11-­‐14.  (Transaction  Analysis)     1. Jan.  12         Assets  (A)   =  Liabilities  (L)   +  Net  Assets  (NA)       Cash               +  $300,000   =  No  change   +  No  change                     Pledges  receivable               –  $300,000                 Date     Dr.   Cr.       1/12   Cash   $300,000             Pledges  receivable     $300,000         Collection  of  pledges         2.   Feb.  4   No  journal  entry.  There  has  been  no  exchange  by  either  party.       3.     Mar.  1         Assets  (A)   =  Liabilities  (L)   +  Net  Assets  (NA)       Cash         Grant  Expense       –  $50,000   =     –  $50,000         Date     Dr.   Cr.       3/1   Grant  Expense   $50,000                        Cash     $    50,000                     Pay  grant  to  GARCH         4.   May  29         Assets  (A)   =  Liabilities  (L)   +  Net  Assets  (NA)       Deposit               +  $5,000   =  No  change   +  No  change                     Cash               –  $5,000                 Date     Dr.   Cr.       5/29   Deposit   $5,000             Cash     $5,000                     Deposit  on  ordered  partitions           5.     Jun.  12         Assets  (A)   =  Liabilities  (L)   +  Net  Assets  (NA)       Cash         Donation  revenue       +  $80,000   =     +  +  $80,000         Date     Dr.   Cr.       6/12   Cash   $80,000             Donation  revenue            $80,000                     Donation  revenue.         6.   Sept.  1         Assets  (A)   =  Liabilities  (L)   +  Net  Assets  (NA)       Inventory     Accounts  payable           +  $60,000   =  +  $30,000   +  No  change                     Cash               –  $30,000                 Date     Dr.   Cr.       9/1   Inventory   $60,000             Cash     $30,000           Accounts  payable        30,000                     Purchase  bookstore   inventory.    .

1. 11-­‐14.
(Transaction
Analysis)
1. Jan.
12
Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)
Cash

2. +
$300,000
=
No
change
+
No
change
Pledges
receivable
–
$300,000

3. Date
Dr.
Cr.
1/12
Cash
$300,000
Pledges
receivable
$300,000
Collection
of
pledges

4. 2.
Feb.
4
No
journal
entry.
There
has
been
no
exchange
by
either
party.
3.
Mar.
1
Assets
(A)
=
Liabilities
(L)
+
Net

5. Assets
(NA)
Cash
Grant
Expense
–
$50,000
=
–
$50,000
Date
Dr.
Cr.
3/1
Grant
Expense
$50,000

6. Cash
$
50,000
Pay
grant
to
GARCH

7. 4.
May
29
Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)
Deposit
+
$5,000
=
No
change
+
No

8. change
Cash
–
$5,000
Date
Dr.
Cr.

9. 5/29
Deposit
$5,000
Cash
$5,000
Deposit
on
ordered
partitions

10. 5.
Jun.
12
Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)
Cash
Donation
revenue
+
$80,000
=

11. +
+
$80,000
Date
Dr.
Cr.
6/12
Cash
$80,000
Donation
revenue
$80,000

12. Donation
revenue.
6.
Sept.
1
Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)
Inventory

13. Accounts
payable
+
$60,000
=
+
$30,000
+
No
change
Cash
–

14. $30,000
Date
Dr.
Cr.
9/1
Inventory
$60,000
Cash
$30,000
Accounts
payable

15. 30,000
Purchase
bookstore
inventory.
7.
Oct.
15

16. Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)
PPE
+
$15,000
=
No
change
+
No
change

17. Deposit
–
$5,000
Cash

18. –
$10,000
Date
Dr.
Cr.
10/15
PPE
$15,000
Deposit

19. $
5,000
Cash
10,000
Received
partitions
(property,
plant,
and
equipment)

20. 8.
Nov.
10
Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)
Cash
=
Notes
payable
No
change
+
$75,000
+

21. $75,000
Date
Dr.
Cr.
11/10
Cash
$75,000
Notes
payable
$75,000

22. Borrow
with
note
payable.
9.
Dec.
5
Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)

23. Cash
=
Notes
payable
Interest
expense
–
$28,000
–
$25,000
–
$3,000
Date
Dr.
Cr.
12/5
Interest
expense
$

24. 3,000
Notes
payable
25,000
Cash
$28,000
Payment
on
note

25. and
interest
expense
10.
Dec.
28
Assets
(A)
=
Liabilities
(L)
+
Net

26. Assets
(NA)
Cash
Wages
payable
Wage
expense
–
$75,000
=
+$15,000
–
$90,000
Date

27. Dr.
Cr.
12/28
Wage
expense
$90,000
Wages
payable
$
15,000
Cash
75,000

28. Record
wage
expense
and
payment
11.
Dec.
31
Assets
(A)
=
Liabilities
(L)
+
Net
Assets

29. (NA)
Cash
Sales
revenue
+
$98,000
=
+
+
$110,000
Accounts
receivable

30. +
$12,000
Inventory
-­‐
Cost
of
goods
sold
-­‐
$58,000

31. -­‐$58,000
Cash
Accounts
payable
-­‐$30,000
-­‐$30,000
12/31
Cash
$68,000

32. Cost
of
goods
sold
58,000
Accounts
receivable
12,000

33. Accounts
payable
30,000
Sales
revenue
$110,000
Inventory
58,000

34. Record
bookstore
sales
Note:
The
cash
and
accounts
payable
transaction
occur
because
the
balance
of
the

35. unpaid
inventory
is
paid
at
the
end
of
the
year
(see
#6).
12.
Dec.
31
Assets
(A)
=

