SOLUTION MANUAL
Accounting
29th Edition
By Carl Warren, Jefferson P. Jones, William B. Tayler
Chapters 1-24
SC
Course Resource
This complete solutions manual for accounting (29th Edition) by Carl S. Warren, Jefferson
P. Jones, and William S. Farmer provides detailed, step-by-step solutions to all end-of-
chapter problems and exercises from Chapters 1–24. It covers essential financial
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accounting concepts including the accounting cycle, financial statements, adjusting and
closing entries, merchandising operations, inventory valuation, receivables, liabilities,
equity, payroll, cash flow statements, and internal controls. Designed to support students
R
in mastering accounting problem-solving skills and to assist instructors with clear
explanations and accurate grading.
EM
Format: Solution Manual
Edition: 29th edition
Coverage: Chapters 1-24
© SCOREVAULT
AX
,TABLE OF CONTENT
1. Introduction to Accounting and Business.
2. Analyzing Transactions.
3. The Adjusting Process.
4. The Accounting Cycle.
5. Accounting for Retail Businesses.
6. Inventories.
7. Internal Controls and Cash.
8. Receivables.
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9. Long-Term Assets: Fixed and Intangible.
10. Liabilities: Current Liabilities, Installment Notes, and Contingencies.
11. Liabilities: Bonds Payable.
12. Partnerships and Limited Liability Companies.
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13. Corporations: Organization, Stock Transactions, and Dividends.
14. Statement of Cash Flows.
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15. Financial Statement Analysis.
16. Introduction to Managerial Accounting.
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17. Job Order Costing.
18. Process Costing.
19. Activity-Based Costing.
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20. Cost-Volume-Profit Analysis.
21. Budgeting.
22. Evaluating Variances from Standard Costs.
23. Differential Analysis and Product Pricing.
24. Capital Investment Analysis.
, CHAPTER 1
INTRODUCTION TO ACCOUNTING AND BUSINESS
DISCUSSION QUESTIONS
1. Some users of accounting information include managers, employees, investors, creditors,
customers, and the government.
2. The role of accounting is to provide information for managers to use in operating the business.
In addition, accounting provides information to others to use in assessing the economic
performance and condition of the business.
3. The corporate form allows the company to obtain large amounts of resources by issuing stock.
For this reason, most companies that require large investments in property, plant, and equipment
SC
are organized as corporations.
4. No. The business entity assumption limits the recording of economic data to transactions directly
affecting the activities of the business. The payment of the interest of $4,500 is a personal
transaction of Josh Reilly and should not be recorded by Dispatch Delivery Service.
5. The land should be recorded at its cost of $167,500 to Reliable Repair Service. This is consistent
with the cost principle.
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6. a. No. The offer of $2,000,000 and the increase in the assessed value should not be recognized
in the accounting records.
b. Cash would increase by $2,125,000, land would decrease by $900,000, and owner’s
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capital would increase by $1,225,000.
7. An account receivable is a claim against a customer for goods or services sold. An account
payable is an amount owed to a creditor for goods or services purchased. Therefore, an account
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receivable in the records of the seller is an account payable in the records of the purchaser.
8. (b) The business realized net income of $91,000 ($679,000 – $588,000).
9. (a) The business incurred a net loss of $75,000 ($640,000 – $715,000).
10. (a) Net income or net loss
(b) Owner’s capital at the end of the period
(c) Cash at the end of the period
AX
1-1
, CHAPTER 1 Introduction to Accounting and Business
BASIC EXERCISES
BE 1–1
$320,000. Under the cost principle, the land should be recorded at the cost to Tin
Roofing.
BE 1–2
a. A = L + OE
$690,000 = $375,000 + OE
OE = $315,000
b. A = L + OE
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$690,000 + $80,000 = $375,000 + $51,500 + OE
$770,000 = $426,500 + OE
OE = $343,500
BE 1–3
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(2) Expense (Advertising Expense) increases by $3,500;
Asset (Cash) decreases by $3,500.
(3) Asset (Supplies) increases by $2,500;
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Liability (Accounts Payable) increases by $2,500.
(4) Asset (Accounts Receivable) increases by $18,750;
Revenue (Delivery Service Fees) increases by $18,750.
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(5) Asset (Cash) increases by $14,150;
Asset (Accounts Receivable) decreases by $14,150.
