Accounting HW for accountsguru

Problem 1

On December 31, 2011, Rollo Company held the following short-term investments in its portfolio of available-for-sale securities. Rollo had no short-term investments in its prior accounting periods. Prepare the December 31, 2011, adjusting entry to report these investments at fair value.

Problem 2

Desi of New York sells its products to customers in the United States and the United Kingdom. On December 16, 2011, Desi sold merchandise on credit to Bronson Ltd. of London at a price of 17,000 pounds. The exchange rate on that day for £1 was $1.5238. On December 31, 2011, when Desi prepared its financial statements, the rate was £1 for $1.4990. Bronson paid its bill in full on January 15, 2012, at which time the exchange rate was £1 for $1.5156. Desi immediately exchanged the 17,000 pounds for U.S. dollars. Prepare Desi’s journal entries on December 16, December 16, December 31, and January 15 (round to the nearest dollar).

P16-

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Student Name:

Class:

Problem 16-04A

GALLEY CORPORATION

Statement of

Cash

For Year Ended

December

31,

2011

Cash flows from operating activities:

Net income

Adjustments to reconcile net income to net

cash provided by operating activities

Increase in accounts receivable

Increase in inventory

Decrease in accounts payable

Increase in taxes payable

Depreciation expense

Net cash provided by operating activities

Cash flows from investing activities:

Cash paid for equipment

Cash flows from financing activities:

Cash received from issuing stock

Cash paid for cash dividends

Net cash used in financing activities

Net increase in cash

Cash balance at beginning of 2011

Cash balance at end of 2011

Enter appropriate data in yellow cells. Some of your entries will be verified.

P16-06A

Student Name:
Class:

GALLEY CORPORATION

For Year Ended

, 2011

December

December

31, 2011

Cash

payable

1,029,000 1,209,000

Net income
Increase in accounts receivable

Decrease in accounts payable

Depreciation expense

0 0

Problem 16-06A
Spreadsheet for Statement of Cash Flows
December 31
Analysis of Changes
31,	2010	Debit	Credit
Balance sheet-debit balance accounts:
117,000	174,000
	Accounts receivable		81,000		93,000
	Merchandise inventory		534,000		609,000
	Equipment		297,000		333,000
	1,029,000		1,209,000
Balance sheet-credit balance accounts:
Accumulated depreciation, equip.	102,000	156,000
	Accounts payable	96,000	69,000
		Income taxes		24,000		27,000
	Common stock, $2 par value		558,000		582,000
	Contributed capital in excess of
	par value, common stock		162,000		198,000
	Retained earnings		87,000		177,000
Statement of cash flows:
Operating activities:
Increase in merchandise inventory
Increase in income tax payable
Investing activities:
Payment for equipment
Financing activities:
Issued common stock for cash
Paid cash dividends

Enter the letter given in the problem that corresponds to the transaction or event.
Enter appropriate data in yellow cells. Your totals in the debit and credit columns will be verified.
Enter the letter given in the problem that corresponds to the transaction or event.
Enter appropriate data in yellow cells. Your totals in the debit and credit columns will be verified.

Given P16-06A

GALLEY CORPORATION

December 31
2011 2010
Cash

Accounts receivable 93,000 81,000
Merchandise inventory 609,000 534,000
Equipment 333,000 297,000
Accounts payable

Income taxes payable 27,000 24,000
Common stock, $2 par value 582,000 558,000

Contributed capital in excess of

par value, common stock 198,000 162,000
Retained earnings 177,000 87,000

$ 1,053,000 $ 927,000

GALLEY CORPORATION

Depreciation expense

4,000

Income taxes

Net income

$ 5

Given Data P16-06A:
Comparative Balance Sheet
December 13, 2011 and 2010
Assets
$ 174,000	$ 117,000
Accumulated depreciation, Equipment	(156,000)	(102,000)
Total assets		$ 1,053,000		$ 927,000
Liabilities and Equity
$ 69,000	$ 96,000
Total liabilities and equity
Income Statement
For Year Ended December 31, 2011
Sales	$ 1,992,000
Cost of goods sold	1,194,000
Gross profit	798,000
Operating expenses:
	$ 5
Other expenses	501,000	555,000
Income before taxes	243,000
42,000
$ 201,000
Additional information:
Equipment purchased for cash	$ 36,000
Number of stock shares issued	12,000
Price per share of stock issued
Cash dividends declared and paid	$ 111,000
Check figure:
(1) Analysis of Changes column totals:	$ 579,000