At 30 June 2015, the financial statements of McMaster Ltd showed a building with a cost (net of GST) of $312,000 and accumulated depreciation of $158,000. The business uses the straight-line method to depreciate the building. When acquired, the building's useful life was estimated at 30 years and its residual value at $62,000. On 1 January 2016, McMaster Ltd made structural improvements to the building costing $98,000 (net of GST). Although the capacity of the building was unchanged, it is estimated that the improvements will extend the useful life of the building to 40 years, rather than the 30 years originally estimated. No change is expected in the residual value.

1. Calculate the number of years the building had been depreciated to 30 June 2015
2. Prepare the general journal entry to record the cost of the structural improvements on 1 January 2016
3. Prepare the general journal entry to record the building’s depreciation expense for the year ended 30 June 2016. Assume no depreciation had been recorded since 30 June 2018.

Campbell Glass Company makes stained glass lamps. Each lamp that it sells for $315.10 per lamp requires $16.70 of direct materials and $70.30 of direct labor. Fixed overhead costs are expected to be $190,500 per year. Campbell Glass expects to sell 1,000 lamps during the coming year. Selling and administrative expenses were zero.

Required

1. Prepare income statements using absorption costing, assuming that Campbell Glass makes 1,000, 1,250, and 1,500 lamps during the year.

2. Prepare income statements using variable costing, assuming that Campbell Glass makes 1,000, 1,250, and 1,500 lamps during the year.

Prepare income statements using absorption costing, assuming that Campbell Glass makes 1,000, 1,250, and 1,500 lamps during the year. (Do not round intermediate calculations.)

Prepare income statements using variable costing, assuming that Campbell Glass makes 1,000, 1,250, and 1,500 lamps during the year. (Do not round intermediate calculations.)

The following information was drawn from the year-end balance sheets of Jordan Trading Company:

Additional information regarding transactions occurring during 2017:

1. Investment securities that had cost $5,130 were sold. The 2017 income statement contained a loss on the sale of investment securities of $610.

2. Equipment with a cost of $46,000 was purchased.

3. The income statement showed a gain on the sale of equipment of $5,300. On the date of sale, accumulated depreciation on the equipment sold amounted to $8,800.

4. A building that had originally cost $168,000 was demolished.

5. Land that had cost $25,800 was sold for $20,600.

Required

1. Determine the amount of cash flow for the purchase of investment securities during 2017.

2. Determine the amount of cash flow from the sale of investment securities during 2017.

3. Determine the cost of the equipment that was sold during 2017.

4. Determine the amount of cash flow from the sale of equipment during 2017.

5. Determine the amount of cash flow for the purchase of buildings during 2017.

6. Determine the amount of cash flow for the purchase of land during 2017.

7. Prepare the investing activities section of the 2017 statement of cash flows.

Determine the amount of cash flow for the purchase of investment, sale of investment, cost of the equipment that was sold, sale of equipment, purchase of buildings and purchase of land during 2017.

Prepare the investing activities section of the 2017 statement of cash flows. (Cash outflows should be indicated with minus sign.)

Options:

• Gain on sale of equipment
• Loss on sale of buildings
• Paid to purchase buildings
• Paid to purchase equipment
• Paid to purchase investment securities
• Paid to purchase land
• Proceeds from sale of equipment
• Proceeds from sale of investment securities
• Proceeds from sale of land
• Proceeds to purchase investment securities

Benson Brands, Inc. Benson, presents its statement of cash flows using the indirect method. The following accounts and corresponding balances were drawn from Benson’s 2017 and 2016 year-end balance sheets:

The 2017 income statement is shown below:

Required

1. Prepare the operating activities section of the statement of cash flows using the direct method.

2. Prepare the operating activities section of the statement of cash flows using the indirect method.

Prepare the operating activities section of the statement of cash flows using the direct method. (Cash outflows should be indicated with minus sign.)

Prepare the operating activities section of the statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)

As part of an effort to increase cash and reduce the cash cycle, the connections between the AP and AR processes are often scrutinized to see if the company is fully billing what it is entitled to bill … to this end, folks sometimes ask about "unbilled" and how long that "unbilled" has remained in that state … is number for "unbilled" best derived from what has been declared as revenue under 606 but not yet billed or as what has been billed out to vendors if vendors are involved in the performance?

