Problem 14-5A (P14-5A) Grania Company’s income statement contained the condensed information below

ACC 280 / XACC 280

Axia College of University of Phoenix (UoP)

Principles of Accounting

Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2008). Financial Accounting (6th ed.). Hoboken, NJ: Wiley.

ACC 280 / XACC 280 Solution
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Problem 14-5A (P14-5A) Grania Company’s income statement contained the condensed information below.

GRANIA COMPANY
Income Statement
For the Year Ended December 31, 2008
Revenues $970,000
Operating expenses, excluding depreciation $624,000
Depreciation expense 60,000
Loss on sale of equipment 16,000 700,000
Income before income taxes 270,000
Income tax expense 40,000
Net income $230,000
2008 2007
Accounts receivable $75,000 $60,000
Accounts payable 41,000 28,000
Income taxes payable 11,000 7,000
Accounts payable pertain to operating expenses.

Instructions
Prepare the operating activities section of the statement of cash flows using the indirect method

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*NEW* ACC 225 Week Nine Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 9 Solution
1. Final Project: Comprehensive Problem-Perpetual

• Resources: Appendix A, Fundamental Accounting Principles, p. 301, and Appendix C

• Complete the Comprehensive Problem-Perpetual. In this project, follow the steps of the accounting cycle to process given transactions in a business environment. Then, synthesize special journals, a trial balance, financial statements, and a post-closing trial balance.

• Use the spreadsheet in Appendix C available on the student Web site to complete the problems. Use the tabs labeled P07C and Given P07C only (feel free to delete the other tabs if you would like).

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*NEW* ACC 225 Week Eight Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 8 Solution

1. CheckPoint: Internal Control and Bank Reconciliations

• Resource: Fundamental Accounting Principles, pp. 335 & 336
• Complete Exercises 7-8 & 7-11 on p. 291 and Quick Study question 8-6 on p. 335.

Exercises 7-8 (E7-8) SOLUTION

Exercises 7-11 (E7-11) SOLUTION

Quick Study Question 8-6 (QS 8-6) SOLUTION

2. Assignment: Internal Control and Bank Reconciliations
[Please be aware that since Sunday is the 4th of July Holiday this week’s assignment is due on Saturday July 3, instead of Sunday – this week only.]

• Resources: Fundamental Accounting Principles, pp. 338 & 339

• Complete Problems 8-1A & 8-4A (including the Analysis Component) on pp. 338–339. When responding to the cases in 8-1A, think critically about each case. Identify the principles of internal control that has been violated and provide an explanation of why you think that principle has been violated. Identify the consequences of the actions described in the cases. Make a recommendation for what the business should do to ensure adherence to principles of internal control.

• Use the spreadsheet in Appendix B available on the student Web site to complete Problem 8-4A. Use the tabs labeled SP08-04A and Given P08-04A

Problems 8-1A (P8-1A) SOLUTION

Problems 8-4A (P8-4A) (Appendix B) SOLUTION

*NEW* ACC 225 Week Seven Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 7 Solution

2. CheckPoint: Accounting Information Systems and Special Journals

• Resource: Fundamental Accounting Principles, pp. 289, 290, & 291
• Complete Quick Study questions 7-4 on p. 289 and Exercises 7-1, 7-4, 7-7, & 7-10 on pp. 290–291 (note that only the Sales Journal needs to be completed for Ex. 7-1, only the CR Journal needs to be completed for Ex. 7-4, only the Purchases Journal needs to be completed for Ex. 7-7 and only the CD Journal needs to be completed for Ex. 7-10, in other words there will be transactions listed that will not be used – ask questions if you have any).

Quick Study Questions 7-4 (QS 7-4) SOLUTION

Exercises 7-1 (E7-1) SOLUTION

Exercises 7-4 (E7-4) SOLUTION

Exercises 7-7 (E7-7) SOLUTION

Exercises 7-10 (E7-10) SOLUTION

*NEW* ACC 225 Week Six Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 6 Solution

1. CheckPoint: Computing Inventory Balances and Lower of Cost or Market

• Resource: Fundamental Accounting Principles, pp. 247–249
• Complete Quick Study question 6-1 on p. 247 and Exercises 6-1 on pp. 248.

