...ACTG 351 Homework #3 (Investments) - Answers 1. Clear Monkey Technologies (CMT) purchased 10-year bonds issued from Banana Bandana’s Inc with a face value of $2,000,000 and a stated rate of 8 percent on January 1, 2013. Interest is payable semi-annually on December 31 and June 30. The market rate of interest for similar bonds is 10 percent. In addition, the market value of the bonds at June 30 and December 31 were $2,037,000 and $1,977,000, respectively. Assume the company prepares financial reports semiannually at June 30 and December 31. a) Assume CMT accounts for these bonds as (1) Held-to-Maturity Securities and (2) Available-for-Sale Securities. Please record the initial purchase of the bonds and the first two interest payments on June 30 and December 31, as well as any adjusting entries on June 30 and December 31 assuming these two classifications. HTM and AFS (PV = 2,000,000*.37689 + 80,000*12.46221): Jan 1 Investment in Bonds 2,000,000 Discount on Bonds Cash Jun 30 Cash 80,000 Discount on Bonds 7,538 Interest Revenue Dec 31 Cash 80,000 Discount on Bonds 7,915 Interest Revenue 249,243 1,750,757 87,538 87,915 Adjusting Entries for AFS: Adjustment = 2,037,000 – 1,758,295 = 278,705 Jun 30 Fair Value Adjustment 278,705 Net Unrealized Gains/Losses – OCI 278,705 Adjustment = (1,977,000 – 1,766,210) - 278,705 = -67,915 Dec 31 Net Unrealized Gains/Losses – OCI 67,915 Fair Value Adjustment 67,915 b) CMT sells the bonds...
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...P18-6 (Long-Term Contract with Interim Loss) On March 1, 2010, Pechstein Construction Company contracted to construct a factory building for Fabrik Manufacturing Inc. for a total contract price of $8,400,000. The building was completed by October 31, 2012. The annual contract costs incurred, estimated costs to complete the contract, and accumulated billings to Fabrik for 2010, 2011, and 2012 are given below. 2010 2011 2012 Contract costs incurred during the year $2,880,000 $2,230,000 $2,190,000 Estimated costs to complete the contract at 12/31 3,520,000 2,190,000 –0– Billings to Fabrik during the year 3,200,000 3,500,000 1,700,000 Instructions (a) Using the percentage-of-completion method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2010, 2011, and 2012. (Ignore income taxes.) (b) Using the completed-contract method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2010, 2011, and 2012. (Ignore incomes taxes.) (a) Computation of Recognizable Profit/Loss Percentage-of-Completion Method 2010 Costs to date (12/31/10) $2,880,000 Estimated costs to complete 3,520,000 Estimated total costs $6,400,000 Percent complete ($2,880,000 ÷ $6,400,000) 45% Revenue recognized ($8,400,000 X 45%) $3,780,000 Costs incurred 2,880,000 Profit recognized in 2010 $ 900,000 2011 Costs...
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...CHAPTER 2 SUGGESTED SOLUTIONS TO QUESTIONS AND PROBLEMS 1. P.V. Ltd. Income Statement for Year 2 Accretion of discount (10% × 286.36) $28.64 P.V. Ltd. Balance Sheet As at Time 2 Financial Asset Cash $315.00 Shareholders’ Equity Opening balance Net income Capital Asset Present value 0.00 $315.00 $315.00 $286.36 28.64 Note that cash includes interest at 10% on opening cash balance of $150. 2. Suppose that P.V. Ltd. paid a dividend of $10 at the end of year 1 (any portion of year 1 net income would do). Then, its year 2 opening net assets are $276.36, and net income would be: Copyright © 2009 Pearson Education Canada 8 P.V. Ltd. Income Statement For Year 2 Accretion of discount (10% × 276.36) $27.64 P.V.’s balance sheet at time 2 would be: P.V. Ltd. Balance Sheet As at Time 2 Financial Asset Cash: (140 + 14 + 150) $304.00 Shareholders’ Equity Opening balance: $276.36 (286.36 - 10.00 dividend) Capital Asset, at Present value 0.00 $304.00 $304.00 Net income 27.64 Thus, at time 2 the shareholders have: Cash from dividend Interest at 10% on cash dividend, for year 2 Value of firm per balance sheet $10.00 1.00 304.00 $315.00 This is the same value as that of the firm at time 2, assuming P.V. Ltd. paid no dividends (see Question 1). Consequently, the firm’s dividend policy does not matter to the shareholders under ideal conditions. It may be worth noting that a Copyright © 2009 Pearson Education Canada 9 crucial requirement here, following from...
