Part 1) Journalize the adjusting entries below at year-end December 31, XXXX. Please share your supporting calculations for the adjusting entries requiring computations.
(a) The unadjusted balance of the Supplies account is $2,200. The total cost of supplies remaining is $1,000.
(b) Accrued Service Revenue of $9,000.
(c) Equipment was purchased at the beginning of the year for $45,000. The equipment's useful life is 5 years, and the residual value is $5,000. Record the depreciation for this year.
(d) The weekly payroll is $25,000. Employees are owed for 3 days of a 5-day work week.
(e) Beginning unearned service revenue is $7,500, and ending unearned service revenue is $3,500.
(f) The business has interest expense of $750 that is due in January.
Part 2) Calculate the overall overstatement or understatement of net income if the above adjusting entries were not made. Please share your work.
Question Please review the following 6 ratios for Langley Company and XYZ Inc. for the year ended 2014, and address the 2 questions below.
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Ratio Name
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Langley Company
|
XYZ Inc.
|
|
(a) Rate of return on total assets
|
21.5%
|
17.9%
|
|
(b) Debt ratio
|
25.0%
|
10.1%
|
|
(c) Accounts receivable turnover
|
8.3
|
7.5
|
|
(d) Price-Earnings ratio
|
25
|
19
|
|
(e) Inventory turnover
|
6.1
|
5.2
|
|
(f) Current ratio
|
1.96
|
3.12
|
Instructions: This is a 2-part question.
(1) Explain the meaning of each of the Langley Company ratios above.
(2) State which company performed better for each ratio.