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    Assignment-1-Intermediate-Accounting - PERDIZO, MILJANE P.

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    Miljane Perdizo
    The document lists accounting expenses under selling and general administrative categories and provides amounts for each. It asks how much should be included in selling expenses and general administrative expenses. Selling expenses would include advertising, freight-out, half

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    Assignment-1-Intermediate-Accounting - PERDIZO, MILJANE P.

    Uploaded by

    Miljane Perdizo
    352 views8 pages
    The document lists accounting expenses under selling and general administrative categories and provides amounts for each. It asks how much should be included in selling expenses and general administrative expenses. Selling expenses would include advertising, freight-out, half

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    Assignment-1-intermediate-accounting- PERDIZO, MILJANE P.

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    The document lists accounting expenses under selling and general administrative categories and provides amounts for each. It asks how much should be included in selling expenses and general administrative expenses. Selling expenses would include advertising, freight-out, half

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    352 views8 pages

    Assignment-1-Intermediate-Accounting - PERDIZO, MILJANE P.

    Uploaded by

    Miljane Perdizo
    The document lists accounting expenses under selling and general administrative categories and provides amounts for each. It asks how much should be included in selling expenses and general administrative expenses. Selling expenses would include advertising, freight-out, half

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 8

    PERDIZO, MILJANE P.

    BS Accoountancy
    Fill in the blanks below with the accounting principle, assumption, or related item that best
    completes the sentence.
    1.Relevance and Faithful representation are the two primary qualities that make accounting
    information useful for decision-making.
    2.Information that helps users confirm or correct prior expectations has confirmatory value.
    3. Comparability enables users to identify the real similarities and differences in economic
    phenomena because the information has been measured and reported in a similar manner for
    different enterprises.
    4. Some costs which give rise to future benefits cannot be directly associated with the revenues
    they generate. Such costs are allocated in a rational and systematic manner to the periods
    expected to benefit from the cost.
    5. The materiality constraint would allow the expensing of all repair tools when purchased,
    even though they have an estimated life of 3 years.
    6.The consistency characteristic requires that the same accounting method be used from one
    accounting period to the next, unless it becomes evident that an alternative method will bring
    about a better description of a firm's financial situation.
    7. Conservatism guides accountants to select the accounting treatment that is least likely to
    overstate income and assets.
    8.Parenthetical balance sheet disclosure of the inventory method utilized by a particular company
    is an application of the full disclosure principle.
    9.Corporations must prepare accounting reports at least yearly due to the periodicity
    assumption.
    10.Recording and reporting inflows at the end of production is an allowable exception to the
    revenue recognition principle.

    Provide clear, concise answers for the following.

    1. What are assets?


    * are defined as “resources controlled by the enterprise as a result of past transactions and
    events and from which future economic benefits are expected to flow the enterprise”.
    2. What are liabilities?
    * are defined as “present obligations of an enterprise arising from past transactions or events,
    the settlement of which is expected to result in an outflow from the enterprise of resources
    embodying economic benefits”.
    3. What is equity?
    * In layman’s language, it is the amount of money or value of property put by the proprietor into
    the business to start with the operation which is referred to as “Initial Investment”.
    4. What are current liabilities?
    * are financial obligations of the enterprise which are (1) expected to be settled in the normal
    course of the operating cycle; (2) due to be settled within one year from the balance sheet date.
    5. What are intangible assets?
    * Per PAS No. 38, these are identifiable non-monetary assets without physical existence.
    6. What are current assets?
    * refer to all assets that are expected to be realized, sold or consumed within the enterprise’s
    operating cycle.
    7. What are revenues?
    * PAS No. 28 defines as the “gross inflow of economic benefits during the period arising in the
    course of ordinary activities of an enterprise when those inflows result in increase in equity, other
    than those relating to contribution from owners”.
    8. What are expenses?
    * are the “gross outflow of economic benefits during the period arising in the course of ordinary
    activities of an enterprise when those outflow result in decrease in equity, other than those
    relating to distribution to owners”.
    9. What are gains?
    * include income from activities and events that do not form part of the ordinary course of the
    business operation.
    10. What are losses?
    * represent decreases in assets or increases in liabilities arising from the activities or events that
    are outside the ordinary course of business operation.

