1. The document contains 25 accounting problems related to financial statements, ratios, inventory, depreciation, bonds, dividends, and cash flows. It provides accounting transactions, account balances, and asks questions to calculate missing values. 2. Specifically, it includes problems about calculating stockholders' equity, retained earnings, notes payable balances, trial balance totals, depreciation expense, cost of goods sold, days in inventory, estimating uncollectible accounts, recording equipment trades, interest payments on bonds and mortgages, stock dividends, and cash flows from operating activities using direct and indirect methods. 3. The questions require applying accounting concepts like inventory costing methods, allowance for doubtful accounts, straight-

1. 1. A company has $123,000 in Assets and $65,000 in Liabilities.
How much does the company have in Stockholders' Equity?
2. Beginning Retained Earnings are $65,000, sales are $29,500,
expenses are $33,000, and dividends paid are $3,500. How
much is the amount in ending Retained Earnings?
3. The Notes Payable account began with a zero balance and
then had the following changes: increase of $500, increase of
$200, decrease of $550, and increase of $250. What is the
final balance in the Notes Payable account, and is it a debit or
credit?

2. 4. The trial balance for Motor Work, Inc. contains the following
balances:
What is the amount of total debits for this trial balance?
5. On January 1, 2014, a company paid $36,000 for a machine
with a salvage value of
$4,000. If the company uses straight-line depreciation for 10
years, what is the
depreciation expense for 2014?
6. The total revenues of $6,500, total expenses of $3,500, and
dividends of $500 were
recorded in the closing entries for September. What is the net
change in Retained
Earnings for the month?

3. 7. Cosmo Co. purchases goods for resale from Galaxy, Inc. The
amount of a recent purchase
is $12,500 with terms of 3/10, n/30. Cosmo later returns $500
worth of the goods. Under
the perpetual inventory method, what is the journal entry to
record the return?
8. A company has net sales of $126,000, cost of goods sold of
$72,000, operating
expenses of $38,000, and other expenses of $3,000. What is the
company's operating
income?
9. Olympic Enterprises has the following inventory data:
Assuming average cost, what is the cost of goods sold for the

4. June 7 sale?
Date Quantity Unit cost
June 1 Beginning inventory 5 $52
June 4 Purchase 10 $55
June 7 Sale 12

5. June 11 Purchase 9 $58
June 14 Sale 8
Accounts payable $267
Accounts receivable $429
Cash $367
Expenses $103
Revenue $632
10. A company has $8,200 in net sales, $1,100 in gross profit,
$2,500 in ending inventory,
and $2,000 in beginning inventory. What is the company's cost
of goods sold?

6. 11. Goods available for sale total $25,000, beginning inventory
is $8,000, ending inventory
is $12,000, and cost of goods sold is $10,000. How many days
is the days-sales-ininventory?
12. Identify the following two schemes:
1. An employee gives a false refund and pockets the cash.
2. An employee receives a check from a customer, endorses it,
and then cashes it.
13. Which part of the Fraud Triangle relates to committing a
fraud because one feels that it
will be easy to do?
14. A company has $317,000 in credit sales. The company uses
the allowance method to

7. account for uncollectible accounts, and the Allowance for
Doubtful Accounts now has
an $8,150 debit balance. If the company estimates 6% of credit
sales will be uncollectible,
what is the amount of the journal entry for the estimated
uncollectible
accounts?
15. Bestway, Inc. had credit sales of $142,000 for the period.
The balance in Allowance
for Doubtful Accounts is a debit of $643. If Bestway ages
accounts receivable and
determines estimated uncollectible accounts to be $2,840, what
is the required

8. journal entry to record estimated uncollectible accounts?
16. After four years, a machine had an accumulated depreciation
of $38,000. The machine
originally had an anticipated life of eight years and a salvage
value of $5,000. If the
current book value after four years is $43,000 and the machine
has only two years of
usable life left, how much will be depreciated in year five and
in year six using the
straight-line method of depreciation, and assuming the salvage
value is still $5,000?
17. Equipment costing $118,000 has accumulated depreciation
of $92,000. The equipment
is a trade-in for new equipment costing $187,000. If the trade-in

9. value received for
the old equipment is $30,000, what is the journal entry to record
this transaction?
18. On January 1, Bestway, Inc. signed a $175,000, 8%, 30-year
mortgage that requires
semiannual payments of $7,735 on June 30 and December 31 of
each year. What is
the journal entry to record the second semiannual payment
(round interest calculation
to the nearest dollar?
19. $200,000 of 6%, 25-year bonds were sold for $190,000 on
January 1. The bonds
require semiannual interest payments on June 30 and December
31. What is the
journal entry to record the June 30 interest payment on the
bonds?

10. 20. Liberty Company declared a $40,000 cash dividend to
shareholders. The company has
5,000 shares of $20-par, 6% preferred stock and 10,000 shares
of $15-par common
stock. The preferred stock is cumulative. How much will be
distributed to the preferred
and common stockholders on the date of payment if the
preferred stock is $12,000
in arrears?
21. Arc Electric, Inc. has 400,000 shares of $10-par common
stock outstanding. They
have declared a 5% stock dividend. The current market price of
the common stock is

11. $18/share. What is the amount that will be credited to Paid-in
Capital in Excess of Par
Common Stock on the date of declaration?
22. Prestige Auto's records show net income of $30,000,
depreciation expense of $10,000,
and cash dividends paid of $5,000. Using the indirect method,
determine the cash flow
from operating activities on the cash flow statement.
23. Operating expenses for the year, other than depreciation,
were $563,000. Accrued
expenses decreased by $47,000. Using the direct method,
determine the cash payments
for operating expenses to be reported on the cash flow
statement.

12. 24. A company has $56,000 in cash, $12,000 in accounts
receivable, $25,000 in shortterm
investments, and $100,000 in merchandise inventory. The
company also has
$60,000 in current liabilities. What is the company's quick ratio
(rounded to the nearest
hundredth)?
25. If sales are $100,000, net income is $22,700, beginning
stockholders' equity is
$88,000, and ending common stockholders' equity is $84,000,
what is the return on equity?

13. 2
Date Quantity Unit cost
June 1 Beginning inventory 5 $52
June 4 Purchase 10 $55

14. June 7 Sale 12
June 11 Purchase 9 $58
June 14 Sale 8
Accounts payable $267
Accounts receivable $429
Cash $367
Expenses $103
Revenue $632