Exercise 2-8 Preparing T-accounts (ledger) and a trial balance LO P2 Following are the transactions of a new company called Pose-for-Pics Aug. 1 Madison Harris, the owner, invested $6,see cash and $33,509 of photog company paid $2,100 cash for an insurance policy covering the next 24 month:s s The company purchased office supplies for $888 cash. 20 The company received $3,331 cash in photography fees earned. 31 The company paid $675 cash for August utilities.
Required:
1. Post the transactions to the T-accounts.
2. Use the amounts from the T-accounts in Requirement (1) to prepare an August 31 trial balance for Pose-for-Pics. Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Post the transactions to the T-accounts Cash ies Balance

Answer:

All requirements solved

Explanation:

For different accounts, debits and credits may translate to increases or decreases, but the debit side must always lie to the left of the T outline and the credit entries must be recorded on the right side.

T-Accounts

Cash

Date                Description                     Debit                 Credit

1-Aug          M Harris, Capital              $6,500

2-Aug         Prepaid Insurance                                         $2,100

5-Aug          Office Supplies                                             $880

20-Aug         Fees Earned                   $3,331

31-Aug        Utilities Expense                                           $675

31-Aug             Balance                                                     $6,176

Total                                                  $9,831                   $9,831

Office Supplies

Date                Description                     Debit                 Credit

5-Aug                  Cash                             $880

31-Aug              Balance                                                   $880

Total                                                        $880                  $880

Prepaid Insurance

Date                Description                     Debit                 Credit

2-Aug                 Cash                             $2,100

31-Aug              Balance                                                 $2,100

Total                                                        $2,100            $2,100

Photography Equipment

 Date                Description                     Debit                 Credit

1-Aug          M Harris, Capital               $33,500

31-Aug               Balance                                                $33,500

Total                                                        $33,500         $33,500

M Harris, Capital

  Date                Description                     Debit                 Credit

1-Aug                 Cash                                                     $6,500

1-Aug    Photography Equipment                                $33,500

31-Aug              Balance                        $40,000

Total                                                     $40,000         $40,000

Utilities Expense

   Date                Description                     Debit                 Credit

31-Aug                Cash                              $675

31-Aug               Balance                                                  $675

 Total                                                        $675                  $675

Photography Fees Earned

    Date                Description                     Debit                 Credit

20-Aug               Cash                                                     $3,331

31-Aug              Balance                       $3,331

 Total                                                    $3,331                 $3,331

Trial Balance

                                                            Debit                Credit

Cash                                                  $6,176

Office Supplies                                  $880

Prepaid Insurance                           $2,100

Photography Equipment                 $33,500

M Harris, Capital                                                        $40,000

Photography Fees Earned                                         $3,331

Utilities Expense                              $675

Totals                                                $43,331                $43,331

Some of the ledger accounts for the Sanderson Hardware Company are listed below. For each of the October 2021 transactions numbered 1 through 10 below, indicate by account name which accounts should be debited and which should be credited when preparing journal entries. The company uses the perpetual inventory system. Assume that appropriate adjusting entries were recorded at the end of September.


Accounts payable Equipment Inventory
Accounts receivable Cash Supplies
Supplies expense Prepaid rent Sales revenue
Retained earnings Notes payable Common stock
Deferred sales revenue Rent expense Salaries payable
Cost of goods sold Salaries expense Interest expense

Accound debited Accound credited
1. Paid a cash dividend.
2. Paid rent for the next three months.
3. Sold goods to customers on account.
4. Purchased inventory on account.
5. Purchased supplies for cash.
6. Paid employees wages for September.
7. Issued common stock in exchange for cash.
8. Collected cash from customers for goods sold in 3.
9. Borrowed cash from a bank and signed a note.
10. At the end of October, recorded the amount of supplies that had been used during the month.
11. Received cash for advance payment from customer.
12. Accrued employee wages for October.

