Accounting workbook | Accounting homework help

 

 

 

Question 2

In performing accounting services to small businesses, you encounter the following situations pertaining to cash sales.

1.

  Poole Company enters sales and sales taxes separately on its cash register. On April 10, the register totals are sales $30,000 and sales taxes $1,500.

2.

  Waterman Company does not segregate sales and sales taxes. Its register total for April 15 is $25,680, which includes a 7% sales tax.

Prepare the entry to record the sales transactions and related taxes for each client. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

 

 

 

Question 3

Moreno Company publishes a monthly sports magazine, Fishing Preview. Subscriptions to the magazine cost $20 per year. During November 2014, Moreno sells 15,000 subscriptions beginning with the December issue. Moreno prepares financial statements quarterly and recognizes subscription revenue at the end of the quarter. The company uses the accounts Unearned Subscription Revenue and Subscription Revenue.

 

Prepare the entry in November for the receipt of the subscriptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

 

Prepare the adjusting entry at December 31, 2014, to record sales revenue recognized in December 2014. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

 

Prepare the adjusting entry at March 31, 2015, to record sales revenue recognized in the first quarter of 2015. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

 

 

 

 

 

 

 

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