Accounting Principles 10th Edition Weygandt Kimmel Chapter 1 Solutions For Chapter 1 Accounting in Action

Chapter 1, Transaction Analysis & Financial Statements, pages 15 - 23
Assets = Liabilities + Owner's Equity
Assets = Liabilities +
Accounts Accounts
Cash Receivable Supplies Equipment Payable
1) $ 15,000
2) (7,000) 7,000
3) 1,600 1,600
4) 1,200
5) 250
6) 1,500 2,000
7) (1,700)
5, 8) (250) (250)
6, 9) 600 (600)
10) (1,300)
$ 8,050 $ 1,400 $ 1,600 $ 7,000 $ 1,600

$ 18,050
summation of assets summation of liabilities

& owner's equity
$ 18,050 $ 18,050
$ 18,050
Income Statement
month ending September 30, 2012
Revenues
Service Revenues $ 4,700
Expenses
Salaries & Wages Expense (900)
Rent Expense (600)
Advertising Expense (250)
Utilities Expense (200)
Total Expenses (1,950)
Net Income $ 2,750
Owner's Equity Statement

Owner's Capital, September 1 0

Add: Investments $ 15,000
Add: Net Income $ 2,750
17,750
Less: Drawings $ (1,300)
Owner's Capital, September 30 16,450
Investment by Owner
Drawings by Owners
net change in cash
cash at beginning of pe
cash at end of period
Owner's Equity
Owner's -Owner's
Capital Drawings Revenues -Expenses
$ 15,000 Initial Investment
Equipment on cash
Supplies on Credit
1,200 Service Revenue
(250) Advertising Expense
(900) Salaries & Wage Expense
(600) Rent Expense
(200) Utilities Expense
(1,300)
$ 15,000 $ (1,300) $ 4,700 $ (1,950)

$ 18,050
owner's cap/draw net income

$ 13,700 $ 2,750
summation of owner's equity

$ 16,450 $ 16,450
Balance Sheet
Assets
Cash $ 8,050
Accounts Receivable 1,400
Supplies 1,600
Equipment 7,000
Total Assets $ 18,050
Liabilities & Owner's Equity

Liabilities
Accounts Payable $ 1,600
Owner's Equity
Owner's Capital 16,450
Total Liabilities & Owner's Equity $ 18,050
Statement of CashFlows
Cash Flows from Operating Activities

cash receipts from revenues $ 3,300
cash payments for expenses (1,950)
Net Cash Provided by Operating Activities $ 1,350
Cash Flow from Investing Activities

Purchase of Equipment $ (7,000) paid cash so put it here
Cash Flow from Financing Activities

Investment by Owners 15,000
Drawings by Owners (1,300)
$ 13,700
net change in cash $ 8,050
cash at beginning of period $ -

cash at end of period $ 8,050
Transactions
1) initial investment by owner, $15,000 cash, equal increase in assets

and owner's equity
2) purchase of equipment for $7,000 cash, equal increases and decrease
3) purchase of supplies on $1,600 credit, assets and liabilities increase
4) services provided for $1,200 cash, revenue increases owner's equity
5) purchased advertising on $250 credit, increased liabilities and

decreased owner's equity (expense)
6) services provided for $1,500 cash and $2,000 credit

equal increase in assets and owners equity
7) payment of $1,700 expenses equal decrease in assets and expenses

equal decrease in assets and owner's equity
8) payment of accounts payable (from #5) payment of $250 bill in cash

equal decrease in cash and accounts payable
9) receipt of cash on account (from #6) received $600 in cash

composition of assets changed
10) withdrawl of $1,300 in cash by owner

equal decrease in assets and owner's equity
so put it here
Chapter 1, Transaction Analysis & Financial Statements, pages 21

Accounts Accounts Owner's
Cash Receivable Supplies Equipment Payable Capital
1) $ 25,000 $ 25,000
2) 7,000 7,000
3) 8,000
4) (850)
5) (1,000)
$ 31,150 $ - $ - $ 7,000 $ 7,000 $ 25,000
summation of assets summation of liabilities owner's cap/draw