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...action where necessary is an example of control and evaluation. Continuous improvement. The management accountant helps identify opportunities for improvement, measures the projected costs and benefits, and reports on the actual outcomes. Decision making. The management accountant helps in the analysis of various alternatives and helps to choose the optimum course of action. 2. a. Planning; expected price and cost information are needed. b. Continuous improvement; cost savings from improved order entry quality. c. Control and evaluation; a performance report triggered the investigation that led to corrective action. d. Planning; forecasting of financial effects is necessary. e. Decision making; accounting must analyze cost-volume-profit effects. f. Continuous improvement; before-and-after costs are needed. g. Decision making; cost information for a keep-or-drop decision is needed. h. Continuous improvement; cost information for setups and materials waste. Problems 1–8 At first glance, this seems simple. Couldn’t John simply mention that Patty had...
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...ACCT 212 Final Exam Ratings: (0)|Views: 472 |Likes: 0 Published by ssdasdasdas See more ACCT 212 Final Exam / FinancialAccounting Click this link to get the tutorial:http://homeworkfox.com/tutorials/business/15355/acct-212-final-exam-financial-accounting/ 6. (TCO 6) Depreciation is a process to allocate the cost of long-life assets to each period'sincome statement and adjusts the value of the asset on the balance sheet. (1) Explain how thestraight-line method is computed (10 points) and (2) provide an example of how this methodcould be used on a new delivery truck purchased for $25,000 to be used for 4 years with asalvage value of $0 for year one only. (15 points) (Points : 25) 7. (TCO 6) To raise capital, companies might sell bonds. This allows them to bypass lenderssuch as banks and go directly to the investing public. Your company is planning to sell bondswith a face amount of $10,000 and paying 5% annual interest. (1) The day the bonds hit themarket, the bond price is quoted at 101.5. What is the bond's selling price? (10 points) and (2)how does the company record this sale in its accounting information system? Use journal entriesto support your answer. (15 points) (Points : 25) 8. (TCO 1) Financial statement analysis is used by investors, creditors, and managers of businessto evaluate the operation and health of the business. This information is in part the basis for decision-making. (1) Identify ratios used to evaluate the profitability of a company (10 points)and...
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...Toronto, Ontario M1K 5G4. Or you can visit our Internet site at www.nelson.com. ALL RIGHTS RESERVED. No part of this work covered by the copyright hereon may be reproduced or used in any form or by any means—graphic, electronic, or mechanical, including photocopying, recording, taping, web distribution or information storage and retrieval systems—without the written permission of the publisher. We wish to extend our gratitude to Ross Meacher for his immaculate attention to detail in the technical editing of this solutions manual. Table of Contents PART I PLANNING FOR THE TRIP Accounting Communication – An Introduction......................... 1 Financial Statements and the Annual Report .......................... 22 CHAPTER 1 CHAPTER 2 PART II GETTING BASIC TRAINING Processing Accounting Information ......................................... 40 Accrual Accounting, Adjusting Entries, and Accounting Cycle ...................................................................................... 74 CHAPTER 3 CHAPTER 4 PART III TOURING THE INCOME STATEMENT CHAPTER 5 CHAPTER 6 PART IV Income Measurement and the Income Statement................... 115 Inventories and Cost of Goods Sold........................................ 130 TOURING THE BALANCE SHEET Liquid Assets and Internal Control........................................... 154 Capital Assets: Property, Plant, and Equipment, Natural Resources, and Intangibles .................................................... 175 Current...
