencingoftherequiredstepsintheaccountingcycleisasfollows:..9.

Analyzebusinesstransactions.Journalizethetransactions.Posttoledgeraccounts.Prepareatrialbalance.Journalizeandpostadjustingentries.Prepareanadjustedtrialbalance.Preparefinancialstatements.Journalizeandpostclosingentries.Prepareapost-closingtrialbalance.Fillingintheblanks,theanswersare4,2,8,7,5,3,9,6,1.BRIEFEXERCISE4-91.

ServiceRevenueAccountsReceivable4-10

780

780BRIEFEXERCISE4-9(Continued)2.

AccountsPayable($1,850–$1,580)StoreSupplies

270

270BRIEFEXERCISE4-10KRENCOMPANYPartialBalanceSheetCurrentassetsCashShort-terminvestmentsAccountsreceivableSuppliesPrepaidinsuranceTotalcurrentassets*BRIEFEXERCISE4-11

$18,4006,70012,5005,2003,600$46,400Nov.1

SalariesPayable1,200SalariesExpense

1,200ThebalancesafterpostingthereversingentryareSalariesExpense(Cr.)$1,200andSalariesPayable$0.4-11SOLUTIONSTOEXERCISESEXERCISE4-1CAJONCOMPANY(Partial)WorkSheetFortheMonthEndedApril30,2006AdjustedTrialBalance

IncomeStatement

BalanceSheetAccountTitles

Dr.

Cr.

Dr.

Cr.

Dr.

Cr.CashAccountsReceivablePrepaidRentEquipmentAccum.DepreciationNotesPayableAccountsPayableCommonStockRetainedEarningsDividendsServiceRevenueSalariesExpenseRentExpenseDepreciationExpenseInterestExpense

14,7527,8402,28023,0503,6509,84076067157

4,9215,7005,67225,0008,96012,590

9,84076067157

12,590

14,7527,8402,28023,0503,650

4,9215,7005,67225,0008,960InterestPayableTotalsNetIncomeTotals

_____62,900

5762,900

______11,3281,26212,590

______12,590______12,590

______51,572______51,572

5750,3101,26251,5724-12EXERCISE4-2CAJONCOMPANYIncomeStatementFortheMonthEndedApril30,2006RevenuesServicerevenueExpensesSalariesexpenseRentexpenseDepreciationexpenseInterestexpenseTotalexpensesNetincomeCAJONCOMPANYRetainedEarningsStatementFortheMonthEndedApril30,2006

$9,84076067157

$12,59011,328$1,262RetainedEarnings,April1Add:NetincomeLess:DividendsRetainedEarnings,April30CAJONCOMPANYBalanceSheetApril30,2006AssetsCurrentassetsCashAccountsreceivablePrepaidrentTotalcurrentassetsProperty,plant,andequipment

$8,9601,26210,2223,650$6,572$14,7527,8402,28024,872Equipment

$23,050Less:AccumulateddepreciationTotalassets4-13

4,921

18,129$43,001EXERCISE4-2(Continued)CAJONCOMPANYBalanceSheet(Continued)April30,2006LiabilitiesandStockholders’EquityCurrentliabilitiesNotespayableAccountspayableInterestpayableTotalcurrentliabilitiesStockholders’equity

$5,7005,6725711,429CommonStockRetainedEarningsTotalstockholders’equityTotalliabilitiesandstockholders’equityEXERCISE4-3

$25,0006,572

31,572$43,001(a)Apr.30303030(b)

ServiceRevenueIncomeSummaryIncomeSummarySalariesExpenseRentExpenseDepreciationExpenseInterestExpenseIncomeSummaryRetainedEarningsRetainedEarningsDividends

12,59011,3281,2623,650

12,5909,840760671571,2623,650IncomeSummary

RetainedEarnings(2)(3)

11,328(1)12,5901,26212,59012,590

(4)

3,650Bal.8,960(3)1,262Bal.6,5724-14EXERCISE4-3(Continued)(c)

CAJONCOMPANYPost-ClosingTrialBalanceApril30,2006Debit

CreditCashAccountsReceivablePrepaidRentEquipmentAccumulatedDepreciationNotesPayableAccountsPayableInterestPayableCommonStock

$14,7527,8402,28023,050

$4,9215,7005,6725725,000RetainedEarningsEXERCISE4-4

_______$47,922

6,572$47,922(a)AccountsReceivableServiceRevenueInsuranceExpensePrepaidInsuranceDepreciationExpenseAccumulatedDepreciationSalariesExpenseSalariesPayable4-15

600400900500

600400900500EXERCISE4-4(Continued)(b)

IncomeStatement

BalanceSheetDr.

Cr.

Dr.