& owner's equity $ 24,000
$ 38,150 $ 38,150
$ 38,150 $ 31,150
Chapter 1, Transaction Analysis & Financial Statements, pages 21 Chapter 1, Transaction Analysis
Income Statement Balance Sheet

month ending August 31, 2012 month ending August 31, 2012
Revenues Assets
Service Revenues $ 8,000 Cash
Accounts Receivable
Expenses Supplies
Salaries & Wages Expense - Equipment
Rent Expense (850) Total Assets
Advertising Expense -
Utilities Expense - Liabilities & Owner's Equity
Total Expenses (850) Liabilities
Accounts Payable
Net Income $ 7,150 Owner's Equity
Owner's Capital
Total Liabilities & Owner's Equit
month ending August 31, 2012
Owner's Capital, September 1 0 month ending August 31, 2012
Add: Investments 25,000
Add: Net Income 7,150 Cash Flows from Operating Acti
32,150 cash receipts from revenues
Less: Drawings (1,000) cash payments for expenses
Owner's Capital, September 30 $ 31,150 Net Cash Provided by Operating
Cash Flow from Investing Activi

Purchase of Equipment
Cash Flow from Financing Activi

Investment by Owners
Drawings by Owners
net change in cash
cash at beginning of period

Owner's Equity
-Owner's
Drawings Revenues -Expenses
cash
equpment on credit
8,000 service provided
(850) rent expense
(1,000) cash withdrawal
$ (1,000) $ 8,000 $ (850)

$ 7,150
ummation of owner's equity

$ 31,150
Balance Sheet
$ 31,150
Accounts Receivable -
-
7,000
iabilities & Owner's Equity

Owner's Equity

cash payments for expenses (850)

Purchase of Equipment $ -

$ 24,000
ash at beginning of period $ -

ash at end of period $ 31,150
Chapter 1, - pages 21
Transactions
1) Initial Investment by Owner, $25,000 Cash

Equal Increase in Assets and Owner's Equity
2) Purchase of Equipment for $7,000 Credit

Equal Increase in Total Assets and Total Liabilities
3) Services provided for $8,000 Cash

Total Assets, Cash increased
Revenue Increases Owner's Equity
4) Payment of $850 Rent Expenses, Cash

Equal Decrease in Assets and Expenses
Equal Decrease in Assets and Owner's Equity
5) WithDrawl of $1,000 in cash by Owner

Equipment paid on credit so it is zero
we start with zero

Income Statement Flannagan Company

month ending December 31, 2012
Revenues
Expenses
Rent Expense (11,000)

Salaries & Wages Expense (7,000)
Utilities Expense (4,000)
Net Income $ 14,000
Balance Sheet Flannagan Company

month ending December 31, 2012
Assets
Cash $ 8,000
Supplies -
Equipment 10,000
-
Liabilities
Note Payble 16,500
Owner's Equity $ 18,500
Presented below is selected information related to Flanagan Company at December

31, 2012. Flanagan reports fi nancial information monthly.
Equipment $10,000 Utilities Expense $ 4,000
Cash 8,000 Accounts Receivable 9,000
Service Revenue 36,000 Salaries and Wages Expense 7,000
Rent Expense 11,000 Notes Payable 16,500
Accounts Payable 2,000 Owner’s Drawings 5,000
(a) Determine the total assets of Flanagan Company at December 31, 2012.
(b) Determine the net income that Flanagan Company reported for December 2012
(c) Determine the owner’s equity of Flanagan Company at December 31, 2012
Chapter 1, Transaction Analysis & Financial Statements, pages 26-27
Accounts Notes Accounts
Cash Receivable Supplies Equipment Payable Payable
1) $ 11,000
2) (800)
3) 3,000 3,000
4) 1,500
5) 700 700
6) 2,000
7) (500)
(300)
(100)
8 (1,000)
$ 10,500 $ 2,000 $ - $ 3,000 $ 700 $ 3,000

