Assignment: Financial Accounting for the Service Industries
Problem 1
Given the information below calcuate the cost of goods used and cost of goods sold.
Record the transactions in the general journal then post in the appropriate ledger.
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Purchases
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$ 57,900.00
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Food Inventory Beginning of December, 2009
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$ 1,160.00
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Food Inventory end of December, 2009
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$ 1,450.00
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Transfers from Bar to Kitchen during December
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$ 95.00
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Employee Meals during December
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$ 723.00
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Transfers from Kitchen to Bar during December
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$ 50.00
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Promotional Meals during December
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$ 432.00
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Cost of food used during December:
Cost of food sold during December:
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Number
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Account
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110
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Food Inventory
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510
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Cost of Food Sold
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552
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Employee Meals
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553
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Promotional Meals
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590
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Transfer to Bar
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Using the account numbers ro the right, record the adjustments from listed above in the general journal below:
Use posting date of December 31, 2009. Assume that all purchases and that preveious weekly expenses have been properly recorded prior to that date. This means that you only have two entries: one adjusting for the change in the inventory and the other adjusting the change from cost of goods used to cost of goods sold. Transfer to Bar is an expense account.
Complete the ledger entries using the information from the general journal.
Problem 2
Given the information below calculate the annual depreciation expense and the total depreciation expense at the time of the sale.
Record the transaction in the general journal then post in the appropriate ledger.
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Delivery van purchase price
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$ 30,000.00
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Estimated Salvage value
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$ 3,000.00
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Estimated live of the van
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5 years
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Selling price of the van
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$ 8,000.00
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Time owned before sale
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3.5 years
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Annual Depreciation Expense
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$ 5,400.00
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Total depreciation after 3.5 years
Using the account numbers ro the right, record the depreciation expense for the final 1/2 a year.
Use December 31, 2007 as the sale date. You should also use this date to record the final depreciation expense prior to the sale. After you have recorded the final depreciation expense, record the sale for cash.
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Number
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Account
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100
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Cash
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115
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Delivery Van
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125
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Accumulated Depreciation, Van
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425
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Gain on Disposal of an Asset
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553
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Depreciation Expense, Van
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572
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Loss on Disposal of an Asset
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Complete the ledger entries using the information from the general journal.
Problem 3
The Upper Room Inn is preparing its it taxes for the year.
The pre-depreciation income was $200,000
The company reported depreciation of $50,000 on its annual report using financial accounting.
Based on current tax law, the company can use $100,000 as the annual depreciation on its tax return.
If the tax rate is 25%, calculate the taxes that will be shown on the annual report (financial accounting) and the taxes that will be shown on the tax return.
Taxes on Annual Report
Taxes on Tax Return
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Number
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Account
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256
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Income Tax Payable
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269
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Deferred Income Taxes
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552
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Income Tax Expense
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Using the numbers above and the accounts to the right, post the taxes to the general journal below. (See page 149)
Use December 31, 2009 as the posting date.
Complete the ledger entries using the information from the general journal.
Problem 4
The following is the monthly income and expenses for Brandt's Bed and Breakfast. Using that information complete the income statement.
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Rooms revenue
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$ 82,800.00
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Wages and salaries
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$ 16,560.00
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Operating supplies
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$ 2,484.00
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Linen
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$ 500.00
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Laundry
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$ 5,500.00
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Commissions
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$ 700.00
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Dry cleaning
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$ 120.00
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Uniforms
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$ 200.00
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Miscellaneous expenses
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2% of revenue
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Payroll taxes (treat as a benefit)
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30% of wages and salaries
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Attachment:- Template.rar