Cr.AccountsReceivablePrepaidInsuranceAccum.DepreciationSalariesPayableServiceRevenueSalariesExpenseInsuranceExpenseDepreciationExpense

XXX

X

XX

XXEXERCISE4-5(a)AccountsReceivable—$27,000($34,000–$7,000).Supplies—$3,000($7,000–$4,000).AccumulatedDepreciation—$22,000($12,000+$10,000).SalariesPayable—$0Noliabilityrecordeduntiladjustmentsaremade.InsuranceExpense—$8,000($26,000–$18,000).SalariesExpense—$44,000($49,000–$5,000).(b)AccountsReceivableServiceRevenueInsuranceExpensePrepaidInsuranceSuppliesExpenseSuppliesDepreciationExpenseAccumulatedDepreciationSalariesExpenseSalariesPayable4-16

7,0008,0004,00010,0005,000

7,0008,0004,00010,0005,000EXERCISE4-6(a)

GeneralJournal

J15DateJuly31

AccountTitlesandExplanationCommissionRevenue

Ref.404

Debit67,000

CreditRentRevenueIncomeSummary

429350

6,500

73,500313131

IncomeSummarySalariesExpenseUtilitiesExpenseDepreciationExpenseRetainedEarningsIncomeSummaryRetainedEarningsDividends

350720732711320350320332

74,6001,10016,000

55,70014,9004,0001,10016,000(b)RetainedEarnings

No.320DateJuly31

ExplanationBalance

Ref.Debit

Credit

Balance25,2003131

ClosenetlossClosedividends

J15J15

1,10016,000

24,1008,100IncomeSummary

No.350DateJuly313131

ExplanationRef.DebitCloserevenuesJ15CloseexpensesJ1574,600TransfernetlossJ15

Credit73,5001,100

Balance73,500(1,100)04-17EXERCISE4-6(Continued)(c)

LANZACOMPANYPost-ClosingTrialBalanceJuly31,2006Debit

CreditCashAccountsReceivableEquipmentAccumulatedDepreciationAccountsPayableUnearnedRentRevenueCommonStock

$14,8408,78015,900

$5,4004,2201,80020,000RetainedEarningsEXERCISE4-7(a)LANZACOMPANY

_______$39,520

8,100$39,520IncomeStatementFortheYearEndedJuly31,2006RevenuesCommissionrevenueRentrevenueTotalrevenuesExpensesSalariesexpenseUtilitiesexpenseDepreciationexpenseTotalexpensesNetloss

$55,70014,9004,000

$67,0006,50073,50074,600($1,100)LANZACOMPANYRetainedEarningsStatementFortheYearEndedJuly31,2006Retainedearnings,August1,2005Less:Netloss

$1,100

$25,200DividendsRetainedearnings,July31,20064-18

16,000

17,100$8,100EXERCISE4-7(Continued)(b)

Currentassets

LANZACOMPANYBalanceSheetJuly31,2006AssetsCashAccountsreceivableTotalcurrentassetsProperty,plant,andequipmentEquipment

$15,900

$14,8408,78023,620Less:AccumulateddepreciationTotalassetsLiabilitiesandStockholders’EquityCurrentliabilitiesAccountspayableUnearnedrentrevenueTotalcurrentliabilities

5,400

10,500$34,120$4,2201,8006,020Stockholders’equityCommonstock$20,000RetainedearningsTotalstockholders’equityTotalliabilitiesandstockholders’equityEXERCISE4-8

8,100

28,100$34,120(a)June30303030

ServiceRevenueIncomeSummaryIncomeSummarySalariesExpenseSuppliesExpenseRentExpenseIncomeSummaryRetainedEarningsRetainedEarningsDividends4-19

16,10013,1003,0002,500

16,1008,8001,3003,0003,0002,500EXERCISE4-8(Continued)(b)IncomeSummaryJune3013,100June3016,100June303,00016,10016,100EXERCISE4-91.2.3.

AccountsPayable($830–$380)CashSuppliesEquipmentAccountsPayableDividendsSalariesExpense

450560400

45056504400EXERCISE4-10(a)

Currentassets

REGOBOWLINGALLEYINC.BalanceSheetDecember31,2006AssetsCashAccountsreceivablePrepaidinsuranceTotalcurrentassetsProperty,plant,andequipmentLandBuilding

$128,800

$64,000

$18,04014,5204,68037,240Less:Acc.depr.—buildingEquipment

45,60062,400

83,200Less:Acc.depr.—equipmentTotalassets

18,720

43,680

190,880$228,1204-20EXERCISE4-10(Continued)REGOBOWLINGALLEYINC.BalanceSheet(Continued)December31,2006LiabilitiesandStockholders’EquityCurrentliabilitiesCurrentportionofmortgagepayableAccountspayableInterestpayableTotalcurrentliabilitiesLong-termliabilitiesMortgagepayable($94,780–$13,600)TotalliabilitiesStockholders’equityCommonstock$100,000

