Cornerstones of Financial Accounting
4th Edition
ISBN: 9781337690881
Author: Jay Rich, Jeff Jones
Publisher: Cengage Learning
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Textbook Question
Chapter 3, Problem 3MCQ
Which transaction would require adjustment at December 31?
a. The sale of merchandise for cash on December 30.
b. Common stock was issued on November 30.
c. Salaries were paid to employees on December 31 for work performed in December.
d. A I-year insurance policy (which took effect immediately) was purchased on December 1.
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(1) Prepare the year-end adjusting entry to record accrued interest revenue on December 31.
(2) Prepare the entry required on the note's maturity date assuming it is honored. (Use 360 days a year.)
A company purchased a certificate of deposit (a short-term investment that pays interest to the purchaser when it matures) on March 1 that will pay $120 of interest 3 months from that date when it matures. On March 31, which of the following adjusting journal entries would be made?
Account
Debit
Credit
A.
Interest receivable
120
Interest revenue
120
B.
Interest receivable
40
Interest revenue
40
C.
Interest receivable
120
Unearned revenue
120
D.
No entry is recorded on March 31.
Group of answer choices
A.
B.
C.
D.
Lakeview Company completed the following two transactions. The annual accounting period ends December 31.
a. On December 31, calculated the payroll, which indicates gross earnings for wages ($64,000), payroll deductions for income tax
($6,400), payroll deductions for FICA ($4,800), payroll deductions for American Cancer Society ($2,400), employer contributions for
FICA (matching), and state and federal unemployment taxes ($560). Employees were paid in cash, but payments for the
corresponding payroll deductions have not yet been made and employer taxes have not yet been recorded.
b. Collected rent revenue of $5,700 on December 10 for office space that Lakeview rented to another business. The rent collected
was for 30 days from December 11 to January 10 and was credited in full to Deferred Revenue.
Required:
1. & 2. Prepare the journal entries to record payroll on December 31, the collection of rent on December 10 and adjusting journal entry
on December 31.
3. Show how any of the…
Chapter 3 Solutions
Cornerstones of Financial Accounting
Ch. 3 - How does accural-basis net income differ from...Ch. 3 - Explain when revenue may be recognized and give an...Ch. 3 - What happens during the accounting cycle?Ch. 3 - Prob. 4DQCh. 3 - Why are adjusting entries needed?Ch. 3 - What accounting concepts require that adjusting...Ch. 3 - Prob. 7DQCh. 3 - Prob. 8DQCh. 3 - What is the difference between an accural and a...Ch. 3 - Prob. 10DQ
Ch. 3 - Prob. 11DQCh. 3 - Describe the effect on the financial statements...Ch. 3 - Prob. 13DQCh. 3 - Prob. 14DQCh. 3 - Prob. 15DQCh. 3 - Prob. 16DQCh. 3 - Prob. 17DQCh. 3 - Prob. 18DQCh. 3 - ( Appendix 3A) What is the relationship between...Ch. 3 - Prob. 20DQCh. 3 - Which of the following statements is true? Under...Ch. 3 - In December 2019, Swanstrom Inc. receives a cash...Ch. 3 - Which transaction would require adjustment at...Ch. 3 - Which of the following statements is false?...Ch. 3 - Dallas Company loaned to Ewing Company on December...Ch. 3 - Rons Diner received the following bills for...Ch. 3 - In September 2019, GolfWorld Magazine obtained...Ch. 3 - Hurd Inc. prepays rent every 3 months on March 1,...Ch. 3 - Which of the following statements is incorrect...Ch. 3 - Reinhardt Company reported revenues of $122,000...Ch. 3 - Prob. 11MCQCh. 