COMM 293 excel both days
.xlsx
School
University of British Columbia**We aren't endorsed by this school
Course
COMM 293
Subject
Accounting
Date
Dec 20, 2024
Pages
20
Uploaded by arish12355667
DateAccountsDebitCredit1-NovAccounts receivable20000Sales revenue20000Cost of goods sold5000Inventory50001-NovCash200000Note payable2000002-NovCash2000004,000 shares x $50Common stock2000006-NovPrepaid rent (A+)6000Cash600018-NovInventory25000Accounts payable2500022-NovCash (A+)10000Accounts receivable (A-)10001-DecSalaries expense30000Cash300001-DecNo Entry (No transactions)1-Dec Loan receivable60,000Cash600002-DecAdvertising expense2000Cash20007-DecDividends declared52004,000 x $1.30Dividends payable52009-DecCash17000Unearned revenue1700012-DecSupplies20000Cash2000020-DecDividends payable5200Cash5200
DateAccountsDebitCredit31-DecSalaries expense35000Salaries payable3500031-DecSupplies expense6100051,000 + 20,000 = 71,000 - 10,000 = 61,000Supplies (A–)61000Beg + Purchases - End = Used31-DecDepreciation expense50000(1,600,000 – 100,000) / 30Accumulated depreciation - buildings50000(Cost - Residual Value) / Useful life31-DecAccounts receivable20000Sales revenue (service revenue)2000031-DecRent receivable1000Building1,600,000Rent revenue1000Acc. Dep600,000Net building1,000,000Break over at 2:37pm
WIZE CORPIncome Statement (Statement of Earnings)multi-step income statementFor the year ended December 31, 2021(in dollars)<- Enter the unit e.g. 'in thousands'Sales revenue$ 150,000.00 Less: Sales discounts1,000.00 <- Sales discounts and/or Sales returns and allowanceNet sales149,000.00 Sales revenue – returns and discountsCost of goods sold73,000.00 Gross profit76,000.00 Operating ExpensesSalaries expense$ 3,000.00 All expenses are 'operating' except:Depreciation expense500Income tax, interest, lossesAdvertising expense400Other operating expenses11000Total operating expenses14,900.00 Income from operations61,100.00 <- Gross profit – Operating expensesNon-Operating Revenues and ExpensesInterest expense(1,000.00)Include all remaining revenues, expenses, gains,Rent revenue200.00 Total non-operating revenues and expenses(800.00)Expenses and losses should be entered as negatives (iIncome before tax60,300.00 Income from operations + Non-operatingIncome tax expense12,060.00 Income before tax * tax rateNet income$ 48,240.00 net income / # of sharesEarnings per share (EPS)$ 0.01 48240 / 5,000,000 sharesDollar sign on the first number of each column, net income and EPSDouble underline net incomelosses except income tax!
WIZE CORPBalance Sheet (Statement of Financial Position)As at December 31, 2021(in dollars)AssetsCurrent AssetsCash$ 50,000.00 <- assets are reported in order of liquidityAccounts receivable4,000.00 #1 Cash, #2 Short-term investment, #3 Accounts receiMerchandise inventory2,000.00 Prepaid expenses500.00 Total current assets56,500.00 Non-Current Assets$ 60,000.00 Less: Accumulated depreciation – building10,000.00 50,000.00 Land10,000.00 Total non-current assets60,000.00 Total Assets$ 116,500.00 first number of each column and total assets needed double underline total assetsLiabilities and Shareholders' EquityLiabilitiesCurrent LiabilitiesAccounts payable$ 8,000.00 For current liabilities, report Accounts payable firstSalaries payable2,000.00 Unearned revenue1,500.00 Total current liabilities11,500.00 Non-current LiabilitiesLong-term notes payable30,000.00 Total liabilities41,500.00 Buildings (at cost)Use the left column to show the details, and the right to show the net value of the asset (after depreciation)
Shareholders' EquityCommon shares25,000.00 Retained earnings50,000.00 R/E = Beg R/E + Net Income – Dividends declaredTotal shareholders' equity75,000.00 5,760 + 48,240 – 4,000Net income is from the incoTotal liabilities and shareholders' equity$ 116,500.00 first number of the column and total liabilites & equitdouble underline total liabilities & equityAssets = Liabilities + Shareholders' EquityRatiosProfit marginNet income / Net sales48240 / 149000 = 32.38%Gross profit marginGross profit / Net sales76,000 / 149,000 = 51.01%Current ratioCurrent Assets / Current Liabilities56,500 / 11,500 = 4.91
esin brackets)
ivablea dollar sign
ome statementty need $ signOur profit equals 32.38% of our salesOur gross profit equals 51.01% of our salesFor every $1 of current liabilities we have $4.91 of current assets
DateAccountsDebitsCredits31-Dec Sales revenue150,000.00 Rent revenue200.00 Sales discounts1,000.00 Income summary149,200.00 <- Total revenues31-DecIncome summary100960<- Total expensesSalaries expense3000Depreciation expense500Advertising expense400Other operating expenses11000Interest expense1000Income tax expense12060Cost of goods sold73000Income Summary14920010096048240<- should equal net income4824031-DecIncome summary48240<- to reduce income summary to zeroRetained earnings (SE+)48240<- to add net income to retained earnings31-DecRetained earnings4000<- to take dividends out of retained earningsDividends declared4000<- to reduce dividends declared to zero
