1. Bliesmer Company incurred the following costs. Indicate to which account Bliesmer would debit each of the costs.
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No.
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Transactions
|
|
Account
|
|
1.
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Sales tax on factory machinery purchased
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$ 5,000
|
|
|
2.
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Painting of and lettering on truck immediately upon purchase
|
700
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|
|
3.
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Installation and testing of factory machinery
|
2,000
|
|
|
4.
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Real estate broker's commission on land purchased
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3,500
|
|
|
5.
|
Insurance premium paid for first year's insurance on new truck
|
1,100
|
|
|
6.
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Cost of landscaping on property purchased
|
7,200
|
|
|
7.
|
Cost of paving parking lot for new building constructed
|
17,900
|
|
|
8.
|
Cost of clearing, draining, and filling land
|
12,600
|
|
|
9.
|
Architect's fees on self-constructed building
|
10,000
|
|
2. Tanger Company purchased a delivery truck for $36,000 on January 1, 2014. The truck has an expected salvage value of $6,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 15,000 in 2014 and 12,000 in 2015.
a. Calculate depreciable cost per unit.
b. Compute depreciation expense for 2014 and 2015 using the straight-line method, the units-of-activity method, and the double-declining-balance method.
Assume that Tanger uses the straight-line method.
(1) Prepare the journal entry to record 2014 depreciation.
(2) Show how the truck would be reported in the December 31, 2014, balance sheet.
3. Francis Company owns equipment that cost $50,000 when purchased on January 1, 2011. It has been depreciated using the straight-line method based on estimated salvage value of $8,000 and an estimated useful life of 5 years.
Prepare Francis Company's journal entries to record the sale of the equipment in these four independent situations.
(a) Sold for $28,000 on January 1, 2014.
(b) Sold for $28,000 on May 1, 2014.
(c) Sold for $11,000 on January 1, 2014.
(d) Sold for $11,000 on October 1, 2014.
4. Ripley Company was organized on January 1. During the first year of operations, the following plant asset expenditures and receipts were recorded in random order.
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Debits
|
|
1.
|
Cost of filling and grading the land
|
$ 6,000
|
|
2.
|
Full payment to building contractor
|
780,000
|
|
3.
|
Real estate taxes on land paid for the current year
|
5,000
|
|
4.
|
Cost of real estate purchased as a plant site (land $100,000 and building $45,000)
|
145,000
|
|
5.
|
Excavation costs for new building
|
35,000
|
|
6.
|
Architect's fees on building plans
|
10,000
|
|
7.
|
Accrued real estate taxes paid at time of purchase of real estate
|
2,000
|
|
8.
|
Cost of parking lots and driveways
|
14,000
|
|
9.
|
Cost of demolishing building to make land suitable for construction of new building
|
15,000
|
|
|
|
$1,012,000
|
|
Credits
|
|
10.
|
Proceeds from salvage of demolished building
|
$ 3,600
|
Analyze the foregoing transactions using the following column headings. Insert the amounts in the appropriate columns.
5. Padillio Company had the following transactions involving notes payable.
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July 1, 2014
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Borrows $60,000 from Fourth National Bank by signing a 9-month, 8% note.
|
|
Nov. 1, 2014
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Borrows $50,000 from Livingston State Bank by signing a 3-month, 9% note.
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|
Dec. 31, 2014
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Prepares adjusting entries.
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|
Feb. 1, 2015
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Pays principal and interest to Livingston State Bank.
|
|
Apr. 1, 2015
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Pays principal and interest to Fourth National Bank.
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Prepare journal entries for each of the transactions.
6. In providing accounting services to small businesses, you encounter the following situations pertaining to cash sales.
a. Jackson Company enters sales and sales taxes separately on its cash register. On April 10, the register totals are sales $30,000 and sales taxes $1,650.
b. Pearson Company does not segregate sales and sales taxes. Its register total for April 15 is $20,330, which includes a 7% sales tax.
Prepare the entry to record the sales transactions and related taxes for each client.
7. Dan Noll's gross earnings for the week were $1,780, his federal income tax withholding was $303, and his FICA total was $136.
What was Noll's net pay for the week?
Journalize the entry for the recording of his pay in the general journal. (Note: Use Salaries and Wages Payable; not Cash.)
Record the issuing of the check for Noll's pay in the general journal.
8. According to the accountant of Ulster Inc., its payroll taxes for the week were as follows: $137.68 for FICA taxes, $13.77 for federal unemployment taxes, and $92.93 for state unemployment taxes.
Journalize the entry to record the accrual of the payroll taxes.