Solutions Manual for College Accounting A Practical
Approach 15th Canadian Edition by Jeffrey Slater, Debra
Good
,1
Accounting Concepts and k k
Procedures: An Introduction
k k k
ANSWERS kTO kDISCUSSION kQUESTIONS kAND
kCRITICAL kTHINKING/ETHICAL kCASE
1. The kfunctions kof kaccounting kare kto kanalyze, krecord, kclassify, ksummarize, kreport kand
kinterpret kinformation.
2. Sole kproprietorship—one kowner, kunlimited kliability; keasy kto kform kPartnership—two kor kmore
kowners; kunlimited kliability, keasy kto kform kCorporation—one kor kmore kshareholders; klimited
kliability; kmore kdifficult kto kform.
3. Service, kmerchandising, kor kmanufacturing.
4. The kobjective kof kaccounting kis kto kprovide krelevant, ktimely kinformation kfor kuser kdecision
kmaking. kAccountants kmust kbehave kin kan kethical kmanner kso kthat kthe kinformation kthey kprovide
kwill kbe ktrustworthy kand, ktherefore, kuseful kfor kall kdecisions. kEthics kare kmoral kprinciples kthat
kguide kthe kconduct kof kindividuals. kSometimes kbusiness kmanagers kand kaccountants kbehave kin kan
kunethical kmanner.
5. The kthree kelements kof kthe kbasic kaccounting kequation kare kassets, kliabilities, kowner’s kequity.
6. Capital kis kthe kowner’s kcurrent kinvestment kor kequity kin kthe kassets kof ka kbusiness. kIt kis kone ksubdivision kof
owner’s kequity.
7. True. kThe ksum kof kthe kleft kside kof kthe kequation kmust kequal kthe ksum kof kthe kright kside kof kthe kequation.
8. False. kIt kis kthe kincome kstatement kthat ktells khow kwell kthe kcompany khas kperformed.
9. False. kRevenue kis ka ksubdivision kof kowner’s kequity.
10. Owner’s kequity kis ksubdivided kinto kCapital, kWithdrawals, kRevenue, kand kExpenses.
11. False. kIt kis ka ksubdivision kof kowner’s kequity.
12. Reject. kAs kexpenses kincrease kand krevenue kremains kthe ksame, kowner’s kequity kdecreases.
13. Revenue kless kExpenses; kan kincome kstatement kshows kperformance—profit kor kloss kfor kthe kperiod.
14. False. kIt kcalculates kending kcapital.
15. The kquestion kin kthis kcase kis kwhether kPaul kshould kbe kallowed kto k―pad‖ khis kexpense kaccount
kwith kan kadditional k$100 kof kexpenses. kPaul kshould kbe kallowed kto kcharge konly kthose kitems kthat
kare kbusiness krelated. kPaul’s kargument kthat khe kis kentitled kto kan kadditional k$100 kis knot ka kvalid
kassumption. kHowever, khe kshould kbe kallocated kmoney kfor kany kbusiness kexpenses kduring kthe
kweekend. kPaul kshould kalso kask khis kemployer kfor kadditional kcompensation kfor kworking kduring khis
knon kscheduled ktime. kThe kimportant kpoint kis kthat kaccountants kneed kto kbe kseen kas kbeing kethical
kand kshould knot kdo kunethical kactivities.
, SOLUTIONS kTO kCLASSROOM kDEMONSTRATION kEXERCISES
CDE1. a. A CDE4. $24,000 ($12,000 + $12,000) CDE8. a. IS
b. A b. BS
c. L CDE5. c. J. Penny, Capital c. BS
d. A d. Advertising Expense d. BS
e. OE f. Taxi Fees Earned e. IS
f. A g. J. Penny, Withdrawls f. IS
g. OE
h. BS
CDE2. a. Liabilities and or CDE6. c. Accounts Payable
b. Assets d. Grooming Fees Earned CDE9 a. OE
c. Accounts Payable b. BS
c. BS
d. IS
CDE3. a. I CDE7. a.
b. S b.
d.
CDE10.
1. Balance kSheet
2. Assets
3. Liabilities
4. Accounting kEquation
5. Accounts kPayable
6. Service
7. Owner’s kEquity
8. Accounts kReceivable
9. Transaction
10. Creditor
SOLUTIONS kTO kEXERCISES—SET kA
E1-1A.
a. $15,000
k ($19,000 k− k$4,000)
b. $15,000
k ($ k6,000 k+ k$9,000)
c. $ 6,000
k k ($10,000 k− k$4,000)
E1-2A.
