ACC211 .. 5 questions..

ACCT 211 - Fall 2015 MIDTERM EXAM ONE (Take-Home)

Name: __________________________ Date: DUE ON OCTOBER 27, 2015 (Tuesday)

1. At the beginning of the year, Gant Company had total assets of $660,000 and total liabilities of $300,000. Answer the following questions viewing each situation as being independent of the others. (1) If total assets increased $225,000 during the year, and total liabilities decreased $100,000, what is the amount of stockholders' equity at the end of the year? (2) During the year, total liabilities increased $215,000 and stockholders' equity decreased $130,000. What is the amount of total assets at the end of the year? (3) If total assets decreased $60,000 and stockholders' equity increased $150,000 during the year, what is the amount of total liabilities at the end of the year?

Friday, October 23, 2015 Page 1

ACCT 211 - Fall 2015 MIDTERM EXAM ONE (Take-Home)

2. The following items are taken from the financial statements of Tracy Company for 2014:

Instructions(a) Calculate the net income. (b) Calculate the retained earnings balance that would appear on a balance sheet at December 31, 2014 (c) Prepare a classified balance sheet for Tracy Company at December 31, 2014 assuming the note payable is a long-term liability. (d) Compute the current ratio, debt to assets ratio, and earnings per share value. The average number of shares outstanding for 2014 was 10,000.

Friday, October 23, 2015 Page 2

Accounts receivable 11,000 Accumulated depreciation—equipment 38,000 Advertising expense 21,000 Cash 14,000 Common stock 90,000 Depreciation expense 12,000 Dividends 15,000 Equipment 210,000 Insurance expense 3,000 Notes payable (due 2017) 70,000 Prepaid insurance 6,000 Rent expense 17,000 Retained earnings (beginning) 12,000 Salaries and wages expense 34,000 Salaries and wages payable 3,000 Service revenue 130,000 Supplies 4,000 Supplies expense 6,000

Accounts payable $ 10,000

ACCT 211 - Fall 2015 MIDTERM EXAM ONE (Take-Home)

3. This information relates to Hanshew Real Estate Agency.

Instructions (a) Journalize the transactions. Do not provide explanations. (b) Post the transactions to T accounts. (c) Prepare a Trial Balance.

Friday, October 23, 2015 Page 3

2 Hires an administrative assistant at an annual salary of $36,000. 3 Buys equipment for $3,500 on account. 6 Sells a house and lot for M Springer; commissions due from Springer,

$10,000 (not paid by Springer at this time). 10 Receives cash of $140 as commission for acting as rental agent renting

an apartment. 27 Pays $700 on account for the equipment purchased on October 3. 30 Pays the administrative assistant $3,000 in salary for October.

Oct. 1 Stockholders invested $35,000 in exchange for common stock of the corporation.

ACCT 211 - Fall 2015 MIDTERM EXAM ONE (Take-Home)

4. The adjusted trial balance of Nicks Financial Planners appears below and using the information from the adjusted trial balance, you are to prepare for the month ending December 31:

Friday, October 23, 2015 Page 4

2. a retained earnings statement; and 3. a balance sheet.

NICKS FINANCIAL PLANNERS Adjusted Trial Balance

December 31, 2014 Debit Credit

Cash $ 15,400 Accounts Receivable 2,200 Supplies 1,800 Equipment 15,500 Accumulated Depreciation—Equipment $ 4,000 Accounts Payable 3,000 Unearned Service Revenue 5,000 Common Stock 15,000 Retained Earnings 7,400 Dividends 3,500 Service Revenue 9,500 Supplies Expense 1,100 Depreciation Expense 2,500 Rent Expense 1,900 ______

$43,900 $43,900

1. an income statement;

ACCT 211 - Fall 2015 MIDTERM EXAM ONE (Take-Home)

5. The following ledger accounts are used by the Heartland Race Track:

Instructions:For each of the following transactions below, prepare the journal entry (if one is required) to record the initial transaction and then prepare the adjusting entry, if any, required on November 30, the end of the fiscal year. (a) On November 1, paid rent on the track facility for three months, $150,000. (b) On November 1, sold season tickets for admission to the racetrack. The racing season is year-round with 25 racing days each month. Season ticket sales totaled $960,000. (c) On November 1, borrowed $250,000 from First National Bank by issuing a 6% note payable due in three months. (d) On November 5, programs for 20 racing days in November, 25 racing days in December and 15 racing days in January were printed for $3,000. (e) The accountant for the concessions company reported that gross receipts for November were $140,000. Ten percent is due to Heartland and will be remitted by December 10.

Friday, October 23, 2015 Page 5

Prepaid Rent Unearned Sales Revenue Sales Revenue Advertising Expense Rent Expense

Accounts Receivable Prepaid Advertising

ACCT 211 - Fall 2015 MIDTERM EXAM ONE (Take-Home)

Friday, October 23, 2015 Page 6