Question
In: Accounting
Nicole organized a new corporation. The corporation began business on April 1 of year 1. She...
Nicole organized a new corporation. The corporation began
business on April 1 of year 1. She made the following expenditures
associated with getting the corporation started: (Leave no
answer blank. Enter zero if applicable.)
| Expense | Date | Amount | |
| Attorney fees for articles of incorporation | February 10 | $ | 39,500 |
| March 1 – March 30 wages | March 30 | 6,250 | |
| March 1 – March 30 rent | March 30 | 2,750 | |
| Stock issuance costs | April 1 | 26,000 | |
| April 1 – May 30 wages | May 30 | 15,625 | |
a. What is the total amount of the start-up costs and organizational expenditures for Nicole's corporation?
b. What amount of the start-up costs and organizational expenditures may the corporation immediately expense in year 1 (excluding the portion of the expenditures that are amortized over 180 months)?
c. What amount can the corporation deduct as amortization expense for the organizational expenditures and for the start-up costs for year 1 (not including the amount determined in part b)? (Round intermediate calculations to 2 decimal places and final answer to the nearest whole dollar amount.)
Solutions
ekkarill92 answered 2 years agoRelated Solutions
Nicole organized a new corporation. The corporation began business on April 1 of year 1. She...
Nicole organized a new corporation. The corporation began
business on April 1 of year 1. She made the following expenditures
associated with getting the corporation started: (Leave no
answer blank. Enter zero if applicable.)
Expense
Date
Amount
Attorney fees for articles of incorporation
February 10
$
32,000
March 1 – March 30 wages
March 30
4,500
March 1 – March 30 rent
March 30
2,000
Stock issuance costs
April 1
20,000
April 1 – May 30 wages
May 30
12,000...
Nicole organized a new corporation. The corporation began business on April 1 of year 1. She...
Nicole organized a new corporation. The corporation began
business on April 1 of year 1. She made the following expenditures
associated with getting the corporation started: (Leave no
answer blank. Enter zero if applicable.)
Expense
Date
Amount
Attorney fees for articles of incorporation
February 10
$
37,000
March 1 – March 30 wages
March 30
5,350
March 1 – March 30 rent
March 30
2,500
Stock issuance costs
April 1
31,000
April 1 – May 30 wages
May 30
13,375...
Nicole organized a new corporation. The corporation began business on April 1 of year 1. She...
Nicole organized a new corporation. The corporation began
business on April 1 of year 1. She made the following expenditures
associated with getting the corporation started: (Leave no answer
blank. Enter zero if applicable.) Expense Date Amount Attorney fees
for articles of incorporation February 10 $ 39,000 March 1 – March
30 wages March 30 6,100 March 1 – March 30 rent March 30 2,700
Stock issuance costs April 1 27,000 April 1 – May 30 wages May 30
15,250...
Nicole organized a new corporation this year. The corporation began business on April 1, 2019. She made the...
Nicole organized a new corporation this year. The
corporation began business on April 1, 2019. She made
the following expenditures associated with getting the corporation
started:
Expense
Date
Amount
Attorney fees for articles of incorporation
February 10
$32,000
March 1 – March 30 wages
March 30
$4,500
March 1 – March 30 rent
March 30
$2,000
Stock issuance costs
April 1
$20,000
April 1 – May 30 wages
May 30
$12,000
What is the total amount of the start-up costs expenditures?
What...
Lucy organized a new corporation. The corporation began business on May 1, 2019. She made the...
Lucy organized a new corporation. The corporation began business
on May 1, 2019. She made the following expenditures associated with
getting the corporation started:
Expense Date Amount
Legal drafting of corporate charter February 2 $28,000
Rental (April 2019) April 30 6,000
Organizational meeting April 30 3,500
Salaries and Wages (April 2019) April 30 8,000
Rental (May 2019) May 31 12,000
REQUIRED:
i What is the total amount of the start-up costs and
organizational expenditures for Lucy's corporation
IL. What amount...
Tunic Corporation was organized on April 1 of the current year, with an authorization of 25,000...
Tunic Corporation was organized on April 1 of the current year,
with an authorization of 25,000 shares of 6%, $50 par value
preferred stock and 200,000 shares of $5 par value common stock.
During April, the following transactions affecting stockholders’
equity occurred.
April 1 Issued 80,000 shares of common stock
at $15 per share.
Issued 2,000 shares of common stock to attorneys and promoters
in exchange for their services in organizing the corporation. The
services were valued at $31,000.
Issued...
1. The business began on April 1, 2016 2. The period under consideration is April 1,...
1. The business began on April 1, 2016
2. The period under consideration is April 1, 2016 - April 30,
2016.
3. For the purposes of this assignment, ignore the effects of
income tax, property tax, sales tax, and payroll tax
. 4. Straight-line depreciation method is used.
5. On April 30, 2016, the company had $150 of Office Supplies
and $850 of Lawn & Garden Supplies on hand.
6. The telephone bill for April 2016 for $260 was received...
XYZ is a calendar-year corporation that began business on January 1, 2020. For the year, it...
XYZ is a calendar-year corporation that began business on
January 1, 2020. For the year, it reported the following
information in its current-year audited income statement. Notes
with important tax information are provided below. Use Exhibit
16-6.
XYZ corp.
Book
Income
Income statement
For current year
Revenue from sales
$
40,000,000
Cost of Goods Sold
(27,000,000
)
Gross profit
$
13,000,000
Other income:
Income from investment in corporate stock
300,000
1
Interest income
20,000
2
Capital gains (losses)
(4,000
)...
XYZ is a calendar-year corporation that began business on January 1, 2018. For the year, it...
XYZ is a calendar-year corporation that began business on
January 1, 2018. For the year, it reported the following
information in its current-year audited income statement. Notes
with important tax information are provided below. Use Exhibit
16-6.
XYZ corp.
Book
Income
Income statement
For current year
Revenue from sales
$
40,000,000
Cost of Goods Sold
(27,000,000
)
Gross profit
$
13,000,000
Other income:
Income from investment in corporate stock
300,000
1
Interest income
20,000
2
Capital gains (losses)
(4,000
)...
XYZ is a calendar-year corporation that began business on January 1, 2018. For the year, it...
XYZ is a calendar-year corporation that began business on
January 1, 2018. For the year, it reported the following
information in its current-year audited income statement. Notes
with important tax information are provided below. Use Exhibit
16-6.
XYZ corp.
Book
Income
Income statement
For current year
Revenue from sales
$
40,000,000
Cost of Goods Sold
(27,000,000
)
Gross profit
$
13,000,000
Other income:
Income from investment in corporate stock
300,000
1
Interest income
20,000
2
Capital gains (losses)
(4,000
)...
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