Bu127 final exam practice q\'s PDF

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Summary

Some final exam practice questions to tune up your skills and make sure you can do the best of your ability on the final exam....

Description

July 1 Cash

30,000

Horses

30,000

Contributed Capital

60,000

July 1 Prepaid expense 14,400 Cash

July 1 Supplies

14,400

6,000 Cash

August 1 Cash

6,000

18,000 Deferred revenue 18,000

October 1 Equipment

16,000

Notes payable – long term 16,000

December 3 Accounts receivables 5,000 Sales revenue 5,000

December 31 Supplies expense 4,000 Supplies

4,000

December 31 Bad debt expense 250 Allowance for doubtful accounts

250

December 31 Accumulated depreciation: Horses 3,000 Horses

3,000

December 31 Accumulated depreciation: Equipment 750 Equipment

750

December 31 Interest Expense (16,000 x 10% x 3/12) Interest payable

400

December 31 Rent expense 7,200 Prepaid expenses 7,200

December 31 Deferred revenue

7,500

Sales revenue 7,500

Cash flow statement

Clark Inc. Cash flow statement For the year ended December 31, 2020

Operating Activities Net income

$10,000

Depreciation

8,000

Gain on sale of equipment

(4,000)

Decrease in A/R

5,000

Decrease in inventory

13,000

Increase in A/P

6,000

Operating cash flow

38,000

400

Investing Activities Increase in equipment (46000 – 21000 – 10000) 15000 Purchase of equipment

(40,000)

Investing cash flow

(25000)

Financing Activities Increase in Long term notes

9,000

Payment of cash dividends ((retained earnings) 25000 – (net earnings) 10000) (15,000) Financing cash flow

(6000)

Total cash flow

7000

Opening cash flow

20,000

Ending cash flow

27,000

Revenue (270,000 x 10/12)

225,000

Depreciation expense

(30,000)

Income before tax

195,000

Income tax (40%)

(78,000)

Net earnings

117,000

Deferred rental revenue 45,000

P10-5 Interest to be paid = $60,000,000 x 7.9%/2 = $2,370,000 Principle = $60,000,000 x 0.6756 = $40,536,000 Interest = $2,370,000 x 8.1109= $19,222,833 Issue price = $40,536,000 + $19,222,833= $59,758,833

Cash

$59,758,833

Discount on bond payable $241,167 Bond payable

$60,000,000

June 30 year 1: $59,758,833 x 8%/2 = $2,390,353 $2,390,353- $2,370,000 = $20,353 Bond interest expense

$2,390,353

Discount on bonds payable

$20,353

Cash

$2,370,000

$59,758,833 + $20,353 = $59,779,186 December 31 year 1: $59,779,186 x 8%/2 = $2,391,167 $2,391,167- $2,370,000 = $21,167 Bond interest expense

$2,391,167

Discount on bonds payable

$21,167

Cash

$2,370,000

$59,779,186 + $21,167 = $59,800,353 June 30 year 2: $59,800,353 x 8%/2 = $2,392,014 $2,392,014 - $2,370,000 = $22,014 Bond interest expense $2,392,014 Discount on bonds payable $22,014

Cash

$2,370,000

Year 1 interest expense: $2,390,353 + $2,391,167 = $4,781,520 Year 1 financial position $241,167- $20,353 - $21,167 = $199,647 Long-term liabilities: Bonds payable, 7.9%

$60,000,000

Less: unamortized discount

$199,647

$59,800,353

Gold Inc. Statement of Cash flows For the year ended December 31, 2017 Operating Activities Net income

$28,000

Depreciation

8,000

Gain on sale of equipment (2,000) Decrease in A/R

16,000

Decrease in inventory

9,000

Decrease in A/P

(17,000)

Operating cash flow

$42,000

Investing Activities Proceeds from selling equipment $12,000 Increase in equipment with cash (55000 - (27000 – 20000) – 10000) (38,000) Purchase of land

(30,000)

Investing cash flow

$(56,000)

Financing Activities Increase in notes payable (minus the one for equipment) $15,000 Payment of dividends

(9,000)

Financing cash flow

$6,000

Total cash flow for the year

(8,000)

Beginning cash flow

18,000

Ending cash flow

10,000

Laporte Inc. Statement of Cash Flows For the year ended December 31, 2020 Operating activities Net profit

$12

Depreciation expense

10

Gain on sale of investments

(6)

Loss on sale of equipment

2

Increase in A/R

(10)

Decrease in inventory

4

Decrease in A/P

(14)

Decrease in income tax payable (1) Operating cash flow

$(3)

Investing activities Increase in equipment with cash $(22) Sale of investments (change in investments +/- gain/loss on investments) 24

Sale of equipment

10

Investing cash flow

$12

Financing activities Payment of dividends

$(2)...