| ACCT 201 FINAL EXAM--PROBLEMS |
| | Instructions: | | Complete the following problems using Excel (preferred), Word, or hand write the solutions |
| | | | and scan them. Drop the file into the digital dropbox in the Final Exam section in Moodle. |
| 1. | Prepare journal entries to record the following: |
| | (a) | Issued 1,000 shares of $10 par common stock at $59 for cash. |
| | (b) | Issued 1,400 shares of common stock in exchange for equipment with a fair market price of $60,000. |
| | (c) | Purchased 100 shares of treasury stock at $32. |
| | (d) | Sold 100 shares of treasury stock at $42. |
| 2. | Prepare journal entries for the following selected transactions completed during the current fiscal year: |
| | Jan. 3 | The board of directors reduced the par of common shares from $100 to $20. This action increased |
| | | the number of outstanding shares to 400,000. |
| | Jan. 22 | Declared a dividend of $1.50 per share on the outstanding shares of common stock. |
| | Feb. 8 | Paid the dividend declared on January 22. |
| | Sep. 1 | Declared a 5% stock dividend on the common stock outstanding (the fair market value of the stock |
| | | to be issued is $30). |
| | Oct. 1 | Issued the certificates for the common stock dividend declared on September 1. |
| 3. | On the first day of the current fiscal year, $2,000,000 of 10-year, 7% bonds, with interest payable annually, were |
| | sold for $2,125,000. Prepare journal entries to record the following transactions for the current fiscal year: |
| | (a) | Issuance of the bonds. |
| | (b) | First annual interest payment. |
| 4. | (a) | Prepare the journal entry to issue $100,000 bonds which sold for $94,000. |
| | (b) | Prepare the journal entry to issue $100,000 bonds which sold for $104,000. |
| 5. | Prepare journal entries to record the following selected transactions of Masterson Co. |
| | (a) | Purchased 600 shares of the 100,000 shares outstanding $10 par common shares of Dankin |
| | | Corporation for $5,100. |
| | (b) | Purchased 3,500 shares of the 10,000 shares no par common shares of Ramon Co. for $45,700. |
| | | The investment was accounted for by the equity method. |
| | (c) | Received a cash dividend of $1 per share on the Dankin Corporation stock acquired in (a). |
| | (d) | Received a cash dividend of $2 per share on the Ramon Co. stock acquired in (b). |
| | (e) | Sold 100 shares of the Dankin Corporation shares acquired in (a) for $2,100. |
| | (f) | Recorded the appropriate share of Ramon Company’s net income of $50,000. |
| | | The stock was acquired in (b). |
| 6. | Prepare journal entries to record the following selected transactions: |
| | (a) | Purchased $100,000 of Kruse Co. 8% bonds at 102 plus accrued interest of $2,000. |
| | (b) | Received first semiannual interest payment. |
| | (c) | Sold the bonds at 97 plus accrued interest of $1,500. The bonds were carried at $101,500 at the |
| | | time of the sale. |
| 7. | Sales reported on the income statement were $340,000. The accounts receivable balance declined |
| | $17,000 over the year. Determine the amount of cash received from customers. |
| 8. | Lamar Corporation purchased land for $150,000. Later in the year the company sold land with a book value of |
| | $190,000 for $200,000. Show how the effects of these transactions are reported on the statement of cash flows. |
| 9. | From the following data, determine for the current year the (a) return on assets, (b) return on common |
| | stockholders' equity, (c) earnings per share (d) price-earnings ratio. Assume that the current market price |
| | per share of common stock is $25. |
| | | | | | | | Current Year | Preceding Year |
| | Current assets | | | | | | $ 745,000 | $ 820,000 |
| | Property, plant, and equipment | | | | | | 1,510,000 | 1,400,000 |
| | Current liabilities |
| | (non-interest-bearing) | | | | | | 160,000 | 140,000 |
| | Long-term liabilities, 12% | | | | | | 400,000 | 400,000 |
| | Preferred 10% stock | | | | | | 250,000 | 250,000 |
| | Common stock, $25 par | | | | | | 1,200,000 | 1,200,000 |
| | Retained earnings: |
| | Beginning of year | | | | | | 240,000 | 160,000 |
| | Net income for year | | | | | | 95,000 | 155,000 |
| | Preferred dividends declared | | | | | | (25,000) | (25,000) |
| | Common dividends declared | | | | | | (70,000) | (60,000) |
| 10. | The Zoe Corporation has the following information for the month March. Determine the (a) cost of goods |
| | manufactured, and (b) cost of goods sold. |
| | Cost of materials placed in production | | | | | | $ 69,000 |
| | Direct labor | | | | | | 27,000 |
| | Factory overhead | | | | | | 34,000 |
| | Work in process, March 1 | | | | | | 15,000 |
| | Work in process, March 31 | | | | | | 19,500 |
| | Finished goods inventory, March 1 | | | | | | 25,000 |
| | Finished goods inventory, March 31 | | | | | | 23,000 |
| 11. | Put the following, a through h, in the order of the flow of manufacturing costs for a company. |
| | a. Closing under/over applied factory overhead to cost of goods sold |
| | b. Materials purchased |
| | c. Factory labor used and factory overhead incurred in production |
| | d. Completed jobs moved to finished goods |
| | e. Factory overhead applied to jobs according to the predetermined overhead rate |
| | f. Materials requisitioned to jobs |
| | g. Selling of finished product |
| | h. Preparation of financial statements to determine gross profit |
| 12. | Six selected transactions for the current month are indicated by letters in the following T accounts in a job |
| | order cost accounting system. Describe each of the six transactions: |
| | | Materials | | | Work in Process |
| | | | (a) | | (a) | (d) |
| | | | | | (b) |
| | | | | | (c) |
| | | Wages Payable | | | (f) |
| | | | (b) |
| | | Factory Overhead | | | Finished Goods |
| | | (a) | (c) | | (d) | (e) |
| | | (b) | (f) | | (f) |
| | | Cost of Goods Sold |
| | | (e) |
| | | (f) |