$13,60012,3002,60028,50081,180109,680Retainedearnings($15,000+$3,440*)Totalstockholders’equityTotalliabilitiesandstockholders’equity

18,440

118,440$228,120*Netincome=$14,180–$780–$7,360–$2,600=$3,440(b)Currentassetsexceedcurrentliabilitiesby$8,740($37,240–$28,500).Inaddition,approximately50%ofcurrentassetsareintheformofcash.Insum,thecompany’sliquidityappearstobereasonablygood.*EXERCISE4-11(a)Dec.3131(b)Jan.11

CommissionRevenueIncomeSummaryIncomeSummaryInterestExpenseCommissionRevenueAccountsReceivableInterestPayableInterestExpense4-21

92,0007,8004,2001,500

92,0007,8004,2001,500*EXERCISE4-11(Continued)(c)&(e)AccountsReceivableDec.31Balance19,80031Adjusting4,20024,000Jan.1ReversingCommissionRevenueDec.31Closing92,000Dec.31Balance31Adjusting92,000Jan.1Reversing4,200Jan.10InterestPayableDec.31Adjusting

4,20087,8004,20092,0004,2001,500Jan.1

Reversing

1,500InterestExpense(d)

Dec.31Balance31AdjustingJan.15

6,300Dec.31Closing1,5007,8002,700Jan.1Reversing(1)

7,8007,8001,500Jan.1015

CashCommissionRevenue(2)InterestExpenseCash4-22

4,2002,700

4,2002,700PROBLEM4-1A4-23(a)UNDERCOVERROOFINGINC.WorkSheetFortheMonthEndedMarch31,2006TrialBalanceDr.Cr.Dr.Cr.Dr.Cr.Dr.Cr.Dr.AdjustmentsAdjustedTrialBalanceIncomeStatementBalanceSheetCr.AccountTitles2,5001,8001,1006,000(a)(b)(c)1701,4001,4001305,0002,0006003,000(c)(d)9602002,5001,8001406,0002,5001,8001406,0001,4001,4001305,0002,0006003,1703,1701,0502009602001,2001,4003005,0002,0006001701,050200960200(d)35012,900(a)(b)70020012,9009602001,6803501,68013,45035013,4503,17011,040CashAccountsReceivableRoofingSuppliesEquipmentAccumulatedDepreciationAccountsPayableUnearnedRevenueCommonStockRetainedEarningsDividendsServiceRevenueSalariesExpenseMiscellaneousExpenseTotalsSuppliesExpenseDepreciationExpenseSalariesPayableTotalsNetIncomeTotals2,4107603,1703,17011,04035010,28076011,040Key:(a)SuppliesUsed;(b)DepreciationExpensed;(c)ServiceRevenueEarned;(d)SalariesAccrued.(a)UNDERCOVERROOFINGINC.WorkSheetFortheMonthEndedMarch31,2006TrialBalanceDr.Cr.Dr.Cr.Dr.Cr.Dr.Cr.Dr.AdjustmentsAdjustedTrialBalanceIncomeStatementBalanceSheetCr.AccountTitles2,5001,8001,1006,000(a)(b)(c)1701,4001,4001305,0002,0006003,000(c)(d)9602002,5001,8001406,0002,5001,8001406,0001,4001,4001305,0002,0006003,1703,1701,0502009602001,2001,4003005,0002,0006001701,050200960200(d)35012,900(a)(b)70020012,9009602001,6803501,68013,45035013,4503,17011,040CashAccountsReceivableRoofingSuppliesEquipmentAccumulatedDepreciationAccountsPayableUnearnedRevenueCommonStockRetainedEarningsDividendsServiceRevenueSalariesExpenseMiscellaneousExpenseTotalsSuppliesExpenseDepreciationExpenseSalariesPayableTotalsNetIncomeTotals2,4107603,1703,17011,04035010,28076011,040Key:(a)SuppliesUsed;(b)DepreciationExpensed;(c)ServiceRevenueEarned;(d)SalariesAccrued.PROBLEM4-1A(Continued)(b)

Revenues

UNDERCOVERROOFINGINC.IncomeStatementFortheMonthEndedMarch31,2006ServicerevenueExpensesSalariesexpenseSuppliesexpenseDepreciationexpenseMiscellaneousexpenseTotalexpensesNetincomeUNDERCOVERROOFINGINC.RetainedEarningsStatementFortheMonthEndedMarch31,2006

$1,050960200200

$3,1702,410$760Retainedearnings,March1Add:NetincomeLess:DividendsRetainedearnings,March31UNDERCOVERROOFINGINC.BalanceSheetMarch31,2006AssetsCurrentassetsCashAccountsreceivableRoofingsuppliesTotalcurrentassetsProperty,plant,andequipment

