Assignment No.2

Assignment No.
2
Chapter 2 :
Q:1 Prepare journal entries to record the following transactions of Royal Company , assuming
they use the allowance method to account for uncollectible accounts :
- On March 8 , sold merchandise $6,000 to Sun company on account .

- On March 15 , Royal company made an estimate that $7,500 will not be collectable from
accounts receivable .
- On April 20 , Royal Company wrote off $6,000 owed by Sun company .
- On June 15 , Sun Company paid $6,000 on cash .
Q:2 Prepare journal entries to record the following transactions of Smart Company , assuming
they use the Direct method to account for uncollectible accounts :
- On June 1 , sold merchandise $7,500 to Danny company on account .

- On July 20 , Smart Company wrote off $7,500 owed by Danny company .
- On September 15 , Danny Company paid $7,500 on cash
Q:3 On May 31, a company had a balance in its accounts receivable of $103,895. Prepare
journal entries to record the following transactions for June.
Q:4 Hasbro had net sales of $7,875 and its average accounts receivables is $1,350. Calculate
Hasbro's accounts receivable turnover:
Q:5 Griggs Company uses the direct write-off method of accounting for uncollectible accounts
receivable. On December 6, Year 1, Griggs sold $6,300 of merchandise to the Hillman
Company. On August 8, Year 2, after numerous attempts to collect the account, Griggs
determined that the $6,300 account of the Hillman Company was uncollectible.
Prepare the journal entry required to record the transactions on August 8.
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Q:6 The Connecting Company uses the percent of sales method of accounting for uncollectible
accounts receivable. During the current year, the following transactions occurred:
A. Prepare the general journal entries to record these transactions.

B. If the balance of the allowance for uncollectible accounts was $8,000 on January 1 of the
current year, determine the balance of the allowance for uncollectible accounts at December 31
of the current year. Assume that the transactions above are the only transactions affecting the
allowance for uncollectible accounts during the year.
Q:7 The Moon Company had Net Credit Sales of $750,000 during 2020, Average accounts
receivables of $350,000 during the same time.
Calculate the Accounts Receivable Turnover and Number of Days in Receivables.
Q:8 Prepare journal entries to record the following transactions of Danny Company :
- On Jan 1 , sold merchandise $60,000 to Smart company on account .
- On Jan 15 ,Smart Company signed a 5%, 30-day, $60,000 note to Danny Company.
- On February 15 , Smart Company paid the amount owed on cash .
Chapter 3 :
Q:9 Nguyen invested $100,000 and Hansen invested $200,000 in a partnership. They agreed to
share incomes and losses by allowing a $60,000 per year salary allowance to Nguyen and a
$40,000 per year salary allowance to Hansen, plus an interest allowance on the partners'
beginning-year capital investments at 10%, with the balance to be shared equally. Under this
agreement, the shares of the partners when the partnership earns $105,000 in income are:
A. $52,500 to Nguyen; $52,500 to Hansen.
B. $35,000 to Nguyen; $70,000 to Hansen.
C. $57,500 to Nguyen; $47,500 to Hansen.
D. $42,500 to Nguyen; $62,500 to Hansen.
E. $70,000 to Nguyen; $60,000 to Hansen.
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Q:10 The following information is available on Stewart Enterprises, a partnership, for the most
recent fiscal year:

There are three partners in Stewart Enterprises: Stewart, Tedder and Armstrong. At the end of
the year, the partners' capital accounts were in the ratio of 2:1:2, respectively. Compute the
ending capital balances of the three partners.
A. Stewart = $108,000; Tedder = $54,000; Armstrong = $108,000.
B. Stewart = $90,000; Tedder = $90,000; Armstrong = $90,000.
C. Stewart = $204,000; Tedder = $102,000; Armstrong = $204,000.
D. Stewart = $84,000; Tedder = $102,000; Armstrong = $84,000.
E. Stewart = $60,000; Tedder = $30,000; Armstrong = $60,000.
Q:11 A partnership recorded the following journal entry :
This entry reflects:

A. Acceptance of a new partner who invests $70,000 and receives a $20,000 bonus.
B. Withdrawal of a partner who pays a $10,000 bonus to each of the other partners.
C. Addition of a partner who pays a bonus to each of the other partners.
D. Additional investment into the partnership by Tanner and Jackson.
E. Withdrawal of $10,000 each by Tanner and Jackson upon the admission of a new partner.
Q:12 Groh and Jackson are partners. Groh's capital balance in the partnership is $64,000, and
Jackson's capital balance $61,000. Groh and Jackson have agreed to share equally in income or
loss. Groh and Jackson agree to accept Block with a 20% interest. Block will invest $35,000 in
the partnership. The bonus that is granted to Groh and Jackson equals:
A. $1,500 each.
B. $1,875 each.
C. $3,750 each.
D. 1,920 to Groh; $1,830 to Jackson.
E. $0, because Groh and Jackson actually grant a bonus to Block.
Q:13 When a partnership is liquidated:

