Which of the following statements regarding the balance ledger form is inaccurate quizlet

1. Social Science
2. Economics
3. Finance

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McLeary Corporation Trial Balance
Cash
$5,500

Accounts Receivable
2,000

Art Supplies
3,000

Office Supplies
5,000

Prepaid Rent
7,000

Prepaid Insurance
5,000

Art Equipment
5,000

Office Equipment
3,000

Accounts Payable
$10,000
Common Stock
5,000
Retained Earnings
5,000
Dividends
?

Advertising Fees Earned
?
Wages Expense
?

Utilities Expense
5,000

Telephone Expense
3,000
________

$ A
$ B
on the trial balance, total assets equal

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finance

The following amounts summarize the financial position of Davis Resources on May 31, 2012: $$ \begin{matrix} \quad & \quad & \quad & \text{Assets} & \quad & \quad & \quad & \quad & \text{ =} & \text{Liabilities} & \text{ +} & \text{Stockholders’ Equity} & \quad & \quad\\ \quad & \text{Cash} & \text{ +} & \text{Accounts Receivable} & \text{ +} & \text{Supplies} & \text{ +} & \text{Land} & \text{ =} & \text{Accounts Payable} & \text{ +} & \text{Common Stock} & \text{ +} & \text{Retained Earnings}\\ \text{Bal} & \text{1,050} & \quad & \text{1,350} & \quad & \quad & \quad & \text{11,700} & \quad & \text{7,900} & \quad & \text{3,600} & \quad & \text{2,600}\\ \end{matrix} $$ During June, 2012, the business completed these transactions: a. The business received cash of $8,900 and issued common stock. b. Performed services for a customer and received cash of$6,300. c. Paid $4,100 on accounts payable. d. Purchased supplies on account,$700. e. Collected cash from a customer on account, $200. f. Consulted on the design of a computer system and billed the customer for services rendered,$2,400. g. Recorded the following expenses for the month: (1) paid office rent—$1,300; (2) paid advertising—$1,000. h. Declared and paid a cash dividend of $2,000. Analyze the effects of the preceding transactions on the accounting equation of Davis Resources, Inc. Prepare the income statement of Davis Resources, Inc., for the month ended June 30, 2012. List expenses in decreasing order by amount. Prepare the statement of retained earnings of Davis Resources, Inc., for the month ended June 30, 2012. Prepare the balance sheet of Davis Resources, Inc., at June 30, 2012.

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finance

Comparative figures for Apple and Microsoft follow. $$ \begin{matrix} \quad & \quad & \text{Apple} & \quad & \quad & \text{Microsoft}\\ \text{\$ millions} & \text{Current Year} & \text{One Year Prior} & \text{Two Years Prior} & \text{Current Year} & \text{One Year Prior} & \text{Two Years Prior}\\ \text{Inventory} & \text{\$ 2,349} & \text{\$ 2,111} & \text{\$ 1,764} & \text{\$ 2,902} & \text{\$ 2,660} & \text{\$ 1,938}\\ \text{Cost of sales} & \text{140,089} & \text{112,258} & \text{106,606} & \text{33,038} & \text{27,078} & \text{20,385}\\ \end{matrix} $$ 1. Compute inventory turnover for each company for the most recent two years shown. 2. Compute days’ sales in inventory for each company for the three years shown. 3. Comment on and interpret your findings from parts 1 and 2. Assume an industry average for inventory turnover of 15.

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finance

Vulcan Company's contribution format income statement for June is given below: $$ \begin{matrix} \text{Vulcan Company Income Statement For the Month Ended June 30}\\ \text{Sales} & \text{\$ 750.000}\\ \text{Variable expenses} & \text{336.000}\\ \text{Contribution margin} & \text{414.000}\\ \text{Fixed expenses} & \text{378.000}\\ \text{Net operating income} & \text{\$ 36.000}\\ \end{matrix} $$ Management is disappointed with the company's performance and is wondering what can be done to improve profits. By examining sales and cost records, you have determined the following: a. The company is divided into two sales territories- Northem and Southem. The Northem territory recorded $300,000 in sales and$156,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southem territory. Fixed expense,s of $120,000 and$108,000 aree traceable to the Northern and Southern territories, respectively. The rest of the fixed expenses are common to the two territories. b. The company is the exclusive distributor for two products-Paks and Tibs. Sales of Paks and Tibs totaled $50.000 and$25.000, respectively, in the Northem territory during June. Variable expenses are 22% of the selling price for Paks and 58% for Tibs. Cost records show that $30.000 of the Northern territory's fixed expenses are traceable to Paks and$40.000 to Tibs, with the remainder common to the two products. 1. Prepare contribution format segmented income statements first showing the total company broken down between sales territories and then showing the Northem territories broken down by product line. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. 2. Look at the statement you have prepared showing the total company segmented by sales territory. What insights revealed by this statement should be brought to the attention of management? 3. Look at the statement you have prepared showing the Northem territory segmented by product lines. What insights revealed by this statement should be brought to the attention of management?

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finance

The accounts of Gleneagles Company prior to the year-end adjustments follow. $$ \begin{matrix} \text{Cash......................................... } & \text{\$ 7,300 } & \text{Common stock............................. } & \text{\$ 14,000 }\\ \text{Accounts receivable..................} & \text{7,500 } & \text{Retained earnings.........................} & \text{46,000 }\\ \text{Supplies....................................} & \text{4,600 } & \text{Dividends..................................... } & \text{16,000 }\\ \text{Prepaid insurance..................... } & \text{3,500 } & \text{Service revenue............................. } & \text{161,000 }\\ \text{Building....................................} & \text{110,000} & \text{Salary expense.............................. } & \text{37,000}\\ \text{Accumulated depreciation - building.................................} & \text{15,600 } & \text{Depreciation expense-building..................................... } & \quad\\ \text{Land.........................................} & \text{53,000 } & \text{Supplies expense...........................} & \quad\\ \text{Accounts payable..................... } & \text{6,100} & \text{Insurance expense........................ } & \quad\\ \text{Salary payable..........................} & \quad & \text{Advertising expense.....................} & \text{7,300 }\\ \text{Unearned service revenue.........} & \text{5,500} & \text{Utilities expense...........................} & \text{2,000}\\ \end{matrix} $$ Adjusting data at the end of the year include the following: a. Unearned service revenue that has been earned, $1,650 b. Accrued service revenue,$32,200 c. Supplies used in operations, $3,100 d. Accrued salary expense,$3,500 e. Prepaid insurance expired, $1,500 f. Depreciation expense—building,$2,600 Rorie St.Pierre, the principal stockholder, has received an offer to sell Gleneagles Company. He needs to know the following information within one hour: a. Net income for the year covered by these data b. Total assets c. Total liabilities d. Total stockholders’ equity e. Proof that Total assets = Total liabilities + Total stockholders’ equity after all items are updated. Without opening any accounts, making any journal entries, or using a work sheet, provide Mr. St. Pierre with the requested information. The business is not subject to income tax.

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