3 - Cornerstone Exercise 3-12 Accrual- and Cash-Basis...Ch. 3 - Cornerstone Exercise 3-13 Accrual- and Cash-Basis...Ch. 3 - Prob. 14CECh. 3 - Prob. 15CECh. 3 - Cornerstone Exercise 3-16 Identification of...Ch. 3 - Cornerstone Exercise 3-17 Accrued Revenue...Ch. 3 - Cornerstone Exercise 3-18 Accrued Expense...Ch. 3 - Cornerstone Exercise 3-19 Deferred Revenue...Ch. 3 - Cornerstone Exercise 3-20 Deferred Expense...Ch. 3 - Cornerstone Exercise 3-21 Adjustment for Supplies...Ch. 3 - Cornerstone Exercise 3-22 Adjustment for...Ch. 3 - Prob. 23CECh. 3 - Cornerstone Exercise 3-24 Preparing an Income...Ch. 3 - Cornerstone Exercise 3-25 Preparing a Retained...Ch. 3 - Cornerstone Exercise 3-26 Preparing a Balance...Ch. 3 - Cornerstone Exercise 3-27 Preparing and Analyzing...Ch. 3 - Brief Exercise 3-28 Accrual- and Cash-Basis...Ch. 3 - Brief Exercise 3-29 Revenue and Expense...Ch. 3 - Brief Exercise 3-30 Identification of Adjusting...Ch. 3 - Brief Exercise 3-31 Adjusting Entries-Accruals...Ch. 3 - Brief Exercise 3-32 Adjusting Entries-Deferrals...Ch. 3 - Brief Exercise 3-33 Preparing an Income Statement...Ch. 3 - Brief Exercise 3-34 Preparing a Retained Earnings...Ch. 3 - Prob. 35BECh. 3 - Brief Exercise 3-36 Preparing and Analyzing...Ch. 3 - Prob. 37BECh. 3 - Exercise 3-38 Accrual- and Cash-Basis Expense...Ch. 3 - Exercise 3-39 Revenue Recognition Each of the...Ch. 3 - Exercise 3-40 Revenue and Expense Recognition...Ch. 3 - Exercise 3-41 Cash-Basis and Accrual-Basis...Ch. 3 - Exercise 3-42 Revenue and Expense Recognition...Ch. 3 - Exercise 3-43 Recognizing Expenses Treadway Dental...Ch. 3 - Exercise 3-44 Revenue Expense and Recognition...Ch. 3 - Exercise 3-45 Identification of Adjusting Entries...Ch. 3 - Exercise 3-46 Identification and Analysis of...Ch. 3 - Exercise 3-47 Revenue Adjustments Sentry Transport...Ch. 3 - Expense Adjustments Faraday Electronic Service...Ch. 3 - Prob. 49ECh. 3 - Exercise 3-50 Prepayment of Expenses JDM Inc. made...Ch. 3 - Exercise 3-51 Adjustment for Supplies The downtown...Ch. 3 - Adjusting Entries Exercise 3-52 Allentown Services...Ch. 3 - Prob. 53ECh. 3 - Exercise 3-54 Recreating Adjusting Entries...Ch. 3 - Exercise 3-55 Effect of Adjustments on the...Ch. 3 - Exercise 3-56 Preparing an Income Statement Oxmoor...Ch. 3 - Exercise 3-57 Preparing a Retained Earnings...Ch. 3 - Exercise 3-58 Preparing a Balance Sheet Refer to...Ch. 3 - Exercise 3-59 Preparation of Closing Entries Grand...Ch. 3 - Exercise 3-60 Preparation of Closing Entries James...Ch. 3 - Exercise 3-61 Preparation of a Worksheet (Appendix...Ch. 3 - Problem 3-62A Cash-Basis and Accrual-Basis Income...Ch. 3 - Problem 3-63A Revenue and Expense Recognition...Ch. 3 - Problem 3-64A Identification and Preparation of...Ch. 3 - Problem 3-65A Preparation of Adjusting Entries...Ch. 3 - Problem 3-66A Effects of Adjusting Entries on the...Ch. 3 - Problem 3-67A Adjusting Entries and Financial...Ch. 3 - Problem 3-68A Inferring Adjusting Entries from...Ch. 3 - Problem 3-69A Preparation of Closing Entries and...Ch. 3 - Problem 3-70B Comprehensive Problem: Reviewing the...Ch. 3 - Problem 3-71 A Preparing a Worksheet (Appendix 3A)...Ch. 3 - Prob. 62BPSBCh. 3 - Problem 3-63B Revenue and Expense Recognition Aunt...Ch. 3 - Problem 3-64B Identification and Preparation of...Ch. 3 - Problem 3-65B Preparation of Adjusting Entries...Ch. 3 - Problem 3-66A Effects of Adjusting Entries on the...Ch. 3 - Problem 3-67B Adjusting Entries and Financial...Ch. 3 - Problem 3-68B Inferring Adjusting Entries from...Ch. 3 - Problem 3-69B Preparation of Closing Entries and...Ch. 3 - Problem 3-70B Comprehensive Problem: Reviewing the...Ch. 3 - Problem 3-71B Preparing a Worksheet (Appendix 3A)...Ch. 3 - Case 3-72 Cash- or Accrual-Basis Accounting Karen...Ch. 3 - Case 3-73 Recognition of Service Contract Revenue...Ch. 3 - Case 3-73 Recognition of Service Contract Revenue...Ch. 3 - Case 3-73 Recognition of Service Contract Revenue...Ch. 3 - Case 3-74 Revenue Recognition Melaney Parks...Ch. 3 - Prob. 74.2CCh. 3 - Prob. 75CCh. 3 - Prob. 76CCh. 3 - Prob. 77.1CCh. 3 - Prob. 77.2CCh. 3 - Prob. 78.1CCh. 3 - Prob. 78.2CCh. 3 - Case 3-78 Interpreting Closing Entries Barnes...Ch. 3 - Case 3-79 Research and Analysis Using the Annual...Ch. 3 - Prob. 79.2CCh. 3 - Prob. 79.3CCh. 3 - Prob. 79.4CCh. 3 - Prob. 79.5CCh. 3 - Prob. 80.1CCh. 3 - Refer to the 10-K reports of Under Armour, Inc.,...Ch. 3 - Prob. 80.3CCh. 3 - Prob. 80.4CCh. 3 - Prob. 81.1CCh. 3 - Prob. 81.2CCh. 3 - Prob. 81.3CCh. 3 - Prob. 81.4CCh. 3 - Prob. 81.5CCh. 3 - Prob. 81.6CCh. 3 - Prob. 81.7C
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