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ACC 205 Week 2 Assignment Revenue and Expenses (Updated September 2013)

ACC 205 Week 2 Assignment Revenue and Expenses (Updated September 2013)

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Published by egnor80
ACC 205 Week 1 Basic Accounting Equations (Updated September 2013)
ACC 205 Week 1 DQ 1
ACC 205 Week 1 DQ 2
ACC 205 Week 2 Assignment Revenue and Expenses (Updated September 2013)
ACC 205 Week 2 DQ 1 Accounting Cycle
ACC 205 Week 2 DQ 2 Bank Reconciliation
ACC 205 Week 3 Assignment Inventory ( Updated September 2013)
ACC 205 Week 5 Final Paper
ACC 205 Week 3 DQ 1 LIFO vs FIFO
ACC 205 Week 3 DQ 2 Depreciation.
ACC 205 Week 4 Assignment Liability (Updated September 2013)
ACC 205 Week 4 DQ 1 Current Liability.
ACC 205 Week 4 DQ 2 Client Recommendations.
ACC 205 Week 5 Assignment Financial Ratios ( Updated September 2013)
ACC 205 Week 5 DQ 1 Ratios.
ACC 205 Week 5 DQ 2 Profit Margin
ACC 205 Week 1 Basic Accounting Equations (Updated September 2013)
ACC 205 Week 1 DQ 1
ACC 205 Week 1 DQ 2
ACC 205 Week 2 Assignment Revenue and Expenses (Updated September 2013)
ACC 205 Week 2 DQ 1 Accounting Cycle
ACC 205 Week 2 DQ 2 Bank Reconciliation
ACC 205 Week 3 Assignment Inventory ( Updated September 2013)
ACC 205 Week 5 Final Paper
ACC 205 Week 3 DQ 1 LIFO vs FIFO
ACC 205 Week 3 DQ 2 Depreciation.
ACC 205 Week 4 Assignment Liability (Updated September 2013)
ACC 205 Week 4 DQ 1 Current Liability.
ACC 205 Week 4 DQ 2 Client Recommendations.
ACC 205 Week 5 Assignment Financial Ratios ( Updated September 2013)
ACC 205 Week 5 DQ 1 Ratios.
ACC 205 Week 5 DQ 2 Profit Margin

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Published by: egnor80 on Oct 15, 2013
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10/15/2013

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Recognition of concepts. Jim Armstrong operates a small company that books entertainers for theaters, parties,
conventions, and so forth. The company’s fiscal year ends on June 30. Consider the following items and classify each
as either:
 
(1) prepaid expense, (2) unearned revenue, (3) accrued expense, (4)
 
accrued revenue, or (5) none of the foregoing.
 
a. Interest owed on the company's bank loan, to be paid in early July
 
b. Professional fees earned but not billed as of June 30
 
c. Office supplies on hand at year-end
 
d. An advance payment from a client for a performance next month at a convention
 
e. The payment in part (d) from the client's point of view
 
f. Amounts paid on June 30 for a 1-year insurance policy
 
g. The bank loan payable in part (a)
 
h. Repairs to the firm's copy machine, incurred and paid in June
 
 
2. Understanding the closing process. Examine the following list of accounts:
 
Note Payable Accumulated Depreciation: Building
 
 Alex Kenzy, Drawing Accounts Payable
 
Product Revenue Cash
 
 Accounts Receivable Supplies Expense
 
Utility Expense
 
Which of the preceding accounts
 
a. appear on a post-closing trial balance?
 
b. are commonly known as temporary, or nominal, accounts?
 
c. generate a debit to Income Summary in the closing process?
 
d. are closed to the capital account in the closing process?
 
3. Adjusting entries and financial statements. The following information pertains to Sally Corporation:
 
The company previously collected $1,500 as an advance payment for services to be rendered in the future. By theend of December, one half of this amount had been earned.
 
Sally Corporation provided $1,500 of services to Artech Corporation; no billing had been made by December 31.
 
Salaries owed to employees at year-end amounted to $1,000.
 
 
The Supplies account revealed a balance of $8,800, yet only $3,300 of supplies were actually on hand at the end of the period.
 
The company paid $18,000 on October 1 of the current year to Vantage Property Management.
 
The payment was for 6 months’ rent of Sally Corporation’s headquarters, beginning on
 
November 1.
 
Sally Corporation’s accounting year ends on December 31.
 
Instructions
 
 Analyze the five preceding cases individually and determine the following:
 
a. The type of adjusting entry needed at year-end (Use the following codes: A, adjustment of a prepaid expense; B,adjustment of an unearned revenue; C, adjustment to record an accrued expense; or D, adjustment to record anaccrued revenue.)
 
b. The year-end journal entry to adjust the accounts
 
c. The income statement impact of each adjustment (e.g., increases total revenues by $500)
 
4. Adjusting entries. You have been retained to examine the records of Mary’s Day Care Center as of December 31,
20X3, the close of the current reporting period. In the course of your examination, you discover the following:
 
On January 1, 20X3, the Supplies account had a balance of $1,350. During the year, $5,520 worth of supplies waspurchased, and a balance of $1,620 remained unused on December 31.
 
Unrecorded interest owed to the center totaled $275 as of December 31.
 

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