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...1. In the statement of cash flows, increases in a company's capital stock accounts are treated as a "use" rather than as a "source" of cash. FALSE 2. Which of the following would be considered a "use" of cash for purposes of constructing a statement of cash flows? A. an increase in accounts payable. B. an increase in prepaid expenses. C. an increase in accrued liabilities. D. an increase in accumulated depreciation. 3. In a statement of cash flows, a change in prepaid expenses would be classified as: A. an operating activity. B. a financing activity. C. an investing activity. D. a noncash item that need not appear on the statement of cash flows. 4. In a statement of cash flows, a change in the inventories account would be classified as: A. an operating activity. B. a financing activity. C. an investing activity. D. a noncash item that need not appear on the statement of cash flows. 5. An increase in the plant and equipment account of $100,000 over the course of a year would be shown on the company's statement of cash flows prepared under the indirect method as: A. an addition to net income of $100,000 in order to arrive at net cash provided by operating activities. B. a deduction from net income of $100,000 in order to arrive at net cash provided by operating activities. C. an addition of $100,000 under investing activities. D. a deduction of $100,000 under investing activities. 6. Which of the following should be classified as an...
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...BSHS 373 - Week 3 Individual Assignment: Accounting Short-Answer Questions Resource: Financial Management for Human Service Administrators Write 200- to 300-word responses to the following questions: What are the major accounting differences between nonprofit and for-profit organizations? Why are audits becoming increasingly important in the nonprofit sector? Cite at least three reasons. Complete Exercises 4.1–4.3 in Ch. 4 of Financial Management for Human Service Administrator July 1, 20XX–December 31, 20XX (a).July 1, 20XX— Received unrestricted donation check in the amount of $15,000 from the Multnomah County Department of Health and Human Services. Debited Cash $15,000 Credited Revenue $15,000 (b) July 19, 20XX—Paid Great Northwest Insurance Company $9,000 for six more months of fire and liability insurance coverage. Debited Prepaid Insurance $ 9,000 Credited Cash $ 9,000 (c) July 15, 20XX—Paid Portland Arts & Crafts Company $3,000 for additional arts and crafts supplies. Debited Arts & Crafts Supplies $ 3,000 Credited Cash $ 3,000 (d) July 15, 20XX—transferred temporarily restricted funds in the amount of $3,000 from investments to pay for additional arts and crafts supplies. Debited Investments $3,000 Credited Cash $3,000 (e) July 30, 20XX—Paid Oregon Sporting Goods $5,000 for additional recreational equipment. Debited Expense $ 5,000 Credited Cash $5...
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...ACCT 595 Advanced Accounting Final Exam Answers https://homeworklance.com/downloads/acct-595-advanced-accounting-final-exam-answers/ ACCT 595 Advanced Accounting Final Exam Answers FINAL EXAM ADVANCED ACCOUNTING (30 questions x 9 points=270) 1. Gaw Company owns 15% of the common stock of Trace Corporation and used the fair-value method to account for this investment. Trace reported net income of $110,000 for 2011 and paid dividends of $60,000 on October 1, 2011. How much income should Gaw recognize on this investment in 2011? A. $16,500. B. $9,000. C. $25,500. D. $7,500. E. $50,000. 2. Yaro Company owns 30% of the common stock of Dew Co. and uses the equity method to account for the investment. During 2011, Dew reported income of $250,000 and paid dividends of $80,000. There is no amortization associated with the investment. During 2011, how much income should Yaro recognize related to this investment? A. $24,000. B. $75,000. C. $99,000. D. $51,000. E. $80,000. 3. On January 1, 2011, Pacer Company paid $1,920,000 for 60,000 shares of Lennon Co.’s voting common stock which represents a 45% investment. No allocation to goodwill or other specific account was made. Significant influence over Lennon was achieved by this acquisition. Lennon distributed a dividend of $2.50 per share during 2011 and reported net income of $670,000. What was the balance in the Investment in Lennon Co. account found in the financial records of Pacer as of December 31, 2011? ...