Cramer Corporation formats operating cash flows using the indirect method. E:How do accounts receivable affect Cramer's cash flows from operating activities for 2018?
A. They increase cash provided by operating activities,
B. They don't because accounts receivable result from investing activities
C. They don't because accounts receivable result from financing activities.
D. They decrease cash provided by operating activities
Cramer's Income Statement for 2018
Sales revenue 170,000
Gain on sale of equipment 10,000 180.000
Cost of goods sold 110000
Depreciation 7500
Other operating expenses 27000 144500
Nel income 35500
The book value of equipment sold during 2018 was $22.000. 110,000 7.500 27.000 Done kerating activities for 2018? 1 Data Table Cash Accounts receivable
Cramer's Comparative Balance Sheets
December 31, 2018 and 2017
2018 2017
Cash 3,500 $ 2,000
Accounts payable 6,000 11,000
Accrued liabilities 8,000 7,000
Common stock 89,000 71,000
Retained earnings $ 106,500 $ 91,000
2018 2017
Accounts payable 7,000 $ 8,000
Accounts liabilities 9,000 1,000
Common stock 20,000 10000
Retained earnings 70500 72000
106,500 91,000

A company has the following ratios:

Current ratio: 2.1 to 1.0

Accounts receivable turnover ratio. 350 to 1 Debt/ equity ratio. 20.0 to 1 Interest coverage ratio 7.0 to 1 Inventory turnover ratio 9.0 to 1 The industry averages are: A company has the following ratios: Current ratio: 4.1 to 1.0 Accounts receivable turnover ratio. 8 to 1 Debt/ equity ratio. 4.0 to 1 Interest coverage ratio 9.0 to 1 Inventory turnover ratio 8.0 to 1. Based on the above items, please compare and contrast the ratios between the company and the industry.

Required:
Analyze reasons why there could be differences and the overall financial position of the company. Also, what of the ways the company could finance the company without significant negative changes to the above financial metrics (ratios)?

Henry Ford's concept of
meant parts did not have to be custom built to match a particular car.

Janice’s Dress Delivery operates a mail-order business that sells clothes designed for frequent travelers. It had sales of $560,000 in December. Because Janice’s Dress Delivery is in the mail-order business, all sales are made on account. The company expects a 30 percent drop in sales for January. The balance in the Accounts Receivable account on December 31 was $96,400 and is budgeted to be $73,600 as of January 31. Janice’s Dress Delivery normally collects accounts receivable in the month following the month of sale. Required: Determine the amount of cash Janice’s Dress Delivery expects to collect from accounts receivable during January.

Kim Co. purchased goods with a list price of $175,000, subject to trade discounts of 20% and 10%, with no cash discounts allowable. How much should Kim Co. record as the cost of these goods

The Weber Company purchased a mining site for $1,750,000 on July 1. The company expects to mine ore for the next 10 years and anticipates that a total of 400,000 tons will be recovered. The estimated residual value of the property is $150,000. During the first year, the company extracted 6,500 tons of ore. The depletion expense is

Jeremy wants to avoid conflict with his new coworkers. He should
Spread gossip with them
Treat them all with respect
Talk to the most popular people
d Buy them expensive gifts

Nicole Boyd, an HR manager, receives many complaints that some line managers have rejected some employees request to work from home. Nicole reviews the situation and finds that the employees who made the request have high-quality work performance. Nicole takes up the case with the line managers; they finally reach an agreement that employees with a good track record will be allowed to work from home three days a week. According to the Uhlrich’s model, Nicole’s act of confronting the line managers with an issue faced by some employees represents this role of an HR manager.

a. True
b. False

t a sales volume of 36,500 units, Peres Corporation's sales commissions (a cost that is variable with respect to sales volume) total $576,700. To the nearest whole dollar, what should be the total sales commissions at a sales volume of 35,000 units? (Assume that this sales volume is within the relevant range.

How is government in the United States today different from government in ancient Athens? O The United States is a direct democracy. The United States allows citizens to vote. The United States is a republic. O The United States has a unicameral legislature.​

Robert G. Flanders Jr., the state-appointed receiver for Central Falls, RI, said his city's declaration of bankruptcy had proved invaluable in helping it cut costs. Before the city declared bankruptcy, he said, he had found it impossible to wring meaningful concessions out of the city's unions and retirees, who were being asked to give up roughly half of the pensions they had earned as the city ran out of cash.
True or False

You are considering an investment in Justus Corporation’s stock, which is expected to pay a dividend of $2.25 a share at the end of the year (D1 = $2.25) and has a beta of 0.9. The risk-free rate is 4.9%, and the market risk premium is 5%. Justus currently sells for $46.00 a share, and its dividend is expected to grow at some constant rate, g. Assuming the market is in equilibrium, what does the market believe will be the stock price at the end of 3 years? (That is, what is P3 ?)

