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Class Exercises-Session-5,6 (For Course Instructor Guidance)
Class Exercises-Session-5,6 (For Course Instructor Guidance)
Q No.1
1)
T.B: Prepaid insurance Rs. 5000
Adj: Insurance was paid for one year on July 1st( accounting year ends on Dec.31st each
year)
2)
T.B: Prepaid Rent Rs.6000
Adj: Rent was paid on first January for two years
1)
T.B: Office equipment Rs.50,000
Adj: Depreciation of office equipment is estimated 10%
4)
T.B: A/c Receivable Rs.25,000
Adj: Uncollectable account estimated 2.5% of A./c receivable
5)
T.B: Salaries expense Rs. 55,000
Adj: salaries outstanding Rs.12000
6)
T.B: Advertising expense Rs. 12500
Adj: Advertising expense for the last month of the year is Rs.5000. It was not recorded
or paid by the company till the end of the year.
7)
T.B: Office supplies Rs.500
Adj: office supplies used by Rs.400
8)
T.B: Commission revenue Rs 75,000
Adj: accrued commission revenue at the end of the year Rs.12500
9)
T.B: Commission unearned Rs.25000
Adj: commission earned by Rs.17500
10)
T.B: commission unearned Rs. 12500
Adj: commission unearned Rs.2500
Required:
i. prepare adjusting entries
ii. prepare adjusted trial balance
iii. prepare income statement
iv. prepare balance sheet
Cash $ 1,320
Accounts receivable 4,920
Supplies 2,300
Prepaid rent 1,600
Office equipment 20,180
Accumulated depreciation—office $ 4,35
equipment 0
Office furniture 37,710
Accumulated depreciation—office furniture 4,870
Accounts payable 4,740
Interest payable 830
Unearned service revenue 620
Note payable 13,500
Ken Sorley, capital 26,090
Ken Sorley, drawings 29,000
Service revenue 120,910
Depreciation expense—office equipment 6,680
Depreciation expense—office furniture 2,370
Salary expense 39,900
Rent expense 17,400
Interest expense 3,100
Utilities expense 2,670
Insurance expense 3,810
Supplies expense 2,950
$175,91 $175,91
Total 0 0
Required
1. Prepare Marineland's 20X6 income statement and statement of owner's equity and
year-end balance sheet.
2.
a. Which financial statement reports Marineland's results of operations?
Were operations successful during 20X6? Cite specifics from the financial
statements to support your evaluation.
Which statement reports the company's financial position? Does Marineland's financial
position look strong or weak? Give the reason for your evaluation.
Q No.4 The unadjusted trial balance of Christine Salomon, at July 31, 20X2, and the
related month-end adjustment data follow.
$ 5,60
Cash
0
Accounts receivable 11,600
Prepaid rent 4,000
Supplies 800
Furniture 28,800
Accumulated depreciation- $ 3,50
Furniture 0
Accounts payable 3,450
Salary payable
Salomon, capital 39,050
Salomon, Drawing 4,000
Accounting service revenue 11,750
Salary expense 2,400
Rent expense
Utilities expense 550
Depreciation expense
Supplies expense
$57,75 $57,75
Total 0 0
Adjustment data:
b. Prepaid rent expired during the month. The unadjusted prepaid balance of $4,000
relates to the period July through October.
d. Depreciation on furniture for the month. The estimated useful life of the furniture
is four years.
e. Accrued salary expense at July 31 for one day only. The five-day weekly payroll
is $1,000.
Required
2. Prepare the income statement and the statement of owner's equity for the month
ended July 31, 20X2, and the balance sheet at that date.
Q No.5 The trial balance of Cohen Construction Co. at June 30, 20X3, follows.