Total Assets $ 15,500 Total liability$ 3,700

& owner's equity
$ 15,500 $ 15,500
$ 15,500
Income Statement
month ending July 31, 2012
Revenues
Expenses
Rent Expense (800)
Salaries & Wages Expense (500)
Utilities Expense (300)
Supplies Expense (100)
Net Income $ 1,800

Owner's Capital July 1st, 2012
Owner's Capital, September 1 $0

Add: Net Income 1,800
12,800
Less: Drawings (1,000)
Owner's Capital, July 31 $ 11,800
Owner's Equity
Owner's -Owner's
$ 11,000
(800) Rent Expense
Equipment on credit
borrowed cash
(500) expense
(300) expense
(100) expense
(1,000)
$ 11,000 $ (1,000) $ 3,500 $ (1,700)

$ 11,800

$ 10,000 $ 1,800

$ 11,800 $ 11,800
Balance Sheet
Assets
Cash $ 10,500
Supplies -
Equipment 3,000

Liabilities
Notes Payable $ 700
Total Liabilities 3,700
Owner's Equity

Net Cash Provided by Operating Activities $ (200)

Purchase of Equipment $ -

Proceeds from debt $ 700
$ 10,700

Chapter 1, - pages 26 - 27
Transactions (July 2012)

2) Payment of $800 Rent Expense (July 2012)

3) Purchase of Equipment on $3,000 Credit

Assets and Liabilities Increase
4) Legal Services provided for $1,500 Cash

5) Borrowed $700 Cash from Bank on Note Payable

6) Legal Services provided for $2,000 Credit
Accounts Receivable Increases
7) Payment of $900 Expense (July 2012)

8) WithDrawl of $1,000 in cash by Owner

Accounts Accounts
Cash Receivable Supplies Equipment Payable
1) $ 15,000
2) (2,000) 5,000 $3,000
3) (750) 750
4) 4,600 3,900
5) (1,500) (1,500)
6) (2,000)
7) (650)
8 450 (450)
9 (4,800)
10 500
$ 8,350 $ 3,450 $ 750 $ 5,000 $ 2,000

& owner's equity
$ 17,550 $ 17,550
$ 17,550
Income Statement
Revenues
Expenses
rent Expense (650)
salary Expense (4,800)
utilities Expense (500)
Net Income $ 2,550

Owner's Capital, September 1 0

Add: Net Income 2,550
17,550
Less: Drawings (2,000)
Owner's Capital, September 30 $ 15,550
Owner's Equity
Owner's -Owner's
$ 15,000
supplies
(2,000) Ownerss drawing

(650) rent Expense
accounts receivable
(4,800) salaries expense
(500) Utilities expense
$ 15,000 $ (2,000) $ 8,500 $ (5,950) $ 15,550

$ 13,000 $ 2,550

$ 15,550 $ 15,550
Balance Sheet
Assets
Cash $ 8,350
Supplies 750
Equipment 5,000

Liabilities
Owner's Equity

Net Cash Provided by Operating Activities $ (2,650)

Purchase of Equipment $ (2,000)

$ 13,000

Transactions (August 2012)

2) Purchase of Equipment on $5,000 ($2,000 Cash, $3,000 Credit)

Assets and Liabilities Increase
3) Purchase of supplies on $750 Cash

Assets increased and decreased
4) Revenues of $8,500 earned $4,600 Cash ans $3,900 Credit

Cash and Accounts Receivable Increases
5) Paid $1,500 Cash on Accounts Payable

7) Payment of $650 Rent Expense (August 2012)

8) Received / Collected $450 Cash on Account

Assets increased and decreased
9) Payment of $4,800 Expenses (August 2012)

10) Incurred $500 of Utilities Expenses on Account

Liabilities Increased, Equity / Expenses Decreased
Problem Set P1 - A1
Chapter 1, Transaction Analysis & Financial Statements, page 39 Chapter 1, Transaction An
a) Assets = Liabilities + Owner's

