acct301 quiz and homework down payment

Student Name: ______________________________________

INSTRUCTIONS: This quizis to be completed without the assistance of any other person and is intended to be completed in one setting. You may use your course notes, face-to-face discussion material, textbook readings, and other LEO materials.

If you find it helpful, you may create an Excel file to show your work for numerical problems. You must show your work including calculations to receive full credit.

Additionally, your work must be presented in a logical, easy to follow manner for full credit. Partial credit will be given for incorrect answers if you show your work.

This quiz is worth 175 points or 17.5% of your final grade and is comprised of 20 questions. The point breakout of the questions is as follows:

Question 1	10	Question 11	8
Question 2	5	Question 12	8
Question 3	15	Question 13	8
Question 4	10	Question 14	8
Question 5	10	Question 15	15
Question 6	10	Question 16	12
Question 7	10	Question 17	8
Question 8	6	Question 18	5
Question 9	6	Question 19	5
Question 10	6	Question 20	10
		Total	175

*Save this file as: Last Name_ First Name_Quiz 2 and upload to the Correct Assignment Dropbox*

I pledge on my honor that I have not given or received any unauthorized assistance on this examination. In addition, I pledge that I will not disclose to, or discuss the contents of this examination with, students who have not taken it.

_____________________________________________________________________________________________

Good Luck!!!

Question 1 (10 points):

What is the difference between FOB Shipping and FOB Destination? When determine the balance of inventory at the end of the year, why does it matter to know the shipping terms of in-transit inventory?

Accountants report a merchandiser's and a manufacturer'srevenues only when a sale is made. FOB Shipping Point pretty much indicates that the sale occurred at the shipping point, at the seller's shipping dock. FOB Destination indicates that the sale will occur only when it arrives at the destination, meaning at the buyer's receiving dock.

In Accounting, we assume that the cost of transporting the goods corresponds to these terms. If the sale occurred at the shipping point (seller's shipping dock), then the buyer should definitely take responsibility for the cost of transporting the Merchandise. (The buyer will record this cost as Freight-In or Transportation-In.) If the sale doesn't occur until the goods reach the destination (terms are FOB Destination) that means that the seller should be responsible for transporting the goods until they reach the buyer's unloading dock. (The seller will record the transportation cost as Freight-Out, Transportation-Out, or Delivery Expense.)

Question 2 (5 points):

Franklin Corporation began the accounting period with $60,000 of merchandise inventory, purchases during the year totaled $240,000, and a physical count of inventory of hand at the end of the period totaled $72,000. What was Franklin Corporation’s cost of goods sold for the period?

Question 3 (15 points)

Superstar Sporting Goods had the following transactions in April 2014.

• April 1^st – Sold merchandise on account for $288,000 with terms 2/10, n/30.
• April 5^th – Customer who purchased goods on April 1^st returned $45,000 worth of goods for full credit. Payment for these goods has not yet been received.
• April 8^th – Payment was received for the net amount due from the sale on April 1^st.

Record the three journal entries to summarize the activity from the transactions above.

Use the following information for Question 4 – Question 7

Taylor Corporation is a newly formed entity that engages in the purchase and resale of amphibious tour vehicles. Purchases for the first year of operation were as follows:

Date	Purchases
7-Jan	50 units @ $15,000 each
15-Mar	70 units @ $16,000 each
16-Jun	30 units @ $16,500 each
3-Aug	90 units @ $17,000 each
11-Oct	25 units @ $17,200 each

Sales for year amounted to 210 units and totaled $4,250,000.

Question 4 (10 points)

If Taylor uses the first-in, first-out (FIFO) inventory method, what value would be assigned to ending inventory and cost of goods sold? How much is gross profit?

Question 5 (10 points)

If Taylor uses the last-in, first-out (LIFO) inventory method, what value would be assigned to ending inventory and cost of goods sold? How much is gross profit?

Question 6 (10 points)

If Taylor uses the weighted average inventory method, what value would be assigned to ending inventory and cost of goods sold? How much is gross profit?

Question 7 (10 points)

Which of the above techniques produces the highest profit? Which of the above techniques reports the most “current “cost on the balance sheet and why? Which of the above techniques reports the most “current” cost in measuring income? Which of the above techniques results in the lowest income tax obligation?

Use the following information to answer Question 8 – Question 10

On January 1, 2013 ABC Inc. acquired a new machine at a cost of $23,000 with a residual value of $3,000. The estimated useful life is 10 years and 100,000 units. For the year ending December 31, 2013, the machine produced 15,000 units. For the year ending December 31, 2014, the machine produced 10,000 units and 5,000 units were produced in calendar year 2015.

Question 8 (6 points)

Determine the annual depreciation expense for each 2013, 2014, and 2015 using the straight-line method.

Question 9 (6 points)

Determine the annual depreciation expense for each 2013, 2014, and 2015 using the units of production method.

Question 10 (6 points)

Determine the annual depreciation expense for each 2013, 2014, and 2015 using the double-declining method.

