Adjusting Entries - Intermediate Accounting - Exam Answers, Exams of Accounting

Download Adjusting Entries - Intermediate Accounting - Exam Answers and more Exams Accounting in PDF only on Docsity! I. Matching : 4, L, T, 9, P, 2, H, C II. Adjusting Entries 1. Sales revenue 9,000 Unearned sales Revenue 9,000 2. Bad debt expense 4,420 Allowance for uncollectible accounts 4,420 3. Insurance expense 19,050 Prepaid insurance 19,050 4. Depreciation expense 25,000 Accumulated depreciation – building 25,000 5. Interest receivable 16,000 Interest revenue 16,000 6. Rent expense 2,250 Rent payable 2,250 Rent expense 5,850 Prepaid rent 5,850 ************* OR ************* 6. Rent expense 8,100 Rent payable 2,250 Prepaid rent 5,850 ******************************** 7. Supplies expense 225 Supplies 225 II. Closing Entries Sales revenue 222,250 Interest revenue 24,000 Income summary 246,250 Income summary 167,615 Sales returns and allowances 1,250 Cost of goods sold 105,370 Supplies expense 4,425 Bad debt expense 4,420 Insurance expense 19,050 Rent expense 8,100 Depreciation expense 25,000 [NOTE: CLOSING ENTRIES CONTINUED ON NEXT PAGE] docsity.com II. Closing Entries (continued) Income summary 78,635 Retained earnings 78,635 Retained earnings 566 Dividends 566 III. Discontinued Operations 2003 2004 Income (Loss) from Discontinued Operations 53,000 (15,000) Gain (Loss) due to Impairment zero zero Gain (Loss) from Sale of Discontinued Operation zero (2,250) IV. Income Statement and Retained Earnings A.] DJ’s INCOME STATEMENT for the year ending 12/31/03 Income from continuing operations before income taxes $428,400 Income tax expense (171,360) Income from continuing operations 257,040 Extraordinary loss due to flood damage (net of $1,600 tax benefit) (2,400) Net Income $254,640 B.] $430,680 V. Cash Flow/Cash – Accrual Revenues: Sales 185,500 Expenses: Cost of goods sold 63,750; Rent expense 16,550; Wages expense 88,440; Depreciation expense 18,500 Net Income (Loss): (1,740) VI. Multiple Choice 1. D, 2. E, 3. B, 4. D, 5. C VII. Long Term Construction Contracts—Financial Statement Interpretation a. 3,775,000; b. 4,550,000; c. (600,000); d. 90% docsity.com