EXAM #1 WEEK 3 (Chapters 1–3) Should be completed by Sunda

EXAM #1 WEEK 3 (Chapters 1–3) Should be completed by Sunday at 11:59 p.m. ET. Question 1: The records of Skymaster Airplane Rentals show the following information as of December 31, 2011 Accounts payable $ 36,000 2011 Wages expense $75,000 Insurance expense 2,000 2011 Advertising expense 22,000 Accounts receivable 24,000 Cash 11,000 Retained earnings, December 31, 2010 130,000 Common stock Office furniture 20,000 15,000 Airplanes 150,000 2011 Maintenance expense 39,000 Notes payable 47,000 2011 Revenues 217,000 Hangar 60,000 Dividends of $52,000 were paid during 2011. Using the above information, prepare an income statement for 2011. (15 points) Question 2: The records of Skymaster Airplane Rentals show the following information as of December 31, 2011 Accounts payable $36,000 2011 Wages expense $75,000 Insurance expense 2,000 2011 Advertising expense 22,000 Accounts receivable 24,00 Cash 11,000 Retained earnings, December 31, 2010 130,000 Common stock Office furniture 20,000 15,000 Airplanes 150,000 2011 Maintenance expense 39,000 Notes payable 47,000 2011 Revenues 217,000 Hangar 60,000 Dividends of $52,000 were paid during 2011. Using the above information, prepare a statement of retained earnings for 2011 (15 points) Question 3: The records of Skymaster Airplane Rentals show the following information as of December 31, 2011 Accounts payable $36,000 2011 Wages expense $75,000 Insurance expense 2,000 2011 Advertising expense 22,000 Accounts receivable 24,000 Cash 11,000 Retained earnings, December 31, 2010 130,000 Common stock Office furniture 20,000 15,000 Airplanes 150,000 2011 Maintenance expense 39,000 Notes payable 47,000 2011 Revenues 217,000 Hangar 60,000 Dividends of $52,000 were paid during 2011. Using the above information, prepare a balance sheet at December 31, 2011. (15 points) Question 4: The following is a list of accounts and identification letters A through J for Shannon Management Co.: A. Common Stock F. Prepaid Rent B. Interest Payable G. Advertising Expense C. Land H. Unearned Rent Revenue D. Dividends I. Commissions Earned E. Fees Earned J. Notes Receivable Use the form below to identify the type of account and its normal balance. The first item is filled in as an example. (10 points) Type of Account Normal Balance Asset Liability Equity Debit Credit A. X X B. C. D. E. F. G. H. I. J. Question 5: Dolly Barton began Barton Office Services in October and during the month completed the following transactions: a. Invested $10,000 cash and $15,000 of computer equipment in exchange for common stock b. Paid $500 cash for an insurance premium covering the next 12 months c. Completed a word processing assignment for a customer and collected $1,000 cash d. Paid $200 cash for office supplies e. Paid $2,000 for October’s rent. Prepare journal entries to record the above transactions. Explanations are unnecessary. (15 points) Question 6: In general journal form, record the December 31 adjusting entries for the following transactions and events. Assume that December 31 is the end of the annual accounting period. (15 points) a. The Prepaid Insurance account shows a debit balance of $2,340, representing the cost of a three-year fire insurance policy that was purchased on October 1 of the current year b. The Office Supplies account has a debit balance of $400; a year-end inventory count reveals $80 of supplies still on hand c. On November 1 of the current year, Rent Earned was credited for $1,500. This amount represented the rent earned for a three-month period beginning November 1 d. Estimated depreciation on office equipment is $600 e. Accrued salaries amount to $400 Question 7: The adjusted trial balance of Sara’s Web Services follows: SARA’S WEB SERVICES Adjusted Trial Balance December 31 Cash $ 1,170 Supplies 1,930 Prepaid insurance 600 Computer equipment 20,600 Accumulated depreciation – Computer equipment $ 5,400 Accounts payable 325 Common stock 3,000 Retained earnings 10,925 Dividends 4,800 Services revenue 21,720 Salaries expense 6,920 Depreciation expense 2,000 Rent expense 1,200 Supplies expense 800 Utilities expense 950 Insurance expense 400 Totals $41,370 $41,370 1. (a) Prepare the closing entries for Sara’s Web Services. (15 points)

