Accounting Study Notes

6. Note 8 states Harnischfeger’s allowance for doubtful accounts. Compute the ratio of the allowance to gross receivables (receivables before the allowance) in 1983 and 1984. What would the allowance have been if the company maintained the ratio at the 1983 level? How much did the pre-tax income increase as a result of the changed ratio in 1984?

24. Mobilee Oil Company accepted a $10,000, 120-day note, dated March 3, at 8.5% to settle a past due accounts receivable. Mobilee Oil discount the note to raise cash on May 10 at a discounted rate of 9%. What proceeds did Mobilee Oil receive?

In Year 1, Brun Corp. properly accrued $10,000 for an income item on the basis of a reasonable estimate. In Year 2, Brun determined that the exact amount was $12,000. Which of the following statements is true?

1/ As part of the initial investment , a partner contributes office equipment that had cost $20,000 and on which accumulated depreciation of $ 12500 had been recorded . If the partners agree on a valuation of $ 9000 for the equipment , what amount should be debited to the office equipment account?

2. Considering the minimum payment you just calculated, determine the amount of interest and the amount that was

Compute the uncollectible account expense, and make the appropriate journal entry, for the current year assuming the uncollectible account expense is determined as follows:

A company recorded 2 days of accrued salaries of $2,100 for its employees on January 31. On February 9, it paid its employees $8,400 for these accrued salaries and for other salaries earned through February 9. The January 31 and February 9 journal entries are:

A bank quotes you a loan interest rate of 14% on your credit card. If you charge $15,000 at the beginning of the year, how much will you have to repay at the end of the year?

You deposit $2,000 in a savings account that pays 10 percent interest, compounded annually. How much will your account be worth in 15 years?

D. Under 10% annual compounding of interest for 5 years, an annuity would require five equal payments of $3,275.95 in order to accumulate

The following partially completed T accounts summarize the transactions of Carlton Company for last year:

Determine the present value of regular payments of $250 to be made at the end of each of the next 50 years. The annual effective interest rate is 5%.

The balance in the accumulated depreciation account of Golf Corporation as on April 1st 2011 was Rs 2,00,000 when the original cost of assets was Rs 10,00,000. The company charges 10% depreciation on a straight-line basis. One such asset costing Rs 5,00,000 (and having an accumulated depreciation of Rs 80,000) was sold for Rs 4,20,000 at the beginning of the year.  What is the balance of the accumulated depreciation account on March 31st

11 The following control account has been prepared by a trainee accountant: Receivables ledger control account $ Opening balance 308,600 Credit sales 154,200 Cash sales 88,100 Contras against credit balances in payables ledger 4,600 Cash received from credit customers Discounts allowed to credit customers Interest charged on overdue accounts Bad debts written off Allowance for receivables Closing balance $ 147,200 1,400 2,400 4,900 2,800 396,800 555,500

A credit customer, B Booker, returns books that she did not order. The cost price of the books was R200. Julies Bookshop issues a credit note for the appropriate sales amount. The entries in the ledger will be: (a) (b) Debit Debtors Allowances R350; Credit Bank R350 Debit Cost of Sales R200; Credit Trading Stock R200 Debit Debtors Control R350; Credit Debtors