1) $ 10,000 $ 10,000
2) (5,000) 5,000
3) (400)
4) (500) 500
5) 250
6) 6,100
7) (1,000)
8) (2,000)
9) (170)
10) 750
10,11) 120 (120)
$ 7,150 $ 630 $ 500 $ 5,000 $ 250 $ 10,000
summation of assets = summation of liabilities owner's cap/draw

$ 13,280 $ 13,280
summation of owner's equ
$ 13,280 $ 13,030
b) Net Income is $4,030

month ending May 31, 2012 month ending May 31, 2012
Revenues Assets
Accounts Receivable
Expenses Supplies
Salaries & Wages Expense (2,000) Equipment
Utilities Expense (170) Liabilities & Owner's Equit
Total Expenses (2,820) Liabilities
Accounts Payable
Owner's Capital
Total Liabilities & Owner's
month ending May 31, 2012
Owner's Capital, May 1 0 month ending May 31, 2012
Add: Net Income $ 4,030 Cash Flows from Operating
$ 14,030 cash receipts from revenu
Less: Drawings $ (1,000) cash payments for expens
Owner's Capital, May 31 $ 13,030 Net Cash Provided by Oper
Cash Flow from Investing A

Cash Flow from Financing A

Drawings by Owners
net change in cash

Chapter 1, Transaction Analysis & Financial Statements, page 39
Owner's Equity
-Owner's
Initial Investment
Equipment cash
(400) Rent Expense cash
Supplies cash
(250) Advertising Expense on account
6,100 Service Revenue cash
(1,000) Owners Drawing
(2,000) Salaries & Wage Expense cash
(170) Utilities Expense cash
750 Service Revenue
received cash $120 from $750
$ (1,000) $ 6,850 $ (2,820)

$ 4,030

$ 13,030
Balance Sheet
$ 7,150
Accounts Receivable 630
500
5,000
Accounts Payable $ 250

Owner's Equity



$ 9,000
cash at beginning of period 0

Problems: Set A – assignments
Transactions
P1-1A Threet’s Repair Shop was started on May 1 by Erica Threet.

A summary of May transactions is presented below.
1. Invested $10,000 cash to start the repair shop.
2. Purchased equipment for $5,000 cash.
3. Paid $400 cash for May office rent.
4. Paid $500 cash for supplies.
5. Incurred $250 of advertising costs in the Beacon News on account.
6. Received $6,100 in cash from customers for repair service.
7. Withdrew $1,000 cash for personal use.
8. Paid part-time employee salaries $2,000.
9. Paid utility bills $170.
10. Provided repair service on account to customers $750.
11. Collected cash of $120 for services billed in transaction (10).
Instructions
(a) Prepare a tabular analysis of the transactions, using the
following column headings: Cash, Accounts Receivable,Supplies,
Equipment, Accounts Payable, Owner’s Capital, Owner’s Drawings,
Revenues, and Expenses
(b) From an analysis of the owner’s equity columns,
compute the net income or net loss for May.
Ans - Net income = $4030
Problem Set P1 - 1B
a) Assets = Liabilities + Owner's

1) $ 15,000 $ 15,000
2) (600)
3) (3,000) 3,000
4) 700
5) (800) 800
6) 3,000 7,000
7) (500)
4, 8) (500) (500)
9) (2,500)
6, 10) 4,000 (4,000)
$ 14,100 $ 3,000 $ 800 $ 3,000 $ 200 $ 15,000
summation of assets = summation of liabilities owner's cap/draw