    In the space provided at right, write the word or phrase that is defined or
    indicated.
    Current Liabilities 1.Obligations expected to be liquidated through use of current
    assets.
    Balance Sheet 2.Statement showing financial condition at a point in time.
    Contingencies 3.Events that depend upon future outcomes.
    Current assets 4. Resources expected to be converted to whichever is longer.
    Property plant and equipment 5. Resources of a durable nature used in operations, normally
    of long term used.
    Intangible assets 6. Economic rights or competitive advantages which lack
    physical substance
    Asset 7. Probable future economic benefits.
    Equity 8. Residual interest in the net assets of an entity.

    Account classification.
    ASSETS LIABILITIES AND CAPITAL
    a.Current assets f.Current liabilities
    b.Investments g.Long-term liabilities
    c.Plant and equipment h.Preferred stock
    d.Intangibles i.Common stock
    e.Other assets j.Additional paid-in capital
    k.Retained earnings l.Items excluded from balance sheet
    Using the letters above, classify the following accounts according to the preferred
    and ordinary balance sheet presentation.

    __B 1.Bond sinking fund


    __I__2.Common stock distributable

    __K_3.Appropriation for plant expansion

    __F_4.Bank overdraft
    __G_5.Bonds payable (due 2010)
    __J_6.Premium on common stock
    __L_7.Securities owned by another company which are collateral for that company's note.
    __A_8.Trading securities
    __A_9.Inventory
    __G_10.Unamortized discount on bonds payable

    __D_11.Patents
    __F_ 12.Unearned revenue

    1. For Mitchell Company, the following information is available:

    Capitalized leases 280,000


    Trademarks 90,000
    Long-term receivables 105,000

    In Mitchell’s balance sheet, intangible assets should be reported at

    a.90,000.
    b.105,000.
    c.370,000.
    d.385,000.

    2. Stanton Company has the following items: common stock, 720,000; treasury stock,
    85,000; deferred taxes, 100,000 and retained earnings, 363,000. What total amount
    should Stanton Company report as stockholders’ equity?

    a.898,000
    b.998,000.
    c.1,098,000.
    d.1,198,000
    3. Quince Holman Corporation reports:

    Cash provided by operating activities 250,000


    Cash used by investing activities110,000
    Cash provided by financing activities140,000
    Beginning cash balance70,000
    What is Holman’s ending cash balance?
    a.280,000.
    b.350,000.
    c.500,000.
    d.570,000.
    4. Gross billings for merchandise sold by Otto Company to its customers last year
    amounted to 15,720,000; sales returns and allowances were 370,000, sales discounts
    were 175,000, and freight-out was 140,000. Net sales last year for Otto Company
    were
    a.15,720,000.
    b.15,350,000.
    c.15,175,000.
    d.15,035,000.
    ABCD Corp. reports operating expenses in two categories: (1) selling and (2) general and
    administrative. The adjusted trial balance at December 31, 2020, included the following expense
    account
    Accounting and legal fees 140,000

    Advertising 120,000

    Freight-out 75,000
    Interest 60,000

    Loss on sale of long-term investments 30,000


    Officers' salaries 180,000

    Rent for office space 180,000


    One-half of the rented premises is occupied by the sales department.

    Sales salaries and commissions 110,000

    5. How much of the expenses listed above should be included in Meyer's selling
    expenses for 2007?
    a.230,000.
    b.305,000.
    c.320,000.
    d.395,000.

    6. How much of the expenses listed above should be included in Meyer's general and
    administrative expenses for 2007?
    a.410,000.
    b.440,000.
    c.470,000.
    d.500,000.

    7-10 Cash 154,900

    Accounts Payable 38,500

    Notes Payable short term 41,250


    Accounts Receivable 20,800

    Inventories 40,290

    Prepaid Rent 23,120

    Machinery 82,900

    Trademark 17,500

    Biological Asset 41,800

    Long term obligation 69,500

    Furnitures and Fixture 38,290

    How much is the:


    a. Current Asset
    Cash 154,900
    Accounts Receivable 20,800
    Biological Asset 41,800
    Inventories 40,290
    Prepaid Rent 23,120
    Total 280,910

    b. Current Liabilities
    Accounts Payable 38,500
    Notes Payable short term 41,250
    Total 79,750
    c. Noncurrent Assets
    Machinery 82,900
    Trademark 17,500
    Furnitures and Fixture 38,290
    Total 138,690
    d. Noncurrent Liabilities
    Long term obligation 69,500
    Total 69,500

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