Answer

Bank reconciliations: Problem type 1 Click following link to download this documentweek 8 Bank reconciliations Problem type 1.docx

Bank reconciliations: Deposits in transit and outstanding checks Bank reconciliations: Deposits in transit and outstanding checksLee Company’s May 31 bank reconciliation shows outstanding checks of $1,870. The Cash account in the general ledger shows total checks issued of $27,500 during June. The June bank statement shows that checks totalling $25,900 have cleared the bank.Required:What is the total amount of

Seller’s retail entries: Problem type 1 Click following link to download this documentweek 5 Sellers retail entries Problem type 1.docx

Seller’s retail entries: Problem type 3 Click following link to download this documentweek 5 Sellers retail entries Problem type 3.docx

Periodic inventory: Buyer’s entries Entry 1 on July 10: The purchase is made on account, which means that it is made on credit. Debit Purchases: Purchases, which represents the cost of inventory purchased this period, is debited (increased). Credit Accounts Payable: Accounts Payable, a current liability, is credited (increased) because Watson owes Ward Company more. Entry 2 on

Perpetual inventory: Adjusting the Merchandise Inventory account When the perpetual inventory system is used to keep track of inventory, all transactions involving purchases and sales of inventory are recorded in Merchandise Inventory. The balance in the Merchandise Inventory account is called the current book balance. At the end of each fiscal period, merchandising businesses take a physical count of

Preparing a retail income statement The income statement for a merchandising business is presented using the “multiple-step” format. There are four steps to completing an income statement. Step 1: Compute the net sales: Net Sales = Sales – (Sales Discounts + Sales Returns and Allowances)   = $106,600 – ($4,200 + $4,000)   = $98,400. Step 2: Compute

Principles of internal control For each of the following two situations, determine which principle of internal control has been violated. Click following link to download this documentPrinciples of internal control.docx

Ratio analysis: Liquidity ratios The average collection period measures the average number of days it takes to collect a receivable. It is generally desirable to collect receivables as promptly as possible. The cash collected from receivables improves liquidity. Prompt collection also lessens the risk of loss from uncollectible accounts. To compute the average collection period, the

Ratio analysis: Profitability ratios Cash return on sales ratio indicates a company’s ability to turn sales into cash. Cash return on sales ratio is found by dividing cash from operating activities by net sales. Cash return on sales ratio = Cash from operating activitiesNet sales   = $119,300$255,000   = 0.46784…   = 0.47