If Accounts Payable had a balance of $18,340 at the beginning of the month, and the six amounts shown below were posted to this account, what should be the ending balance? Three debits posted to Accounts Payable this month: $4,560, $11,160, and $14,660. Three credits posted to Accounts Payable this month: $3,740, $9,640, and $12,840. $4,160. $22,500. $48,720. correct $14,180. Accounts payable is a liability account which means it has a normal credit balance and is increased by credits and decreased by debits. $18,340 – $4,560 – $11,160 – $14,660 + $3,740 + $9,640 + $12,840 = $14,180.

If Accounts Payable had a balance of $18,340 at the beginning of the month, and the six amounts shown below were posted to this account, what should be the ending balance?

Three debits posted to Accounts Payable this month: $4,560, $11,160, and $14,660.
Three credits posted to Accounts Payable this month: $3,740, $9,640, and $12,840.

	$4,160.
	$22,500.
	$48,720.
	$14,180.

Accounts payable is a liability account which means it has a normal credit balance and is increased by credits and decreased by debits.

$18,340 – $4,560 – $11,160 – $14,660 + $3,740 + $9,640 + $12,840 = $14,180.

he balance sheet of Mister Ribs Restaurant reports current assets of $50,000 and current liabilities of $20,000. Required: (a) Calculate the current ratio. (Round your answer to 1 decimal place.) Current ratio (b) Does it appear likely that Mister Ribs will be able to pay its current liabilities as they come due in the next year? Yes Explanation: (a) Current Ratio = Current Assets Current Liabilities Current Ratio = $50,000 = 2.5 $20,000 (b) Yes, it is likely that Mister Ribs will be able to pay its current liabilities as they come due. The current ratio of 2.5 indicates that for every dollar in current liabilities, the company has 2.5 dollars in current assets. This ratio indicates a good ability to pay.

he balance sheet of Mister Ribs Restaurant reports current assets of $50,000 and current liabilities of $20,000.  

Required:

(a)	Calculate the current ratio. (Round your answer to 1 decimal place.)

 

Current ratio

 

(b)	Does it appear likely that Mister Ribs will be able to pay its current liabilities as they come due in the next year?

Yes

Explanation:

(a)

Current Ratio	=	Current Assets
		Current Liabilities

 

Current Ratio	=	$50,000		=	2.5
		$20,000

(b)

Yes, it is likely that Mister Ribs will be able to pay its current liabilities as they come due.  The current ratio of 2.5 indicates that for every dollar in current liabilities, the company has 2.5 dollars in current assets. This ratio indicates a good ability to pay.

 

 

he balance sheet of Mister Ribs Restaurant reports current assets of $50,000 and current liabilities of $20,000. Required: (a) Calculate the current ratio. (Round your answer to 1 decimal place.) Current ratio (b) Does it appear likely that Mister Ribs will be able to pay its current liabilities as they come due in the next year? Yes Explanation: (a) Current Ratio = Current Assets Current Liabilities Current Ratio = $50,000 = 2.5 $20,000 (b) Yes, it is likely that Mister Ribs will be able to pay its current liabilities as they come due. The current ratio of 2.5 indicates that for every dollar in current liabilities, the company has 2.5 dollars in current assets. This ratio indicates a good ability to pay.

he balance sheet of Mister Ribs Restaurant reports current assets of $50,000 and current liabilities of $20,000.  

Required:

(a)	Calculate the current ratio. (Round your answer to 1 decimal place.)

 

Current ratio

 

(b)	Does it appear likely that Mister Ribs will be able to pay its current liabilities as they come due in the next year?

Yes

Explanation:

(a)

Current Ratio	=	Current Assets
		Current Liabilities

 

Current Ratio	=	$50,000		=	2.5
		$20,000

(b)

Yes, it is likely that Mister Ribs will be able to pay its current liabilities as they come due.  The current ratio of 2.5 indicates that for every dollar in current liabilities, the company has 2.5 dollars in current assets. This ratio indicates a good ability to pay.

 

 

The following accounts are taken from the financial statements of Trump Entertainments Resorts, Inc., at its September 30, 2008, year-end. (Amounts are in thousands.)

The following accounts are taken from the financial statements of Trump Entertainments Resorts, Inc., at its September 30, 2008, year-end. (Amounts are in thousands.)

