Chapter 2
The Accounting Information System
Assignment Classification Table (By Topic)
Brief
Topics Questions Exercises Exercises Problems
1. Transaction Identification. 1, 2, 3, 5 1, 2 1, 2, 3, 4, 17 1
2. Nominal Accounts. 4, 7
3. Trial Balance. 6, 10 2, 3, 4 1
4. Adjusting Entries. 8, 11, 13, 14 3, 4, 5, 6, 7, 5, 6, 7, 8, 1, 2, 3, 4,
8, 9, 10 9, 10, 20 5, 6, 7, 8,
9, 10, 12
5. Financial Statements. 11, 12, 15, 1, 2, 4, 6,
22, 23 7, 8
6. Closing. 12 11 13, 14, 16 1, 4, 9,
10, 12
7. Inventory And Cost 9 14, 15
Of Goods Sold.
8. Comprehensive 1, 4, 12
Accounting Cycle.
*9. Cash Vs. Accrual Basis. 15, 16, 17 12 18, 19 11
*10. Reversing Entries. 18 13 20
*11. Worksheet. 19 21, 22, 23 12
*These topics are dealt with in an Appendix to the Chapter.
5-1-48 Copyright © 2022 WILEY Kieso, Intermediate Accounting, 18/e, Solutions Manual (For Instructor Use Only)
,Assignment Classification Table (By Learning Objective)
Brief
Learning Objectives Questions Exercises Exercises Problems
1. Explain the basic concepts of an 1, 2, 3,
accounting information system. 4, 5, 7
2. Record and summarize accounting 3, 6 1, 2, 3, 4, 1, 2, 3, 1, 9,10
transactions. 5, 6, 4, 9, 17
3. Identify and prepare adjusting entries. 8, 11, 3, 4, 5, 6, 5, 6, 7, 8, 2, 3, 4, 5,
13, 14 7, 8, 9, 10 9, 10, 20 6, 7, 8, 9,
10, 12
4. Prepare financial statements from the 10, 12 11 11, 12, 13, 1, 2, 4, 6,
adjusted trial balance and prepare 14, 16 7, 8, 9, 10,
closing entries. 12
5. Prepare financial statements for a 9 13, 15 4,
merchandising company.
*6. Differentiate the cash basis of 15, 16, 12 18, 19 11
accounting from the accrual basis of 17
accounting.
*7. Identify adjusting entries that may be 18 13 20
reversed.
*8. Prepare a 10-column worksheet. 19 21, 22, 23 12
*These topics are dealt with in an Appendix to the Chapter.
Copyright © 2022 WILEY Kieso, Intermediate Accounting, 18/e, Solutions Manual (For Instructor Use Only) 5-1-49
,Assignment Characteristics Table
Level Of Time
Item Description Difficulty (Minutes)
E2.1 Transaction Analysis–Service Company. Simple 15–20
E2.2 Corrected Trial Balance. Simple 10–15
E2.3 Corrected Trial Balance. Simple 15–20
E2.4 Corrected Trial Balance. Simple 10–15
E2.5 Adjusting Entries. Moderate 10–15
E2.6 Adjusting Entries. Moderate 10–15
E2.7 Analyze Adjusted Data. Complex 15–20
E2.8 Adjusting Entries. Moderate 10–15
E2.9 Adjusting Entries. Moderate 15–20
E2.10 Adjusting Entries. Complex 25–30
E2.11 Prepare Financial Statements. Moderate 20–25
E2.12 Prepare Financial Statements. Moderate 20–25
E2.13 Closing Entries. Simple 10–15
E2.14 Closing Entries. Moderate 10–15
E2.15 Missing Amounts. Simple 10–15
E2.16 Closing Entries for a Corporation. Moderate 10–15
E2.17 Transactions of a Corporation, Including Investment Moderate 10–15
and Dividend.
*E2.18 Cash to Accrual Basis. Moderate 15–20
*E2.19 Cash and Accrual Basis. Moderate 10–15
*E2.20 Adjusting and Reversing Entries. Complex 20–25
*E2.21 Worksheet. Simple 10–15
*E2.22 Worksheet and Balance Sheet Presentation. Moderate 20–25
*E2.23 Partial Worksheet Preparation. Moderate 10–15
P2.1 Transactions, Financial Statements–Service Company. Moderate 25–35
P2.2 Adjusting Entries and Financial Statements. Moderate 35–40
P2.3 Adjusting Entries. Moderate 25–30
P2.4 Financial Statements, Adjusting and Closing Entries. Moderate 40–50
P2.5 Adjusting Entries. Moderate 15–20
P2.6 Adjusting Entries and Financial Statements. Moderate 25–35
P2.7 Adjusting Entries and Financial Statements. Moderate 25–35
P2.8 Adjusting Entries and Financial Statements. Moderate 25–35
P2.9 Adjusting and Closing. Moderate 30–40
P2.10 Adjusting and Closing. Moderate 30–35
*P2.11 Cash and Accrual Basis. Moderate 35–40
*P2.12 Worksheet, Balance Sheet, Adjusting and Closing Complex 40–50
Entries.
