Iron Company

1. How much was paid for inventory purchases?

Cost of sale (340,000 x 60%) 204,000
Add: Merchandise inventory @ cost 93,920
Goods available for sale 297,920
Less: Accounts Payable 46,284
Payments for purchases 251,636

2. How much was collected from customers?

Sale 340,000
Less: Accounts receivable 85,380
Collection from customers 254,620

3. How much is the cashier's accountability at Nov. 15, 2018?

Cashier's accountability:
Receipts:
Issuance of ordinary shares (300k + 20k) 320,000
Mortgage payable 80,000
Note payable - bank 32,000
Collections from sale 254,620
Total 686,620
Disbursements:
Real property 200,000
Furnitures and fixtures (29k-6k) 23,000
Expenses 60,756
Purchases 251,636
Total 535,392
Cash balance 151,228

4. What is the adjusted bank balance as of Nov. 15, 2018?

Unadjusted balances 26,328
Deposit in transit 5,140
Service charge -
Outstanding checks 1,852
Adjusted balances 29,616

5. The cash shortage as of Nov. 15, 2018 totaled

Cashier's accountability 151,228
Cash accounted -29,616
Cash shortage as of Nov. 15, 2018 121,612
Ikebana Company

1. The adjusted balance of Ikebana's "1 to 6 months" accounts receivable is C. 177,000

2. The adjusted balance of Ikebana's "over 6 months" accounts receivable is B. 52,000
3. The adjusted accounts receivable on Dec. 31, 2018 should be C. 409,000

AGING
Subsidiary Ledger Under 1 month
Control account CR DR
Unadjusted balances 424,000 20,000 440,000 180,000
Accounts with credit balances 13,000 -20,000 -7,000
Write off -24,000 -24,000
Unlocated difference -4,000
Total 409,000 0 409,000 180,000

4. The required balance of the allowance for credit loss account on Dec. 31, 2018 is
Adjusted balance Rate Amount
Under 1 month 180,000 1% 1,800
1 to 6 months 177,000 2% 3,540
Over 6 months:
Doubtful 12,000 50% 6,000
Good but slow 40,000 10% 4,000
Required allowance 15,340

5. The entry to adjust the allowance for credit loss account is

Bad debts expense 13,340
Allowance for bad debts 13,340

Required allowance 15,340

Allowance balance(10k+24k-24k-8k) 2,000
Adjustment - increase in allowance 13,340
 AGING
1 to 6 months Over 6 months

184,000 76,000
-7,000
-24,000

177,000 52,000
Carroll Company

1. The deferred tax liability to be reported in Carroll's statement of financial position at Dec. 31, 2018 is
480,000 x 5 x 0.30 720000

2. The deferred tax asset to be reported in Carroll's statement of financial position at Dec. 31, 2018 is
900,000 x 0.30 270,000

3. The amount of current income tax payable to be reported in Carroll's statement of financial position at Dec. 31
Taxable income 2,400,000
Tax rate 30%
Income tax payable for 2018 720,000

4. Carroll's pretax accounting income for 2018 is

Taxable income for 2018 2,400,000
Future taxable temporary difference - depreciation 2,400,000
Future deductible temporary difference - litigation -900,000
Pretax accounting income for 2018 3,900,000

5. Carroll's net income for 2018 is

Pretax accounting income 3,900,000
Income tax expense:
Current 720,000
Deferred (720k-270k) 450,000 -1,170,000
Net income 2,730,000

Deferred tax liability, Dec. 31, 2018 720,000

Deferred tax liability, Jan. 1, 2018 0
Deferred tax expense for 2018 720,000

Deferred tax asset, Dec. 31, 2018 270,000

Deferred tax asset, Jan. 1, 2018 0
Deferred tax benefit for 2018 270,000
at Dec. 31, 2018 is

Dec. 31, 2018 is

financial position at Dec. 31, 2018 is

 Elie Corp

1. How much was received by Elie from the sale of the bonds on July 1, 2016?
Present value of principal (10M x 0.31180)
Present value of interest payments (10M x 5%= 500k x 11.46992)
Issue price/proceeds

2. What is the current portion of Elie's notes payable at Mar. 31, 2018?
Note payable - current portion:
Apr. 1, 2018 400,000
Jul. 1, 2018 600,000
Oct. 1, 2018 300,000
Jan. 1, 2019 300,000
Total 1,600,000

3. The balance of the estimated warranties payable at Mar. 31, 2018 is

Estimated warranties payable:
Balance, Apr. 1, 2017 180,000
Add: Warranty expense for current year 520,000
Total 700,000
Less: Actual warranty costs 358,000
Balance,Mar. 31, 2018 342,000

4. On Mar. 31, 2018, Eleanor's statement of financial position would report total current liabilities of
Notes payable - current portion 1,600,000
Estimated warranties payable 342,000
Accounts payable 740,000
Payroll - related accruals and deductions withheld 404,000
Miscellaneous accruals 150,000
Cash dividends payable 1,200,000
Accrued interest on:
Bonds payable(10M x 10% x 3/12) 250,000
Notes payable 600,000
Total current liabilities 5,286,000

5. On Mar. 31, 2018, Elie's statement of financial position would report total noncurrent liabilities of
Amortization Schedule (Partial)
Discount Carrying
Date Interest paid Interest expense amortization Value
7/1/2016 0 0 0 8,852,960
12/31/2016 500,000 531,178 31,178 8,884,138
7/1/2017 500,000 533,048 33,048 8,917,186
12/31/2017 500,000 535,031 35,031 8,952,217
7/1/2018 500,000 537,133 37,133 8,989,350
 Bonds payable
Carrying value, Jan. 1, 2018 8,952,217
Add: Discount amortization, Jan. 1 - Mar. 31 (37,133 x 3/6) 18,566 8,970,783

Notes payable - noncurrent portion (7M-1.6M current portion) 5,400,000

Total noncurrent liabilities 14,370,783
3,118,000
5,734,960
8,852,960