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...CHAPTER 19 Accounting for Income Taxes ASSIGNMENT CLASSIFICATION TABLE (BY TOPIC) Topics 1. Reconcile pretax financial income with taxable income. 2. Identify temporary and permanent differences. 3. Determine deferred income taxes and related items— single tax rate. 4. Classification of deferred taxes. 5. Determine deferred income taxes and related items— multiple tax rates, expected future income. 6. Determine deferred taxes, multiple rates, expected future losses. 7. Carryback and carryforward of NOL. 8. Change in enacted future tax rate. 9. Tracking temporary differences through reversal. 10. Income statement presentation. 9 8 16, 17, 18, 14, 21, 22 Questions 1, 13 3, 4, 5 6, 7, 13 2, 3, 4, 5, 6, 7, 9 15 10 Brief Exercises Exercises 1 1, 2, 4, 7, 12, 18, 20, 21 4, 5, 6, 7 Concepts Problems for Analysis 1, 2, 3, 8 2, 3, 4 3, 4, 5 2 1, 3, 4, 5, 7, 8, 3, 4, 8, 9 12, 14, 15, 19, 21, 23, 25 7, 11, 16, 18, 19, 20, 21, 22 2, 13, 16, 17, 18, 20, 22 3, 6 1, 2, 6, 7 10, 11, 12 2, 3, 5 1, 6, 7 10 12, 13, 14 11 9, 10, 23, 24, 25 16 8, 17 5 2, 7 2, 7 5, 6 1, 2, 3, 4, 5, 7, 1, 2, 3, 5, 10, 12, 16, 19, 7, 8, 9 23, 24, 25 7 1, 2, 7 11. Conceptual issues—tax allocation. 1, 2, 8, 19, 21, 22 7 12. Valuation allowance—deferred 8, 19 tax asset. 13. Disclosure and other issues. 15 7, 14, 15, 23, 24, 25 Copyright © 2010 John Wiley & Sons, Inc. Kieso, Intermediate Accounting, 13/e, Solutions Manual (For Instructor Use Only) 19-1 ASSIGNMENT CLASSIFICATION...
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...Instructions: 1. The following pages have answer areas for the chapter quizzes and selected matching exercises from the chapters for this workshop. 2. You will need to use your textbook to find the actual quiz and matching exercises. 3. Note that the answer to the quizzes are shown at the end of the chapter under “AIS Action Solutions”. Check your answers for the chapter quizzes before you upload the completed document. 4. Your instructor will evaluate your submitted work and determine the points you will earn for this activity. Chapter 15 quiz Question No. | Answer | 1. | B | 2. | B | 3. | D | 4. | D | 5. | D | 6. | B | 7. | C | 8. | A | 9. | B | 10. | C | Problem 15.1 Match the terms in the left column with the appropriate definition from the right column. Ignore d and f. Term | Definition letter | 1. Payroll service bureau | E | 2. Payroll clearing account | H | 3. Earnings statement | G | 4. Payroll register | A | 5. Time card | C | 6. Time sheet | B | b b Chapter 16 quiz Question No. | Answer | 1. | B | 2. | B | 3. | C | 4. | B | 5. | D | 6. | C | 7. | A | 8. | A | 9. | B | 10. | C | Problem 16.1 Match the term in the left column with its appropriate definition from the right column: Terms | Definition letter | 1. journal voucher file | D | 2. instance document | K | 3. XBRL element | A | 4. Balanced Scorecard | F | 5. XBRL extension taxonomy | L | 6....
