• What is the responsibilities of management for errors, omissions, material fraud, illegal acts, and provide examples.

Lauer Corporation uses the periodic inventory system and has provided the following information about one of its laptop computers:

During the year, Lauer sold 900 laptop computers.
What was cost of goods sold using the LIFO cost flow assumption?

Which of the following statement is incorrect? The general pattern of cash flows from a bond with a positive coupon rate are the coupon interest payments at regular intervals throughout the life of the bond and the face value payment on the maturity date. A bond's market price depends on its yield to maturity and when the YTM is equal to the coupon rate, the market price equals the face value. Cash payments from preferred stock dividends are scheduled to continue forever. To value businesses, assets, and securities, investors and financial managers use a general valuation model to calculate the future value of the historical net income values and that model unfortunately does not incorporate risk and return, and time value of money concepts. Most of the answers are correct.

Wildhorse Co. has the following inventory data: July 1 Beginning inventory 32 units at $21 $672 7 Purchases 113 units at $22 2486 22 Purchases 16 units at $24 384 $3542 A physical count of merchandise inventory on July 30 reveals that there are 52 units on hand. Using the FIFO inventory method, the amount allocated to cost of goods sold for July is

a. $2366

b. $1112

c. $2430

d. $1176

Hi-Test Company uses the weighted-average method of process costing to assign production costs to its products. Information for the company's first production process September follows. Assume that all materials are added at the beginning of this production process, and that conversion costs are added uniformly throughout the process. Work in process inventory, September 1 (3,500 units, 100% complete with respect to direct materials, 70% complete with respect to conversion; consists of $95,800 of direct materials cost, $97,955 conversion cost $ 193,755 Costs incurred in September Direct materials $ 440,000 Conversion $ 386,000 Work in process inventory, September 30 (8,500 units, 100% complete with respect to direct materials, 30% complete with respect to conversion) ? Units started in September 34,500 Units completed and transferred out 29,500 Required: Compute each of the following using the weighted-average method of process costing.

1. & 2. The number of equivalent units for materials and conversion for the month. 3. & 4. The cost per equivalent unit of materials and conversion for the month. 5. The total cost of goods transferred out. 6. The total cost of ending work in process inventory.

QUESTION 52

1. The XYZ Corporation reported the following balance sheet data for 2018 and 2017:
   

   ​	2018	2017
   Cash	$60,375	$22,955
   Available-for-sale debt securities	​	​
   (not cash equivalents)	15,500	85,000
   Accounts receivable	91,000	68,250
   Inventory	165,000	145,000
   Prepaid insurance	1,500	2,000
   Land, buildings, and equipment	1,260,000	1,125,000
   Accumulated depreciation	(610,000)	(572,000)
   Total assets	$983,375	$876,205
   Accounts payable	$70,340	$148,670
   Salaries payable	20,000	24,500
   Notes payable (current)	25,000	75,000
   Bonds payable	200,000	0
   Common stock	300,000	300,000
   Retained earnings	368,035	328,035
   Total liabilities and shareholders' equity	$983,375	$876,205

   
   Additional information for 2018:
   (1.) Sold available-for-sale debt securities costing $69,500 for $74,000.
   (2.) Equipment costing $20,000 with a book value of $5,000 was sold for $6,000.
   (3.) Issued 6% bonds payable at face value, $200,000.
   (4.) Purchased new equipment for $155,000 cash.
   (5.) Paid cash dividends of $20,000.
   (6.) Net income was $50,000.
   
   Required:
     
   Prepare a statement of cash flows for 2018 in good form using the indirect method for cash flows from operating activities. USE Worksheet Provide in class.

ThreePoint Sports Inc. manufactures basketballs for the Women’s National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 119,500 units.

Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $236,000.

In July, normally a slack manufacturing month, ThreePoint Sports receives a special order for 10,000 basketballs at $27 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.77 per unit because of shipping costs but would not increase fixed costs and expenses.

Partially correct answer iconYour answer is partially correct.

(a) Prepare an incremental analysis for the special order. (Round all per unit computations to 2 decimal places, e.g. 15.25. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

(b) Should ThreePoint Sports Inc. accept the special order?

  

What is the minimum selling price on the special order to produce net income of $5.15 per ball? (Round answer to 2 decimal places, e.g. 15.25.)

8. The accounting records of Jamaican Importers, Inc., at January 1, 2018, included the following:

Assets Investment in IBM common shares $1,895,000 Less: Fair value adjustment (200,000) ____________ $1,695,000

No changes occurred during 2018 in the investment portifolio.

Required: Prepare appropriate adjusting entry(s) at December 31, 2018, assuming the fair value of the IBM common shares was

1. $1,331,000 2. $1,770,000 3. $1,920,000

(If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Record the fair value adjustment assuming the fair value of the IBM common shares was $1,331,000.

Regarding the statute of limitations on additional assessments of tax by the IRS, select the applicable date in each of the following situations. Note: Assume a calendar year individual with no fraud or substantial omissions involved. a. The income tax return for 2018 was filed on March 3, 2019. The three-year statute of limitations will begin to run on . b. The income tax return for 2018 was filed on August 13, 2019. The statute of limitations will begin to run on . c. The income tax return for 2018 was prepared on March 31, 2019, but was never filed. Through some misunderstanding between the preparer and the taxpayer, each expected the other to file the return. The statute of limitations . d. The income tax return for 2018 was never filed because the taxpayer thought no additional tax was due. The statute of limitations .