Quick Study Question 6-1 (QS 6-1) SOLUTION

Exercises 6-1 (E6-1) SOLUTION


2. Assignment: Estimating Inventory and Preparing Multiple-Step and Single-Step Income Statements

• Resources: Fundamental Accounting Principles, pp. 251
• Complete Problems 5-4A on p. 212, 6-1A on p. 251. (Beware, these are very detailed problems and may take you a while to complete. Make sure you give yourself enough time!)

Problems 5-4A (P5-4A) SOLUTION

Problems 6-1A (P6-1A) SOLUTION

*NEW* ACC 225 Week Five Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 5 Solution

2. CheckPoint: Inventory Systems and Calculating Revenues, Expenses, and Income
• Resource: Fundamental Accounting Principles, pp. 206, 208, & 209.
• Complete Exercises 5-9 & 5-13 on pp. 208–209.

Exercises 5-9 (E5-9) SOLUTION

Exercises 5-13 (E5-13) SOLUTION

*NEW* ACC 225 Week Four Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 4 Solution

1. CheckPoint: Preparing Balance Sheets and Statements
• Resource: Fundamental Accounting Principles, pp. 156 & 159
• Complete Quick Study question 4-2 & 4-7 on p. 156 & 157 and Exercises 4-4 & 4-5 on p. 159.

Quick Study Question 4-2 (QS 4-2) SOLUTION

Quick Study question 4-7 (QS 4-7) SOLUTION

Exercises 4-4 (E4-4) SOLUTION

Exercises 4-5 (E4-5) SOLUTION

2. Assignment: Preparing Entries and Statements

• Resources: Fundamental Accounting Principles, pp. 165–167

• Complete problems 4-5A (all requirements must be completed). When responding to the analysis component of 4-5A, think critically about the possible errors that are described. In your answer, carefully analyze the worksheet as if the errors were made and present the evidence for your explanation. Identify the consequences of the errors and describe their affect on the financial statements. Explain whether the error is likely to be discovered when completing the worksheet.
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*NEW* ACC 225 Week Three Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 3 Solution

2. CheckPoint: Adjustments and Accrual and Cash Basis Accounting

• Resource: Fundamental Accounting Principles, pp. 116–118 & 120
• Complete Quick Study questions 3-2, & 3-9 on pp. 116 & 117 and Exercises 3-3 on pp. 119.

Quick Study Questions 3-2 (QS 3-2) SOLUTION

Quick Study Questions 3-9 (QS 3-9) SOLUTION

Exercises 3-3 (E3-3) SOLUTION

*NEW* ACC 225 Week Two Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 2 Solution

1. CheckPoint: Debits and Credits

• Resource: Fundamental Accounting Principles, p. 74
• Post your answers to Quick Study questions 2-4, 2-5, & 2-6.

Quick Study questions 2-4 (QS 2-4) SOLUTION

Quick Study questions 2-5 (QS 2-5) SOLUTION

Quick Study questions 2-6 (QS 2-6) SOLUTION

2. Assignment: Preparing Journal Entries and Trial Balances

• Resource: Fundamental Accounting Principles, pp. 75 & 81.
• Complete Exercise 2-1 on p. 75 and Problem 2-3A on p. 81.

Exercise 2-1 (E2-1) SOLUTION

Problem 2-3A (P2-3A) SOLUTION

*NEW* ACC 225 Week One Solution

ACC 225

Axia College of University of Phoenix (UoP)

Financial Accounting

Larson, K. D., Wild, J. J., & Chiappetta B. (2005). Fundamental accounting principles (17th ed.)

ACC 225 Week 1 Solution

3. Exercise: Accounting and Business Organizations

• Resource: Fundamental Accounting Principles, p. 30
• Post your answers to Quick Study Questions 1-8, 1-9 and 1-11 and Exercise 1-1.

Quick Study Questions 1-8 (QS 1-8) SOLUTION

Quick Study Questions 1-9 (QS 1-9) SOLUTION

Quick Study Questions 1-11 (QS 1-11) SOLUTION

Exercise 1-1 (E1-1) SOLUTION

Problem 11-7A (P11-7A) On July 1, 2008, Rossillon Company issued $4,000,000 face value, 8%, 10-year bonds at $3,501,514

ACC 280 / XACC 280

Axia College of University of Phoenix (UoP)

Principles of Accounting

Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2008). Financial Accounting (6th ed.). Hoboken, NJ: Wiley.

