Geogia State University Intermediate Accounting

TRADITIONAL HOMEWORK ITEMS – Spring 2024 – ACT 3391
General Instructions for the Traditional Homework – refer to the instructions for traditional item nos. 1 to 3.
4. (5 points) On August 1, 2020, Y borrowed $1,500,000 at 3%. Y pays interest every 6 months with interest payments every
February 1 and August 1. Y will repay $500,000 of the principal on August 1, 2021 and the remainder on February 1, 2022. Assume
Y only makes AJEs every December 31 AND does NOT make reversing entries. Prepare the entries Y should make on:
a. August 1, 2020
b. December 31, 2020
c. February 1, 2021
d. August 1, 2021
e. December 31, 2021
f. February 1, 2022
5.
(6 points) Zena Company’s financial records showed the following selected items for 2021:
Advertising receipts
Interest paid on borrowings
$500,000
$ 40,000
Land rental revenues
Wage expense
$650,000
$250,000
Zena follows the accrual basis of accounting. The following balances were taken from Zena’s balance sheets:
12-31-21
12-31-20
Advertising receivables
38,000
31,000
Prepaid advertising costs
42,000
36,000
Wages payable
16,000
21,000
Interest payable
12,000
8,000
Unearned advertising revenues
40,000
37,000
Unearned land rental revenue
45,000
43,000
a.
b.
c.
d.
What were Zena’s advertising revenues for 2021?
What was Zena’s interest expense for 2021?
How much cash did Zena pay out for wages and salaries during 2021?
How much cash did Zena collect for land rentals during 2021?
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