1. Service 6. Service
2. Merchandise 7. Service
3. Service 8. Manufacturer
4. Merchandise 9. Manufacturer
5. Merchandise 10. Merchandise
E1-3A.
1-3A kSolutions
1. k B
2. k B
3. k B
4. k A
5. k D
6. k D
, 7. k D
8. k B
9. k C
10. k A
, SOLUTIONS kTO kEXERCISES—SET kA kCont.
E1-4A. BELL’S kCOMPUTER kCOMPANY
Assets = k k Liabilities k k + Owner’s kEquity
Accounts Computer Accounts B. B. kBell,
Cash + k + k Equipme = k Payable + kBell, – k Withdrawals Revenue – Expenses
k Receivable nt k Capit k +
al
A. + k$60,000 + k$60,000
B. + k$7,000 + k$7,000
C. – k$200 + k$200
D. + k$14,000 + k$14,000
E. + k$30,000 + k$30,000
F. – k$4,000 + k$4,000
G. – k$1,500 + k$1,500
ENDING
k BALANC $68,300 + k$30,000 + k$7,000 = +$7,000 + k$60,000 −$200 + k$44,000 –
E k $5,500
+ k$105,300 = k k $105,300
Remember, kas kwithdrawals kor kexpenses kincrease, kthe kend kresult kis kto kreduce kowner’s kequity.
E1-5A.
(a)
FREDERICK kREALTY
kINCOME
kSTATEMENT
FOR kTHE kMONTH kENDED kNOVEMBER k30, k2022
Revenue:
Professional kFees $3 0 0 0 0 k0
Operating kExpenses:
Salaries kExpense $ 5 5 0 0 k0
Utilities kExpense 2 0 0 0 k0
Rent kExpense 8 0 0 0 k0
Total kOperating kExpenses 1 5 5 0 0 k0
Net kIncome $1 4 5 0 0 k0
(b)
FREDERICK kREALTY
STATEMENT kOF kOWNER’S kEQUITY
FOR kTHE kMONTH kENDED kNOVEMBER k30, k2022
S. kFrederick, kCapital, kNovember k1, k2022 $9 0 0 0 0 k0
Net kIncome kfor kNovember $1 4 5 0 0 k0
,Less: kWithdrawals kfor kNovember 1 2 0 0 k0
Increase kin kCapital 1 3 3 0 0 k0
S. kFrederick, kCapital, kNovember k2022 $ 3 3 0 0 k0
k10
,E1-5A, kCont.
SOLUTIONS kTO kEXERCISES—SET kA, kCont.
(c)
FREDERICK kREALTY
kBALANCE kSHEET
kNOVEMBER k30, k2022
ASSETS LIABILITIES kAND kOWNER’S
EQUITY
Cash $4 8 0 0 0 k0 Liabilities
Accounts kReceivable 1 2 3 0 0 k0 Accounts kPayable $4 0 0 0 0 k0
Office kEquipment 8 3 0 0 0 k0 Owner’s kEquity
S. kFrederick, kCapital 10 3 3 0 0 k0
Total kLiabilities
Total kAssets $14 3 3 0 0 k0 and kOwner’s kEquity $14 3 3 0 0 k0
SOLUTIONS kTO kEXERCISES—SET kB
E1-1B.
a. A k= k11,300 d. A k= k$7,500
k L k= k L k= k3,500
k$4,200 kOE kOE k=
k= k$7,100 k$4,000
b A k= k$18,00 e. A k= k15,270
k L k= k L k=
k$6,600 kOE k$5,800 kOE
k= k11,400 k= k$9,470
c. A k= f. A k=
k$21,000 kL k$17,600 kL
k= k$8,000 k= k5,600
kOE k= OE k= k$12,000
k13,000
E1-2B.
1. Increases kan kasset kand kincreases ka kliability k– kReceive ka kbank kloan
2. Increases kone kasset kand kdecreases kanother kasset. k– kReceiver kpayment kof kan kaccounts kreceivable
3. Decreases kan kasset kand kdecreases kowner’s kequity k– kPay kwages
4. Decreases kan kasset kand kdecreases ka kliability k– kPay kan kaccounts kpayable
5. Increases kan kasset kand kincreases kowner’s kequity k– kCash ksale
EI-3B.
