Reference no: EM132109822

Questions -

Q1. Owner's equity on 1/1/2013 and 12/31/2013 were $130,000 and $140,000, respectively. Assets on 1/1/2013 and 12/31/2013 were $210,000 and $250,000, respectively. Liabilities on 1/1/2013 were $80,000. What is the amount of liabilities on 12/31/2013? Describe how you used the accounting equation to come up with your answer. Why is the accounting equation so important to accounting?

Q2. Journalize the following transactions:

i. Began business by making a deposit in a company bank account of $36,000, in exchange for 3,600 shares of common stock.

ii. Paid the premium on a 1-year insurance policy, $3,600.

iii. Paid the current month's rent, $4,000.

Q3. Flamingo, Inc. has the following assets, liabilities, revenues, and expenses for the current year.

Equipment Rent expense Salary expense Cash Land Service revenue Note payable Supplies expense Interest payable Building Insurance expense Accounts receivable Common stock Accounts payable Utilities expense

$45,000 $24,000 $68,000 $10,000 $18,000 $125,000 $30,000 $4,000 $500  $100,000 $1,500 $14,500 $21,000 $19,500 $12,000

Prepare the Income Statement for ABC, Inc. for the current year.

Q4. Prepare adjusting entries for the year ended December 31, 2013, based on the following data:

i. A 2-year insurance policy costing $3,000 was purchased on September 30, 2013.

ii. Employee salaries are owed for 3 days of a regular 5-day work week. Weekly payroll, $8,000.

iii. The balance in Supplies before adjustment is $1,600. A physical count reveals $350 of supplies on hand on December 31, 2013.

iv. Equipment was purchased at the beginning of the year for $20,000. The equipment has a useful life of 4 years and no salvage value.

v. Unearned Service Revenue has a balance of $4,200 before adjustment. Records show that $2,725 of that amount has been earned by December 31, 2013.