Mgmt 1A
Examples fully
solved &
updated
The assets of a company total $700,000; the liabilities total
$200,000. What are the claims of the owners? - answer $500,000
How would the accounting equation be affected by the billing of a
client for $10,000 of consulting work completed? - answer +10,000
accounts receivable
+10,000 revenue
Photometer Company paid off $30,000 of is accounts payable in
cash. What would be the effects of this transaction on the
accounting equation? - answer Assets, $30,000 decrease
Liabilities, $30,000 decrease
Equity, no effect
If a parcel of land that was originally purchased for $85,000 is
offered for sale at $150,000, is assessed for tax purposes at
$95,000, is recognized by its purchasers as easily being worth
$140,000, and is sold for $137,000. At the time of the sale, assume
that the seller still owed $30,000 to TrustOne Bank on the land that
was purchased for $85,000. Immediately after the sale, the seller
paid off the loan to TrustOne Bank. What is the effect of the sale and
,the payoff of the loan on the accounting equation? - answer Assets
increase $22,000
Owner's equity increases $52,000
Liabilities decrease $30,000
137,000-85,000-30,000=22,000
(also check #8 on S13 if confused--duplicate question??)
Quick Computer Service had revenues of $80,000 and expenses of
$50,000 for the year. Its assets at the beginning of the year were
$400,000. At the end of the year assets were worth $450,000.
Calculate return on assets. - answer 7.1%
30,000/[(400,000+450,000)/2]=30,000/425,000=7.1%
If a parcel of land that was originally purchased for $85,000 is
offered for sale at $150,000, is assessed for tax purposes at
$95,000, is recognized by its purchasers as easily being worth
$140,000, and is sold for $137,000, the land account transaction
amount to handle the sale of the land in the seller's book is: -
answer $85,000 decrease
If a parcel of land that was originally purchased for $85,000 is
offered for sale at $150,000, is assessed for tax purposes at
$95,000, is recognized by its purchasers as easily being worth
$140,000, and is sold for $137,000. What is the effect of the sale on
the accounting equation for the seller? - answer Assets increase
$52,000
owner's equity increases $52,000
(check S13 #7 answer if confused)
, An example of a financing activity is:
a. buying office supplies
b. obtaining a long-term loan
c. buying office equipment
d. selling inventory
e. buying land - answer obtaining a long-term loan (b)
An example of an operating activity is:
a. paying wages
b. purchasing office equipment
c. borrowing money from a bank
d. selling stock - answer paying wages (a)
The following transactions occurred during July:
Received $900 cash for services provided to a customer during July.
Received $2,200 cash investment from Barbara Hanson, the owner
of the business.
Received $750 from a customer in partial payment of his account
receivable which arose from sales in June.
Provided services to a customer on credit, $375.
Borrowed $6,000 from the bank by signing a promissory note.
Received $1,250 cash from a customer for services to be rendered
next year.
What was the amount of revenue for July? - answer 1,275
Zed Bennett opened an art gallery and as a dealer completed these
transactions:
Started the gallery, Artery, by investing $40,000 cash and
equipment valued at $18,000. Purchased $70 of office supplies on
credit.
Examples fully
solved &
updated
The assets of a company total $700,000; the liabilities total
$200,000. What are the claims of the owners? - answer $500,000
How would the accounting equation be affected by the billing of a
client for $10,000 of consulting work completed? - answer +10,000
accounts receivable
+10,000 revenue
Photometer Company paid off $30,000 of is accounts payable in
cash. What would be the effects of this transaction on the
accounting equation? - answer Assets, $30,000 decrease
Liabilities, $30,000 decrease
Equity, no effect
If a parcel of land that was originally purchased for $85,000 is
offered for sale at $150,000, is assessed for tax purposes at
$95,000, is recognized by its purchasers as easily being worth
$140,000, and is sold for $137,000. At the time of the sale, assume
that the seller still owed $30,000 to TrustOne Bank on the land that
was purchased for $85,000. Immediately after the sale, the seller
paid off the loan to TrustOne Bank. What is the effect of the sale and
,the payoff of the loan on the accounting equation? - answer Assets
increase $22,000
Owner's equity increases $52,000
Liabilities decrease $30,000
137,000-85,000-30,000=22,000
(also check #8 on S13 if confused--duplicate question??)
Quick Computer Service had revenues of $80,000 and expenses of
$50,000 for the year. Its assets at the beginning of the year were
$400,000. At the end of the year assets were worth $450,000.
Calculate return on assets. - answer 7.1%
30,000/[(400,000+450,000)/2]=30,000/425,000=7.1%
If a parcel of land that was originally purchased for $85,000 is
offered for sale at $150,000, is assessed for tax purposes at
$95,000, is recognized by its purchasers as easily being worth
$140,000, and is sold for $137,000, the land account transaction
amount to handle the sale of the land in the seller's book is: -
answer $85,000 decrease
If a parcel of land that was originally purchased for $85,000 is
offered for sale at $150,000, is assessed for tax purposes at
$95,000, is recognized by its purchasers as easily being worth
$140,000, and is sold for $137,000. What is the effect of the sale on
the accounting equation for the seller? - answer Assets increase
$52,000
owner's equity increases $52,000
(check S13 #7 answer if confused)
, An example of a financing activity is:
a. buying office supplies
b. obtaining a long-term loan
c. buying office equipment
d. selling inventory
e. buying land - answer obtaining a long-term loan (b)
An example of an operating activity is:
a. paying wages
b. purchasing office equipment
c. borrowing money from a bank
d. selling stock - answer paying wages (a)
The following transactions occurred during July:
Received $900 cash for services provided to a customer during July.
Received $2,200 cash investment from Barbara Hanson, the owner
of the business.
Received $750 from a customer in partial payment of his account
receivable which arose from sales in June.
Provided services to a customer on credit, $375.
Borrowed $6,000 from the bank by signing a promissory note.
Received $1,250 cash from a customer for services to be rendered
next year.
What was the amount of revenue for July? - answer 1,275
Zed Bennett opened an art gallery and as a dealer completed these
transactions:
Started the gallery, Artery, by investing $40,000 cash and
equipment valued at $18,000. Purchased $70 of office supplies on
credit.