Accounting Accounting-related
kprofessionals kpractice kopportunities kwithin keach kfield
kin kfour kbroad kfields kare knumerous kand kinclude
kincluding
,Financial kaccounting - Statement kpreparation
- Statement kanalysis
- Auditing
- Regulatory
- Consulting
- Planning
- Criminal kinvestigation
Managerial kaccounting - kGeneral kaccounting
- Cost kaccounting
- Budgeting
- Internal kauditing
- Management kadvisory kservices
, SOLUTIONS kTO kEXERCISES—SET kB, kCont.
E1-3B, kCont.
Taxation - Preparation
- Planning
- Regulatory
- Investigations
- Consulting
Accounting-related - Lenders
- Consultants
- Analysts
- Traders
- Managers
- Directors
- Underwriters
- Planners
- Appraisers
- Teachers
E1-4B. BELL’S kCOMPUTER kCOMPANY
Assets = k k Liabilities k k + Owner’s kEquity
Accounts Computer Accounts B. B. kBell,
Cash + k + k Equipme = k Payable + kBell, – k Withdrawals Revenue – Expenses
k Receivable nt k Capit k +
al
A. + k$40,000 + k$40,000
B. + k$8,000 + k$8,000
C. – k$150 + k$150
D. + k$12,000 + k$12,000
E. + k$25,000 + k$25,000
F. – k$3,000 + k$3,000
G. – k$900 + k$900
ENDING
k BALANC
$47,950 + k$25,000 + k$8,000 = + k$8,000 + k$40,000 – k$150 + k$37,000 – k$3,900
E
+ k$80,950 = $80,950
Remember, kas kwithdrawals kor kexpenses kincrease, kthe kend kresult kis kto kreduce kowner’s kequity.
E1-5B.
(a)
FRENCH kREALTY
k INCOME
STATEMENT
k
FOR kTHE kMONTH kENDED kJUNE k30, k2022
Revenue:
Professional kFees $5 6 0 0 0 k0
Operating kExpenses:
Salaries kExpense $ 8 0 0 0 k0
Utilities kExpense 7 6 0 0 k0
, Rent kExpense 6 5 0 0 k0
Total kOperating kExpenses 2 2 1 0 0 k0
Net kIncome $3 3 9 0 0 k0
Approach 15th Canadian Edition by Jeffrey Slater, Debra
Good
,1
Accounting Concepts and k k
Procedures: An Introduction
k k k
ANSWERS kTO kDISCUSSION kQUESTIONS kAND
kCRITICAL kTHINKING/ETHICAL kCASE
1. The kfunctions kof kaccounting kare kto kanalyze, krecord, kclassify, ksummarize, kreport kand
kinterpret kinformation.
2. Sole kproprietorship—one kowner, kunlimited kliability; keasy kto kform kPartnership—two kor kmore
kowners; kunlimited kliability, keasy kto kform kCorporation—one kor kmore kshareholders; klimited
kliability; kmore kdifficult kto kform.
3. Service, kmerchandising, kor kmanufacturing.
4. The kobjective kof kaccounting kis kto kprovide krelevant, ktimely kinformation kfor kuser kdecision
kmaking. kAccountants kmust kbehave kin kan kethical kmanner kso kthat kthe kinformation kthey kprovide
kwill kbe ktrustworthy kand, ktherefore, kuseful kfor kall kdecisions. kEthics kare kmoral kprinciples kthat
kguide kthe kconduct kof kindividuals. kSometimes kbusiness kmanagers kand kaccountants kbehave kin kan
kunethical kmanner.
5. The kthree kelements kof kthe kbasic kaccounting kequation kare kassets, kliabilities, kowner’s kequity.
6. Capital kis kthe kowner’s kcurrent kinvestment kor kequity kin kthe kassets kof ka kbusiness. kIt kis kone ksubdivision kof
owner’s kequity.
7. True. kThe ksum kof kthe kleft kside kof kthe kequation kmust kequal kthe ksum kof kthe kright kside kof kthe kequation.
