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Accounting 211
Monday, January 25th, 1999
Announcements:
TA Info: Shelley, Office Hours--Wednesday 9:30-12:30, Email--mlh257
Lecture notes:
Chapter 1 Homework:
Questions:
Management accounting involves the internal decision makers who run the business whereas financial accounting generates repots about how the business is running.
- The decision makers who use accounting information are management, those with direct financial interest, and those with indirect financial interest (everyone involved with running the business).
- In a corporation, stockholders invest in the stock and then elect a board of directors who determine corporate policy, declare dividends, and appoint management. Management then executes policy and carries out day-to-day operations.
- Revenues, expenses, and dividends affect retained earnings. An increase in revenues increases retained earnings whereas increases in expenses and dividends causes them to decrease.
- The income statement shows a business' financial standing over a period of time whereas a balance sheet shows the financial standing at one specific point in time (for period ending / as of).
Short Exercises:
2.
|
1) |
60,000 |
|
2) |
36,000 |
|
3) |
50,000 |
4. Stockholder's Equity = $150,000
7.
|
|
ASSETS |
LIABILITIES |
SE |
|
1) |
+ |
+ |
NC |
|
2) |
NC |
NC |
NC |
|
3) |
+ |
NC |
+ |
|
4) |
-- |
NC |
-- |
|
5) |
NC |
NC |
NC |
|
6) |
+ |
NC |
+ |
9.
|
Jay Company
Balance Sheet
December 31, 19XX
___________________________________________________________ |
|
ASSETS |
|
LIABILITIES |
|
|
|
Cash |
$1,200 |
Accounts Payable |
|
$2,500 |
|
Accounts Receivable |
$1,600 |
|
|
|
|
Equipment |
$3,300 |
SE |
|
|
|
|
Common Stock |
$3,000 |
|
|
|
Retained Earnings |
$600 |
|
|
|
|
|
|
|
|
Total SE |
|
$3,600 |
|
|
|
|
|
|
TOTAL ASSETS |
$6,100 |
TOTAL LIABILITIES AND SE |
|
$6,100 |
Exercises:
6.
|
1) |
R |
|
2) |
D |
|
3) |
NSE |
|
4) |
I |
|
5) |
E |
|
6) |
R |
|
7) |
NSE |
|
8) |
E |
7.
|
|
ASSETS |
LIABILITIES |
SE |
|
1) |
-- |
NC |
-- |
|
2) |
+ |
+ |
NC |
|
3) |
NC |
NC |
NC |
|
4) |
+ |
NC |
+ |
|
5) |
+ |
NC |
+ |
|
6) |
-- |
-- |
NC |
|
7) |
+ |
NC |
+ |
|
8) |
NC |
NC |
NC |
|
9) |
NC |
+ |
-- |
|
10) |
-- |
NC |
-- |
10.
|
1) |
a) A |
c) A |
e) A |
g) A |
|
b) L |
d) SE |
f) L |
|
|
|
|
|
|
|
2) |
a) IS |
c) IS |
e) IS |
g) RE |
|
b) BS |
d) BS |
f) BS |
|
12.
|
A |
B |
C |
|
a) 800 |
g) 6800 |
m) 160 |
|
b) 300 |
h) 1600 |
n) 80 |
|
c) 300 |
i) (1000) |
o) 0 |
|
d) 4600 |
j) 6000 |
p) 180 |
|
e) 1000 |
k) 6000 |
q) 480 |
|
f) 4600 |
l) 21000 |
r) 200 |
Chapter 2 Homework:
Questions:
This statement is incorrect, it should just read debits on left, credits on right.
12.
|
a) |
ASSETS = |
Debit to increase |
Credit to decrease |
|
b) |
LIABILITIES = |
Debit to decrease |
Credit to increase |
|
c) |
SE = |
Debit to decrease |
Credit to increase |
13. Because they are on the same side of the equation.
14. There is $500 cash in assets in the account.
- A trial balance proves that the total of all debits equals the total of all credits recorded.
- Normal balance if accounts payable is a credit. It could be a debit if all liabilities decrease.
- Yes--the transaction may have been analyzed incorrectly or recorded under improper accounts.
Short Exercises:
4.
|
May |
Account Debited |
Account Credited |
|
2 |
Cash |
Common Stock |
|
5 |
Computer |
Cash |
|
7 |
Supplies |
Accounts Payable |
|
19 |
Cash |
Revenue |
|
22 |
Cash |
Unearned Revenue |
|
25 |
Rent |
Cash |
|
31 |
Accounts Receivable |
Revenue |
5.
|
CASH |
|
5000 |
2500 |
|
500 |
|
|
600 |
650 |
|
Balance = 2950 |
|
|
REVENUE |
|
250 |
|
500 |
|
Balance = 750 |
6.
|
Hurley's Prog Service, Inc.
Trial Balance
May 31, 19XX
_________________________________________ |
|
Cash |
2950 |
|
|
Accounts Receivable |
250 |
|
|
Computer |
2500 |
|
|
Supplies |
300 |
|
|
Rent |
650 |
|
|
Accounts Payable |
|
300 |
|
Unearned Revenue |
|
600 |
|
Common Stock |
|
750 |
|
Revenue |
|
750 |
|
------------------------------------------------------- |
|
6550 |
6650 |
9.
|
El-Tech Co.
Trial Balance
June 30, 19XX
_________________________________________ |
|
Cash |
10 |
|
|
Accounts Receivable |
140 |
|
|
Equipment |
200 |
|
|
Office Expense |
90 |
|
|
Accounts Payable |
|
70 |
|
Common Stock |
|
100 |
|
Retained Earnings |
|
120 |
|
Service Revenue |
|
150 |
|
------------------------------------------------------ |
|
440 |
440 |
Exercises:
1.
|
Feb 17) |
No |
May 14) |
No |
|
Mar 17) |
No |
May 19) |
No |
|
Apr 28) |
Yes |
June 27) |
Yes |
|
May 2) |
No |
|
|
3. Answer is in the packet.
13.
|