$ 21,20
Cash
0
Accounts receivable 37,820
Supplies 17,660
Prepaid insurance 2,300
Equipment 32,690
Accumulated depreciation—equipment $ 26,240
Building 42,890
Accumulated depreciation—building 10,500
Land 28,300
Accounts payable 22,690
Interest payable
Wage payable
Unearned service revenue 10,560
Note payable, long-term 22,400
Lynn Cohen, capital 79,130
Lynn Cohen, withdrawals 4,200
Service revenue 20,190
Depreciation expense—equipment
Depreciation expense—building
Wage expense 3,200
Insurance expense
Interest expense
Utilities expense 1,110
Advertising expense 340
Supplies expense
$191,71
$191,710
Total 0
Required
Q No.6 The adjusted trial balance of Gallo Shipping & Handling at June 30, 20X9, after
all adjustments, follows.
$ 12,35
Cash
0
Accounts receivable 26,470
Supplies 31,290
Prepaid insurance 3,200
Equipment 135,800
Accumulated depreciation—equipment $ 16,480
Building 34,900
Accumulated depreciation—building 16,850
Land 30,000
Accounts payable 38,400
Interest payable 1,490
Wages payable 770
Unearned service revenue 2,300
Note payable, long–term 97,000
Linda Gallo, capital 58,390
Linda Gallo, withdrawals 45,300
Service revenue 139,860
Depreciation expense—equipment 7,300
Depreciation expense—building 3,970
Wage expense 21,470
Insurance expense 3,100
Interest expense 8,510
Utilities expense 4,300
Supplies expense 3,580
$371,54
$371,540
Total 0
Adjusting data at June 30, 20X9, which have all been incorporated into the adjusted trial
balance figures:
Required:Prepare Gallo's income statement and statement of owner's equity for the year
ended June 30, 20X9, and the classified balance sheet on that date.
Additional information:
1. Merchandise Inventory-ending Rs.45,000
2. Depreciation 10% on fixed assets
3. Tax rate is 30%
Required:
a) Income Statement showing EBIT
b) Balance Sheet
Q No.8 Delux company authorized capital is 500,000 shares of Rs.10 each. Following
information provided on December 31,2004.
Additional information:
1. Merchandise Inventory ending Rs.140,000
2. Provide depreciation on furniture 20% and building at 2%.
3. Income tax 40%
Required:
a) Income Statement
b) Balance Sheet
Q-9 Prepare Balance Sheet from the given data, but be careful, every item will not be
appeared in Balance Sheet.
Land 25000
Building 125000
A/c payable 30000
Cash 15000
Note payable 25800
Sales 550000
Office supplies 5000
Bank 17000
A/c receivable 15000
Amir-capital ?
Salaries payable 32500
Short-term investment 58000
Office salaries expense 12500
Prepaid advertising 36000
Commission revenue 256900
Q-10 An incorrect Balance sheet of Ahmad Merchant is given here, your are required to
prepare correct and classified Balance Sheet on December 31,2002.
Q-11 Following Balance Sheet presented by Sajid and sons on March 31, 2002
ASSETS EQUITIES
CURRENT ASSETS LIABILITIES
CASH 125,000 A/C PAYABLE 85000
A/C RECEIVABLE 45000 LOAN FROM AKRAM 100,000
NOTE RECEIVABLE 25000 NOTE PAYABLE 25000
PREPAID ADVERTISING 2500
OWNER'S EQUITY
FIXED ASSETS CAPITAL 502500
EQUIPMENT 65000
BUILDING 450,000
TOTAL ASSETS 712,500 EQUITIES 712500
Required:
1. Prepare Journal entries for the above transactions
2. Draw General ledger for the accounts effected
3. Prepare Balance Sheet as at April 30th,2002
Q No. 12 The Trial Balance from the given data of Funfood Enterprises on August
31st,2005.
Required:
1. Prepare Income Statement
2. Prepare Balance Sheet
Q No.2 Saleem provided following Trial Balance on December 31, 2002 and adjustment
data.
Adjustment data
1. Depreciation on non-current assets @ 2%
2. Income Tax 40%
3. Merchandise Inventory-ending 12500
Required:
1. Prepare Income Statement
2. Prepare Balance sheet
3. Prepare closing entries