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Tuesday, November 16, 2010

Valix Finacc vol 2 Problem 1-18

Financial Accounting Volume 2 2008 Valix-Peralta
Chapter 1 Problem 1-18


     2008
1.  Cash                                                                                              3,600,000
            Sales                                                                                                               3,600,000

2.  Premiums                                                                                         390,000
            Cash                                                                                                                  390,000

3.  Cash (5,000 x 10)                                                                               50,000
     Premium expense (5,000 x 40)                                                      200,000
            Premiums (5,000 x 50)                                                                                      250,000                                                                                                                               
4.  Premium expense (5,000 x 20)                                                      100,000
            Cash                                                                                                                  100,000

5.  Premium expense (2,000 x 60)                                                      120,000
            Estimated premiums payable                                                                       120,000

     2009
1.  Estimated premiums payable                                                      120,000
            Premium expense                                                                                           120,000
                        Reversing entry.

      Cash                                                                                             4,200,000
            Sales                                                                                                               4,200,000

2.  Premiums                                                                                         580,000
            Cash                                                                                                                  580,000

3.  Cash (9,000 x 10)                                                                               90,000
    Premium expense (9,000 x 40)                                                       360,000
            Premiums (9,000 x 50)                                                                                      450,000

4.  Premium expense (9,000 x 20)                                                      180,000
            Cash                                                                                                                  180,000

5.  Premium expense (3,000 x 60)                                                      180,000
            Estimated premiums payable                                                                       180,000


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