36. Liabilities
(L)
+
Net
Assets
(NA)
Accounts
receivable,
net
=
–
Bad
debt
expense
–
$2,000
$2,000
Date
Dr.
Cr.

37. 12/31
Bad
debt
expense
$2,000
Accounts
receivable,
net
$2,000
Record
estimated
uncollectible
receivables

38. OR
Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)
Allowance
for
Uncollectible
Accounts
=
–
Bad

39. debt
expense
–
$2,000
$2,000
Date
Dr.
Cr.
12/31
Bad
debt
expense
$2,000
Allowance

40. for
Uncollectible
Accounts
$2,000
13.
Dec.
31
Assets
(A)
=
Liabilities
(L)
+
Net
Assets
(NA)
PPE,
net
=

41. –
Deprec.
Expense
–
$40,000
$40,000
Date
Dr.
Cr.
12/31
Depreciation
expense
$40,000
PPE,

42. net
$40,000
Record
depreciation
expense
PROBLEM 11-15
SOLUTION
(Transactions Worksheet)

43. (000’s omitted) =
Pledges Acc. Rec. PPE Accounts Wages
Cash Receivable Net Inventory Deposits net Payable Payable
Beginning Balance 10 350 26 25 0 350 27 32
Transaction #1 300 (300)
Transaction #2
Transaction #3 (50)
Transaction #4 (5) 5
Transaction #5 80
Transaction #6 (30) 60 30
Transaction #7 (10) (5) 15
Transaction #8 75
Transaction #9 (28)
Transaction #10 (75) 15
Transaction #11 98 12
Transaction #11
(con't)
(58)
Transaction #11
(con't)

44. (30) (30)
Transaction #12 (2)
Transaction #13 (40)
Ending Balance $335 $50 $36 $27 $0 $325 $27 $47
Assets Liabilities and Net Assets
Tempo- Perma-
Notes rarily nently
Payable Unrestricted Restricted Restricted
270 302 30 100
(50) Grant Expense
80 Donation
Revenue
75
(25) (3) Interest
Expense
(90) Wage Expense
110 Sales Revenue
(58) COGS
(2) Bad Debt

45. Expense
(40) Depreciation
Expense
$320 $249 $30 $100
Liabilities and Net Assets
Net Assets
Sheet1PROBLEM 11-
17TEMPLATE(LIFO/FIFO)BoxesCostConsumption in
UnitsBalance Left in UnitsFIFOLIFOFIFOLIFOBeginning
bal.00Purchase March00Purchase August00Total
UsedFIFOLIFOFIFO Inventory ValueLIFO Inventory
ValueExpenseExpense$0$0$0$0$0$0$0$0$0$0$0$0$0$0$0$0
Sheet2
Sheet3
Activity StatementPROBLEM 11-16TEMPLATE(Financial
Statement)ARCHActivity Statementfor the Year Ending
December 31, Year 2Revenues and supportDonation
revenueSales revenueTotal revenues and
support$0Expenses:Grant ExpenseCost of goods soldWage
expenseInterest expenseBad debtsDepreciationTotal
expenses$0Increase/(Decrease) in net assets$0
Balance SheetARCHStatement of Financial Positionas of
December 31, Year 2 and Year 1AssetsLiabilities & Net
AssetsYear 2Year 1Year 2Year 1Current
assetsLiabilitiesCashCurrent liabilitiesAccounts receivable, net
of estimated uncollectibles of $2,000 in Year 2Accounts
payableWages payableTotal current liab.$0$0Pledges
receivableInventoryLong-term liabilitiesTotal current
assets$0$0Notes payableTotal long-term liab.$0$0Long-term
assetsFixed assetsTotal liabilities$0$0Buildings & Equip.,

46. netTotal long-term assets$0$0Net assetsUnrestrictedTemp.
restrictedPerm. restrictedTotal net assets$0$0Total
assets$0$0Total equities$0$0
Cash Flow StatementARCHStatement of Cash Flowsfor the Year
Ending December 31, Year 2Cash flows from operating
activitiesDecrease in unrestricted net assetsAdd expenses not
requiring cash:DepreciationBad DebtsOther
adjustments:Subtract the increase in accounts receivablesAdd
the decrease in pledges receivableSubtract the increase in
inventoryAdd the increase in wages payableNet cash from
operating activities$0Cash flows from investing
activitiesPurchase of PPENet cash used in investing
activities$0Cash flows from financing activitiesBorrowing with
notesNet cash from financing activities$0Net
increase/(decrease) in cash$0Cash, beginning of yearCash, end
of year$0
Observations1) Strengths:2) Concerns:
Sheet1PROBLEM 11-15TEMPLATE(Transactions
Worksheet)(000’s omitted)Assets=Liabilities and Net
AssetsNet AssetsTempo-Perma-PledgesAcc.
Rec.PPEAccountsWagesNotesrarilynentlyCashReceivableNetInv
entoryDepositsnetPayablePayablePayableUnrestrictedRestricted
RestrictedBeginning BalanceTransaction #1Transaction
#2Transaction #3Transaction #4Transaction #5Transaction
#6Transaction #7Transaction #8Transaction #9Transaction
#10Transaction #11Transaction #11 (con't)Transaction #11
(con't)Transaction #12Transaction #13Ending
Balance$0$0$0$0$0$0$0$0$0$0$0$0
Sheet2
Sheet3