ACCT 2301 Exam 2 Chapters 3 and 4

Description

 

 

QUESTION 1

1. Prepare a formal Statement of Retained Earnings for Purple Co. for the year ended December 31, 2020.

 

Net Income from Income Statement FYE December 31, 2020	$25,000
Service Revenue from Income Statement FYE December 31, 2020	$86,000
Dividends From Adjusted Trial Balance December 31, 2020	$7,500
Unearned Revenue from Adjusted Trial Balance December 31, 2020	$6,000
Retained Earnings From Post Closing Trial Balance, January 1, 2020	$45,000
Cash from Adjusted Trial Balance December 31, 2020	$52,400

 

QUESTION 2

1. Prepare the required adjusting entries for the following:

 

a.	Harvest work performed but not yet billed for. The amount for this unbilled work is $86,000.
b.	$7,500 of prepaid insurance was used and needs to be accounted for.
c.	Some harvest work was paid in advance and posted as Unearned Revenue.  Amount earned as of December 31 is $15,000.
d.	Harvest supplies need to be expensed in the amount of $4,500
e.	Harvest Equipment must be depreciated and the expense for that is $9,500.

 

QUESTION 3

1. Use the following Adjusted Trial Balance to journalize all the necessary Closing Entries in the space below.

Harvest Industries
Adjusted Trial Balance
31-Dec-18
Account	Debit	Credit
Cash	$         30,000
Account Receivable	10,000
Harvest Supplies	2,500
Prepaid Insurance	1,000
Equipment	500,000
Account Payable		$            5,000
Common Stock		100,000
Retained Earnings		431,000
Dividends	60,000
Harvest Revenue		250,000
Harvest Expense	50,000
Wage Expense	75,000
Rent Expense	25,000
Interest Expense	5,000
Repairs Expense	27,500
Totals	$       786,000	$       786,000

 

 

QUESTION 4

1. The following selected accounts and their balances are based on the ledger balances after adjusting entries for Valentine Inc. for the year ending December 31, 2020.  Use the necessary accounts and balances to prepare an Income Statement, in good form, in the space below.

 

Account Name	Balance
Service Revenue	$33,000
Unearned Revenue	$1,100
Accounts Receivable	$3,500
Utilities Expense	$2,600
Interest Expense	$125
Rent Payable	$300
Miscellaneous Expense	$1,150
Salaries Expense	$12,000
Cash	$18,600
Rent Expense	$6,000

 

 

QUESTION 5

1. Using the following information, prepare the Classified Balance Sheet for Green Company as of  July 31, 2020. (You may not need to use all the accounts listed.)

 

Building	200,000
Unearned Revenue	4,500
Notes Payable – Long Term	15,000
Accumulated Depreciation –Building	50,000
Office Supplies	1,000
Retained Earnings	$127,000
Dividends	10,000
Depreciation Expense -Building	10,000
Cash	15,000
Transportation Expense	6,300
Prepaid Insurance	6,000
Common Stock	30,000
Accounts Payable	3,000
Accounts Receivable	7,500