+
ACCT 221 FINAL EXAM (SUMMER 2016)

ACCT 221 FINAL EXAM (SUMMER 2016)

Rating:
Rating
(0)
Author: Joyce Buda
Description:

http://theperfecthomework.com/acct-221-final-exam-summer-2016/

Question 1 (30 points)
 
On December 31, 2014, Rayco Inc. had the following balances (all balances are normal):
Accounts

Amount

Preferred Stock, ($100 par value, 5% noncumulative, 50,000 shares authorized, 10,000 shares issued and outstanding)

$1,000,000

Common Stock ($10 par value, 200,000 shares authorized, 100,000 shares issued and outstanding)

$1,000,000

Paid-in Capital in Excess of par, Common

150,000

Retained Earnings

700,000

The following events occurred during 2014 and were not recorded:
a.     On January 1, Rayco declared a 5% stock dividend on its common stock when the market value of the common stock was $15 per share. Stock dividends were distributed on January 31 to shareholders as of January 25.
b.     On February 15, Rayco reacquired 1,000 shares of common stock for $20 each.
c.     On March 31, Rayco reissued 250 shares of treasury stock for $25 each.
d.     On July 1, Rayco reissued 500 shares of treasury stock for $16 each.
e.     On October 1, Rayco declared full year dividends for preferred stock and $1.50 cash dividends for outstanding shares and paid shareholders on October 15.
f.On December 15, Rayco split common stock 2 shares for 1.
g.     Net Income for 2014 was $275,000.
Requirements:
a.     Prepare journal entries for the transactions listed above.
b.     Prepare a Stockholders' section of a classified balance sheet as of December 31, 2014.
Question 1 options:
Skip Toolbars for .
 
More Insert actions.
 
                   
Show All Components
 
 

Save
Question 2 (5 points)
 
On January 1, 2014, XYZ Company purchased 10,000 shares of the stock of Rayco, and did obtain significant influence. The investment is intended as a long-term investment. The stock was purchased for $90,000, and represents a 30% ownership stake. Rayco made $25,000 of net income in 2014, and paid dividends of $10,000. The price of Rayco's stock increased from $10 per share at the beginning of the year, to $12 per share at the end of the year.
Requirements:
a.     Prepare the January 1 and December 31 general journal entries for XYZ Company.
b.     How much should the XYZ Company report on the balance sheet for the investment in Rayco at the end of 2014?
Question 2 options:
Skip Toolbars for .
 
More Insert actions.
 
                   
Show All Components
 
 

Save


(more)
See More
Try a College Course Free

Sophia’s self-paced online courses are a great way to save time and money as you earn credits eligible for transfer to over 2,000 colleges and universities.*

Begin Free Trial
No credit card required

25 Sophia partners guarantee credit transfer.

221 Institutions have accepted or given pre-approval for credit transfer.

* The American Council on Education's College Credit Recommendation Service (ACE Credit®) has evaluated and recommended college credit for 20 of Sophia’s online courses. More than 2,000 colleges and universities consider ACE CREDIT recommendations in determining the applicability to their course and degree programs.

Tutorial