Question 1 - Below is the trial balance of Bellemy Fashion Center as at year end, November 30, 2014:
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BELLEMY FASHION CENTER - TRIAL BALANCE (30-Nov-14)
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Debit
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Credit
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Cash
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$33,530
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Accounts Receivable
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37,400
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Inventory
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48,700
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Supplies
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9,200
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Equipment
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140,400
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Accumulated Depreciation-Equipment
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$26,260
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Notes Payable
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54,700
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Accounts Payable
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52,200
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Common Stock
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93,700
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Retained Earnings
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11,700
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Sales Revenue
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765,730
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Sales Returns and Allowances
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4,200
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Cost of Goods Sold
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495,400
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Salaries and Wages Expense
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138,960
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Advertising Expense
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27,530
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Utilities Expenses
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15,040
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Maintenance and Repairs Expense
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12,100
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Delivery Expense
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16,700
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Rent Expense
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25,130
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Totals
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$1,004,290
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$1,004,290
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Other information:
- Depreciation is $16,695 on the equipment.
- Supplies on hand totaled $5,200.
- Interest of $15,140 is accrued on notes payable at November 30.
Required:
- Prepare the necessary adjusting journal entries as of November 30, 2014.
- Prepare an adjusted trial balance as of November 30, 2014.
Question 2 - Shown below is an income statement for 2010 that was prepared by a poorly trained bookkeeper of Howell Corporation.
Howell Corporation INCOME STATEMENT December 31, 2010
Sales revenue $945,000
Investment revenue 19,500
Cost of merchandise sold (408,500)
Selling expenses (145,000)
Administrative expense (215,000)
Interest expense (13,000)
Income before special items 183,000
Special items
Loss on disposal of a component of the business (30,000)
Major casualty loss (extraordinary item) (70,000)
Net federal income tax liability (24,900)
Net income $ 58,100
Required
Prepare a multiple-step income statement for 2010 for Howell Corporation that is presented in accordance with generally accepted accounting principles (including format and terminology). Howell Corporation has 50,000 shares of common stock outstanding and has a 30% federal income tax rate on all tax related items. Round all earnings per share figures to the nearest cent.
Question 3 - The following balance sheet was prepared by Kraus Company as of December 31, 2010.
Kraus Company Balance Sheet as of December 31, 2010
Cash $ 80,000 Accounts payable $ 75,000
Accounts receivable (net) 52,200 Long-term liabilities 100,000
Inventories 57,000 Stockholders' equity 218,500
Investments 76,300
Equipment (net) 96,000
Patents 32,000
$393,500 $393,500
The following additional information is provided:
1. Cash includes the cash surrender value of a life insurance policy $9,400, and a bank overdraft of $2,500 has been deducted.
2. The net accounts receivable balance includes:
(a) accounts receivable-debit balances $60,000;
(b) accounts receivable-credit balances $4,000;
(c) allowance for doubtful accounts $3,800.
3. Investments include investments in common stock, trading $19,000 and available-for-sale $48,300, and franchises $9,000.
4. Equipment costing $5,000 with accumulated depreciation $4,000 is no longer used and is held for sale. Accumulated depreciation on the other equipment is $40,000.
Required: Prepare a balance sheet in good form (stockholders' equity details can be omitted.)
You should also attach the word or excel file so that we can see how you arrived at your numbers.