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3 years ago

The following transactions were completed by the company

Business

2 answers:

djyliett [7]3 years ago

8 0

Answer:

(a) The company completed consulting work for a client and immediately collected $6,700 cash earned - Assets (increase) = Liabilities (NA) + Equity (increase)

(b) The company completed commission work for a client and sent a bill for $5,200 to be received within 30 days - Assets (increase) = Liabilities (NA) + Equity (increase)

(c) The company paid an assistant $2,000 cash as wages for the period - Assets (decrease) = Liabilities (NA) + Equity (decrease)

(d) The company collected $2,600 cash as a partial payment for the amount owed by the client in transaction b - Assets (No effect) = Liabilities (NA) + Equity (NA)

(e) The company paid $940 cash for this period's cleaning services - Assets (decrease) = Liabilities + Equity (decrease)

*NA = Not Applicable

Explanation:

Accounting equation is defined by this formula: Assets = Liabilities + Equity

Cash of $6,700 collected by the company increase Cash (Asset) and increases Service revenue (Retained earnings/Equity).
The commission work increases Accounts receivable (Asset) and Credit sales (Retained earnings/Equity) by $5,200.
Payment of $2,000 for wages decreases Cash (Asset) and increases Wages expense (which decreases Equity).
Collection of $2,600 has no effect on the asset, since the company would have debited Accounts receivable to credit Sales revenue initially, so the collection is a debit to Cash (Asset) and credit to Accounts receivable (Asset).
Payment for cleaning services of $940 decrease Cash (Asset) and increase Operating expenses (ultimately decreases Equity).

Pavel [41]3 years ago

4 0

Answer:

The Accounting Equation is As follows:

Assets = Liabilities + Stockholder's Equity

Statement (a)

With the cash collected there will be increase in assets by $6,700

And with the recognition of revenue there will be increase in stockholder's equity as retained earnings will increase by the amount $6,700,

Assets increase $6,700 = Liabilities + Stockholder's equity increase $6,700.

Statement (b)

Revenue is recognized and with that retained earnings will increase, and accordingly stockholder's equity will also increase by $5,200,

As the cash is not realized now, accounts receivables increase and accordingly, assets increase by $5,200.

Statement (c)

Cash paid as wages will reduce cash and accordingly assets by $2,000,

Also , with the recognition of expense, retained earnings will reduce and accordingly stockholder's equity will reduce by $2,000.

Statement (d)

This will increase the cash and decrease the accounts receivable by $2,600.

Thus on the assets side there will be + $2,600 and - $2,600 making it neutral.

No effect on the right side, as net effect on left side of equation = 0

Statement (e)

Cash paid for cleaning expense will decrease assets by $940,

And also this will decrease retained earnings and accordingly stockholder's equity will decrease by $940.

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1. Arness Woodcrafters sells $300,000 of receivables to Commercial Factors, Inc. on a with recourse basis. Commercial assesses a

stellarik [79]

Answer:

(a)

Dr. Cash $273,000

Dr. Receivable (Commercial Factor) $9,000

Dr. Loss on sale of Receivables $20,500

Cr. Account Receivables $300,000

Cr. Recourse Payable $8,000

(b)

Dr. Account Receivables $300,000

Dr. Recourse Receivable ($300,000 x 6%) $18,000

Cr. Income from Recourse Services $36,000

Cr. Cash $273,000

Cr. Account payable (Arness) $9,000

Explanation:

The fair value of recourse liability will be recorded by Arness, but the Commercial Factors Inc. will record the actual amount of 6% as receivable.

Cash is received excluding the finance charges and retained accounts receivables.

Net of Liabilities and receivable will be recorded as Loss on the recourse of receivables.

Cash $300,000 – ($300,000 X (.06 + .03)) = $273,000

Due from Factor ($300,000 X .03) = $9,000

Loss on Sale of Receivables = $20,500

Accounts Receivable = $300,000

Recourse Liability = $8,000

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3 years ago

The following condensed balance sheet is for the partnership of Hardwick, Saunders, and Ferris, who share profits and losses in

spin [16.1K]

Question Completion:

Condensed Balance Sheet:

Cash $115,000

Other assets 760,000

Total assets $875,000

Accounts payable $232,000

Ferris, loan 43,000

Hardwick, capital 270,000

Saunders, capital 170,000

Ferris, capital 160,000

Total liabilities and capital $875,000

Answer:

The Partnership of Hardwick, Saunders, and Ferris

Proposed Schedule of Liquidation:

Net proceeds from sale of assets $526,000

Share of net proceeds:

Hardwick 4/10 * $526,000 $210,400

Saunders 3/10 * $526,000 $157,800

Ferris 3/10 * $526,000 $157,800 $526,000

Explanation:

a) Data and Calculations:

Condensed Balance Sheet:

Cash $115,000

Other assets 760,000

Total assets $875,000

Accounts payable $232,000

Ferris, loan 43,000

Hardwick, capital 270,000

Saunders, capital 170,000

Ferris, capital 160,000

Total liabilities and capital $875,000

Schedule of Assets Disposal:

Cash $115,000

Other assets:

40% of $760,000 ($304,000) sold for 230,000

60% of $760,000 ($456,000) sold for 456,000

Proceeds from disposal, including cash 801,000

Settlement of Accounts Payable -232,000

Settlement of Ferris, loan -43,000

Net proceeds 526,000

Hardwick Saunders Ferris

Capital accounts $270,000 $170,000 $160,000

Final settlement 210,400 157,800 157,800

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3 years ago

Johnston Chemicals' president is very excited about the possibility of the firm's British subsidiary having access to customers

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3 years ago

A study of college graduates involves three variables: income level, job satisfaction, and one-way commute times to work. List s

pickupchik [31]

Answer:

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A working spouse could affect all three variables.

People might be very satisfied with their career as long as the income is high.

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Explanation:

As we know that the study in college for graduation generally includes the three types of variables i.e. level of the income, job satisfaction and the one way commute

Now there are some ways that may be cofounded such as the one way commute could belong as if the house is far from the job, for the working spouse the above three variables could be impacted, when the income of the people are high they feel very satisfied and they follow their passion but they have the low income or long commute travelled at the same time

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3 years ago

The administration of a large university is interested in learning about the types of wellness programs that would interest its

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