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CA1-1 (FASB and Standard-Setting)Presented below are four statements which you are to identify as true or false. If false, explain why the statement is false.
1. GAAP is the term used to indicate the whole body of FASB authoritative literature
2. Any company claiming compliance with GAAP must comply with most standards and interpretations but does not have to follow the disclosure requirements
1. ACCT 550 Week 1 Homework
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CA1-1 (FASB and Standard-Setting)Presented below are four statements
which you are to identify as true or false. If false, explain why the
statement is false.
1. GAAP is the term used to indicate the whole body of FASB
authoritative literature
2. Any company claiming compliance with GAAP must comply with
most standards and interpretations but does not have to follow the
disclosure requirements
3. The primary governmental body that has influence over the FASB is
the SEC.
4. The FASB has a government mandate and therefore does not have to
follow due process in issuing a standard.
CA1-2 (GAAP and Standard-Setting) Presented below are four
statements which you are to identify as true or false. If false, explain
why the statement is false.
1. The objective of financial statements emphasizes a stewardship
approach for reporting financial information
CA1-3 (Financial Reporting and Accounting Standards)Answer the
following multiple-choice questions.
GAAP stands for
Chapter 2 E2-5 (Elements of Financial Statements) Ten interrelated
elements that are most directly related to measuring the performance and
financial status of an enterprise are provided below.
2. Assets
Distributions to owners
Expenses
Liabilities
Comprehensive income
Gains
Equity
Revenues
Losses
E3-1 (Transaction Analysis—Service Company) Christine Ewing is a
licensed CPA. During the first month of operations of her business (a
sole proprietorship), the following events and transactions occurred
E3-5 (Adjusting Entries) The ledger of Chopin Rental Agency on March
31 of the current year includes the following selected accounts before
adjusting entries have been prepared
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ACCT 550 Week 2 Homework Assignment
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Chapter 4: E4-4
A) Webster Company
Multiple-Step Income statement
For the Year Ended December 31, 2012
Sales $96,500
3. Cost of Goods Sold 63,570
Gross Profit on Sales 32,930
B) Webster Company
Single-Step Income Statement
For the Year Ended December 31, 2012
Revenue
Sales 96,500
Rent Revenue
Chapter 4: E4-12
Net Income:
Income from continuing operations
Before income tax 21,650,000
Income tax (21,650,000 x 35%) 7,577,500
Income from continuing operations 14,072,500
Chapter 4: P4-1
Dickinson Company
Income Statement
For the Year Ended December 31, 2012
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ACCT 550 Week 3 Homework Assignment
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ACCT 550 Week 3 Homework Assignment
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ACCT 550 Week 5 Homework Assignment
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E8-3 Assume that in an annual audit of Webber Inc. at December 31,
2012, you find the following transactions near the closing date.
1.A special machine, fabricated to order for a customer, was finished
and specifically segregated in the back part of the shipping room on
December 31, 2012. The customer was billed on that date and the
machine excluded from inventory although it was shipped on January 4,
2013.
2.Merchandise costing $2,800 was received on January 3, 2013, and the
related purchase invoice recorded January 5. The invoice showed the
shipment was made on December 29, 2012, f.o.b. destination.
3.A packing case containing a product costing $3,400 was standing in
the shipping room when the physical inventory was taken. It was not
included in the inventory because it was marked “Hold for shipping
instructions.” Your investigation revealed that the customer’s order was
dated December 18, 2012, but that the case was shipped and the
customer billed on January 10, 2013. The product was a stock item of
your client.
4.Merchandise costing $720 was received on December 28, 2012, and
the invoice was not recorded. You located it in the hands of the
purchasing agent; it was marked “on consignment.”
5. 5.Merchandise received on January 6, 2013, costing $680 was entered in
the purchases journal on January 7, 2013. The invoice showed shipment
was made f.o.b. supplier’s warehouse on December 31, 2012. Because it
was not on hand at December 31, it was not included in inventory.
Assuming that each of the amounts is material, state whether the
merchandise should be included in the client’s inventory, and give your
reason for your decision on each item.
P8-4 Hull Company’s record of transactions concerning part X for the
month of April was as follows:
E9-1 The inventory of Oheto Company on December 31, 2013, consists
of the following items.
Part No. 121 is obsolete and has a realizable value of $0.50 each as
scrap.
(a)Determine the inventory by the lower-of-cost-or-market method,
applying the method to the total of the inventory.
(b)Determine the inventory as of December 31, 2013, by the lower-of-
cost-or-market method, applying this method directly to each item.
P9-12 Late in 2009, Joan Seceda and four other investors took the chain
of Becker Department Stores private, and the company has just
completed its third year of operations under the ownership of the
investment group. Andrea Selig, controller of Becker Department Stores,
is in the process of preparing the year-end financial statements. Based on
the preliminary financial statements, Seceda has expressed concern over
inventory shortages, and she has asked Selig to determine whether an
abnormal amount of theft and breakage has occurred. The accounting
records of Becker Department Stores contain the following amounts on
November 30, 2012, the end of the fiscal year.
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