exercies 25 - 1 ACCOUNTING Exercise 25 BMW 645CI 2 ECONOMIC...

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Unformatted text preview: 1 ACCOUNTING Exercise 25 BMW 645CI 2 ECONOMIC EVENTS 1. Spend $30,000,000 to design a new car model. 2. Spend $300,000 for prototypes of the car. 3. Spend $1,000,000 for a worldwide sales staff gathering to preview the car and take test drives. 4. Spend $800,000 developing a marketing brochure. 5. Spend $2,000,000 practicing production techniques in the Pilot Plant. 6. Spend $100,000,000 expanding the manufacturing plant to accommodate production of the new car. 7. Spend $800,000,000 producing 20,000 cars. 8. Sell 5,000 cars to domestic customers, on credit, for $500,000,000. 9. Record $200,000,000 Cost of Sales. 10. Sell 10,000 cars to international customers. Invoice the customers for 1,000,000,000 Euros. Exchange rate is $1.00 = 1.00 Euro. 11. Record $400,000,000 Cost of Sales. 3 ECONOMIC EVENTS 12. Receive a 7,000,000 Euro invoice from a European advertising agency when the exchange rate is $1.00 = one Euro. 13. Accrue $20,000,000 estimated warranty costs (5 year warranty). 14. Invest $800,000 excess cash in stock of another company (short term). 15. Invest $700,000 excess cash in bonds of another company (short term). 16. Spend $1,000,000 buying back some shares of the companys stock. 17. Receive $100,000 dividends from the stock investment. 18. Receive $100,000 interest from the bond investment. 19. Collect 1,000,000,000 Euros from the Europe customer. Exchange the Euros for dollars when the exchange rate is $1.00 = 1.05 Euros 20. Buy 7,000,000 Euros and pay the Europe advertising agency invoice. Exchange rate is $1.00 = 1.05 Euros 21. Pay $5,000,000 for warranty costs. 22. Receive $20,000,000 by issuing Bonds Payable (10% rate , five years). 4 ECONOMIC EVENTS 23. Establish a $100,000 Petty Cash Fund. 24. Sell the treasury stock for $1,500,000. 25. Sell the stock investment for $600,000. 26. Accrue $2,000,000 interest on the Bonds Payable. 27. Accrue $800,000 for employee vacations (will be taken within one year). 28. Transfer Net Income (Loss) to Retained Earnings. 5 JOURNAL ENTRIES 1. 2. 3. 4. 5. 6 JOURNAL ENTRIES 6. 7. 8. 9. 10. 7 JOURNAL ENTRIES 11. 12. 13. 14. 15. 8 JOURNAL ENTRIES 16. 17. 18. 19. 20. 9 JOURNAL ENTRIES 21. 22. 23. 24. 25. 10 JOURNAL ENTRIES 26. 27. 28. 29. 30. 11 Cash Reference Transaction Current Balance Debit Credit Debit Credit 5,000,000,000 12 Manufacturing Plant Reference Transaction Current Balance Debit Credit Debit Credit 2,000,000,000 13 Pilot Plant Reference Transaction Current Balance Debit Credit Debit Credit 100,000,000 14 Common Stock Reference Transaction Current Balance Debit Credit Debit Credit 2,500,000,000 15 Paid in Capital Reference Transaction Current Balance Debit Credit Debit Credit 2,500,000,000 16 Retained Earnings Reference Transaction Current Balance Debit Credit Debit Credit 2,100,000,000 17 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 18 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 19 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 20 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 21 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 22 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 23 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 24 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 25 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 26 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 27 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 28 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 29 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 30 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 31 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 32 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 33 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 34 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 35 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 36 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 37 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 38 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 39 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 40 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 41 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 42 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 43 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 44 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 45 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 46 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 47 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 48 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 49 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 50 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 51 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 52 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 53 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 54 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 55 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 56 _________________ A/C Reference Transaction Current Balance Debit Credit Debit Credit 57 TRIAL BALANCEpage 1 Account Debit Credit 58 TRIAL BALANCEpage 2 Account Debit Credit 59...
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exercies 25 - 1 ACCOUNTING Exercise 25 BMW 645CI 2 ECONOMIC...

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