A. Noncash assets are converted to cash.
B. Any gain or loss on liquidation is allocated to the partners' capital accounts using the income
and loss sharing ratio.
C. Liabilities are paid or settled.
D. Any remaining cash is distributed to the partners based on their capital balances.
E. All of these.
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Q:14 A capital deficiency means that:
A. The partnership has a loss.
B. The partnership has more liabilities than assets.
C. At least one partner has a debit balance in his/her capital account.
D. At least one partner has a credit balance in his/her capital account.
E. The partnership has been sold at a loss.
Q:15 When a partner is unable to pay a capital deficiency:

A. The partner must take out a loan to cover the deficient balance.
B. The deficiency is absorbed by the remaining partners before distribution of cash.
C. The partnership ends before distribution of cash.
D. The deficient partner is relieved of the liability.
E. The remaining partners must wait for the deficiency to be paid before cash is distributed.
Q:16 Jane and Castle are partners and share equally in income or loss. Jane's current capital
balance is $140,000 and Castle's is $130,000. Jane and Castle agree to accept Sean with a 30%
interest in the partnership. Sean invests $108,000 in the partnership. The balances in Jane's and
Castle's capital accounts after admission of the new partner equal:
A. Jane $140,000; Castle $130,000.
B. Jane $142,700; Castle $132,700.
C. Jane $145,000; Castle $135,000.
D. Jane $137,300; Castle $127,300.
E. Jane $135,000; Castle $124,000.
Q:17 Kathleen Reilly and Ann Wolf decide to form a partnership on August 1. Reilly invested
the following assets and liabilities in the new partnership:
The note payable is associated with the building and the partnership will assume responsibility
for the loan. Wolf invested $60,000 in cash and $105,000 in equipment in the new partnership.
Prepare the journal entries to record the two partners' original investments in the new
partnership.
Q:18 Holden, Phillips, and Rogers are partners with beginning-year capital balances of
$120,000, $60,000, and $60,000, respectively. Partnership net income for the year is $84,000.
Make the necessary journal entry to close Income Summary to the capital accounts if:
a. Partners agree to divide income based on their beginning-year capital balances.
b. Partners agree to divide income based on the ratio of 5:3:2 (Holden:Phillips:Rogers),
respectively.
c. Partnership agreement is silent as to division of income and less.
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Q:19 On July 1,2020 , Amir, Adel, and Rehab formed a partnership , Amir was transferring $
150,000 of personal cash to the partnership . Adel owned land worth $ 45,000 and a small
building worth $ 55,000 , which transferred to the partnership . Rehab transferred to the
partnership cash of $ 35,000 , accounts receivable of 25,000 and Cars worth $ 65,000. The
partnership expected to collect $ 22,000 of the accounts receivable .
Required :
1- Prepare the journal entries to record each of the partners' investment.
2- Prepare the balance sheet .
Q:20 On March 1, 2020, Ali and Amr agree to accept Nouran as a partner upon her investment
of $100,000 cash in the partnership. Nouran is to receive a 30% ownership interest in the new
partnership. Any bonus is attributable to the existing partners and is shared equally. Capital
balances before admission is Ali $80,000 , Amr $ 70,000.
Required : Calculate the Nouran's equity share and prepare journal entries.
Q:21 On June 1, 2020, Ahmed and Dalia agree to accept Peter as a partner upon his investment
of $75,000 cash in the partnership. Peter is to receive a 40% ownership interest in the new
partnership. Any bonus is attributable to the new partner and is shared equally by the existing
partners. Capital balances before admission is Ahmed $60,000 , Dalia $ 65,000.
Required : Calculate the Osama's equity share and prepare journal entries.

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Assignment No.

- On March 8 , sold merchandise $6,000 to Sun company on account .

- On June 1 , sold merchandise $7,500 to Danny company on account .

A. Prepare the general journal entries to record these transactions.

recent fiscal year:

Q:11 A partnership recorded the following journal entry :

This entry reflects:

Q:13 When a partnership is liquidated:

Q:15 When a partner is unable to pay a capital deficiency:

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