Chapter_3_The_Accounting_Information_System_Extra_Class_Problems_And_Solutions

Chapter_3_The_Accoun - Intermediate Accounting I Chapter 3 Additional Problems 1 On August 1 Mike Tiger Company paid $8,400 in advance for two

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Intermediate Accounting I Chapter 3 Additional Problems 1. On August 1, Mike Tiger Company paid $8,400 in advance for two years’ insurance coverage. Prepare Tiger’s August 1 journal entry and the annual adjusting entry of December 31. 1a. Assume the same facts as above, but Mike Tiger erroneously recorded the payment as an expense on August 1. Prepare Tiger’s August 1 journal entry and the annual adjusting entry of December 31. 2. Bayou Corporation owns a warehouse. On November 1, they rented storage space to a lessee for three months for a total cash payment of $2,700 received in advance. Prepare Bayou’s November 1 journal entry and the annual adjusting entry of December 31. 2a. Assume the same facts as above, but Bayou erroneously recorded the receipt as revenue on November 1. Prepare Bayou’s November 1 journal entry and the annual adjusting entry of December 31. 3. Janeway Company’s weekly payroll, paid on Fridays, totals $6,000. Employees work a five-day week. Prepare Janeway’s adjusting entry on Wednesday, December 31 and the journal entry to record the $6,000 cash payment on Friday, January 2. 4. At December 31, 2005, Orchid Company had account balances before adjustment as follows: Accounts Receivable, $420,000 and Allowance for Doubtful Accounts, $4,100 (credit balance). Prepare the annual adjusting entry to record bad debts expense if uncollectible accounts are estimated to be 8% of accounts receivable. Give the balances in both accounts after recording the journal entry. 4a. Use the same information as for #4 above. Assume that on January 31, 2006, Orchid was notified that the Pansy Seed Company, a customer, was filing for bankruptcy. Orchid determined that the amount due from Pansy Seed, $15,000, was uncollectible. Prepare the journal entry to write off the uncollectible account. Give the balances in both accounts after recording the journal entry, assuming no other transactions since year-end. 5.
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This note was uploaded on 02/12/2012 for the course ACCT 3001 taught by Professor Moffitt during the Spring '08 term at LSU.

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Chapter_3_The_Accoun - Intermediate Accounting I Chapter 3 Additional Problems 1 On August 1 Mike Tiger Company paid $8,400 in advance for two

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