Frontier Park was started on April 1 by C. J. Mendez and associates. The following selected events
and transactions occurred during April.
Shareholders invested $40,000 cash in the business in exchange for ordinary shares.
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER, 2010
Cash flow from operating activities
Cash receipts from customers
Cash paid to suppliers and employees
Interest and tax paid
Cash provided from operating activities
E 1219 (LO3, LO4)
Investment in Trading SecuritiesJournal Entries
July 1 Investment in Trading Securities.
Purchased 350 shares of Bateman Company
stock at $22 per share plus $600 commission.
Oct. 31 Cash.
E 1319 (LO2)
Classification of Cash Flows
a. Collections from
b. Depreciation expense.
c. Wages and salaries paid.
d. Cash dividends paid.
e. Taxes paid.
f. Utilities paid.
g. Building purchased in
exchange for stock.
The following list of ledger account balances for Bells Beach Retail Stores at 31
December, 2010. Bells Beach Retail Stores has asked you to prepare a Trial Balance for
year ended 31 December, 2010.
Bells Beach Retail Stores
Ledger account bala
E 15 (LO2)
Users of Financial Information
These groups or individuals would be interested in a firms financial statements
for the following reasons:
Current stockholders have already invested in the firm, and with the financial
E 822 (LO1)
FICA Taxes Payable, Employees .
Federal Income Taxes Withheld .
State Income Taxes Withheld .
Cash (or Salaries Payable).
To record payroll for 2009.
Payroll Tax Expense .
FICA Taxes Payable, Employer
E 1121 (LO3, LO4)
Stock Issuance, Treasury Stock, and Dividends
Paid-In Capital in Excess of Par, Common Stock.
Issued 95,000 shares of common stock at $22 per
share (95,000 $22 = $2,090,000; 95,0
E 626 (LO2)
In order to decide when revenue should be recognized, we must consider the following two revenue recognition criteria:
Is the work done?
Is the cash collected or collectible?
Work done: The work is not do
E 1023 (LO1)
Computing the Present Value of a Single Sum
All present value factors are from Table I (text page 484).
0.7921 = $15,842
(6% for 4 periods)
0.7730 = $30,920
(2% for 13 periods)
E 747 (LO7)
FIFO, LIFO, and Average Cost Calculations (Perpetual
Cost of goods sold:
First sale. 4,000 units at $2.00
Second sale. 3,000 units at 2.00
Third sale. 5,000 units at 2.00
= $ 8,000
Jane Kent is a licensed accountant. During the first month of operations of her business, Jane Kent, Accountant, the following
events and transactions occurred.
Shareholders invested 25,000 cash in exchange for ordinary shares.
Hired a secretary-rece
On May 1, Yoon Flying School, a company that provides flying lessons, was started with an investment of 45,000,000 cash in the business.
Following are the assets and liabilities of the company on May 31, 2011, and the revenues and expenses for the m
Define debits and credits and explain their use in recording
Identify the basic steps in the re
Accounting in Action
Accounting in Action
Accounting in Action
Cash and Internal
A partial definition of internal control is that companies have
procedures in place to safeguard assets. No company wants
employees walking out the door with company cash or
people off the street shopli
CHAPTER 11 TOPIC
THE TIME VALUE OF MONEY [TVM]
A. Interest is a relevant factor for most business decisions
1. A dollar today is worth more than a dollar one year from now
2. Inflation is one factor
3. Current (vs.) delayed consumption/satisfactio
Accounting Principles and Financial
What is accounting? Often it is viewed as a bunch of
numbers. While calculations are important, to start we
need to understand the underlying concepts. Accounting is
measuring financial r
Foundations of Financial Reporting
and the Classified Balance Sheet
Objectives of Financial
The reading on pages 170-174 covers
this well. I would like to add clarification
to selected terms from those pages.
Materiality text lower pag
Adjusting the Accounts
The majority of companies present annual
financial statements on the assumption that the
business will continue to operate indefinitely
that is, that the company is a going concern.
The continuity assumption sta