ACC 280 / XACC 280 Solution
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Problem 11-7A (P11-7A) On July 1, 2008, Rossillon Company issued $4,000,000 face value, 8%, 10-year bonds at $3,501,514.This price resulted in an effective-interest rate of 10% on the bonds. Rossillon uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest July 1 and January 1.

Instructions
(a) Prepare the journal entries to record the following transactions.
(1) The issuance of the bonds on July 1, 2008.
(2) The accrual of interest and the amortization of the discount on December 31, 2008.
(3) The payment of interest and the amortization of the discount on July 1, 2009, assuming no accrual of interest on June 30.
(4) The accrual of interest and the amortization of the discount on December 31, 2009.
(b) Show the proper balance sheet presentation for the liability for bonds payable on the December 31, 2009, balance sheet.
(c) Provide the answers to the following questions in letter form.
(1) What amount of interest expense is reported for 2009?
(2) Would the bond interest expense reported in 2009 be the same as, greater than, or less than the amount that would be reported if the straight-line method of amortization were used?
(3) Determine the total cost of borrowing over the life of the bond.
(4) Would the total bond interest expense be greater than, the same as, or less than the total interest expense that would be reported if the straight-line method of amortization were used?

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Exercise 11-8 (E11-8) Jim Thome has prepared the following list of statements about bonds

ACC 280 / XACC 280

Axia College of University of Phoenix (UoP)

Principles of Accounting

Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2008). Financial Accounting (6th ed.). Hoboken, NJ: Wiley.

ACC 280 / XACC 280 Solution
Help in ACC 280
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Exercise 11-8 (E11-8) Jim Thome has prepared the following list of statements about bonds.
1. Bonds are a form of interest-bearing notes payable.
2. When seeking long-term financing, an advantage of issuing bonds over issuing common stock is that stockholder control is not affected.
3. When seeking long-term financing, an advantage of issuing common stock over issuing bonds is that tax savings result.
4. Secured bonds have specific assets of the issuer pledged as collateral for the bonds.
5. Secured bonds are also known as debenture bonds.
6. Bonds that mature in installments are called term bonds.
7. A conversion feature may be added to bonds to make them more attractive to bond buyers.
8. The rate used to determine the amount of cash interest the borrower pays is called the stated rate.
9. Bond prices are usually quoted as a percentage of the face value of the bond.
10. The present value of a bond is the value at which it should sell in the marketplace.

Instructions
Identify each statement above as true or false. If false, indicate how to correct the statement. Evaluate statements about bonds.

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Exercise 11-18 (E11-18) Hrabik Corporation issued $600,000, 9%, 10-year bonds on January 1, 2008, for $562,613

ACC 280 / XACC 280

Axia College of University of Phoenix (UoP)

Principles of Accounting

Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2008). Financial Accounting (6th ed.). Hoboken, NJ: Wiley.

ACC 280 / XACC 280 Solution
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Exercise 11-18 (E11-18) Hrabik Corporation issued $600,000, 9%, 10-year bonds on January 1, 2008, for $562,613.This price resulted in an effective-interest rate of 10% on the bonds. Interest is payable semiannually on July 1 and January 1. Hrabik uses the effective-interest method to amortize bond premium or discount.

Instructions
Prepare the journal entries to record the following. (Round to the nearest dollar.)
(a) The issuance of the bonds.
(b) The payment of interest and the discount amortization on July 1, 2008, assuming that interest was not accrued on June 30.
(c) The accrual of interest and the discount amortization on December 31, 2008

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Exercise 11-2 (E11-2) On June 1, Melendez Company borrows $90,000 from First Bank on

ACC 280 / XACC 280

Axia College of University of Phoenix (UoP)

Principles of Accounting

Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2008). Financial Accounting (6th ed.). Hoboken, NJ: Wiley.

ACC 280 / XACC 280 Solution
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Exercise 11-2 (E11-2) On June 1, Melendez Company borrows $90,000 from First Bank on a 6-month, $90,000, 12% note.

Instructions
(a) Prepare the entry on June 1.
(b) Prepare the adjusting entry on June 30.
(c) Prepare the entry at maturity (December 1), assuming monthly adjusting entries have been made through November 30.
(d) What was the total financing cost (interest expense)?

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