class+problems

class+problems - Classproblems...

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Click to edit Master subtitle style 8/1/11 Class problems Chapter 3: E3-2; P3-4, 5
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8/1/11 E3-2: Reporting cash basis versus accrual basis  income Ru’s Sports, Inc., Sells sports equipment to customers. Its fiscal year ends on Dec 31. The following transactions occurred in 2011 … Required: Prepare cash basis and accrual basis income Cash Basis Income Statement Accrual basis Income Statement Revenues Revenues Cash Sales Sales to customers Customer deposits Expenses Expenses Inventory purchases Cost of sales Wages paid Wages expense Utility paid Utility expense Net Income Net Income
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8/1/11 E3-2: transaction a. Paid Employees $54,200 in wages for the year; an additional $4,800 for 2011 wage will be paid in January 2012 Cash Basis Income Statement Accrual basis Income Statement Revenues Revenues Cash Sales Sales to customers Customer deposits Expenses Expenses Inventory purchases Cost of sales Wages paid Wages expense Utility paid Utility expense Net Income Net Income
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8/1/11 E3-2: transaction b. Purchased $334,000 of new sports equipment inventory; paid $90,000 in cash and owed the rest on account. Cash Basis Income Statement Accrual basis Income Statement Revenues Revenues Cash Sales Sales to customers Customer deposits Expenses Expenses Inventory purchases Cost of sales Wages paid Wages expense Utility paid Utility expense Net Income Net Income
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8/1/11 E3-2: transaction c. Sold sports equipment to customers for $410,000; received $340,000 in cash and the rest on account. The cost of the equipment was $287,000 Cash Basis Income Statement Accrual basis Income Statement Revenues Revenues Cash Sales Sales to customers Customer deposits Expenses Expenses Inventory purchases Cost of sales Wages paid Wages expense Utility paid Utility expense Net Income Net Income
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This note was uploaded on 07/30/2011 for the course ACT 101 taught by Professor Ben during the Spring '11 term at HKU.

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class+problems - Classproblems...

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