Penn Foster 06101501 Financial Accounting Exam Parts 1& 2 Manville Corporation and Coleman-Foose Company

PENN FOSTER 06101501

Financial Accounting Examination

PART 1

The list of accounts below and the unadjusted balances of these accounts were taken from the ledger of the Manville Corporation at the end of their accounting period, March 31, 20X2:

Cash 3,995

Accounts Receivable 13,240

Allowance for Doubtful Accounts 120

Inventory, April 1, 20X1 22,800

Prepaid Insurance 360

Supplies on Hand 520

Equipment 15,000

Accumulated Depreciation'Equipment 4,500

Accounts Payable 11,870

Taxes Payable 390

Capital Stock 25,000

Retained Earnings 11,920

Dividends 9,000

Sales 89,490

Sales Returns and Allowances 920

Sales Discounts 1,330

Purchases 56,320

Purchase Returns and Allowances 490

Purchase Discounts 1,125

Transportation-In 880

Sales Salaries 11,800

Rent Expense 3,600

Advertising Expense 2,700

Utilities Expense 1,880

Maintenance Expense 560

Additional data:

A. Merchandise inventory at March 31, 20X2, was $23,300.

B. The Allowance for Doubtful Accounts should be increased by $600.

C. Prepaid insurance represents a three-year policy purchased April 1, 20X1.

D. Supplies on hand were estimated to be $170 on March 31, 20X2.

E. The cost of the equipment is being depreciated over a 15-year estimated life using the straight-line method. Salvage value should be ignored.

F. Unpaid sales salaries on March 31, 20X2, amounted to $200.

Instructions:

1. Prepare a worksheet (Adjusted trial balance columns may be omitted).

2. Prepare an income statement.

3. Prepare a statement of retained earnings.

4. Prepare a balance sheet.

5. Prepare the closing entries.

Part 2

The trial balance of the Coleman-Foose Company was prepared from the record of the company on November 30, 20X2, the close of its fiscal year:

Coleman-Foose Company

Trial Balance

November 30, 20X2

Cash 12,200

Accounts receivable 16,300

Allowance for doubtful accounts 200

Inventory - 12/1/X1 14,175

Unexpired insurance 660

Supplies on hand 265

Land 18,000

Building 22,000

Accumulated depreciation - building 6,000

Office equipment 6,800

Accumulated depreciation - office equipment 2,100

Accounts payable 11,400

Mortgage payable 9,000

Capital stock 40,000

Retained earnings 2,200

Dividends 8,000

Sales 172,000

Sales returns and allowances 600

Sales discounts 2,700

Purchases 109,800

Purchases returns and allowances 1,200

Purchase discounts 2,300

Transportation-in 900

Salaries expense 23,000

Travel expense 5,200

Office expense 1,300

Professional fee expense 2,500

Telephone expense 1,200

Building repair expense 800

Total 246,400 246,400

Additional data:

A. The allowance for doubtful accounts should be increase by $400

B. Merchandise inventory at November 30, 20x2 was $16,200.

C. Unexpired insurance on November 30, 20x2 amounted to $440.

D. Supplies on hand November 30, 20x2, $120.

E. Building depreciation is calculated at 5% per year

F. Office depreciation is calculated at 10% per year G. Salaries accrued at November 30, 20x2, are $400.

Required:

1. Prepare a work sheet (The adjusted trial balance columns are to be omitted).

2. Prepare an income statement for the year.

3. Prepare closing entries.