Table 1 shows the financial position of Bank Uno once $ 3375.00 has been deposited. Assume that the required reserve ratio is 5.00 %, that banks do not keep excess reserves, and that all the money loaned out from Bank Uno is deposited into Bank Duo (whose loans go to other banks not shown here). Once the lending and depositing process is complete, what will the accounts look like in Tables 2 and 3? Specify all answers to two decimal places. Table 1. Bank Uno's Initial T-Account Assets Liabilities Reserves: $3375.00 Deposits: $3375.00 Table 2. Bank Uno's T-Account After Loans Assets Liabilities Reserves: ? Deposits: ? Loans: ? Table 3. Bank Duo's T-Account After Deposits and Loans Assets Liabilities Reserves: ? Deposits: ? Loans: ? What are Bank Uno's deposits in Table 2? $ What are Bank Uno's reserves in Table 2? $ What are Bank Duo's loans in Table 3? $ What are Bank Uno's loans in Table 2? $

What are the five steps to understanding how foreign born labor impacts native born workers?

The adjusted trial balance of Gary Cooper Co. as of December 31, 2014, contains the following.
GARY COOPER CO.
ADJUSTED TRIAL BALANCE
DECEMBER 31, 2020
Debit Credit
Cash $20,892
Accounts Receivable 8,340
Prepaid Rent 3,700
Equipment 19,470
Accumulated Depreciation-
Equipment $6,315
Notes Payable 7,120
Accounts Payable 6,892
Common Stock 21,420
Retained Earnings 12,730
Dividends 4,420
Service Revenue 13,010
Salaries and Wages Expense 8,260
Rent Expense 2,154
Depreciation Expense 251
Interest Expense 189
Interest Payable 189
$67,676 $67,676
Instructions:
(a) Prepare an income statement.
(b) Prepare a statement of retained earnings.
(c) Prepare a classified balance sheet.

Which best describes why investing can be such a challenge?
All investments involve major risks.
There is never a sure way to predict the likelihood of success.
There are no guaranteed investments.
The market is totally unpredictable.

Nell and Kirby are in the process of negotiating their divorce agreement. What should be the tax consequences to Nell and Kirby if the following, considered individually, became part of the agreement?
a. In consideration for her one-half interest in their personal residence, Kirby will transfer to Nell stock with a value of $200,000 and $50,000 of cash. Kirby's cost of the stock was $150,000, and the value of the personal residence is $500,000. They purchased the residence three years ago for $300,000.
Nell's basis for the stock is _______$ X
Kirby's basis in the house is ______$ X
b. Nell will receive $1,000 per month for 120 months. If she dies before receiving all 120 payments, the remaining payments will be made to her estate.
The payments (qualify, do not qualify) as alimony and are (included in, excluded from) Nell's gross income as they are received.
c. Nell is to have custody of their 12-year-old son, Bobby. She is to receive $1,200 per month until Bobby (1) dies or (2) attains age 21 (whichever occurs first). After either of these events occurs, Nell will receive only $300 per month for the remainder of her life.
$ X per month is alimony that is (included in, excluded from) Nell's gross income, and the remaining $ X per month is considered​(child support, property settlement) and is (nontaxable, taxable) to Nell.

