The following selected account balances were drawn from the 2010 balance sheet and income statement of Fultz Company:
4,500 Common Stock
Exercise 2-1Ir Prepaid vs. unearned, the entity concept L0 2-4, 2-5
On October 1. 2M4. Caldonia Company paid East Alabama Rentals $4,5iil] for a 12-month lease on
a. Record the defen'al and the related December 31. 2014, adjustme
D A survey to collect data on a sample
I a. set of items of interest drawn from the population
0 Methods of organizingr summarizing, and ptesentlng data
a! E The process of malting an estimate. prediction, or decision about a po
a. ldenfyr the events met would require a yearend adjueting entry.
Answer I: complete and current
b. Are edjueting er eldeing eniriee recorded rel?
Burke Company earned $12,000 of service revenue on account during 2014. The company collected
$9,300 cash from accounts receivable during 2014.
Based on this information alone, determine the following for Burke Company. (Hint: Record the events i
Sold merchandlse oostlng $51,500 for $92,900 on aocount to Mables General Store.
Delivered the goods to Mahle's under terms FOB destination. Freight costs were $500 cash.
Reoelved returned goods from Maple's. The goods cost Poole Company 53,200 and w
The following events apply to Brown and Birgin. a public accounting n'rl. for the 2014 accounting period:
1. Performed $90,000 of services for clients on account.
2. Performed $05,000 of services for cash.
3. Incurred 5345.000 of other operating expenses
The balance sheet of the Chesapeake ICIcImcan'_n.ur contained the fellcwlng acccunta and balances:
Cash 5690 Hates Payable $390
Eaaecl en the ahcve lnfcrmatlcn cnly. the amcunt cr balance fer Land must he
Ed Amold started a personal nancial planning business when he accepted $120,000 cash as advance
payment for managing the nancial assets of a large estate. Amold agreed to manage the estate for a one-
year period beginning May 1. 2014.
a. Show the
High-low method = Cost @ high Costs @ low
High level Low level
CM (units) = selling $ per unit variable exp per unit
Difference between total sales $ and total variable exp
Target profit (dollar) = target profit + fixed expense
Carlos Bueso recently started a business. During the first few days of operation, Mr. Bueso transferred
$30,000 from his personal account into a business account for a company he named Bueso Enterprises.
Bueso Enterprises borrowed $40,000 from the State B
INTRODUCTION TO ACCOUNTING AND BUSINESS
Some users of accounting information include managers, employees, investors, creditors,
customers, and the government.
The role of accounting is to provide information for manage