General expenses	$	176,703
Salaries payable		26,513
Interest expense		79,552
Accounts payable		38,739
Other current liabilities		136,863
Food and beverage revenue		77,816
Cash		275,489
Accounts receivable		45,880
Other current assets		25,182
Property and equipment		1,985,231
Long-term note payable		1,702,506
Contributed capital		14
Retained earnings		427,147

 

Required:
(a)	Prepare a classified balance sheet at September 30, 2008. (TIP: Some of the above accounts are not reported on the balance sheet.) (Enter your answers in thousands. Be sure to list the assets and liabilities in order of their liquidity. Omit the "$" sign in your response.)

Trump Entertainments Resorts Inc. Balance Sheet At September 30, 2008 (in thousands)
Assets				Liabilities
Current Assets				Current Liabilities
Cash	$			Accounts payable	$
Accounts receivable				Salaries payable
Other current assets				Other current liabilities
Total Current Assets				Total Current Liabilities
				Long-term notes payable
				Total Liabilities
				Stockholders’ Equity
Property and equipment				Contributed capital
				Retained earnings
				Total Stockholders’ Equity
Total Assets	$			Total Liabilities & Stockholders’ Equity	$

 

(b)	Using the balance sheet, indicate whether the total assets of Trump Entertainments Resorts, Inc. at the end of the year were financed primarily by liabilities or stockholders' equity.

 

The total assets were financed primarily by liabilities.

 

Explanation:

As of September 30, 2008, liabilities have provided the primary source of financing for Trump Entertainments Resorts, Inc. The company has financed $1,904,621 of its assets with liabilities and only $427,161 with stockholders' equity.

J.K. Builders was incorporated on July 1, 2010. a. Received $37,500 cash invested by owners and issued stock. b. Bought an unused field from a local farmer by paying $43,000 cash. As a construction site for smaller projects, it is estimated to be worth $48,000 to J.K. Builders. c. A lumber supplier delivered lumber to J.K. Builders for future use. The lumber would have normally sold for $11,200, but the supplier gave J.K. Builders a 11 percent discount. J.K. Builders has not yet received a bill from the supplier. d. Borrowed $22,000 from the bank with a plan to use the funds to build a small workshop in August. The loan must be repaid in two years. e. One of the owners sold $12,000 worth of his stock to another shareholder for $13,000. Required: Prepare journal entries for the above transactions from the first month of business. (In cases where no entry is required, please select the option "No journal entry required" for your answer to grade correctly. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.) Event General Journal Debit Credit a. Cash Contributed capital b. Land Cash c. Lumber Accounts payable d. Cash Note payable e. No journal entry required No journal entry required

J.K. Builders was incorporated on July 1, 2010.  

a.	Received $37,500 cash invested by owners and issued stock.
b.	Bought an unused field from a local farmer by paying $43,000 cash. As a construction site for smaller projects, it is estimated to be worth $48,000 to J.K. Builders.
c.	A lumber supplier delivered lumber to J.K. Builders for future use. The lumber would have normally sold for $11,200, but the supplier gave J.K. Builders a 11 percent discount. J.K. Builders has not yet received a bill from the supplier.
d.	Borrowed $22,000 from the bank with a plan to use the funds to build a small workshop in August. The loan must be repaid in two years.
e.	One of the owners sold $12,000 worth of his stock to another shareholder for $13,000.

 

Required:

Prepare journal entries for the above transactions from the first month of business. (In cases where no entry is required, please select the option "No journal entry required" for your answer to grade correctly. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

Event	General Journal	Debit	Credit
a.	Cash
	Contributed capital
b.	Land
	Cash
c.	Lumber
	Accounts payable
d.	Cash
	Note payable
e.	No journal entry required
	No journal entry required

 

For each of the following transactions of Spotlighter Inc. for the month of January 2010, indicate the accounts, amounts, and direction (+ for increase and − for decrease) of the effects on the accounting equation. A sample is provided. a. (Sample) Borrowed $8,460 from a local bank on a note due in six months. b. Received $4,930 cash from investors and issued stock to them. c. Purchased $1,610 in equipment, paying $190 cash and promising the rest on a note due in one year. d. Paid $597 cash for supplies. e. Bought $580 of supplies on account. Assets = Liabilities + Stockholders' Equity a. Cash +8,460 Notes payable +8,460 b. Cash +4,930 Contributed capital +4,930 c. Cash -190 Notes payable +1,420 Equipment +1,610 d. Cash -597 Supplies +597 e. Supplies +580 Accounts payable +580

For each of the following transactions of Spotlighter Inc. for the month of January 2010, indicate the accounts, amounts, and direction (+ for increase and − for decrease) of the effects on the accounting equation. A sample is provided.