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...Interview Questions & Answers You Need to Know A Production http://breakingintowallstreet.com http://www.mergersandinquisitions.com Copyright 2010 Capital Capable Media LLC. All Rights Reserved. Notice of Rights No part of this book may be reproduced or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. http://breakingintowallstreet.com http://www.mergersandinquisitions.com 2 Table of Contents Introduction .................................................................................................................. 4 Fit / Qualitative Questions ........................................................................................... 6 Analytical / Attention to Detail Questions & Suggested Answers ....................... 7 Background / Personal Questions & Suggested Answers ................................... 10 “Career Changer” Questions & Suggested Answers .......................................... 14 Commitment Questions & Suggested Answers................................................... 17 Culture Questions & Suggested Answers ............................................................ 20 “Future” Questions & Suggested Answers .......................................................... 23 Strengths / Weaknesses Questions & Suggested Answers ................................. 25 Team / Leadership Questions & Suggested Answers ......................
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...professor is giving the lecture. What I do is make sure I mark the title of the section that I am taking the notes on then mark the notes from the section accordingly with other symbols. I find it easy to take notes in my calculus class and in my physics class. In my accounting class the professor does not have a slide show and does not lecture so it is very difficult to take notes in that class. I manage to get notes down in every class so that I can understand the material. Next the book talks about demoting assignments, and how you should choose which assignments to do over others. If you have multiple sources to read for a paper then you should only read the most credible sources so you get the important material and don’t read the same thing multiple times. I have not had a class yet that gives out multiple reading assignments for a paper. The book gives a good a good example that I would use if I did have and assignment that was like that. I think it would make sure I get everything that I need to know. Next the book talks about making a study guide for your classes. They talk about ripping out your notes and putting them together by topic. Then they say to make questions for the study guides so you can answer them to study from. I mark at the top of the...
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...September 14, 2015 was the first time we had our SUSTAIN activity. I remember at that time I am still unfamiliar and confused in some adjusting entries. But along with my groupmates we tried our best to work it out until the end. Every time we had our SUSTAIN activity we make it a point that we always start it and end it with a prayer that somehow God would gave us enough strength and wisdom to accomplish the task given to us. Then we properly start by asking each one in our group what part of the lesson did they not understand every well. Each one of us had different answers to that question and one or two of us know the answer to the question we teach it to the group. And to make our SUSTAIN activity fun while learning we answer all together, share our answered activity and each one of us gives constructive criticism on our work to improved. In the end, our SUSTAIN activities are really a big help in our accounting subject. In a way that we gain more knowledge from each other from the simple constructive criticism my groupmates gave in our work. We learned what we shouldn’t and should do in a given account and what are right and wrong adjusting entries we had made in a given problem. The SUSTAIN activity somehow lessen the hardness of a given task to us because I think the essential key to that are; we teach us a team and we work us a team. And most importantly were having fun while learning in...
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...Vernitra Hilton Forensic Accounting Summer 2014 Interview On June 17 an interview was conducted with the head of Human Resources, Pat Young. The purpose of the interview was to get information from Pat about Jay Rich, a senior manager in the Operations department. The interviewer met with Pat discreetly outside of the office. The interview took place in a classroom in Aderhold at approximately 9:30 P.M. on Tuesday, June 17, 2014. Three people were present; Pat, the interviewer, and an observer. The interviewer and Jay sat side by side at an angle. The interviewer seemed confident and was prepared with a list of questions. Pat seemed a bit nervous and uneasy. The interviewer did not make an introduction. The interviewer began the interview by talking to Pat about himself, the company, and his role in human resources. The interviewer tried to build a rapport with Pat and make him comfortable. However he could not answer most of the questions that were asked in the rapport building phase so the attempt was unsuccessful. The interview continued and Pat was asked general questions about the office’s atmosphere, the different departments, and the structure. He was asked to elaborate on the roles of certain individuals. At this point Pat revealed aspects of Jay’s personal life that was normal. Upon further questioning about controls and the processes Pat grew increasingly nervous. The interviewer continued to ask questions to gain information. Finally Pat revealed that...
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