Suppose that Ramos contributes $5500/year into a traditional IRA earning interest at the rate of 5%/year compounded annually, every year after age 37 until his retirement at age 67. At the same time, his wife Vanessa deposits $3850/year (the amount after paying taxes at the rate of 30%) into a Roth IRA earning interest at the same rate as that of Ramos. Suppose that Ramos withdraws his investment upon retirement at age 67 and that his investment is then taxed at 30%. (Round your answers to the nearest cent.)

(a)How much will Ramos's investment be worth (after taxes) at that time?

(b)How much will Vanessa's investment be worth at that time?

Problem 21-1

Monty Leasing Company agrees to lease machinery to Flounder Corporation on January 1, 2017. The following information relates to the lease agreement.

(Assume the accounting period ends on December 31.)

Part 1:

Calculate the amount of the annual rental payment required. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971.)

My answer for Part 1 (INCORRECT): 133,805

Part 2:

Compute the present value of the minimum lease payments. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971.)

My answer for Part 2 (INCORRECT): 716,561

Part 3:

Prepare the journal entries Monty would make in 2017 and 2018. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places e.g. 58,971.)

To record the lease, on 1/1/17

Dave Solomon is 59 years of age and is planning for his retirement. Dave is a barrister at a leading law firm. His gross salary for the 2019–2020 income year totals $345,000. He has decided to sell the majority of his assets as detailed below:

•  A two-storey residence at St Lucia, described in PoTL end of chapter question 11.6 (a)

•  A painting, described in PoTL end of chapter question 11.6 (b)

•  A parcel of shares, described in PoTL end of chapter question 11.6 (d).

•  A unit in a unit complex that he holds as a residential rental property investment. Davepurchased the unit ‘off plan’ on 1 January 2012 for $350,000. The unit was tenanted from that day. On 1 August 2019, Dave replaced the stove in the unit with a new one that cost him $1,800. He uses the diminishing value method for income tax purposes, and the effective life of the stove is 12 years. Dave sold the unit on 29 February 2020 for $450,000, and applies an apportionment of 0.2% on the sale of depreciating assets as set out in the ATO Rental properties Guide for rental property owners. During the 2019–2020 income year, Dave received rent totalling $16,800. By 30 June 2019, Dave had claimed Div 43 capital works deductions totalling $52,500.

  You are required to:

  Calculate Dave’s taxable income for the 2019–2020 income year. Show all your calculations and provide reasons for your answer, referencing relevant sections of the Income Tax Assessment Acts.

  Question 2

  Your client is a wealthy investor and property owner. Your client provides you with information (as detailed below) about various transactions that took place between 1 July 2019 and 30 June 2020.

1. 1) Warehouse: On 30 April 1985 your client acquired a large parcel of vacant land at Rocklea, a suburb in Brisbane with a significant number of commercial buildings. The purchase price was $180,000 and your client incurred $2,000 in legal fees and $18,000 in transfer duty when purchasing the land. In April 2000 your client signed a contract for the construction of a large warehouse on the land. The final construction cost was $1,000,000. The warehouse is used tohouse your client’s extensive motor vehicle collection. Your client signs the contract to sell the warehouse for $2,200,000 on 1 June 2020. Your client receives the proceeds on 1 July 2020. At the time of sale, an independent valuation revealed the land component of the sale price was $1,200,000. Your client paid $80,000 to insure the warehouse building against flood and fire damage.

2. 2) Boat: Your client owned a luxury motor cruiser that was moored at the Manly Yacht Club. Your client used the boat to go fishing over weekends and to cruise the waters of Moreton Bay. Your client purchased the vessel in late 2006 for $140,000 and sells the vessel on 1 June 2020 to a local boat broker for $90,000. During the period of ownership, your client paid a total of $25,000 in weekly mooring fees to the Manly Yacht club and also incurred $20,000 in repairs on the vessel.

3. 3) Dining Table: Your client acquires a large, hand crafted, English oak dining table for $8,000 in April 2001. The table is very old, having been constructed sometime during 1910 and was used by your client and his family in their formal dining room. Your client auctions the table on 2 April 2020 and it sells for a record price of $50,000. Your client pays $2,000 in auction fees. Duringyour client’s period of ownership they paid $3,000 to insure the table against loss or damage.

4. 4) Your client also has a capital loss carried forward from the 2017–2018 income year of $10,000.

You are required to:

Calculate which amount(s), if any, must be returned as assessable income for the 2019–2020 income year. Show all your calculations and provide reasons for your answer, referencing relevant sections of the Income Tax Assessment Acts.

Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the Cutting process. The following information is available regarding its May inventories: Beginning Inventory Ending Inventory Work in process inventory—Cutting 83,500 80,500 Work in process inventory—Stitching 103,300 72,900 Finished goods inventory 28,100 16,250 The following additional information describes the company's production activities for May. Direct materials Raw materials purchased on credit $ 45,000 Direct materials used—Cutting 22,750 Direct materials used—Stitching 0 Direct labor Direct labor—Cutting $ 17,600 Direct labor—Stitching 70,400 Total factory payroll paid (in cash) 143,800 Factory Overhead (Actual costs) Indirect materials used $ 18,000 Indirect labor used 55,800 Other overhead costs 51,000 Factory Overhead Rates Cutting (150% of direct materials used ) Stitching (120% of direct labor used ) Sales $416,000 rev: 01_28_2020_QC_CS-197408 2. Prepare summary journal entries dated May 31 to record the following production activities during May: (a) raw materials purchases, (b) direct materials usage, (c) indirect materials usage, (d) direct labor costs incurred, (e) indirect labor costs incurred, (f) payment of factory payroll, (g) other overhead costs, (credit Other Accounts), (h) overhead applied, (i) goods transferred from Cutting to Stitching, (j) goods transferred from Stitching to finished goods, (k) cost of goods sold, and (l) sales.