$ 20,900 $ 20,900
summation of owner's equ
$ 20,900 $ 20,700

month ending April 30, 2012 month ending April 30, 2012
Revenues Assets
Accounts Receivable
Expenses Supplies
Salaries & Wages Expense (2,500) Equipment
Liabilities & Owner's Equit
Total Expenses (3,800) Liabilities
Accounts Payable
Owner's Capital
Total Liabilities & Owner's
month ending April 30, 2012
Owner's Capital, April 1 0 month ending April 30, 2012
Add: Net Income $ 6,200 Cash Flows from Operating
$ 21,200 cash receipts from revenu
Less: Drawings $ (500) cash payments for expens
Owner's Capital, April 1 $ 20,700 Net Cash Provided by Oper
Cash Flow from Investing A

Cash Flow from Financing A

Drawings by Owners
net change in cash

Owner's Equity
-Owner's
Initial Investment
(600) Rent Expense cash
Equipment
(700) Advertising Expense on account
Supplies
10,000 Service Revenue cash+Credit
(500) Owners Drawing
Advertising expense
(2,500) Salaries & Wage Expense cash
Service Revenue
$ (500) $ 10,000 $ (3,800)

$ 6,200

$ 20,700
Balance Sheet

800
3,000

Accounts Payable $ 200
Owner's Equity



Drawings by Owners (500)
$ 14,500

Transactions
P1-1B
P1-1B On April 1, Vince Morelli established Vince’s Travel Agency. The following transactions
were completed during the month.
1. Invested $15,000 cash to start the agency.
2. Paid $600 cash for April offi ce rent.
3. Purchased offi ce equipment for $3,000 cash.
4. Incurred $700 of advertising costs in the Chicago Tribune, on account.
5. Paid $800 cash for offi ce supplies.
6. Earned $10,000 for services rendered: $3,000 cash is received from customers, and the balance
of $7,000 is billed to customers on account.
7. Withdrew $500 cash for personal use.
8. Paid Chicago Tribune $500 of the amount due in transaction (4).
9. Paid employees’ salaries $2,500.
10. Received $4,000 in cash from customers who have previously been billed in transaction (6).
Instructions
(a) Prepare a tabular analysis of the transactions using the following column headings: Cash,
Accounts Receivable, Supplies, Equipment, Accounts Payable, Owner’s Capital, Owner’s
Drawings, Revenues, and Expenses.
(b) From an analysis of the owner’s equity columns, compute the net income or net loss for April.
dings: Cash,
Problem Set P1 -2A
Assets = Liabilities
Accounts Notes Accounts
Cash Receivable Supplies Equipment Payable Payable
Balance 9,000 1,700 600 6,000 3,600
1) $ (2,900) $ (2,900)
2) 1,300 (1,300)
3) (800) 2,100 1,300
4) 2,500 5,300
5) (1,100)
6) (1,700)
(900)
(450)
7 170
8 10,000 10,000
$ 14,950 $ 5,700 $ 600 $ 8,100 $ 10,000 $ 2,170
summation of assets = summation of liabilities

& owner's equity
$ 29,350 $ 29,350
Income Statement
Revenues
Expenses
Salaries & Wages Expense (1,700)
Rent Expense (900)
Utilities expense (170)
Net Income $ 4,580

Owner's Capital, April 1 0

Add: Net Income $ 4,580
$ 18,280
Less: Drawings $ (1,100)
Owner's Capital, April 1 $ 17,180
+ Owner's Equity
Owner's -Owner's
13,700 Balance forward
Equipment
7,800 Service revenue
(1,100) Owners drawing
(1,700) Salaries
(900) Rent
(450) Advertising
(170) Utilities
$ 13,700 $ (1,100) $ 7,800 $ (3,220)

$ 12,600 $ 4,580

$ 17,180 $ 17,180
Balance Sheet
Assets
Cash $ 14,950
Supplies 600
Equipment 8,100

Liabilities
Notes Payable $ 10,000
Owner's Equity

cash payments for expenses 9,750

Purchase of Equipment $ (800)

Investment by Owners (2,900)
Drawings by Owners (900)
$ (3,800)

Transactions
P1-2A
P1-2A Ramona Castro opened a veterinary business in Nashville, Tennessee, on August 1. On
August 31, the balance sheet showed Cash $9,000, Accounts Receivable $1,700, Supplies $600,
Equipment $6,000, Accounts Payable $3,600, and Owner’s Capital $13,700. During September,
the following transactions occurred.
1. Paid $2,900 cash on accounts payable.