8. False. kIt kis kthe kincome kstatement kthat ktells khow kwell kthe kcompany khas kperformed.
9. False. kRevenue kis ka ksubdivision kof kowner’s kequity.
10. Owner’s kequity kis ksubdivided kinto kCapital, kWithdrawals, kRevenue, kand kExpenses.
11. False. kIt kis ka ksubdivision kof kowner’s kequity.
12. Reject. kAs kexpenses kincrease kand krevenue kremains kthe ksame, kowner’s kequity kdecreases.
13. Revenue kless kExpenses; kan kincome kstatement kshows kperformance—profit kor kloss kfor kthe kperiod.
14. False. kIt kcalculates kending kcapital.
15. The kquestion kin kthis kcase kis kwhether kPaul kshould kbe kallowed kto k―pad‖ khis kexpense kaccount
kwith kan kadditional k$100 kof kexpenses. kPaul kshould kbe kallowed kto kcharge konly kthose kitems kthat
kare kbusiness krelated. kPaul’s kargument kthat khe kis kentitled kto kan kadditional k$100 kis knot ka kvalid
kassumption. kHowever, khe kshould kbe kallocated kmoney kfor kany kbusiness kexpenses kduring kthe
kweekend. kPaul kshould kalso kask khis kemployer kfor kadditional kcompensation kfor kworking kduring khis
knon kscheduled ktime. kThe kimportant kpoint kis kthat kaccountants kneed kto kbe kseen kas kbeing kethical
kand kshould knot kdo kunethical kactivities.
, SOLUTIONS kTO kCLASSROOM kDEMONSTRATION kEXERCISES
CDE1. a. A CDE4. $24,000 ($12,000 + $12,000) CDE8. a. IS
b. A b. BS
c. L CDE5. c. J. Penny, Capital c. BS
d. A d. Advertising Expense d. BS
e. OE f. Taxi Fees Earned e. IS
f. A g. J. Penny, Withdrawls f. IS
g. OE
h. BS
CDE2. a. Liabilities and or CDE6. c. Accounts Payable
b. Assets d. Grooming Fees Earned CDE9 a. OE
c. Accounts Payable b. BS
c. BS
d. IS
CDE3. a. I CDE7. a.
b. S b.
d.
CDE10.
1. Balance kSheet
2. Assets
3. Liabilities
4. Accounting kEquation
5. Accounts kPayable
6. Service
7. Owner’s kEquity
8. Accounts kReceivable
9. Transaction
10. Creditor
SOLUTIONS kTO kEXERCISES—SET kA
E1-1A.
a. $15,000
k ($19,000 k− k$4,000)
b. $15,000
k ($ k6,000 k+ k$9,000)
c. $ 6,000
k k ($10,000 k− k$4,000)
E1-2A.
1. Service 6. Service
2. Merchandise 7. Service
3. Service 8. Manufacturer
4. Merchandise 9. Manufacturer
5. Merchandise 10. Merchandise
E1-3A.
1-3A kSolutions
1. k B
2. k B
3. k B
4. k A
5. k D
6. k D
, 7. k D
8. k B
9. k C
10. k A
, SOLUTIONS kTO kEXERCISES—SET kA kCont.
E1-4A. BELL’S kCOMPUTER kCOMPANY
Assets = k k Liabilities k k + Owner’s kEquity
Accounts Computer Accounts B. B. kBell,
Cash + k + k Equipme = k Payable + kBell, – k Withdrawals Revenue – Expenses
k Receivable nt k Capit k +
al
A. + k$60,000 + k$60,000
B. + k$7,000 + k$7,000
C. – k$200 + k$200
D. + k$14,000 + k$14,000
E. + k$30,000 + k$30,000
F. – k$4,000 + k$4,000
G. – k$1,500 + k$1,500
ENDING
k BALANC $68,300 + k$30,000 + k$7,000 = +$7,000 + k$60,000 −$200 + k$44,000 –
E k $5,500
+ k$105,300 = k k $105,300
Remember, kas kwithdrawals kor kexpenses kincrease, kthe kend kresult kis kto kreduce kowner’s kequity.
E1-5A.
(a)
FREDERICK kREALTY
kINCOME
kSTATEMENT
FOR kTHE kMONTH kENDED kNOVEMBER k30, k2022
Revenue:
Professional kFees $3 0 0 0 0 k0
Operating kExpenses:
Salaries kExpense $ 5 5 0 0 k0
Utilities kExpense 2 0 0 0 k0
Rent kExpense 8 0 0 0 k0
Total kOperating kExpenses 1 5 5 0 0 k0
Net kIncome $1 4 5 0 0 k0
(b)
FREDERICK kREALTY
STATEMENT kOF kOWNER’S kEQUITY
FOR kTHE kMONTH kENDED kNOVEMBER k30, k2022
S. kFrederick, kCapital, kNovember k1, k2022 $9 0 0 0 0 k0
Net kIncome kfor kNovember $1 4 5 0 0 k0
,Less: kWithdrawals kfor kNovember 1 2 0 0 k0
Increase kin kCapital 1 3 3 0 0 k0
S. kFrederick, kCapital, kNovember k2022 $ 3 3 0 0 k0
k10
,E1-5A, kCont.
