Accounting Problem Sets

Problem Sets

Part 1

 Exercise 1-9A on page 40

Exercise 1-10A on page 40

Exercise 1-4A on page 38

Exercise 1-7A on page 39

Exercise 1-6A on page 39

Exercise 1-8A on page 39

Part 2

Question 1: What is the accounting equation?  Why is this important to the practice of accounting? Please provide an example of how the accounting equation works with recording transactions within a business. Question 2: Is there a difference between bookkeeping and accounting? Discuss. Question 3: Accounting reports past performance. How can this be useful when planning future operations

BA220 – Financial Accounting

Week 1

Answer Key

Textbook: 9th Edition

 

EXERCISE 1-9A

 

 

a.

	Cash	+	Land	=	Creditors	+	Stockholders’ Equity
Bal.		+		=		+

 

b. Creditor’s Claim ÷ Total Assets = Percent of Total

÷ =

 

c. Investor’s Claim ÷ Total Assets = Percent of Total

÷ =

 

d.

 

 

 

 

	Cash	+	Land		Creditors	+	Stockholders’ Equity
Bal.		+		=		+

 

 

 

 

EXERCISE 1-10A

 

a.

 

 

 

b.

							Stockholders’ Equity
	Company		Assets	=	Liabilities	+	Common Stock	+	Retained Earnings
	Allen
	White

 

 

 

 

 

c.

 

 

 

 

 

 

d.

 

 

 

 

EXERCISE 1-4A

 

 

Accounting Equation
					Stockholders’ Equity
					Common		Retained
Company	Assets	=	Liabilities	+	Stock	+	Earnings
A		=		+		+
B		=		+		+
C		=		+		+
D		=		+		+

 

 

EXERCISE 1-7A

a.

Assets	=	Liabilities	+	Stockholders’ Equity
Cash	=	Note Payable	+	Common Stock	+	Retained Earnings
	=		+		+

 

Retained Earnings = – – =

 

b. & c.

Moss Company Effect of 2017 Transactions on the Accounting Equation
	Assets	=	Liabilities	+	Stockholders’ Equity
			Notes		Common		Retained
Event	Cash	=	Payable	+	Stock	+	Earnings
Beginning Balances
1. Earned Revenue
2. Paid expenses
3. Paid dividend
Ending Balance		=		+		+

 

d.

Cash	=	Note Payable	+	Common Stock	+	Retained Earnings
	=		+		+

 

Liabilities + Stockholders’ Equity = + + =

 

Assets = Liabilities + Stockholders’ Equity

=

 

e.

 

 

 

 

 

 

 

EXERCISE 1-7A

 

EXERCISE 1-7A

a.

Assets	=	Liabilities	+	Stockholders’ Equity
Cash	=	Note Payable	+	Common Stock	+	Retained Earnings
	=		+		+

 

Retained Earnings = – – =

 

b. & c.

Moss Company Effect of 2017 Transactions on the Accounting Equation
	Assets	=	Liabilities	+	Stockholders’ Equity
			Notes		Common		Retained
Event	Cash	=	Payable	+	Stock	+	Earnings
Beginning Balances
1. Earned Revenue
2. Paid expenses
3. Paid dividend
Ending Balance		=		+		+

 

d.

Cash	=	Note Payable	+	Common Stock	+	Retained Earnings
	=		+		+

 

Liabilities + Stockholders’ Equity = _______ + __________ + =

 

Assets = Liabilities + Stockholders’ Equity

=

 

e.

 

 

EXERCISE 1-6A

a.

Better Corporation Accounting Equation for 2016
		Assets	=	Liabilities	+	Stockholders’ Equity
Event		Cash	+	Land	=	Notes Payable	+	Com. Stock	+	Retained Earnings	Acct. Title/RE
Bal. 1/1/16
1. Pur. Land
2. Issued stk.
3. Provide Svc.
4. Paid Exp.
5. Loan
6. Paid Div.
7. Land Value
Totals			+		=		+		+

 

 

b.

 

Assets	=	Liabilities	+	Stockholders’ Equity
	=		+

 

 

 

c. The balances of total assets, liabilities and stockholders’ equity will be the same on January 1, 2017 as the balances on December 31, 2016. (See b. above)

 

Assets	=	Liabilities	+	Stockholders’ Equity

 

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