5-1-50 Copyright © 2022 WILEY Kieso, Intermediate Accounting, 18/e, Solutions Manual (For Instructor Use Only)
, Answers to Questions
1. Examples are:
(a) Payment of accounts payable.
(b) Collection of accounts receivable from a customer. Also, a purchase of supplies or equipment
for cash.
(c) Conversion of accounts payable to note payable.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
2. Transactions (a), (b), (d) are considered business transactions and are recorded in the accounting
records because a change in assets, liabilities, and/or owners‘/stockholders‘ equity has been
effected as a result of a transfer of values from one party to another. Transactions (c) and (e) are
not business transactions because a transfer of values has not resulted, nor can the event be
considered financial in nature and capable of being expressed in terms of money.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
3. Transaction (a): Accounts Receivable (debit), Service Revenue (credit).
Transaction (b): Cash (debit), Accounts Receivable (credit).
Transaction (c): Supplies (debit), Accounts Payable (credit).
Transaction (d): Delivery Expense (debit), Cash (credit).
LO: 1, 2, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
4. Revenue and expense accounts are referred to as temporary or nominal accounts because each
period they are closed out to Income Summary in the closing process. Their balances are reduced
to zero at the end of the accounting period; therefore, the term temporary or nominal is given to
these accounts.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
5. Andrea is not correct. The double-entry system means that for every debit amount there must be a
credit amount and vice-versa. At least two accounts are affected and debits must equal credits. It
does not mean that each transaction must be recorded twice.
LO: 1, Bloom: C, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
6. Although it is not absolutely necessary that a trial balance be prepared periodically, it is customary
and desirable. The trial balance accomplishes two principal purposes:
(1) It tests the accuracy of the entries in that it proves that debits and credits of an equal amount
are in the ledger.
(2) It provides a list of ledger accounts and their balances, which may be used in preparing the
financial statements and in supplying financial data about the concern.
LO: 2, Bloom: C, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
7. (a) Real account; balance sheet.
(b) Real account; balance sheet.
(c) Inventory is generally considered a real account appearing on the balance sheet. (Note:
Inventory has the elements of a nominal account when the periodic inventory system is used. It
may appear on the income statement when the multiple-step format is used under a periodic
inventory system.)
(d) Real account; balance sheet.
(e) Real account; balance sheet.
(f) Nominal account; income statement.
(g) Nominal account; income statement.
(h) Real account; balance sheet.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
Copyright © 2022 WILEY Kieso, Intermediate Accounting, 18/e, Solutions Manual (For Instructor Use Only) 5-1-51
The Accounting Information System
Assignment Classification Table (By Topic)
Brief
Topics Questions Exercises Exercises Problems
1. Transaction Identification. 1, 2, 3, 5 1, 2 1, 2, 3, 4, 17 1
2. Nominal Accounts. 4, 7
3. Trial Balance. 6, 10 2, 3, 4 1
4. Adjusting Entries. 8, 11, 13, 14 3, 4, 5, 6, 7, 5, 6, 7, 8, 1, 2, 3, 4,
8, 9, 10 9, 10, 20 5, 6, 7, 8,
9, 10, 12
5. Financial Statements. 11, 12, 15, 1, 2, 4, 6,
22, 23 7, 8
6. Closing. 12 11 13, 14, 16 1, 4, 9,
10, 12
7. Inventory And Cost 9 14, 15
Of Goods Sold.
8. Comprehensive 1, 4, 12
Accounting Cycle.
*9. Cash Vs. Accrual Basis. 15, 16, 17 12 18, 19 11
*10. Reversing Entries. 18 13 20
*11. Worksheet. 19 21, 22, 23 12
*These topics are dealt with in an Appendix to the Chapter.
5-1-48 Copyright © 2022 WILEY Kieso, Intermediate Accounting, 18/e, Solutions Manual (For Instructor Use Only)
,Assignment Classification Table (By Learning Objective)
Brief
Learning Objectives Questions Exercises Exercises Problems
1. Explain the basic concepts of an 1, 2, 3,
accounting information system. 4, 5, 7
2. Record and summarize accounting 3, 6 1, 2, 3, 4, 1, 2, 3, 1, 9,10
transactions. 5, 6, 4, 9, 17
3. Identify and prepare adjusting entries. 8, 11, 3, 4, 5, 6, 5, 6, 7, 8, 2, 3, 4, 5,
13, 14 7, 8, 9, 10 9, 10, 20 6, 7, 8, 9,
10, 12
4. Prepare financial statements from the 10, 12 11 11, 12, 13, 1, 2, 4, 6,
adjusted trial balance and prepare 14, 16 7, 8, 9, 10,
closing entries. 12
5. Prepare financial statements for a 9 13, 15 4,
merchandising company.
*6. Differentiate the cash basis of 15, 16, 12 18, 19 11
accounting from the accrual basis of 17
accounting.
*7. Identify adjusting entries that may be 18 13 20
reversed.
*8. Prepare a 10-column worksheet. 19 21, 22, 23 12
*These topics are dealt with in an Appendix to the Chapter.
