SM_Chap003 - Chapter 03 - Reporting Operating Results on...

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Unformatted text preview: Chapter 03 - Reporting Operating Results on the Income Statement Chapter 3 Reporting Operating Results on the Income Statement ANSWERS TO MINI-EXERCISES M3-9 Amount of Revenue Earned in February a. $15,000 b. No revenue earned in February; gift card recorded as unearned revenue until used by customer. c. No revenue earned in February; cash collections in February related to revenues earned in January. d. No revenue earned in February; the revenues will be earned when the golf lessons are provided. Record as unearned revenue. e. $125 M3-10 Amount of Expense Incurred in February f. $4,750 g. Not an expense incurred in February; cash payments in February relate to expenses in January. h. $800 3-1 Chapter 03 - Reporting Operating Results on the Income Statement M3-11 a. dr Cash (+A)......................................................................... 15,000 cr Lesson Revenue (+R, +SE)........................................ 15,000 b. dr Cash (+A)......................................................................... 150 cr Unearned Revenue (+L)............................................. 150 c. dr Cash (+A)......................................................................... 4,000 cr Accounts Receivable (- A)............................................ 4,000 d. dr Cash (+A)......................................................................... 2,250 cr Unearned Revenue (+L)............................................. 2,250 e. dr Accounts Receivable (+A)................................................ 125 cr Lesson Revenue (+R, +SE)........................................ 125 M3-12 f. dr Wages Expense (+E, - SE)............................................... 4,750 cr Cash (- A)..................................................................... 4,750 g. dr Accounts Payable (L)..................................................... 1,750 cr Cash (- A)..................................................................... 1,750 h. dr Utilities Expense (+E, SE).............................................. 800 cr Accounts Payable (+L)................................................ 800 3-2 Chapter 03 - Reporting Operating Results on the Income Statement M3-16 a. dr Cash (+A) 150,000 cr Note Payable (+L) 150,000 b. dr Accounts Receivable (+A) 2,000 cr Repair/Service Revenue (+R, +SE) 2,000 c. dr Rent Expense (+E, -SE) 600 cr Cash (-A) 600 d. dr Cash (+A) 450 cr Repair/Service Revenue (+R, +SE) 450 e. dr Advertising Expense (+E, -SE) 400 cr Accounts Payable (+L) 400 M3-18 Assets Liabilities Stockholders Equity f. 4,750 NE Wages Expense (+E) 4,750 g. 1,750 1,750 NE h. NE +800 Utilities Expense (+E) 800 3-3 Chapter 03 - Reporting Operating Results on the Income Statement ANSWERS TO EXERCISES E3-11 Req. 1 Included with Req. 3 on the next page....
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SM_Chap003 - Chapter 03 - Reporting Operating Results on...

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