 

a.	(Sample) Borrowed $8,460 from a local bank on a note due in six months.
b.	Received $4,930 cash from investors and issued stock to them.
c.	Purchased $1,610 in equipment, paying $190 cash and promising the rest on a note due in one year.
d.	Paid $597 cash for supplies.
e.	Bought $580 of supplies on account.

  

	Assets		=	Liabilities		+	Stockholders' Equity
a.	Cash	+8,460		Notes payable	+8,460
b.	Cash	+4,930					Contributed capital	+4,930
c.	Cash	-190		Notes payable	+1,420
	Equipment	+1,610
d.	Cash	-597
	Supplies	+597
e.	Supplies	+580		Accounts payable	+580

 

The following accounts are taken from Buck Up!, Inc., a company that specializes in horse-breaking services and rodeo lessons, as of December 31, 2010. BUCK UP!, INC. Unadjusted Trial Balance At December 31, 2010 Account Name Debits Credits Cash $ 59,750 Accounts Receivable 3,300 Prepaid Insurance 1,200 Equipment 64,600 Land 23,000 Accounts Payable $ 29,230 Unearned Revenues 1,500 Long-term Notes Payable 74,000 Contributed Capital 5,000 Retained Earnings 14,500 Dividends 3,500 Horse-breaking Revenue 25,200 Rodeo Lesson Revenue 10,500 Wages Expense 3,900 Maintenance Expense 410 Other Expenses 270 Totals $ 159,930 $ 159,930 Requirement 1: Using the unadjusted trial balance provided, create an income statement for Buck Up!, Inc., for the year ended December 31, 2010. (Omit the "$" sign in your response.) BUCK UP!, INC. Income Statement For the Year Ended December 31, 2010 Revenues: Horse-breaking revenue $ Rodeo lesson revenue Total Revenues Expenses: Wages expense Maintenance expense Other expenses Total Expenses Net income $ Requirement 2: Using the unadjusted trial balance provided, create a statement of retained earnings, for Buck Up!, Inc., for the year ended December 31, 2010. (Input all amounts as positive values. Omit the "$" sign in your response.) BUCK UP!, INC. Statement of Retained Earnings For the Year Ended December 31, 2010 Retained Earnings, Jan. 1, 2010 $ Add: Net income Less: Dividends Retained Earnings, Dec. 31, 2010 $ Requirement 3: Using the unadjusted trial balance provided, create a classified balance sheet, for Buck Up!, Inc., for the year ended December 31, 2010. (Be sure to list the assets and liabilities in order of their liquidity. Omit the "$" sign in your response.) BUCK UP!, INC. Balance Sheet At December 31, 2010 Assets Current Assets Cash $ Accounts receivable Prepaid insurance Total Current Assets Equipment Land Total Assets $ Liabilities Current Liabilities Accounts payable $ Unearned revenues Total Current Liabilities Long-term notes payable Total Liabilities Stockholders' Equity Contributed capital Retained earnings Total Stockholders' Equity Total Liabilities and Stockholders' Equity $

The following accounts are taken from Buck Up!, Inc., a company that specializes in horse-breaking services and rodeo lessons, as of December 31, 2010.  

BUCK UP!, INC. Unadjusted Trial Balance At December 31, 2010
Account Name	Debits		Credits
Cash	$	59,750
Accounts Receivable		3,300
Prepaid Insurance		1,200
Equipment		64,600
Land		23,000
Accounts Payable			$	29,230
Unearned Revenues				1,500
Long-term Notes Payable				74,000
Contributed Capital				5,000
Retained Earnings				14,500
Dividends		3,500
Horse-breaking Revenue				25,200
Rodeo Lesson Revenue				10,500
Wages Expense		3,900
Maintenance Expense		410
Other Expenses		270
Totals	$	159,930	$	159,930

 

Requirement 1:

Using the unadjusted trial balance provided, create an income statement for Buck Up!, Inc., for the year ended December 31, 2010. (Omit the "$" sign in your response.)

