SOLUTION MANUAL FOR Accounting 28th Edition by Carl Warren , Christine Jonick ISBN:978-1337902687 A+ GRADE ASSURED!!!!!!! GUARANTEED PASS!!!!! YOUR ULTIMATE GUIDE!!!!!

CHAPTER 1 CA



INTRODUCTION TO ACCOUNTING AND BUSINESS CA CA CA CA




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ebsite,CA inCA wholeCA orCA inCA part.

, DISCUSSION QUESTIONS CA




1. Some users of accounting information include managers, employees, investors, credi
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tors, customers, and the government.
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2. The role of accounting is to provide information for managers to use in operating the b
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usiness. In addition, accounting provides information to others to use in assessing the
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economic performance and condition of the business.
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3. The corporate form allows the company to obtain large amounts of resources by is
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suing stock. For this reason, most companies that require large investments in property, p
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lant, and equipment are organized as corporations.
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4. No. The business entity concept limits the recording of economic data to transactions d
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irectly affecting the activities of the business. The payment of the interest of $4,500 is
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CAa personal transaction of Josh Reilly and should not be recorded by Dispatch Deliver
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y Service.
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5. The land should be recorded at its cost of $167,500 to Reliable Repair Service. This is c
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onsistent with the cost concept.
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6. a.
No. The offer of $2,000,000 and the increase in the assessed value should not b
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e recognized in the accounting records because land is recorded on the cost basis.
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b.
Cash would increase by $2,125,000, land would decrease by $900,000, and ow
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ner’s equity would increase by $1,225,000.
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7. An account receivable is a claim against a customer for goods or services sold. An acco
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unt payable is an amount owed to a creditor for goods or services purchased. Therefore,
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an account receivable in the records of the seller is an account payable in the records
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of the purchaser.
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8. (b) C A The business realized net income of $91,000 ($679,000 – $588,000).
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9. (a) CACA The business incurred a net loss of $75,000 ($640,000 – $715,000).
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10. (a) Net income or net loss
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(b) Owner’s equity at the end of the period
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(c) Cash at the end of the period
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©CA2021CACengageCALearning, CAInc. CAMayCAnotCAbeCAscanned, CAcopiedCAorCAduplicated, CAorCApostedCAtoCAaCApubliclyCAaccessibleCAwebsit
e,CAinCAwholeCAorCAinCApart.

, CHAPTER CA Introduction to Accounting and Busine
CA CA CA CA

1 ss
PE 1- CA PRACTICE EXERCISES CA


3B
PE 1-1A
CA



$597,000. Under the cost concept, the land should be recorded at the cost to Bould
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er Repair Service.
CA CA




PE 1-1B
CA



$369,500. Under the cost concept, the land should be recorded at the cost t
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o Clementine Repair Service.
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PE 1-2A
CA



a. A = L + OE C A C A


$518,000 = $165,000 + OE CA CA


OE = $353,000

b. A = L + OE C A C A


+$86,200 = +$25,000 + OE CA CA


OE = +$61,200
OE on December 31, 20
CA CA CA CA = $353,000 + $61,20 CA CA


Y9 0
= $414,200


PE 1-2B
CA



a. A = L + OE C A C A


$382,000 = $94,000 + OE CA CA


OE = $288,000

b. A = L + OE
C A C A


– CA = +$35,000 + OE – CA CA CA


$63,000 = $98,000
OE = $288,000 – CA


OE on December 31, 20Y
CA CA CA CA = $98,000
CA


9 $190,000

PE 1-3A
CA



(2) Asset (Accounts Receivable) increases by $22,400;
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Owner’s Equity (Delivery Service Fees) increases by $22,400.
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(3) Liability (Accounts Payable) decreases by $4,10
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0; Asset (Cash) decreases by $4,100.
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(4) Asset (Cash) increases by $14,700;
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Asset (Accounts Receivable) decreases by $14,700.
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(5) Asset (Cash) decreases by $1,600;
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Owner’s Equity (Terry Young, Drawing) decreases by $1,600.
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©CA 2021CA CengageCA Learning,CA Inc.CA MayCA notCA beCA scanned,CA copiedCA orCA duplicated,CA orCA postedCA toCA aCA publiclyCA accessibleCA w
ebsite,CA inCA wholeCA orCA inCA part.

,