$2,0007602,760600$2,160$2,5001,8001404,440Equipment

$6,000Less:Accum.depreciation—equipmentTotalassets4-24

1,400

4,600$9,040PROBLEM4-1A(Continued)UNDERCOVERROOFINGINC.BalanceSheet(Continued)March31,2006LiabilitiesandStockholders’EquityCurrentliabilitiesAccountspayableSalariespayableUnearnedrevenueTotalcurrentliabilitiesStockholders’equityCommonstock$5,000

$1,4003501301,880RetainedearningsTotalstockholders’equityTotalliabilitiesandstockholders’equity

2,160

7,160$9,040(c)Mar.31313131(d)Mar.31313131

SuppliesExpenseRoofingSuppliesDepreciationExpenseAccumulatedDepreciationUnearnedRevenueServiceRevenueSalariesExpenseSalariesPayableServiceRevenueIncomeSummaryIncomeSummarySalariesExpenseSuppliesExpenseDepreciationExpenseMiscellaneousExpenseIncomeSummaryRetainedEarningsRetainedEarningsDividends4-25

9602001703503,1702,410760600

9602001703503,1701,050960200200760600PROBLEM4-2A(a)

EAGLECOMPANYPartialWorkSheetFortheYearEndedDecember31,2006Adjusted

Income

BalanceAccount

TrialBalance

Statement

SheetNo.

Titles

Dr.

Cr.

Dr.

Cr.

Dr.

Cr.101112126130151152200201212230311320332400610631711722726

CashAccountsReceivableSuppliesPrepaidInsuranceOfficeEquipmentAcc.Depr.—Off.Equip.NotesPayableAccountsPayableSalariesPayableInterestPayableCommonStockRetainedEarningsDividendsServiceRevenueAdvertisingExpenseSuppliesExpenseDepreciationExpenseInsuranceExpenseSalariesExpense

13,60015,4002,0002,80034,00010,00012,0005,7008,0005,00042,000

8,00020,0006,0003,50080020,0005,00088,000

12,0005,7008,0005,00042,000

88,000

13,60015,4002,0002,80034,00010,000

8,00020,0006,0003,50080020,0005,000905

InterestExpense

800_______

800______

______

______TotalsNetIncomeTotals

151,300

151,300

73,50088,00014,500______88,00088,000

77,800______77,800

63,30014,50077,8004-26PROBLEM4-2A(Continued)(b)

Revenues

EAGLECOMPANYIncomeStatementFortheYearEndedDecember31,2006ServicerevenueExpensesSalariesexpenseAdvertisingexpenseDepreciationexpenseSuppliesexpenseInsuranceexpenseInterestexpenseTotalexpensesNetincome

$42,00012,0008,0005,7005,000800

$88,00073,500$14,500EAGLECOMPANYRetainedEarningsStatementFortheYearEndedDecember31,2006RetainedEarnings,January1Add:NetincomeLess:DividendsRetainedEarnings,December314-27

$5,00014,50019,50010,000$9,500PROBLEM4-2A(Continued)EAGLECOMPANYBalanceSheetDecember31,2006AssetsCurrentassetsCashAccountsreceivableSuppliesPrepaidinsuranceTotalcurrentassetsProperty,plant,andequipmentOfficeequipment

$34,000

$13,60015,4002,0002,80033,800Less:AccumulateddepreciationTotalassetsLiabilitiesandStockholders’EquityCurrentliabilitiesNotespayableAccountspayableSalariespayableInterestpayableTotalcurrentliabilitiesLong-termliabilitiesNotespayableTotalliabilitiesStockholders’equity

8,000

26,000$59,800$10,0006,0003,50080020,30010,00030,300CommonstockRetainedearningsTotalstockholders’equityTotalliabilitiesandstockholders’equity4-28

$20,0009,500

29,500$59,800PROBLEM4-2A(Continued)(c)

GeneralJournal

J14DateDec.31313131

AccountTitlesandExplanationServiceRevenueIncomeSummaryIncomeSummaryAdvertisingExpenseSuppliesExpenseDepreciationExpenseInsuranceExpenseSalariesExpenseInterestExpenseIncomeSummaryRetainedEarningsRetainedEarningsDividends

Ref.400350350610631711722726905350320320332

Debit88,00073,50014,50010,000

Credit88,00012,0005,7008,0005,00042,00080014,50010,000(d)RetainedEarnings

No.320DateJan.1

ExplanationBalance

Ref.Debit

Credit5,000

Balance5,000Dec.3131

ClosingentryClosingentry

J14J14

10,000

14,500

19,5009,500Dividends

No.332DateDec.3131

ExplanationBalanceClosingentry

Ref.J14

Debit10,000

Credit10,000

Balance10,00004-29PROBLEM4-2A(Continued)IncomeSummary

No.350DateDec.313131

ExplanationClosingentryClosingentryClosingentry

Ref.DebitJ14J1473,500J1414,500

Credit88,