BUCK UP!, INC. Income Statement For the Year Ended December 31, 2010
Revenues:
Horse-breaking revenue	$
Rodeo lesson revenue
Total Revenues
Expenses:
Wages expense
Maintenance expense
Other expenses
Total Expenses
Net income	$

 

Requirement 2:

Using the unadjusted trial balance provided, create a statement of retained earnings, for Buck Up!, Inc., for the year ended December 31, 2010. (Input all amounts as positive values. Omit the "$" sign in your response.)

BUCK UP!, INC. Statement of Retained Earnings For the Year Ended December 31, 2010
Retained Earnings, Jan. 1, 2010	$
Add: Net income
Less: Dividends
Retained Earnings, Dec. 31, 2010	$

 

Requirement 3:

Using the unadjusted trial balance provided, create a classified balance sheet, for Buck Up!, Inc., for the year ended December 31, 2010. (Be sure to list the assets and liabilities in order of their liquidity. Omit the "$" sign in your response.)

BUCK UP!, INC. Balance Sheet At December 31, 2010
Assets
Current Assets
Cash	$
Accounts receivable
Prepaid insurance
Total Current Assets
Equipment
Land
Total Assets	$
Liabilities
Current Liabilities
Accounts payable	$
Unearned revenues
Total Current Liabilities
Long-term notes payable
Total Liabilities
Stockholders' Equity
Contributed capital
Retained earnings
Total Stockholders' Equity
Total Liabilities and Stockholders' Equity	$

An auto-body repair shop has been in business for 23 years. a. Signed a long-term note and received a $150,000 loan from a local bank. b. Billed a customer $2,000 for repair work just completed. Payment is expected in 45 days. c. Wrote a check for $600 of rent. d. Received $450 cash from a customer for work done the same day. e. The company incurred $400 in advertising costs for the current month and is planning to pay these costs next month. Required: Prepare journal entries for the above transactions, which occurred during a recent month. (Omit the "$" sign in your response.) General Journal Debit Credit a. Cash Note payable b. Accounts receivable Repair/Service revenue c. Rent expense Cash d. Cash Repair/Service revenue e. Advertising expense Accounts payable

An auto-body repair shop has been in business for 23 years.
 

a.	Signed a long-term note and received a $150,000 loan from a local bank.
b.	Billed a customer $2,000 for repair work just completed. Payment is expected in 45 days.
c.	Wrote a check for $600 of rent.
d.	Received $450 cash from a customer for work done the same day.
e.	The company incurred $400 in advertising costs for the current month and is planning to pay these costs next month.

Required:

Prepare journal entries for the above transactions, which occurred during a recent month. (Omit the "$" sign in your response.)

 

	General Journal	Debit	Credit
a.	Cash
	Note payable
b.	Accounts receivable
	Repair/Service revenue
c.	Rent expense
	Cash
d.	Cash
	Repair/Service revenue
e.	Advertising expense
	Accounts payable

An international children’s charity collects donations, which are used to buy clothing and toys for children in need. The charity records donations of cash and other items as Donations Revenue when received. a. Received $4,000 in cash and checks from a door-to-door campaign. b. Paid $2,000 cash for employee wages this month. c. Paid $1,000 cash on a loan from the bank (ignore interest). d. Bought $3,000 worth of new toy supplies from a large toy manufacturer, paying $1,000 cash and signing a short-term note for $2,000. e. The manufacturer generously donated an additional $2,500 of toy supplies. Required: Prepare journal entries for the above transactions, which occurred during a recent month. (Omit the "$" sign in your response.) General Journal Debit Credit a. Cash Donations revenue b. Wages expense Cash c. Bank loan payable Cash d. Supplies Cash Note payable e. Supplies Donations revenue

An international children’s charity collects donations, which are used to buy clothing and toys for children in need. The charity records donations of cash and other items as Donations Revenue when received.

 

a.	Received $4,000 in cash and checks from a door-to-door campaign.
b.	Paid $2,000 cash for employee wages this month.
c.	Paid $1,000 cash on a loan from the bank (ignore interest).
d.	Bought $3,000 worth of new toy supplies from a large toy manufacturer, paying $1,000 cash and signing a short-term note for $2,000.
e.	The manufacturer generously donated an additional $2,500 of toy supplies.

Required:

Prepare journal entries for the above transactions, which occurred during a recent month. (Omit the "$" sign in your response.)

 

	General Journal	Debit	Credit
a.	Cash
	Donations revenue
b.	Wages expense
	Cash
c.	Bank loan payable
	Cash
d.	Supplies
	Cash
	Note payable
e.	Supplies
	Donations revenue