EXAM #1 WEEK 3 (Chapters 1–3) Should be completed by Sunda

EXAM #1 WEEK 3 (Chapters 1–3) Should be completed by Sunday at 11:59 p.m. ET. Question 1: The records of Skymaster Airplane Rentals show the following information as of December 31, 2011 Accounts payable $ 36,000 2011 Wages expense $75,000 Insurance expense 2,000 2011 Advertising expense 22,000 Accounts receivable 24,000 Cash 11,000 Retained earnings, December 31, 2010 130,000 Common stock Office furniture 20,000 15,000 Airplanes 150,000 2011 Maintenance expense 39,000 Notes payable 47,000 2011 Revenues 217,000 Hangar 60,000 Dividends of $52,000 were paid during 2011. Using the above information, prepare an income statement for 2011. (15 points) Question 2: The records of Skymaster Airplane Rentals show the following information as of December 31, 2011 Accounts payable $36,000 2011 Wages expense $75,000 Insurance expense 2,000 2011 Advertising expense 22,000 Accounts receivable 24,00 Cash 11,000 Retained earnings, December 31, 2010 130,000 Common stock Office furniture 20,000 15,000 Airplanes 150,000 2011 Maintenance expense 39,000 Notes payable 47,000 2011 Revenues 217,000 Hangar 60,000 Dividends of $52,000 were paid during 2011. Using the above information, prepare a statement of retained earnings for 2011 (15 points) Question 3: The records of Skymaster Airplane Rentals show the following information as of December 31, 2011 Accounts payable $36,000 2011 Wages expense $75,000 Insurance expense 2,000 2011 Advertising expense 22,000 Accounts receivable 24,000 Cash 11,000 Retained earnings, December 31, 2010 130,000 Common stock Office furniture 20,000 15,000 Airplanes 150,000 2011 Maintenance expense 39,000 Notes payable 47,000 2011 Revenues 217,000 Hangar 60,000 Dividends of $52,000 were paid during 2011. Using the above information, prepare a balance sheet at December 31, 2011. (15 points) Question 4: The following is a list of accounts and identification letters A through J for Shannon Management Co.: A. Common Stock F. Prepaid Rent B. Interest Payable G. Advertising Expense C. Land H. Unearned Rent Revenue D. Dividends I. Commissions Earned E. Fees Earned J. Notes Receivable Use the form below to identify the type of account and its normal balance. The first item is filled in as an example. (10 points) Type of Account Normal Balance Asset Liability Equity Debit Credit A. X X B. C. D. E. F. G. H. I. J. Question 5: Dolly Barton began Barton Office Services in October and during the month completed the following transactions: a. Invested $10,000 cash and $15,000 of computer equipment in exchange for common stock b. Paid $500 cash for an insurance premium covering the next 12 months c. Completed a word processing assignment for a customer and collected $1,000 cash d. Paid $200 cash for office supplies e. Paid $2,000 for October’s rent. Prepare journal entries to record the above transactions. Explanations are unnecessary. (15 points) Question 6: In general journal form, record the December 31 adjusting entries for the following transactions and events. Assume that December 31 is the end of the annual accounting period. (15 points) a. The Prepaid Insurance account shows a debit balance of $2,340, representing the cost of a three-year fire insurance policy that was purchased on October 1 of the current year b. The Office Supplies account has a debit balance of $400; a year-end inventory count reveals $80 of supplies still on hand c. On November 1 of the current year, Rent Earned was credited for $1,500. This amount represented the rent earned for a three-month period beginning November 1 d. Estimated depreciation on office equipment is $600 e. Accrued salaries amount to $400 Question 7: The adjusted trial balance of Sara’s Web Services follows: SARA’S WEB SERVICES Adjusted Trial Balance December 31 Cash $ 1,170 Supplies 1,930 Prepaid insurance 600 Computer equipment 20,600 Accumulated depreciation – Computer equipment $ 5,400 Accounts payable 325 Common stock 3,000 Retained earnings 10,925 Dividends 4,800 Services revenue 21,720 Salaries expense 6,920 Depreciation expense 2,000 Rent expense 1,200 Supplies expense 800 Utilities expense 950 Insurance expense 400 Totals $41,370 $41,370 1. (a) Prepare the closing entries for Sara’s Web Services. (15 points)