Author: Anonymous

On April 1, Penthouse Publishing Company received $1,548 from Albequerque, Inc. for 36-month subscriptions to several different magazines. The company credited Unearned Fees for the amount received and the subscriptions started immediately. Assuming adjustments are only made at year-end, What is the adjusting entry that should be recorded by Penthouse Publishing Company on December 31 of the first year?

Accounts that appear in the balance sheet are often called temporary (nominal) accounts.

A company’s ledger accounts and their end-of-period balances before closing entries are posted are shown below. What amount will be posted to Retained earnings in the process of closing the Income Summary account? (Assume all accounts have normal balances.)       Retained earnings $ 7,000 Dividends   9,600 Revenue   29,000 Rent expense   3,600 Salaries expense   7,200 Insurance expense   920 Depr. Expense-equipment   500 Accum depr.-equipment   1,500

Player Company installs a machine in its factory at the beginning of the year at a cost of $135,000. The machine’s useful life is estimated to be 5 years, or 300,000 units of product, with a $15,000 salvage value. During its first year, the machine produces 64,500 units of product. Determine the machines’ first year depreciation under the double-declining-balance method.

Feed the World Company sold merchandise on account to a customer for $625, terms n/30. The journal entry to record the collection on account would be:

Pickford Co.  installs a manufacturing machine in its production facility at the beginning of the year at a cost of $87,000. The machine’s useful life is estimated to be 5 years, or 400,000 units of product, with a $7,000 salvage value. During its second year, the machine produces 84,500 units of product. Determine the machines’ second year depreciation under the straight-line method.

On July 9, Muffler Company receives an $8,500, 90-day, 8% note from customer Summers Paxton as payment on account. Compute the amount due at maturity for the note. (Use 360 days a year.)

Spelling Co. had net sales of $35,400 million. Its average total assets for the period were $14,700 million. Spelling’s total asset turnover equals:

The first five steps in the accounting cycle include analyzing transactions, journalizing, posting, preparing an unadjusted trial balance, and recording adjusting entries.

Revenues are increases in equity (via net income) from a company’s sales of products and services to customers.