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    Essay Test BS

    Uploaded by

    Tùng Ngô

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Essay Test BS

    Uploaded by

    Tùng Ngô
    19 views2 pages

    Copyright

    © © All Rights Reserved

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    Download as docx, pdf, or txt
    19 views2 pages

    Essay Test BS

    Uploaded by

    Tùng Ngô

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    A company reports the following beginning inventory and purchases for the month of January.

    On
    January 26, the company sold 360 units at a price of $8 and accepted the customer’s Suntrust Bank
    Card. Suntrust charges a 4% fee.

    Units Unit cost


    Beginning inventory on January 320 $6.00
    1
    Purchase on January 9 85 6.40
    Purchase on January 25 110 6.60

    On 3 January company installed machine with an invoice cost of $180,000. The electrical work required
    for the installation costs $8,000, and $3,000 for delivery. The machine’s useful life is estimated at 10
    years, or 363,000 units of product, with a $6,000 residual value.

    On 28 January company sold equipment that cost $138,750, with accumulated depreciation of $81,000
    for cash at $46,500.

    On 31 January the accountant estimated the balance of the Allowance for Doubtful Accounts using an
    aging of account receivable. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a
    $1,000 debit.

    Accounts Receivable Age of Accounts Receivable Expected Percent Uncollectible


    $396,400 Not yet due 2.0%
    277,800 1 to 30 days past due 4.0
    48,000 31 to 60 days past due 8.5
    6,600 61 to 90 days past due 39.0
    2,800 Over 90 days past due 82.0

    1. Prepare all transactions and adjusting entries above assuming the company uses a perpetual
    inventory system as Weighted average and the units-of-production method, during the first
    month the machine produces 2,500 units of product.
    2. The company’s cash account shows a $32,878.30 debit balance and its bank statement shows
    $46,822.40 on deposit at the close of business on January 31. Prepare its bank reconciliation
    using the following information.
    a. Check No. 1242 for $410.40, Check No. 1273 for $4,589.30, and Check No. 1282 for $400 are
    outstanding checks as of January 31.
    b. Check No. 1267 had been correctly drawn for $3,456 to pay for office suppliers but was
    erroneously entered in the accounting records as $3,465.
    c. The bank statement shows a $762.50 NSF check received from a customer in payment of its
    account. The statement also shows a $99 bank fee in miscellaneous expenses for check
    printing. The company has not yet recorded these transactions.
    d. The bank statement shows that the bank collected $18,980 cash on a note receivable for the
    company. The company did not record this transaction before receiving the statement.
    e. The company's January 31 daily cash receipts of $9,583.10 were placed in the bank’s night
    depository on that date but did not appear on the January 31 bank statement.

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