Agency conflicts between managers and shareholders
Remember, an agency relationship can degenerate into an agency conflict when an agent acts in a manner that is not in the best interest of his or her principal. In large corporations, these conflicts most frequently involve the enrichment of the firm’s executives or managers (in the form of money and perquisites or power and prestige) at the expense of the company’s shareholders. This usurping and reallocation of shareholder wealth is most likely to occur when shareholders do not have sufficient information about the decisions and actions being made by the firm’s management.
Consider the following scenario and determine whether an agency conflict exists:
William and Abigail equally own and manage A New Beginning (ANB), a store that sells preowned clothing and furniture. William is responsible for ANB’s back-office activities, and Abigail staffs the store and makes deliveries to customers. Both have equal decision-making authority and, under the terms of their partnership agreement, both are prohibited from making personal purchases using company funds without prior approval of the other partner. William, without Abigail’s knowledge, used the company’s bank account recently to purchase a new sports car. William has acknowledged that the car will not be used to support the business.
Is this a potential agency conflict between William and Abigail?
No; William and Abigail are both authorized to spend ANB’s money, so no conflict of interest can occur.
No; William and Abigail co-own and co-manage ANB and have a partnership agreement that makes them equal, so an agency conflict cannot exist.
Yes; William is misappropriating some of Abigail’s wealth by unilaterally purchasing a nonbusiness asset using ANB’s funds.
Yes; it should have been Abigail who purchased the car.
Consider the following scenario and determine whether an agency conflict exists:
Five years ago, Caesar created a plant-care business that grew, stocked, and maintained fresh plants in office buildings throughout Raleigh. Over time, The Green Zone Inc. (TGZ) has grown from a proprietorship into a corporation, now reaching far beyond Raleigh. To finance and support this growth, TGZ issued shares that were sold to TGZ employees, Caesar’s family members, and selected outsiders. Caesar is TGZ’s chairman of the board of directors and CEO, but he is no longer the largest shareholder.
At the latest annual meeting, two mutually exclusive proposals were placed on the ballot for discussion and vote. The first was put forth by Caesar and TGZ’s management team, and the second was proposed by a small group of other shareholders. Both groups are adamantly opposed to the other group’s proposal, even though both proposals would likely have the same effect on TGZ’s value and riskiness.
Does an agency conflict exist between TGZ’s management and the small group of opposing shareholders?
No; although an agency relationship exists between TGZ’s management—including Caesar as TGZ’s chairman and CEO and the firm’s shareholders—there is no agency conflict, because no expropriation or wasting of the shareholders’ wealth has occurred.
No; Caesar was the original owner of TGZ, so he would always be sensitive to the concerns of the firm’s current owners (shareholders) and would not engage in an agency conflict.
Yes; any conflict or disagreement between the firm’s managers and its shareholders constitutes an agency conflict.
Yes; an agency relationship exists, and an agency relationship always gives rise to agency conflicts, regardless of the actual behavior of the participants.
Which of the following actions will help ease agency conflicts and better align managers’ objectives with the firm’s shareholder wealth?
Pay the manager a large base salary with a huge stock option package that matures on a single date.
Pay the manager a combination of salary and stock options (phased in over several years) that reward him or her for consistently increasing shareholder wealth.
Great Fortunes Baking Company’s stockholders are mostly individual investors, and there is relatively little institutional ownership. If several pension and mutual funds were to take large positions in Great Fortunes Baking Company’s stock, direct shareholder intervention would be more or less likely to motivate the firm’s management.
In the late 1980s and early 1990s, Congress passed legislation making it more difficult for outside investors to stage hostile takeovers. This legislation likely reduced or increased conflicts between managers and stockholders.

As far as GOODS (compared to services) are concerned, there is ___ opportunity to correct problems due to ___ customer contact. A. less, low B. more, low C. less, high D. more, high

FlanCrest Enterprises is a mid-sized auto supply company that manufactures electronic components for cars. It has approximately 200 employees, with about 150 working on the production line. Its primary customer is Widespread Motors, a large international auto manufacturer. Widespread Motors primarily sells their cars based on price, aiming to make the prices as low as possible in any particular market segment. The cars may not have as many features, but still operate and cost less than those of their competitors. FlanCrest, under the direction of Widespread, has been asked to reduce the price of its electronic components for the next order due to competitive pressure in the market for Widespread's best-selling car. To cut its prices and keep its biggest customer, FlanCrest announces that they will be eliminating the popular community college tuition reimbursement program and eliminating all overtime for production workers.
Which of the below choices most accurately describes the new HR strategy at FlanCrest Enterprises?
a. Commitment, because they are demonstrating commitment to the development of their workforce
b. Control, because they are attempting to control employees within the workplace
c. Commitment, because they are demonstrating commitment to their key customers
d. Control, because they are attempting to minimize labor costs

The following model is a simplified version of the multiple regression model used by Biddle and Hamermesh (1990) to study the tradeoff between time spent sleeping and working and to look at other factors affecting sleep:

sleep = β0 + β1totwrk + β2educ + β3age + u,

where sleep and totwrk (total work) are measured in minutes per week and educ and age are measured in years. (See also Computer Exercise.)

(i) If adults trade off sleep for work, what is the sign of β1?

(ii) What signs do you think β2 and β3 will have?

(iii) Using the data in SLEEP75.RAW, the estimated equation is

= 3,638.25 - .148 totwrk - 11.13 educ + 2.20 age n = 706, R2 = .113.

If someone works five more hours per week, by how many minutes is sleep predicted to fall? Is this a large tradeoff?

(iv) Discuss the sign and magnitude of the estimated coefficient on educ.

(v) Would you say totwrk, educ, and age explain much of the variation in sleep? What other factors might affect the time spent sleeping? Are these likely to be correlated with totwrk?

Use the data in SLEEP75.RAW from Biddle and Hamermesh (1990) to study whether there is a tradeoff between the time spent sleeping per week and the time spent in paid work. We could use either variable as the dependent variable. For concreteness, estimate the model

sleep =β0+ β1totwrk+u, where sleep is minutes spent sleeping at night per week and totwrk is total minutes worked during the week.

(i) Report your results in equation form along with the number of observations and R2. What does the intercept in this equation mean?

