|
M5-13 Accounting for Unrecorded Items on Bank Reconciliation [LO 5-4]
|
Use the following bank statement and T-account to prepare any journal entries needed as a result of the May 31 bank reconciliation. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)
|
|
BANK STATEMENT
|
| Date |
Checks |
Deposits |
Other |
Balance |
| May 1 |
|
|
|
|
|
|
|
|
$ |
260 |
|
| 4 |
#2 |
|
$ |
25 |
|
$ |
65 |
|
|
300 |
|
| 12 |
#4 |
|
|
115 |
|
|
|
NSF Check $65 |
|
120 |
|
| 28 |
#5 |
|
|
35 |
|
|
|
|
|
85 |
|
| 30 |
#6 |
|
|
30 |
|
|
260 |
|
|
315 |
|
| May 31 |
#8 |
|
|
70 |
|
|
|
Service charge 20 |
|
225 |
|
|
|
|
|
| May 1 |
260 |
|
|
| May 3 |
65 |
25 |
May 3 #2 |
| |
|
85 |
May 4 #3 |
| |
|
115 |
May 8 #4 |
| |
|
35 |
May 11 #5 |
| |
|
30 |
May 21 #6 |
| May 29 |
260 |
40 |
May 29 #7 |
| May 30 |
180 |
70 |
May 30 #8 |
|
|
| May 31 |
365 |
|
|
|
|
|
|
|
M5-4 Matching Cash Receipt Processes to Internal Control Principles [LO 5-2, LO 5-3]
|
Match each of the following cash receipt activities to the internal control principle to which it best relates. Select the appropriate Internal Control Principle from the dropdown listed below.
|
|
|
Cash Receipt Activities |
|
| 1. |
A list of checks received in the mail is prepared. |
|
| 2. |
Total cash receipts are compared to the amount on the bank deposit slip. |
|
| 3. |
A password is required to open the cash register. |
|
| 4. |
Price changes at the checkout require a manager’s approval. |
|
| 5. |
Cashiers are required to count the cash in their register at the beginning and end of each shift. |
|
|
|
|
chapter 6
M6-15 Computing and Interpreting the Gross Profit Percentage [LO 6-5]
|
Sole Occhiali Group, an Italian company that sells sunglasses, reported Net Sales of $179,000 and Cost of Goods Sold of $58,500. Candy Electronics Corp. reported Net Sales of $37,000 and Cost of Goods Sold of $27,000.
|
|
| a. |
Calculate the Gross Profit Percentage for both companies. (Round your answers to 1 decimal plac
|
|
Which company has a greater proportion of its sales available to cover expenses other than cost of goods sold?
|
|
M6-17 Determining the Cause of Increasing Gross Profit [LO 6-5]
|
Fortune Brands Home & Security, Inc.sells Master Lock padlocks. It reported an increase in net sales from $5.2 billion in 2011 to $5.5 billion in 2012, and an increase in gross profit from $1.7 billion in 2011 to $1.9 billion in 2012.
|
| a. |
Calculate each year’s gross profit percentage. (Round your answers to 1 decimal place.) |
|
|
b
| Determine whether the change in gross profit was caused by. |
|
E6-5 Inferring Missing Amounts Based on Income Statement Relationships [LO 6-2, LO 6-5]
|
Supply the missing dollar amounts for each of the following independent cases.
|
|
|
| Cases |
Sales
Revenue |
Beginning
Inventory |
Purchases |
Cost of Goods
Available for Sale |
Cost of
Goods Sold |
Cost of
Ending Inventory |
Gross Profit |
| A |
$1,400 |
$800 |
$1,500 |
$ |
$1,040 |
|
$ |
| B |
1,600 |
900 |
1,500 |
|
|
840 |
|
| C |
|
800 |
|
|
900 |
1,000 |
1,100 |
| D |
1,540 |
|
1,300 |
|
1,350 |
950 |
|
| E |
1,700 |
750 |
1,600 |
|
|
|
1,240 |
|
|
|
E6-7 Reporting Purchases and Purchase Discounts Using a Perpetual Inventory System [LO 6-3]
|
During the months of January and February, Axe Corporation purchased goods from three suppliers. The sequence of events was as follows:
|
| Jan. 6 |
Purchased goods for $2,000 from Green with terms 2.5/15, n/60. |
| 6 |
Purchased goods from Munoz for $850 with terms 2.5/15, n/60. |
| 14 |
Paid Green in full. |
| Feb. 2 |
Paid Munoz in full. |
| 28 |
Purchased goods for $750 from Reynolds with terms 2.5/15, n/60. |
| Required: |
|
Assume that Axe uses a perpetual inventory system, the company had no inventory on hand at the beginning of January, and no sales were made during January and February. Calculate the cost of inventory as of February 28.
|
|
