Chapter 14

Scope and Sequence

14-1 Distributing Corporate Earnings to Stockholders

• • Financial Information 

  • Stockholders' equity accounts used by a corporation 

  • Declaring and paying dividend

14-2 Beginning an 8-Column Work Sheet for a Merchandising Business

• • Entering and recording a trial balance on a work sheet

  • Planning adjustments on a work sheet

  • Analyzing and recording supplies adjustments

  • Analyzing and recording a prepaid insurance adjustment

14-3 Planning and Recording a Merchandise Inventory Adjustment

• • Merchandise Inventory

  • Analyzing and recording a merchandise inventory adjustment

  • Analyzing an adjustment when ending inventory is greater than beginning inventory

14-4 Planning and Recording an Allowance for Uncollectible Accounts Adjustment

• • Allowance method of recording losses from uncollectible accounts

  • Estimating uncollectible accounts expense

  • Analyzing and recording an uncollectible accounts expense adjustment

14-5 Planning and Recording Depreciation Adjustments

• • Categories of assets

  • Calculating depreciation expense and book value

  • Analyzing and recording depreciation expense adjustments

14-6 Calculating Federal Income Tax and Completing a Work Sheet

• • Federal income tax expense adjustment

  • Calculating federal income tax

  • Recording the federal income tax adjustment

  • Completing a work sheet

  • A completed 8-column work sheet

  • A 10-column work sheet

Chapter Objectives

• • Define accounting terms related to distributing dividends and preparing a work sheet for a merchandising business

  • Identify accounting concepts and practices related to distributing dividends and preparing a work sheet for a merchandising business

  • Journalize the declaration and payment of a dividends

  • Begin a work sheet for a merchandising business

  • Plan work sheet adjustments for merchandise inventory,  supplies, prepaid expenses, uncollectible accounts, and depreciation

  • Calculate federal income tax and plan the work sheet adjustment for federal income tax

  • Complete a work sheet for a merchandising business

Vocabulary 

• • Retained Earnings

  • Dividends

  • Board of Directors

  • Declaring a Dividend

  • Merchandise Inventory

  • Uncollectible Accounts

  • Allowance Method of Recording Losses from Uncollectible Accounts

  • Book Value

  • Book Value of Accounts Receivable

  • Current Assets

  • Plant Assets

  • Depreciation Expense

  • Estimated Salvage Value

  • Straight-line Method of Depreciation

  • Accumulated Depreciation 

  • Book Value of a Plant Asset