CHAPTER 11 - CHAPTER11 EXERCISE111(a 6/1 Cash NotesPayable...

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CHAPTER 11 SOLUTIONS TO EXERCISES EXERCISE 11-1 (a) 6/1 Cash. .............................................................. 70,000 Notes Payable. ...................................... 70,000 (b) 6/30 Interest Expense. ......................................... 700 Interest Payable. ................................... 700 [($70,000 X 12%) X 1/12] (c) 12/1 Notes Payable. .............................................. 70,000 Interest Payable. ........................................... 4,200 Cash. ...................................................... 74,200 (d) $4,200 EXERCISE 11-2 SUE JACKSON COMPANY Apr. 10 Cash. ................................................................ 26,500 Sales. ........................................................ 25,000 Sales Taxes Payable. .............................. 1,500 PERSON COMPANY 15 Cash. ................................................................ 20,330 Sales ($20,330 ÷ 1.07). ............................ 19,000 Sales Taxes Payable. .............................. 1,330
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($20,330 – $19,000) EXERCISE 11-3 (a) Nov. 30 Cash. ........................................................ 180,000 Unearned Subscriptions. ............... 180,000 (9,000 X $20) (b) Dec. 31 Unearned Subscriptions. ....................... 15,000 Subscription Revenue. ................... 15,000 ($180,000 X 1/12)
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EXERCISE 11-3 (Continued) (c) Mar. 31 Unearned Subscriptions. .......................... 45,000 Subscription Revenue. ...................... 45,000 ($180,000 X 3/12) EXERCISE 11-4 (a) Estimated warranties outstanding: Month Estimate Units Defective Outstanding November December Total 900 960 1,860 600 400 1,000 300 560 860 Estimated warranty liability—860 X $15 = $12,900. (b) Warranty Expense (1,860 X $15). ............................... 27,900 Estimated Warranty Liability. ............................. 27,900 Estimated Warranty Liability. ..................................... 15,000 Repair Parts, Wages Payable, Cash, etc. .......... 15,000 (c) Estimated Warranty Liability (500 X $15). ................. 7,500 Repair Parts, Wages Payable, Cash, etc. .......... 7,500 EXERCISE 11-5
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LARKIN ONLINE COMPANY Partial Balance Sheet Current liabilities Accounts payable. ........................................................... 63,000 $ Long-term debt due within one year. ............................. 40,000 Interest payable. ............................................................... 8,000 Unearned ticket revenue. ................................................ 24,000 Sales taxes payable. ........................................................ 10,000 Estimated warranty liability. ........................................... 18,000 Total current liabilities. ............................................ $163,000
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CHAPTER 11 - CHAPTER11 EXERCISE111(a 6/1 Cash NotesPayable...

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