Intermediate Accounting, assignment help

  • (2 points) Go into WileyPlus. Go to the “Read, Study & Practice” section for chapter 3. Watch the Applied Skills Video entitled “How to Record Adjusting Entries” to answer the following questions:
    • What does the narrator say are necessary every time a company prepares financial statements?
    • When using the accounting equation to discuss the effect of recording an adjusting entry for the $1,500 or unearned revenue that Global has earned, what does the narrator state happens to assets, liabilities, and stockholders’ equity, respectively?
    • In his discussion, what does the narrator state is used to prepare Global’s financial statements?
  • (0.5 point) Per our textbook, what are adjusting entries and why are they necessary?
  • (2 points) Go into WileyPlus. Go to the “Read, Study & Practice” section for any chapter. Click on the CPA Exam Practice (CPAexcel) tab at the top of the page. Register for the Wiley CPAexcel CPA Exam Assessment Tool. After registering, select any one of the exam questions, print it out, and attach your printout to this homework assignment.
  • (4 points) Journalize the following events/transactions that Lobnitz entered into during the month.
  • (0.5 point each) Prepare the Adjusting Journal Entries (AJEs) that should be made on December 31, 2015, the end of the accounting year, for each of the following independent situations. If no AJE is required, indicate “none.” Assume the firm only makes AJEs at the end of the accounting year.
    • On June 30, 2015, the firm collected $18,000 of rent for 9 months in advance. The journal entry to record the receipt included a credit to a temporary account.
    • On October 1, 2015, the firm collected $12,000 of rent for 12 months in advance. The journal entry to record the receipt included a credit to a balance sheet account.
    • On April 1, 2015, the firm collected $6,000 of rent for 6 months in advance. The journal entry to record the receipt included a credit to an income statement account.
    • On August 1, 2015, the firm collected $8,000 of rent for 4 months in advance. The journal entry to record the receipt included a credit to a permanent account.
    • On March 31, 2015, the firm paid $6,000 for a 12-month insurance policy. The journal entry to record the payment included a debit to a permanent account.
    • On June 1, 2015, the firm paid $4,000 for a 4-month rental of a machine. The journal entry to record the payment included a debit to a temporary account.
    • On October 1, 2015, the firm paid $6,000 for a 6-month rental of a machine. The journal entry to record the payment included a debit to an income statement account.
    • On November 1, 2015, the firm paid $12,000 for a 6-month rental of a machine. The journal entry to record the payment included a debit to a balance sheet account.
    • On August 31, 2015, the firm borrowed $2,500,000 at 3%. The firm will repay the interest and principal on March 1, 2016.
    • On March 1, 2015, the firm invested in $600,000 of 5-year, 2% municipal bonds. The company will receive interest on the bonds semi-annually with the first interest receipt occurring on September 1, 2015.
  • (0.5 point each) The following information relates to S Company at the end of 2017. S’s accounting period is the calendar year.

a)Paid the beginning of the month accrued wages payable balance of $33,000.

b)Performed $600,000 of services for customers on a cash basis.

c)Purchased $100,000 of office furniture (property, plant, and equipment) on a credit basis.

d)Incurred, but did not yet pay, $35,000 of wages expense for the month.

e)Collected $50,000 of accounts receivable.

f)Collected $15,000 from customers for work to be performed during the following month.

g)Recorded $30,000 of depreciation expense.

h)Received $50,000 from issuing 5,000 shares of $1 par value Lobnitz common stock. (When recording this entry, credit TWO distinct owners’ equity accounts.)

1. Employees are paid every Friday for the five-day week ending on that day. Salaries amount to $5,000 per week. The accounting period ends on a Thursday.

2. A note for $12,000 was received from a customer in a sales transaction on April 1, 2017. The note matures in one year and bears 8% interest.

3. On September 1, 2017, S borrowed $10,000 cash by signing a note payable due in one year at 6% interest.

Using the information given above, prepare the necessary adjusting entries at December 31, 2017.