ACC504 All case studies (all case 1, 2 and 3)

Case Study 1 (Part A)

P2-69B
(Learning Objectives 4, 5, 6:
Analyze the impact of business transactions on accounts; record (journalize and
post) transactions in the books; construct and use a trial balance) During the
first month of operations, Johnson Plumbing, Inc., completed the following
transactions:

Mar 2

Johnson
received $35,000 cash and issued common stock to the stockholders.

3

Purchased
supplies, $200, and equipment, $3,200, on account.

4

Performed
services for a client and received cash, $1,400.

7

Paid
cash to acquire land, $24,000.

11

Performed
services for a customer and billed the customer, $800. Johnson expects to
collect within one month.

16

Paid for
the equipment purchased March 3 on account.

17

Paid the
telephone bill, $150.

18

Received
partial payment from customer on account, $400.

22

Paid the
water and electricity bills, $170.

29

Received
$1,500 cash for repairing the pipes of a customer.

31

Paid
employee salary, $1,800.

31

Declared
and paid dividends of $2,100.

?Requirements
1. Record each transaction in the journal. Key each
transaction by date. Explanations are not required.2. Post the transactions to the T-accounts, using
transaction dates as posting references.3. Prepare the trial balance of Johnson Plumbing, Inc.,
at March 31 of the current year.4. The manager asks you how much in total resources the
business has to work with, how much it owes, and whether March was
profitable (and by how much).

Case Study 1 (Part B)
P3-77B
(Learning Objectives 3, 4: Adjust
the accounts; construct the financial statements) Consider the unadjusted trial
balance of Princess, Inc., at August 31, 2012, and the related month-end
adjustment data.
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Adjustment data at August 31, 2012,
include the following:
a. Accrued advertising revenue at August 31, $2,100.b. Prepaid rent expired during the month. The unadjusted
prepaid balance of $2,100 relates to the period August 2012 through
October 2012.c. Supplies used during August, $2,090.d. Depreciation on furniture for the month. The
furniture’s expected useful life is three years.e. Accrued salary expense at August 31 for Monday,
Tuesday, and Wednesday. The five-day weekly payroll is $5,100 and will be
paid on Friday.
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retrieve the URL to cite or link to this pageCase Study 3

P4-55A
(Learning Objective 5: Construct and
use a cash budget) Nathan Farmer, chief financial officer of Bosworth Wireless,
is responsible for the company’s budgeting process. Farmer’s staff is preparing
the Bosworth cash budget for 2013. A key input to the budgeting process is last
year’s state.jpg”>ment
of cash flows, which follows (amounts in thousands):

?
Requirements
1. Prepare the Bosworth Wireless cash budget for 2013.
Date the budget simply “2013” and denote the beginning and ending cash
balances as “beginning” and “ending.” Assume the company expects 2013 to
be the same as 2012, but with the following changes:a. In 2013, the company expects a 15% increase in
collections from customers and a 24% increase in purchases of inventory.b. There will be no sales of investments in 2013.c. Bosworth plans to issue no stock in 2013.d. Bosworth plans to end the year with a cash balance of
$3,550.
Case
Study 2
Due by Sunday of Week 5, 11:59
p.m., Mountain time

P4-57B
(Learning Objectives 2, 4: Explain
the components of internal control; evaluate internal controls) Each of the
following situations reveals an internal control weakness:
Situation
a. In evaluating the internal control
over cash payments of Yankee Manufacturing, an auditor learns that the
purchasing agent is responsible for purchasing diamonds for use in the
company’s manufacturing process, approving the invoices for payment, and signing
the checks. No supervisor reviews the purchasing agent’s work.
Situation
b. Rachel Williams owns an
architectural firm. Williams’ staff consists of 19 professional architects, and
Williams manages the office. Often, Williams’ work requires her to travel to
meet with clients. During the past six months, Williams has observed that when
she returns from a business trip, the architecture jobs in the office have not
progressed satisfactorily. Williams learns that when she is away, two of her
senior architects take over office management and neglect their normal duties.
One employee could manage the office.
Situation
c. Mike Dolan has been an employee of
the City of Southport for many years. Because the city is small, Dolan performs
all accounting duties, in addition to opening the mail, preparing the bank
deposit, and preparing the bank reconciliation.
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?
Requirements
1. Identify the missing internal control characteristic
in each situation.2. Identify each firm’s possible problem.3. Propose a solution to the problem.
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Category

Points

Description

Understanding

10

Demonstrate
a strong grasp of the problem at hand. Demonstrate understanding of how the
course concepts apply to the problem.

Analysis

30

Apply
original thought to solving the business problem. Apply concepts from the
course material correctly toward solving the business problem.

Execution

10

Write your answer clearly and succinctly using
strong organization and proper grammar. Use citations correctly.

Total

50

A
quality paper will meet or exceed all of the above requirements.