Copyright © 2022 WILEY Kieso, Intermediate Accounting, 18/e, Solutions Manual (For Instructor Use Only) 5-1-49
,Assignment Characteristics Table
Level Of Time
Item Description Difficulty (Minutes)
E2.1 Transaction Analysis–Service Company. Simple 15–20
E2.2 Corrected Trial Balance. Simple 10–15
E2.3 Corrected Trial Balance. Simple 15–20
E2.4 Corrected Trial Balance. Simple 10–15
E2.5 Adjusting Entries. Moderate 10–15
E2.6 Adjusting Entries. Moderate 10–15
E2.7 Analyze Adjusted Data. Complex 15–20
E2.8 Adjusting Entries. Moderate 10–15
E2.9 Adjusting Entries. Moderate 15–20
E2.10 Adjusting Entries. Complex 25–30
E2.11 Prepare Financial Statements. Moderate 20–25
E2.12 Prepare Financial Statements. Moderate 20–25
E2.13 Closing Entries. Simple 10–15
E2.14 Closing Entries. Moderate 10–15
E2.15 Missing Amounts. Simple 10–15
E2.16 Closing Entries for a Corporation. Moderate 10–15
E2.17 Transactions of a Corporation, Including Investment Moderate 10–15
and Dividend.
*E2.18 Cash to Accrual Basis. Moderate 15–20
*E2.19 Cash and Accrual Basis. Moderate 10–15
*E2.20 Adjusting and Reversing Entries. Complex 20–25
*E2.21 Worksheet. Simple 10–15
*E2.22 Worksheet and Balance Sheet Presentation. Moderate 20–25
*E2.23 Partial Worksheet Preparation. Moderate 10–15
P2.1 Transactions, Financial Statements–Service Company. Moderate 25–35
P2.2 Adjusting Entries and Financial Statements. Moderate 35–40
P2.3 Adjusting Entries. Moderate 25–30
P2.4 Financial Statements, Adjusting and Closing Entries. Moderate 40–50
P2.5 Adjusting Entries. Moderate 15–20
P2.6 Adjusting Entries and Financial Statements. Moderate 25–35
P2.7 Adjusting Entries and Financial Statements. Moderate 25–35
P2.8 Adjusting Entries and Financial Statements. Moderate 25–35
P2.9 Adjusting and Closing. Moderate 30–40
P2.10 Adjusting and Closing. Moderate 30–35
*P2.11 Cash and Accrual Basis. Moderate 35–40
*P2.12 Worksheet, Balance Sheet, Adjusting and Closing Complex 40–50
Entries.
5-1-50 Copyright © 2022 WILEY Kieso, Intermediate Accounting, 18/e, Solutions Manual (For Instructor Use Only)
, Answers to Questions
1. Examples are:
(a) Payment of accounts payable.
(b) Collection of accounts receivable from a customer. Also, a purchase of supplies or equipment
for cash.
(c) Conversion of accounts payable to note payable.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
2. Transactions (a), (b), (d) are considered business transactions and are recorded in the accounting
records because a change in assets, liabilities, and/or owners‘/stockholders‘ equity has been
effected as a result of a transfer of values from one party to another. Transactions (c) and (e) are
not business transactions because a transfer of values has not resulted, nor can the event be
considered financial in nature and capable of being expressed in terms of money.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
3. Transaction (a): Accounts Receivable (debit), Service Revenue (credit).
Transaction (b): Cash (debit), Accounts Receivable (credit).
Transaction (c): Supplies (debit), Accounts Payable (credit).
Transaction (d): Delivery Expense (debit), Cash (credit).
LO: 1, 2, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
4. Revenue and expense accounts are referred to as temporary or nominal accounts because each
period they are closed out to Income Summary in the closing process. Their balances are reduced
to zero at the end of the accounting period; therefore, the term temporary or nominal is given to
these accounts.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
5. Andrea is not correct. The double-entry system means that for every debit amount there must be a
credit amount and vice-versa. At least two accounts are affected and debits must equal credits. It
does not mean that each transaction must be recorded twice.
LO: 1, Bloom: C, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
6. Although it is not absolutely necessary that a trial balance be prepared periodically, it is customary
and desirable. The trial balance accomplishes two principal purposes:
(1) It tests the accuracy of the entries in that it proves that debits and credits of an equal amount
are in the ledger.
(2) It provides a list of ledger accounts and their balances, which may be used in preparing the
financial statements and in supplying financial data about the concern.
LO: 2, Bloom: C, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
7. (a) Real account; balance sheet.
(b) Real account; balance sheet.
(c) Inventory is generally considered a real account appearing on the balance sheet. (Note:
Inventory has the elements of a nominal account when the periodic inventory system is used. It
may appear on the income statement when the multiple-step format is used under a periodic
inventory system.)
(d) Real account; balance sheet.
(e) Real account; balance sheet.
(f) Nominal account; income statement.
(g) Nominal account; income statement.
(h) Real account; balance sheet.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AICPA BB: Communication, AICPA FC: Reporting, AICPA PC: None
Copyright © 2022 WILEY Kieso, Intermediate Accounting, 18/e, Solutions Manual (For Instructor Use Only) 5-1-51
