The List of Accounts Presented Below Is from the Accounting

question 51

Essay

The list of accounts presented below is from the accounting records of Hoosier Momma Promotions on September 30,Year 1.Assume that each account balance is normal,and present them in proper trial balance format.
$\begin{array}{lr}\text { Cash } & \$ 4,200 \\\text { Short-term Investments } & 13,000 \\\text { Accounts Receivable } & 4,500 \\\text { Inventory } & 23,000 \\\text { Land } & 90,000 \\\text { Building } & 700,000 \\\text { Furniture } & 450,000 \\\text { Equipment } & 281,700\\ \text { Accounts Payable } & 7,200 \\\text { Salaries Payable } & 4,100 \\\text { Unearned Revenue } & 17,000 \\\text { Interest Payable } & 2,000 \\\text { Notes Payable } & 70,000 \\\text { Common Shares } & 460,000 \\\text { Retained Earnings } & 977,000 \\\text { Sales } & 158,000\\ \text { Cost of Goods Sold } & 78,000 \\\text { Salaries Expense } & 24,000 \\\text { Rent Expense } & 6,000 \\\text { Insurance Expense } & 1,000 \\\text { Depreciation Expense } & 11,000 \\\text { Utility Expense } & 900 \\\text { Dividends } & 8,000\end{array}$

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Definitions:

FIFO Method

The "first-in, first-out" inventory costing method, where the costs of the earliest goods purchased or produced are the first to be expensed.

Periodic System

An inventory system in which updates to inventory levels are made on a periodic basis rather than continuously.

Rising Prices

An economic situation where the general level of prices for goods and services increases over a period of time.

Costing Method

It is an accounting approach to determine the cost of a product or service, including methods such as standard costing, activity-based costing, and others.