1.  (1 point) Trenton Travel Agency purchased land for $90,000 cash on December 10, 2014. At December 31, 2014, the land’s value has increased to $93,000. What amount should be reported for land on Trenton’s balance sheet at December 31, 2014?

2.  (2 points) Saylor Enterprises had a capital balance of $168,000 at the beginning of the period. At the end of the accounting period, the capital balance was $198,000. 

a.     Assuming no additional investment or withdrawals during the period, what is the net income for the period? 

b.     Assuming an additional investment of $13,000 but no withdrawals during the period, what is the net income for the period?

3.  (4 points) Transactions for the Jo Smith Company for the month of June are presented below.

Journalize the transactions. 

4.  (6 points) The following accounts are taken from the ledger of Chloe Company at December 31, 2014.

Prepare a trial balance in good form.

5.  (5 points) The Green Thumb Lawn Care Company began operations on April 1. At April 30, the trial balance shows the following balances for selected accounts.

Analysis reveals the following additional data.

Prepare the adjusting entries for the month of April.

6.  (16 points) Natalie owns Cookie Creations.  After journalizing and posting the December transactions and adjusting entries, Natalie prepared the following adjusted trial balance.

Using the information in the adjusted trial balance, do the following.

1. Prepare an income statement for the period ended December 31, 2013.
2. Prepare an owner’s equity statement for the period ended December 31, 2013.
3. Natalie has decided that her year-end will be December 31, 2013. Prepare closing entries as of December 31, 2013.
4. Prepare a post-closing trial balance.

7. (15 points)  Because Natalie has had such a successful first few months, she is considering other opportunities to develop her business. One opportunity is the sale of fine European mixers. The owner of Kzinski Supply Co. has approached Natalie to become the exclusive distributor of these fine mixers in her state. The current cost of a mixer is approximately $575, and Natalie would sell each one for $1,150. Natalie comes to you for advice on how to account for these mixers. Each appliance has a serial number and can be easily identified. The trial balance for cookie creations as on December 31, 2011 is as follows:

Prepare the January transactions.

8.  (21 points)  Natalie is busy establishing both divisions of her business (cookie classes and mixer sales) and completing her business degree. Her goals for the next 11 months are to sell one mixer per month and to give two to three classes per week.

The cost of the fine European mixers is expected to increase. Natalie has just negotiated new terms with Kzinski that include shipping costs in the negotiated purchase price (mixers will be shipped FOB destination). Assume that Natalie has decided to use a periodic inventory system and now must choose a cost flow assumption for her mixer inventory. 

Inventory as on January 31, 2014 represents three deluxe mixer purchased at a unit cost of $545.

The following transactions occur in February to May 2014.

Determine the cost of goods available for sale

Calculate (i) ending inventory, (ii) cost of goods sold, (iii) gross profit, and (iv) gross profit rate under each of the following methods: LIFO, FIFO, and average cost. (Round unit cost calculation in average cost method to 3 decimal places, e.g. 2.225. Round gross profit rate to 2 decimal places, e.g. 25.22%. Round all other answers to 0 decimal places, e.g. 2,525.)