Have a second homework assignment required in very short order

Have a 20 question accounting homework assignment that requires submittal by mid-week.

BUAD 212:

Financial Accounting II

Homework Assignment 2

Financial Accounting II

Homework Assignment 2

1.
Draw a diagram of the first three steps in the accounting cycle. Then, explain to me the meaning of the three steps, and why they are important?

2.
Selected accounts from the general ledger of the Express Lawnmower Service follow. Analyze the following transactions and indicate by number what accounts should be debited and credited for each transaction.

101 Cash

111 Accounts Receivable

121 Supplies

131
Equipment

202
Accounts Payable

301 Thomas Jefferson, Capital

401
Fees Income

511

Rent Expense

514
Salaries Expense

517 Utilities Expense

Transactions:

1.
Issued a check for $1,700 to pay the monthly rent.

2.
Purchased supplies for $1,000 on credit.

3.
Collected $4,800 from credit customers.

4.
Collected services for $3,900 in cash.

5.
Performed services for $3,900 in cash.

6.
Issued a check for $1,500 to pay a creditor on account.

7.
Purchased new equipment for $2,150 and paid for it immediately by check.

8.
Provided services for $5,600 on credit.

9.
Sent a check for $600 to the utility company to pay the monthly bill.

10.
Gave a cash refund of $180 to a customer because of a lost package (customer had previously paid in cash.)

Attach additional paper if necessary to the examination for completion of problem.

3.
Tell me why it is important to record transactions in the general ledger, and to prepare compound journal entries?

4.
Tell me why it is important to post journal entries to general ledger accounts, and to correct errors made in the journal or ledger?

5.
What are three situations you might encounter in which you need to “follow” the audit trail?

6.
Tell me why it is important to complete a trail balance on a worksheet, and why it is important to prepare adjustments for unrecorded business transactions?

7. Tell me why if you skip the adjustment process, how will this affect the financial statements?

8.
Determine the necessary end-of-June adjustments for Black and Company:

A.

On June 1, 2003, Black and Company, a new firm, paid $7,200 rent in advance for a six-month period. The $7,200 was debited to the
Prepaid Rent
account.

B.
On June 1, 2003, the firm bought supplies for $1,950. The $1,950 was debited to the
Supplies
account. An inventory of supplies at the end of June showed that items costing $700 were on hand.

C.
On June 1, 2003, the firm bought equipment costing $24,000. The equipment has an expected useful life of ten years and no salvage value. The firm will use the straight-line method of depreciation.

9.
The trial balance of Harding Company as of February 28, 2003, appears below:

A.
Record the trial balance in the Trail Balance section of the worksheet.

B.
Complete the worksheet by making the following adjustments: Supplies on hand at the end of the month, $1,600; expired rent, $1,800; depreciation expense for the period, $500.

Harding Company Worksheet (Partial)

Month Ended February 28, 2003

Account

Trial Balance

Adjustments

Debit
Credit
Debit
Credit

Cash

$37,000

Accounts Receivable
$4,600

Supplies

$2,400

Prepaid Rent

$21,600

Equipment

$28,000

Accumulated Deprec. – Equip.

Accounts Payable

$6,000

Robert Harding, Capital

$67,000

Robert Harding, Drawing
$2,000

Fees Income

$27,000

Deprec. Expense – Equip.

Rent Expense

Salaries Expense

$3,600

Supplies Expense

Utilities Expense

$800

——————————————

Totals

$100,000
$100,000

Analyze: Why do you think the account Accumulated Depreciation – Equipment has a zero balance on the trial balance shown?

10.
Why is it important to complete the worksheet, and prepare an income statement, statement of owner’s equity, and balance sheet from the completed worksheet. And, why is it important to journalize and post the adjusting entries?

11.
Three years ago, the Renton Technical College bought a delivery truck for $55,000. The truck has no salvage value and a five-year useful life. What is the book value of the truck at the end of three years.
You must show all work.

12.
Give me the full and complete definition of net income, as it relates to a completed worksheet. Why is net income important?

13.
Give me the reason(s) why it is important to journalize and post closing entries?

14.
Please tell me, and describe, the four steps in the closing process?

15.
Describe why it is important to prepare a post-closing trial balance. Then, tell me why it is important to interpret financial statements. And finally, why is it important to review the steps in the accounting cycle?

16.
Illustrate, describe, and explain the accounting cycle?

17.
If you owned or managed a business, how often would you want financial statements prepared? Why?

18.
On which financial statement would you find the answer to each question:

–
What were the total fees earned this month?

–
How much money is owed to suppliers?

–
Did the business make a profit?

–
Is there enough cash to purchase new equipment?

–
What were the expenses?

–
Do customers owe money to the business?

19.
On December 31, 2002, the ledger of McAllister and Williams Company contained the following account balances:

Cash

$28,000

Jerold McAllister, Drawing
$12,000

Accounts Receivable

$2,200

Fees Income

$42,500

Supplies

$1,800

Equipment

$15,000

Depreciation Expense

$1,500

Salaries Expense

$14,000

Accumulated Depreciation
$2,500

Supplies Expense

$2,000

Accounts Payable

$3,000

Telephone Expense

$1,800

Jerold McAllister, Capital
$23,100

Utilities Expense

$4,600

All accounts have normal balances. Journalize the closing entries. Use 4 as the general journal page number.

20.
From the following, identify the accounts that will appear on the post-closing trail balance:

A.

Cash

Account Receivable

Supplies

Capital Account

Equipment

Accumulated Depreciation

Accounts Payable

Owner’s Equity

Sharon Black, Capital

Fees Income

Sharon Black, Drawing
Depreciation Expense

Salaries Expense

Supplies Expense

Utilities Expense

Advertising Expense

B.
Now, the following are the steps in the accounting cycle. Arrange the steps in the proper sequence:

Journalize the transactions.

Interpret the financial information.

Record the closing entries.

Prepare a worksheet.

Analyze the transactions.

Prepare financial statements.

Record adjusting entries.

Prepare a post-closing trial balance.

Post the journal entries.