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    Various Accounting Problems and Journal Entries

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    I am having the hardest time with these various Accounting problems. Attached are the problems. To look at the attachment will help out more so with the full description.The problems consist of preparing journal entries, cash flows using the indirect method, job order cost accounting system, units of merchandise, and computing direct materials price and quantity. Again, the attachment gives more details with the actual problems. Thanks in advance, it's a big help.

    Problem 2
    On August 1, 2007, a company issues bonds with a par value of $600,000. The bonds mature in 10 years, and pay 6% annual interest, payable each February 1 and August 1. The bonds sold at $632,000. The company uses the straight-line method of amortizing bond premiums. The company's year-end is December 31. Prepare the general journal entry to record the interest accrued at December 31, 2007.

    Problem 3
    In preparing a budget for the last three months of the current year, Urban Company is planning the units of merchandise it must order each month. The company's policy is to have 15% of the next month's sales in its inventory at the end of each month. Projected sales for October, November, and December are 27,000 units, 29,500 units, and 32,500 units, respectively. How many units must be ordered in November?

    Problem 4
    The following information describes production activities of the Central Corp.:

    30,000 units were completed during the year
    Budgeted standards for each unit produced:
    1/2 lb. of raw material at $4.15 per lb.
    10 minutes of direct labor at $12.50 per hour
    Compute the direct materials price and quantity and the direct labor rate and efficiency variances. Indicate whether each variance is favorable or unfavorable.

    Problem 5
    RC Corp. uses a job order cost accounting system. During the month of April, the following events occurred:
    (a) Purchased raw materials on credit, $32,000.
    (b) Raw materials requisitioned: $25,800 as direct materials and $10,500 indirect materials.
    (c) Paid factory payroll for the month totaling $37,700 which includes $8,200 indirect labor.
    (d) Assigned the factory payroll to jobs and overhead.
    Make the necessary journal entries to record the above transactions and events.

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    Attachments

    Solution Preview

    Please see the attached file.

    Problem 1

    Based on the following income statement and balance sheet for Rashid Corporation, determine the cash flows from operating activities using the indirect method.

    Statement of Cash Flows
    For the year ended Dec 31,
    Cash Flow from Operating Activity $
    Net Income 11,300
    Add Depreciation 42,000
    Less: Gain on sale on equipment (7,200)
    Add: Decrease in Accounts Receivable 8,000
    Subtract Increase in Inventory (5,900)
    Add Increase in Accounts Payable 4,700
    Subtract Decrease in Income tax payable (150)
    Net Cash Flow from Operating Activity 52,750

    Depreciation and gain on sale is non cash. Depreciation was subtracted in the income statement, so is added here. Gain on sale was added in the income statement and so is subtracted here.

    Problem 2
    On August 1, 2007, a company issues bonds with a par value of $600,000. The bonds mature in 10 years, and pay 6% annual interest, payable each February 1 and August 1. The bonds sold at $632,000. The company uses the straight-line method of amortizing bond premiums. The company's year-end is December 31. Prepare the ...

    Solution Summary

    The solution discusses and provides answers for various accounting problems dealing with journal entries, cash flows using the indirect method, job order cost accounting system, units of merchandise, and computing direct materials price and quantity.

    $2.19

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