WIZE CORPIncome Statement (Statement of Earnings)For the year ended December 31, 2021(in dollars)Sales revenue$ 150,000.00 Less: Sales discounts1,000.00 Net sales149,000.00 Cost of goods sold73,000.00 Gross profit76,000.00 Operating ExpensesSalaries expense$ 3,000.00 Depreciation expense500Advertising expense400Other operating expenses11000Total operating expenses14,900.00 Income from operations61,100.00 Non-Operating Revenues and ExpensesInterest expense(1,000.00)Rent revenue200.00 Total non-operating revenues and expenses(800.00)Income before tax60,300.00 Income tax expense12,060.00 Net income$ 48,240.00 Earnings per share (EPS)$ 0.01
RatioFormulaProfit marginNet income / Net salesGross profit marginGross profit / Net salesReturn on assetsNet income / Average total assetsReturn on equityNet income / Average equityCurrent ratioCurrent Assets / Current LiabilitiesAsset turnoverNet sales / Average total assets
Use the following information to calculate:Return on assetsNet income / Average total assetsReturn on equityNet income / Average equityAverage = Average of the current and previous yearAsset turnoverNet sales / Average total assets20202021Sales revenue$ 50,000.00 $ 65,000.00 Expenses10,000.00 12,000.00 Net income40,000.00 53,000.00 Assets125,000.00 132,000.00 Liabilities50,000.00 60,000.00 Shareholders' equity75,000.00 72,000.00 Average total assets in 2021 is the average of assets in 2020 and 2021(125,000 + 132,000) / 2 = 128,500.00 Average shareholders' equity in 2021 is the average of equity in 2020 and 2021(75,000 + 72,000) / 2 = 73,500Return on Assets53,000 / 128,5000.412 Return on Equity53,000 / 73,5000.721 Asset turnover65,000 / 128,5000.506
DateAccountsDebitCredit7-JanAccounts receivable50002/10, n/30Sales revenue5000Cost of goods sold1500Lets assume that the cost of each unit is $30Inventory150015-JanCash44105,000 - 500 - 90Sales returns and allowances5005 units x $100 per unitSales discount902% x 4500Accounts receivable5000Inventory1505 units x $30Cost of goods sold150<- to return the units to inventory11-FebSales returns and allowances8008 units x $100Cash784800 - 16Sales discount16$800 x 2%11-Feb Sales returns and allowances784<- alternative way to journalize a return w/ a discouCash78412-Feb80Cash8018-FebAccounts receivable12000Sales revenue12000Lets assume that the cost of each unit is $30Cost of goods sold3000Inventory300018-Feb10000Cash10000150Cash150Shipping expense/Freight outInventory (perpetual)/ Purchases (periodicInventory(perpetual)/Freight-in (periodic)
18-Feb Inventory10150Cash10150Credit card = 6-MarCash11641200 – 36Credit = AccoCredit card discounts361200 x 3%Sales revenue1200Cost of goods sold400Lets assume that the cost of each unit is $10 (given)Inventory4007-Apr Notes receivable20000Accounts receivable2000011-MayAllowance for doubtful accounts6000<- allowance method (default)Accounts receivable600011-May Bad debt expense6000<- direct write-off methodAccounts receivable600012-AprAccounts receivable5000Allowance for doubtful accounts 5000Cash5000Accounts receivable5000
unt
Cash salesounts receivable
AgeAmount%AFDA = Amount x %Date5000002%1000031-Dec3200008%2560016000015%240009000030%2700031-Dec2500060%1500010000100%<- write-off1,105,000.00 1,095,000.00 <- Accounts receivable after writing off the $10,000Total AFDA101,600.00 Of the $1,095,000 that we're owed (accounts receto be uncollectible (allowance for doubtful accounAllowance for doubtful accounts (natural credit)50,000beg balancewrite-offs50,00010,00010,000recoveriesXbad debt expense adjustment10160050,000 + 10,000 + X - 50,000 - 10,000 = 101,600X = 101,600Accounts receivable turnover ratioNet credit sales10,000,000Average Net Accounts Receivable'Net A/R' = A/R – AFDANot due1 – 30 days past due31 – 60 days past due61 – 90 days past due91 – 120 days past due121 + days past due
BegEndAverageAccounts Rec1,200,000.00 1,095,000.00 AFDA50,000.00 101,600.00 Net A/R1,150,000.00 993,400.00 1,071,700.00 Turnover ratio10,000,000 / 1,071,7009.33 Average age of accounts receivable = 365 / 9.3339.12111468On average, it takes 39 days to collect from our customers
AccountsDebitCreditAllowance for doubtful accounts10000Accounts receivable10000Bad debt expense101600<- bad debt adjustmentAllowance for doubtful accounts101600eivable), $101,600 is estimatednts)
Book balance of cash$ 2,946.90 Bank Statement $ 3,412.50 Service fees-50Outstanding check-895.6Deposit by bank1000Bank error50Interest70Deposit in transit2000NSF-300Correct cash balance$ 4,566.90 Book error900Correct cash balance$ 4,566.90