ACCT 607-Applied Case Assignment #2

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ACCT 607-Applied Case Assignment #2

ACCT
607 Name_____________________

Applied Case Assignment #2
(Chapters 2 and 3)

Refer
to the financial statements included in McCormick & Company, Incorporated’s
(NYSE: MKC; Sparks, MD; hereafter, “McCormick” or “the Company”) 2014 Annual
Report to answer the following questions.

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1.
(a) Did the Company’s “Inventories” increase
or decrease over the last year?

(b)
Were
there more debits or credits to the Company’s inventory accounts during
2014?

2.
(a)
Did the Company’s “Prepaid expenses and other current assets” increase or
decrease over the last year?

(b)
Were
there more debits or credits to the Company’s prepaid expense and other
current asset accounts during 2014?

3.
(a)
Did the Company’s “Trade accounts payable” increase or decrease over the
last year?

(b)
Were
there more debits or credits to the Company’s trade accounts payable
during 2014?

4.
(a) Did the Company’s “Net sales” increase or
decrease over the last year?

(b)
Were
there more debits or credits to the Company’s net sales accounts during 2014?

5.
(a) Did the Company’s “Interest Expense” increase
or decrease over the last year?

(b)
Were
there more debits or credits to the Company’s interest expense accounts
during 2014?

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ACCT
607 Applied Case
Assignment #2 (Chapters 2 and 3)- Continued
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6.
Assume
that, during 2014, the Company purchased an additional $38.3 million in raw
materials inventory for cash. Write the journal entry necessary to record this
transaction.

7.
Assume
that interest of $49.7 million was due and paid for by the Company during 2014.
Write the journal entry necessary to record these transactions.

8.
Assume
that all of the Company’s net sales are “on account.” Write the journal
entry necessary to record total net sales for 2014.

9.
Write
the journal entry necessary to record the Company’s “Selling, general, and
administrative expenses” for 2014, assuming that 90 percent of the expense was
paid for with cash while 10 percent was paid for on credit to regular
suppliers. (2 pts)

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