Use the following information to answer Questions 11 - 14

Kirkland Beverage Company owns a delivery truck with an original cost of $50,000 and an accumulated depreciation balance of $20,000. The estimated residual value is $4,000. Consider each of the independent situations below and present the required journal entry to record the sale or disposal of the truck, using proper format.

Question 11 (8 points)

Sold for $30,000

Question 12 (8 points)

Sold for $26,000

Question 13 (8 points)

Sold for $34,000

Question 14 (8 points)

Is totaled in a collision with no scrap value and no insurance (no proceeds will be received)

Question 15 (5 points)

Why is it important for companies to establish strong internal controls?

Question 16 (12 points)

What are four controls a company can put in place to ensure cash receipts & cash disbursements are handled appropriately?

Use the following information for Question 17 – Question 18

Wiggins Corporation utilizes an accounting software package that is capable of producing a detailed aging of outstanding accounts receivables. Following is the aging schedule as of December 31, 2012. As denoted below the total Accounts Receivable balance outstanding at December 31, 2012 is 2,125,000.

AGE		AMOUNT OUTSTANDING
0 to 30 days		$ 1,200,000
31 to 60 days		700,000
61 to 120 days		200,000
Over 120 days		25,000

Casper Corporation has owned and operated Wiggins Corporation for many years and has a very good sense of the probability of collection of outstanding receivables, based on an aging analysis. The following table reveals the likelihood of collection:

AGE		PROBABILITY OF COLLECTION
0 to 30 days		98%
31 to 60 days		90%
61 to 120 days		75%
Over 120 days		50%

Question 17 (8 points)

Using the % of Receivables method for determining the appropriate Allowance for Uncollectible Accounts, what should the ending balance in the Allowance for Uncollectible Accounts be at December 31, 2012?

Question 18 (5 points)

Assume Casper Corporation has a beginning Allowance for Uncollectible Accounts balance of $56,500 and determines the ending balance of the Allowance for Uncollectible Accounts should be $156,500. What is the journal entry required to record the adjustment to the Allowance for Uncollectible Accounts?

Use the following information for Question 19 – Question 20

The Johnson Company uses the allowance method to account for uncollectible accounts receivable. Bad debt expense is established as a percentage of credit sales. For 2003, net credit sales totaled $4,500,000 and the estimated bad debt percentage is 1.2%. The allowance for uncollectible accounts had a credit balance of $32,000 at the beginning of 2003. The allowance for uncollectible accounts had a credit balance of $32,000 at the beginning of 2003 and a credit balance of $40,000 (after all adjusting entries) at the end of 2003.

Question 19 (5 points)

What is bad debt expense for 2003?

Question 20 (10 points)

Determine the amount of accounts receivable written off during 2003.

Fullerton Aggregate processes raw shale into lightweight aggregate material. This process requires heat treating shale and injecting it with fly ash as it passes through rotating kilns. The shale both expands and hardens in the process, and is ideally suited to road construction. Fullerton uses the weighted-average process costing method to account for production. The following information is available for a recent period:

Beginning work in process on September 1 consisted of 75,000 tons that were 80% complete with respect to raw materials and 50% complete with respect to conversion costs.

Ending work in process on September 30 consisted of 60,000 tons that were 70% complete with respect to raw materials and 40% complete with respect to conversion costs.

860,000 tons of material were put into production, and 875,000 tons exited production. There is no spoilage or loss of tonnage in the production process.

Beginning work in process carried a total cost of $265,000, divided 40/20/40 with respect to direct material/direct labor/factory overhead. Additional costs incurred during the month were $3,000,000, divided 50% to direct material and the remainder on a 1:2 ratio between direct labor and factory overhead.

(a) Prepare a cost of production report for September.

(b) Prepare journal entries to reflect the introduction of additional costs during September, as well as the transfer of completed units to finished goods. S

Vintage Furniture constructs and sells executive style conference tables. The selling price is $10,000 per table. A unique feature is that the only raw material used in the construction of each table, other than indirect materials like glues and screws, comes entirely from a single tree. Tree prices and other costs of production have remained stable, and Vintage is able to use each tree purchased without incurring any significant spoilage. Consider the following "disorganized" information and complete the indicated requirements.

Ending work in process (600 tables) $18,00,000

Selling price per table 10,000

Ending finished goods (200 tables) 14,00,000

Indirect labor incurred during the period 1,25,000

Raw materials transferred into production (700 trees) 7,00,000

Beginning finished goods (400 tables) 28,00,000

Cost of glues and screws 35,000

Beginning work in process 14,65,000

Ending raw materials (500 trees) 5,00,000

Direct labor incurred during the period 33,00,000

Selling, general, and administrative costs incurred 11,50,000

Depreciation of factory equipment 75,000

Raw material purchases during the period (900 trees) 9,00,000

All other factory overhead 3,00,000

Tables sold (800 tables)

(a) Complete the reconciliation of units on the accompanying blank worksheet, showing the "unit" activity in raw materials, work in process, and finished goods.

(b) Calculate the cost of goods manufactured.

(c) Calculate the cost of goods sold.

(d) Calculate net income. Assume an income tax rate of 35%.