Académique Documents
Professionnel Documents
Culture Documents
Cash
18,500
Bal.
Inventory
80,000
Bal.
Accounts Receivable
Bal.
32,000
Bal.
Accum. Depr.Equipment
Bal.
35,000
Adj.
12,000
47,000
Prepaid Insurance
5,100 Adj. 2,550
2,550
Notes Payable
Bal.
28,000
Common Stock
Bal. 80,600
Sales Revenue
600,000 Bal.
600,000
Cls.
Advertising Expense
Bal.
6,700 Adj.
700
Cls.
6,000
6,700
6,700
Bal.
Interest Payable
Adj. 3,360
Adj.
Adj.
Equipment
84,000
Supplies
1,500
Retained Earnings
Bal. 10,000
Inc. 45,790
Bal. 55,790
Supplies Expense
5,000 Adj.
1,500
Cls.
3,500
5,000
5,000
Depr. Exp.
12,000 Cls.
12,000
Adj.
Interest Expense
3,360 Cls.
3,360
Insurance Expense
Adj.
2,550 Cls.
2,550
Salaries and Wages Expense
(Administrative)
Adj.
65,000 Cls.
65,000
Prepaid Advertising
Adj.
700
Exp.
Inc.
Income Summary
554,210 Sales 600,000
45,790
600,000
600,000
3-61
3-62
1,400
12,000
-3Insurance Expense...................................................
Prepaid Insurance .............................................
2,550
3,360
2,400
700
-7Supplies ....................................................................
Supplies Expense .............................................
1,500
1,400
12,000
2,550
3,360
2,400
700
1,500
Dec. 31
Sales Revenue ......................................................
Income Summary ..........................................
Dec. 31
Income Summary .................................................
Cost of Goods Sold.......................................
Advertising Expense .....................................
Salaries and Wages Expense (Admin.)........
Salaries and Wages Expense (Sales) ..........
Supplies Expense .........................................
Insurance Expense .......................................
Bad Debt Expense.........................................
600,000
600,000
554,210
408,000
6,000
65,000
52,400
3,500
2,550
1,400
12,000
3,360
45,790
45,790
3-63
*PROBLEM 3-11
(a)
Revenues................................................
Expenses
Cost of computers & printers:
Purchased and paid ..............
Cost of goods sold ................
Salaries and wages .....................
Rent ..............................................
Other operating expenses ..........
Total expenses ....................
Net income (loss) ...................................
(1)
(2)
Cash Basis
Accrual Basis
$ 75,000
$98,400*
82,500**
9,600
6,000
8,400
106,500
$(31,500)
59,500***
12,600
2,000
10,400
84,500
$13,900
3-64
(b)
Original investment
Cash sales
Cash purchases
Rent paid
Salaries paid
Other operating expenses
Cash balance Jan. 31
$58,500a
$58,500
(2)
Accrual
Basis
$ 58,500a
23,400
23,000b
4,000
$108,900
$
$58,500c
$58,500
3,000
2,000
103,900d
$108,900
$ 90,000
75,000
(82,500)
(6,000)
(9,600)
(8,400)
$ 58,500
3-65
3-66
1.
2.
3.
The cash basis ignores $3,000 of the salaries that have been
earned by the employees in January and will be paid in February.
4.
5.