Assume all sales are collected in the year of sale and all purchases, operating expenses, and taxes are paid during the year incurred.The company decided at the beginning of the current year to reduce the depreciable lives of all of its existing fixed assets by 5 years.
No disclosure of this situation was found in the financial statements.Of comparable importance, although it arises less frequently, is the question of whether the depreciation method should be based on consideration of the assets as units, as a group, or as having a composite life.
P repare closing entries for Homer Winslow Co. on December 31, 2017. (Omit explanations.).Manual Abt Electronics Tips Tricks Upgrading Your Stock Srt 8 Kicker 2008 L7 Xub 4in1 C01temp Sonic Electronix Only.Explain how convertible debentures are handled for purposes of EPS computations.Discuss the appropriate treatment in the income statement for the following items.P3-7 (L03,4,5) (Adjusting Entries and Financial Statements) Rolling Hills Golf Inc. was organized on July 1, 2017.
A ssume that you are the auditor of Weller, Inc. and that you have been asked to explain the appropriate accounting and related disclosure necessary for each of these items.P repare correcting general journal entries required at December 31, 2016, assuming that the books have not been closed.I ndicate the effect of each of these errors on working capital, current ratio (assume that the current ratio is greater than 1), retained earnings, and net income for the current year and the subsequent year.A Wall Street Journal article noted that Apple reported higher income than its competitors by using a more aggressive policy for recognizing revenue on future upgrades to its products.Situation 2: Subsequent to the date of a set of financial statements but prior to the issuance of the financial statements, a company enters into a contract that will probably result in a significant loss to the company.As the chief accountant for Brockman Guitar, it is your job to tell Barbara what you think of her plan.The goods were not included in the physical count, but the invoice was included in accounts payable at December 31, 2017.If interest rates increase, what happens to the fair value of the receivable.The Autotain MEGA is the LARGEST headrest DVD player monitor on.
CA9-4 (LCNRV) Steele Corporation purchased a significant amount of raw materials inventory for a new product that it is manufacturing.Situation 2: Hopkins Co. decides in January 2018 to change from FIFO to weighted-average pricing for its inventories.However, the accountant noted that the following errors had been made.Torville that the two schedules are based on different assumptions concerning the flow of inventory costs, i.e., FIFO and LIFO.Management estimates that about 50% of the projects of the research and development group will result in long-term benefits (i.e., at least 10 years) to the corporation.Depreciation Expense, Service Revenue, Accounts Receivable, Insurance Expense, Interest Expense, Interest Payable, Prepaid.Vice President: If we sell the Casino Knights Division, it seems ridiculous to segregate the results of the sale in the income statement.A basic requirement in preparing accurate income statements is to record costs and revenues properly.
E18 -6 (LO2) (Determine Transaction Price) Bill Amends, owner of Real Estate Inc., buys and sells commercial properties.A total of 800,000 shares were issued to complete the merger.By April 30, all bondholders had exercised their conversion to common stock as of the interest payment date.A physical count on May 31, 2017, shows 2,000 units of part M.O. on hand. Using the FIFO method, what is the cost of part M.O. inventory at May 31, 2017.Presented below are a number of questions related to these qualitative characteristics and underlying constraint.When accounts become delinquent for more than two payment periods, usually 60 days, income is recognized only as payments are received.In doing her review, she noted differences between tax and book depreciation methods that permitted Acme to realize a sizable deferred tax liability on its balance sheet.
The equipment should have been depreciated over 5 years, with no salvage value.Amortize premium or discount on interest dates and at year-end. (Assume that no reversing entries were made.).On September 15, Dickinson sold the wholesale operations to Rogers Company.Howie will be taxed on each of these payments at a rate of 25%.Because there was no beginning inventory for 2016 and no markdowns during.However, Bonanza continued to use the FIFO inventory method for internal accounting and management purposes.CA2-6 (Expense Recognition Principle) An accountant must be familiar with the concepts involved in determining earnings of a business entity.
On May 1, 2017, Economy signs a contract with YellowCard for 300 appliance bundles to be delivered and installed in one of its new buildings.The equipment is estimated to have a service life of 8 years and no residual value.As a result, we urge the FASB to expose its new proposal for public comment, following the established due process procedures that are essential to acceptance of its standards, and providing sufficient time to affected parties to understand and assess the new approach.Board on accounting and reporting practices for research and development costs.Identify any differences in income statement format between these two companies.CA2-7 (Expense Recognition Principle) Accountants try to prepare income statements that are as accurate as possible.