GSU Traditional Homework Items Questions

TRADITIONAL HOMEWORK ITEMS – Spring 2024 – ACT 3391General Instructions for the Traditional Homework Items:
A.
B.
C.
D.
Prepare your answers using some type of computer software program, e.g., Microsoft Word, Excel. Excel is recommended.
Upload your answers through Canvas. Do NOT upload any type of hand-written documents.
You will NOT receive ANY CREDIT FOR LATE HOMEWORK.
When completing your homework assignments DO NOT use abbreviations for phrases, e.g. state Financial Accounting
Standards Board and not simply FASB.
E. You can work on these homework assignments in groups or as an individual. If you work in a group, making sure all
individual names are on the uploaded submission.
F. For ANY problem involving a calculation, CLEARLY SHOW HOW you performed the calculation.
G. For ANY problem involving an entry, identify EACH account that you debited and credited as either a(an):
1) Asset (includes contra-assets)
You can abbreviate with an A
2) Liability (includes contra-liabilities)
You can abbreviate with an L
3) Equity (includes contra-equities)
You can abbreviate with an EQ
4) Revenue (includes contra-revenues AND gains)
You can abbreviate with an R
5) Expense (includes losses)
You can abbreviate with an EX
For example, if you make the following entry:
Cash
$100
Place an “A” to the left of “Cash”
Sales revenue
$100
Place an “R” to the left of “Sales Revenue”
Thus, your final answer would look like this:
A
Cash
$100
R
Sales revenue
$100
UNACCEPTABLE ENTRY FORMATS. Format your entries like the example above. DO NOT give me entries that look like the
following:
A
Cash
$100
R
Sales revenue
$100
or
A
Cash
$100
R
Sales revenue
$100
or
A
Cash
$100
R
Sales revenue
$100
or
A
Cash
$100
R
Sales revenue
$100
1. (5 points) Write the best accounting word/phrase that is defined. Write ONLY ONE word/phrase next to each item. DO
NOT ABBREVIATE.
a. The term used to describe the financial-related report that a publicly
traded firm files annually with the SEC.
b. They are made at the end of an accounting period to bring all accounts up to date on
an accrual basis so that the company can then prepare financial statements.
c. The term used to describe the one place in which all authoritative
accounting pronouncements, i.e., GAAP, reside.
d. The organization that was established by the U.S. federal government
to standardize financial information that is presented to stockholders.
e. The organization that currently establishes GAAP in the U.S.
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2. (10 points) Prepare the Adjusting Journal Entries (AJEs) that should be made on December 31, 2022, the end of the accounting year, for
each of the following independent situations. If no AJE is required, indicate “none.” Assume the firm only makes AJEs at the end of the
accounting year.
a.
On March 31, 2022, the firm collected $9,000 of rent for 9 months in advance. The journal entry to record the receipt included a credit
to a balance sheet account.
b.
On September 1, 2022, the firm collected $6,000 of rent for 6 months in advance. The journal entry to record the receipt included a
credit to a balance sheet (real) account.
c.
On November 30, 2022, the firm collected $3,000 of rent for 3 months in advance. The journal entry to record the receipt included a
credit to a permanent account.
d.
On May 1, 2022, the firm collected $4,000 of rent for 4 months in advance. The journal entry to record the receipt included a credit to
an income statement account.
e.
On April 1, 2022, the firm paid $6,000 for a 6-month insurance policy. The journal entry to record the payment included a debit to a
permanent account.
f.
On September 1, 2022, the firm paid $3,000 for a 3-month rental of a machine. The journal entry to record the payment included a
debit to an income statement (temporary) account.
g.
On April 1, 2022, the firm paid $12,000 for a 12-month rental of a machine. The journal entry to record the payment included a debit
to an income statement account.
h.
On August 31, 2022, the firm paid $7,000 for an 7-month rental of a machine. The journal entry to record the payment included a
debit to a real (balance sheet) account.
i.
On July 31, 2022, the company borrowed $360,000 at 3%. The principle is due on March 1, 2023. The interest is due every three
months and the first interest payment took place on November 1, 2022.
j.
On August 1, 2019, the company borrowed $6,000,000 for six years at 6%. The interest is due and payable every year and the first
interest payment took place on August 1, 2020. The principle is due and payable in six equal installments and the first principal
payment took place on August 1, 2020. The company makes its interest and principal payments on a timely basis.
3. (2 points) Presented below are selected account balances for C Company as of 12-31-xx:
Cash
Accounts payable
Retained earnings
Sales revenues
Gain on the sale of a stock investment
Cost of goods sold
Selling and administrative expenses
Interest expense
Income tax expense
a.
b.
$ 400,000
$ 150,000
$3,750,000
$1,800,000
$ 15,000
$ 600,000
$ 400,000
$ 20,000
$ 210,000
Prepare the ONE SINGLE entry C should make to close out all of the temporary accounts. Do NOT use an “income summary”
account – close each temporary account directly into retained earnings.
What is C’s retained earnings balance AFTER making the closing entry?
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