(ii) If totwrk increases by 2 hours, by how much is sleep estimated to fall? Do you find this to be a large effect?

University Printers has two service departments Maintenance and Personnel and two operating departments Printing and Developing. Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each.
The following data appear in the company records for the current period:
Maintenance Personnel Printing Developing
Machine-hours ? 455 455 2,590
Labor-hours 315 ? 294 1,491
Department direct cost 11,000 $23,000 $25,000 $23,000
Required: Allocate the service department costs using the reciprocal method. Negative amounts should be indicated by a minus sign. Do not round intermediate calculations.

Rodeo, Inc. has a contribution margin ratio of 30%. This month, profit was $12,300 and fixed costs were $15,600. How much was Laredo's sales revenue

Mountain Cycle specializes in making custom mountain bikes. The company founder, PJ Steffan, is having a hard time making the business profitable. Knowing that you have good business knowledge and solid financial sense, PJ has come to you for advice.

Project Focus PJ would like you to determine how many bikes Mountain Cycle needs to sell per year to break even (Profit =0). Solve using the followings.

Fixed cost equals $65,000
Variable cost equals $1,575
Unit Bike price equals $2,500

Curtiss Construction Company, Inc., entered into a fixed-price contract with Axelrod Associates on July 1, 2016, to construct a four-story office building. At that time, Curtiss estimated that it would take between two and three years to complete the project. The total contract price for construction of the building is $4,000,000. Curtiss concludes that the contract does not qualify for revenue recognition over time. The building was completed on December 31, 2018. Estimated percentage of completion, accumulated contract costs incurred, estimated costs to complete the contract, and accumulated billings to Axelrod under the contract were as follows:
At 12-31-2016 At 12-31-2017 At 12-31-2018
Percentage of completion 10% 60% 100%
Costs incurred to date $350,000 $2,500,000 $4,250,000
Estimated costs to complete 3,150,000 1,700,000 0
Billings to Axelrod, to date 720,000 2,170,000 3,600,000
Required:
1. Compute gross profit or loss to be recognized as a result of this contract for each of the three years.
Year Gross Profit (Loss) Recognized
2016
2017
2018
Total project profit (loss)
2. Assuming Curtiss recognizes revenue over time according to percentage of completion, compute gross profit or loss to be recognized in each of the three years.
Year Gross Profit (Loss) Recognized
2016
2017
2018
3. Assuming Curtiss recognizes revenue over time according to percentage of completion, compute the amount to be shown in the balance sheet at the end of 2016 and 2017 as either cost in excess of billings or billings in excess of costs.
Balance Sheet (Partial) 2016 2017
Current assets:
Current liabilities:

Susie buys a share of Alphabet stock through her broker, Mr. Diaz, who works for Acme Investing and purchases the stock at the New York Stock Exchange. In this transaction, __________ is a financial instrument, __________ is a financial institution, and __________ represents a financial market.

Company sells a nature guide. The following information was reported for a typical month: Total Per Unit Sales $ 17,600 $ 16.00 Variable expenses 9,680 Contribution margin 7,920 Fixed expenses 3,600 Net operating income $ 4,320 What is Bear's current break-even point in unit and dollars

The premium on a three-year insurance policy expiring on December 31, 20x11, was paid in total on January 1, 20x9. The original payment was initially debited to a prepaid asset account. The appropriate journal entry has been recorded on December 31, 20x9. The balance in the prepaid asset account on December 31, 20x9 should be Select one: a. The same as the original payment b. The same as it would have been if the original payment had been debited initially to an expense account c. Higher than if the original payment had been debited initially to an expense account d. Zero Check

Comparative financial statement data for Bridgeport Corp. and Sarasota Corp., two competitors, appear below. All balance sheet data are as of December 31, 2017.

Bridgeport Corp. Sarasota Corp.
2017 2017
Net sales $2,340,000 $806,000
Cost of goods sold 1,527,500 442,000
Operating expenses 367,900 127,400
Interest expense 11,700 4,940
Income tax expense 110,500 46,800
Current assets 434,600 195,436
Plant assets (net) 691,600 181,646
Current liabilities 86,223 43,831
Long-term liabilities 141,050 52,889
Net cash provided by operating activities 179,400 46,800
Capital expenditures 117,000 26,000
Dividends paid on common stock 46,800 19,500
Weighted-average number of shares outstanding 80,000 50,000

Required:
Compute the net income and earnings per share for each company for 2017.
b. Compute working capital and the current ratios for each company for 2017.
c. Compute the debt to assets ratio and the free cash flow for each company for 2017.