2. Collected $1,300 of accounts receivable.
3. Purchased additional offi ce equipment for $2,100, paying $800 in cash and the balance on
account.
4. Earned revenue of $7,800, of which $2,500 is received in cash and the balance is due in October.
5. Withdrew $1,100 cash for personal use.
6. Paid salaries $1,700, rent for September $900, and advertising expense $450.
7. Incurred utilities expense for month on account $170.
8. Received $10,000 from Capital Bank (money borrowed on a note payable).
(a) Total assets $29,350

(b) Net income $4,580
Ending capital $17,180

Accounting Principles 10th Edition Weygandt Kimmel Chapter 1 Solutions For Chapter 1 Accounting in Action

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Accounting Principles 10th Edition Weygandt Kimmel Chapter 1 Solutions For Chapter 1 Accounting in Action

Uploaded by

Copyright:

Available Formats

Chapter 1, Transaction Analysis & Financial Statements, pages 15 - 23

Assets = Liabilities + Owner's Equity

$ 8,050 $ 1,400 $ 1,600 $ 7,000 $ 1,600

summation of assets summation of liabilities

Chapter 1, Transaction Analysis & Financial Statements, pages 15 - 23

Net Income $ 2,750

Owner's Equity Statement

Owner's Capital, September 1 0

net change in cash

$ 15,000 $ (1,300) $ 4,700 $ (1,950)

owner's cap/draw net income

summation of owner's equity

Chapter 1, Transaction Analysis & Financial Statements, pages 15 - 23

Liabilities & Owner's Equity

Cash Flows from Operating Activities

Cash Flow from Investing Activities

Cash Flow from Financing Activities

net change in cash $ 8,050

cash at beginning of period $ -

1) initial investment by owner, $15,000 cash, equal increase in assets

2) purchase of equipment for $7,000 cash, equal increases and decrease

3) purchase of supplies on $1,600 credit, assets and liabilities increase

4) services provided for $1,200 cash, revenue increases owner's equity

5) purchased advertising on $250 credit, increased liabilities and

6) services provided for $1,500 cash and $2,000 credit

7) payment of $1,700 expenses equal decrease in assets and expenses

8) payment of accounts payable (from #5) payment of $250 bill in cash

9) receipt of cash on account (from #6) received $600 in cash

10) withdrawl of $1,300 in cash by owner

Assets = Liabilities + Owner's Equity

Assets = Liabilities + Owner's Equity

$ 31,150 $ - $ - $ 7,000 $ 7,000 $ 25,000

summation of assets summation of liabilities owner's cap/draw

Income Statement Balance Sheet

Cash Flow from Investing Activi

Cash Flow from Financing Activi

net change in cash

cash at beginning of period

$ (1,000) $ 8,000 $ (850)

owner's cap/draw net income

ummation of owner's equity

Chapter 1, Transaction Analysis & Financial Statements, pages 21

iabilities & Owner's Equity

Accounts Payable $ 7,000

Cash Flows from Operating Activities

Cash Flow from Investing Activities

Cash Flow from Financing Activities

net change in cash $ 31,150

ash at beginning of period $ -

1) Initial Investment by Owner, $25,000 Cash

2) Purchase of Equipment for $7,000 Credit

3) Services provided for $8,000 Cash

4) Payment of $850 Rent Expenses, Cash

5) WithDrawl of $1,000 in cash by Owner

we start with zero

Income Statement Flannagan Company

Rent Expense (11,000)

Net Income $ 14,000

Balance Sheet Flannagan Company

Presented below is selected information related to Flanagan Company at December

Assets = Liabilities + Owner's Equity

$ 10,500 $ 2,000 $ - $ 3,000 $ 700 $ 3,000

summation of assets summation of liabilities