BE 1–4
A-One Travel Service
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Income Statement
For the Year Ended August 31, 20Y6
Fees earned $1,150,000
Expenses:
Wages expense $640,000
Office expense 150,000
Miscellaneous expense 45,000
Total expenses (835,000)
Net income $ 315,000
1-2
Accounting
29th Edition
By Carl Warren, Jefferson P. Jones, William B. Tayler
Chapters 1-24
SC
Course Resource
This complete solutions manual for accounting (29th Edition) by Carl S. Warren, Jefferson
P. Jones, and William S. Farmer provides detailed, step-by-step solutions to all end-of-
chapter problems and exercises from Chapters 1–24. It covers essential financial
O
accounting concepts including the accounting cycle, financial statements, adjusting and
closing entries, merchandising operations, inventory valuation, receivables, liabilities,
equity, payroll, cash flow statements, and internal controls. Designed to support students
R
in mastering accounting problem-solving skills and to assist instructors with clear
explanations and accurate grading.
EM
Format: Solution Manual
Edition: 29th edition
Coverage: Chapters 1-24
© SCOREVAULT
AX
,TABLE OF CONTENT
1. Introduction to Accounting and Business.
2. Analyzing Transactions.
3. The Adjusting Process.
4. The Accounting Cycle.
5. Accounting for Retail Businesses.
6. Inventories.
7. Internal Controls and Cash.
8. Receivables.
SC
9. Long-Term Assets: Fixed and Intangible.
10. Liabilities: Current Liabilities, Installment Notes, and Contingencies.
11. Liabilities: Bonds Payable.
12. Partnerships and Limited Liability Companies.
O
13. Corporations: Organization, Stock Transactions, and Dividends.
14. Statement of Cash Flows.
R
15. Financial Statement Analysis.
16. Introduction to Managerial Accounting.
EM
17. Job Order Costing.
18. Process Costing.
19. Activity-Based Costing.
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20. Cost-Volume-Profit Analysis.
21. Budgeting.
22. Evaluating Variances from Standard Costs.
23. Differential Analysis and Product Pricing.
24. Capital Investment Analysis.
, CHAPTER 1
INTRODUCTION TO ACCOUNTING AND BUSINESS
DISCUSSION QUESTIONS
1. Some users of accounting information include managers, employees, investors, creditors,
customers, and the government.
2. The role of accounting is to provide information for managers to use in operating the business.
In addition, accounting provides information to others to use in assessing the economic
performance and condition of the business.
3. The corporate form allows the company to obtain large amounts of resources by issuing stock.
For this reason, most companies that require large investments in property, plant, and equipment
SC
are organized as corporations.
4. No. The business entity assumption limits the recording of economic data to transactions directly
affecting the activities of the business. The payment of the interest of $4,500 is a personal
transaction of Josh Reilly and should not be recorded by Dispatch Delivery Service.
5. The land should be recorded at its cost of $167,500 to Reliable Repair Service. This is consistent
with the cost principle.
O
6. a. No. The offer of $2,000,000 and the increase in the assessed value should not be recognized
in the accounting records.
b. Cash would increase by $2,125,000, land would decrease by $900,000, and owner’s
R
capital would increase by $1,225,000.
7. An account receivable is a claim against a customer for goods or services sold. An account
payable is an amount owed to a creditor for goods or services purchased. Therefore, an account
EM
receivable in the records of the seller is an account payable in the records of the purchaser.
8. (b) The business realized net income of $91,000 ($679,000 – $588,000).
9. (a) The business incurred a net loss of $75,000 ($640,000 – $715,000).
10. (a) Net income or net loss
(b) Owner’s capital at the end of the period
(c) Cash at the end of the period
AX
1-1
, CHAPTER 1 Introduction to Accounting and Business
BASIC EXERCISES
BE 1–1
$320,000. Under the cost principle, the land should be recorded at the cost to Tin
Roofing.
BE 1–2
a. A = L + OE
$690,000 = $375,000 + OE
OE = $315,000
b. A = L + OE
SC
$690,000 + $80,000 = $375,000 + $51,500 + OE
$770,000 = $426,500 + OE
OE = $343,500
BE 1–3
O
(2) Expense (Advertising Expense) increases by $3,500;
Asset (Cash) decreases by $3,500.
(3) Asset (Supplies) increases by $2,500;
R
Liability (Accounts Payable) increases by $2,500.
(4) Asset (Accounts Receivable) increases by $18,750;
Revenue (Delivery Service Fees) increases by $18,750.
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(5) Asset (Cash) increases by $14,150;
Asset (Accounts Receivable) decreases by $14,150.
BE 1–4
A-One Travel Service
AX
Income Statement
For the Year Ended August 31, 20Y6
Fees earned $1,150,000
Expenses:
Wages expense $640,000
Office expense 150,000
Miscellaneous expense 45,000
Total expenses (835,000)
Net income $ 315,000
1-2