SOLUTIONS kTO kEXERCISES—SET kA, kCont.
(c)
FREDERICK kREALTY
kBALANCE kSHEET
kNOVEMBER k30, k2022
ASSETS LIABILITIES kAND kOWNER’S
EQUITY
Cash $4 8 0 0 0 k0 Liabilities
Accounts kReceivable 1 2 3 0 0 k0 Accounts kPayable $4 0 0 0 0 k0
Office kEquipment 8 3 0 0 0 k0 Owner’s kEquity
S. kFrederick, kCapital 10 3 3 0 0 k0
Total kLiabilities
Total kAssets $14 3 3 0 0 k0 and kOwner’s kEquity $14 3 3 0 0 k0
SOLUTIONS kTO kEXERCISES—SET kB
E1-1B.
a. A k= k11,300 d. A k= k$7,500
k L k= k L k= k3,500
k$4,200 kOE kOE k=
k= k$7,100 k$4,000
b A k= k$18,00 e. A k= k15,270
k L k= k L k=
k$6,600 kOE k$5,800 kOE
k= k11,400 k= k$9,470
c. A k= f. A k=
k$21,000 kL k$17,600 kL
k= k$8,000 k= k5,600
kOE k= OE k= k$12,000
k13,000
E1-2B.
1. Increases kan kasset kand kincreases ka kliability k– kReceive ka kbank kloan
2. Increases kone kasset kand kdecreases kanother kasset. k– kReceiver kpayment kof kan kaccounts kreceivable
3. Decreases kan kasset kand kdecreases kowner’s kequity k– kPay kwages
4. Decreases kan kasset kand kdecreases ka kliability k– kPay kan kaccounts kpayable
5. Increases kan kasset kand kincreases kowner’s kequity k– kCash ksale
EI-3B.
Accounting Accounting-related
kprofessionals kpractice kopportunities kwithin keach kfield
kin kfour kbroad kfields kare knumerous kand kinclude
kincluding
,Financial kaccounting - Statement kpreparation
- Statement kanalysis
- Auditing
- Regulatory
- Consulting
- Planning
- Criminal kinvestigation
Managerial kaccounting - kGeneral kaccounting
- Cost kaccounting
- Budgeting
- Internal kauditing
- Management kadvisory kservices
, SOLUTIONS kTO kEXERCISES—SET kB, kCont.
E1-3B, kCont.
Taxation - Preparation
- Planning
- Regulatory
- Investigations
- Consulting
Accounting-related - Lenders
- Consultants
- Analysts
- Traders
- Managers
- Directors
- Underwriters
- Planners
- Appraisers
- Teachers
E1-4B. BELL’S kCOMPUTER kCOMPANY
Assets = k k Liabilities k k + Owner’s kEquity
Accounts Computer Accounts B. B. kBell,
Cash + k + k Equipme = k Payable + kBell, – k Withdrawals Revenue – Expenses
k Receivable nt k Capit k +
al
A. + k$40,000 + k$40,000
B. + k$8,000 + k$8,000
C. – k$150 + k$150
D. + k$12,000 + k$12,000
E. + k$25,000 + k$25,000
F. – k$3,000 + k$3,000
G. – k$900 + k$900
ENDING
k BALANC
$47,950 + k$25,000 + k$8,000 = + k$8,000 + k$40,000 – k$150 + k$37,000 – k$3,900
E
+ k$80,950 = $80,950
Remember, kas kwithdrawals kor kexpenses kincrease, kthe kend kresult kis kto kreduce kowner’s kequity.
E1-5B.
(a)
FRENCH kREALTY
k INCOME
STATEMENT
k
FOR kTHE kMONTH kENDED kJUNE k30, k2022
Revenue:
Professional kFees $5 6 0 0 0 k0
Operating kExpenses:
Salaries kExpense $ 8 0 0 0 k0
Utilities kExpense 7 6 0 0 k0
, Rent kExpense 6 5 0 0 k0
Total kOperating kExpenses 2 2 1 0 0 k0
Net kIncome $3 3 9 0 0 k0