Bracken, Louden, and Menser, who share profits and losses in a ratio of 5:3:3, respectively are partners in a home decorating business that has not been able to generate the income the partners had hoped for. They have decided to liquidate the business and have sold all assets except for their decorating equipment. All partnership liabilities have been settled and all the partners are personally insolvent. The decorating equipment has a book value of $51,100, and the partners have capital account balances as follows: Bracken, capital $ 35,700 Louden, capital 5,200 Menser, capital 10,200 Required: Determine the amount of cash each partner will receive as a liquidating distribution if the decorating equipment is sold for the amount stated in each of the following independent cases: (Do not round intermediate calculations.)

a. $39,000

b. $29,100

c. $18,100

Direct Materials Variances

Bellingham Company produces a product that requires 14 standard pounds per unit. The standard price is $8.5 per pound. If 4,200 units required 57,000 pounds, which were purchased at $8.76 per pound, what is the direct materials (a) price variance, (b) quantity variance, and (c) total direct materials cost variance? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Direct Labor Variances

Bellingham Company produces a product that requires 7 standard hours per unit at a standard hourly rate of $22.00 per hour. If 2,600 units required 18,600 hours at an hourly rate of $21.56 per hour, what is the direct labor (a) rate variance, (b) time variance, and (c) total direct labor cost variance? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Mastery Problem: Budgeting

LearnCo

LearnCo manufactures and sells one product, an abacus for classroom use, with two models, the Basic model and the Deluxe model. The company began operations on January 1, 20Y1, and is planning for 20Y2, its second year of operations, by preparing budgets from its master budget.

The company is trying to decide how many units to manufacture, how much it might spend on direct materials and direct labor, and what their factory overhead expenses might be. In addition, the company is interested in budgeting for selling and administrative costs, and in creating a budgeted income statement showing a prediction of net income for 20Y2.

You have been asked to assist the controller of LearnCo in preparing the 20Y2 budgets.

Sales Budget

The sales budget often uses the prior year’s sales as a starting point, and then sales quantities are revised for various factors such as planned advertising and promotion, projected pricing changes, and expected industry and general economic conditions. LearnCo has completed reviewing its prior year’s sales and has prepared the following sales budget.

After reviewing LearnCo’s sales budget, you note that three numbers have been omitted. The company’s controller has told you that the units sold for the Basic and Deluxe models are expected to be the same. Fill in the missing amounts.

Production Budget

The production budget should be integrated with the sales budget to ensure that production and sales are kept in balance during the year. The production budget estimates the number of units to be manufactured to meet budgeted sales and desired inventory levels.

You note that LearnCo has omitted six numbers from the following production budget and fill in the missing amounts. You may need to use numbers from the sales budget you prepared.

Direct Materials Purchases Budget

The direct materials purchases budget should be integrated with the production budget to ensure that production is not interrupted during the year.

Before you make any changes to the budget, you review the information on the following Direct Materials Data Table and enter the units to be produced from the Production Budget. After scanning the direct materials purchases budget (which follows the Direct Materials Data Table), you observe that LearnCo has omitted quite a few numbers from the budget. Fill in the missing amounts. You may need to use numbers from the Direct Materials Data Table, or from the sales budget and production budget you prepared. When required, round your answers to the nearest dollar.

Direct Labor Cost Budget

Direct labor needs from the direct labor cost budget should be coordinated between the production and personnel departments so that there will be enough labor available for production.

Before you make any changes to the budget, you review the information on the following Direct Labor Data Table and enter the units to be produced from the Production Budget. After scanning the Direct Labor Cost Budget (which follows the Direct Labor Data Table), you observe that LearnCo has omitted quite a few numbers from the budget. Fill in the missing amounts. You may need to use numbers from the Direct Labor Data Table, or from the sales budget, production budget, and direct materials purchase budget you prepared. When required, round your answers to the nearest dollar.

Factory Overhead Cost Budget

The factory overhead cost budget should be integrated with the production budget to ensure that production is not interrupted during the year. This budget may be supported by departmental schedules, which normally separate factory overhead costs into fixed and variable costs so that department managers may monitor and evaluate costs during the year. For simplicity, LearnCo has not separated costs in this manner.

After reviewing the following factory overhead cost budget, you note that LearnCo has completed the budget with the exception of one amount. Fill in the missing amount.

Problem 3-02A a-c, d1-d3 (Video) (Part Level Submission)

The Tamarisk, Inc. opened for business on May 1, 2020. Its trial balance before adjustment on May 31 is as follows.

In addition to those accounts listed on the trial balance, the chart of accounts for Tamarisk, Inc. also contains the following accounts and account numbers: No. 142 Accumulated Depreciation—Buildings, No. 150 Accumulated Depreciation—Equipment, No. 212 Salaries and Wages Payable, No. 230 Interest Payable, No. 619 Depreciation Expense, No. 631 Supplies Expense, No. 718 Interest Expense, and No. 722 Insurance Expense.

Other data:

Journalize the adjusting entries on May 31. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,275.)

**NEED ASSISTANCE WITH REQ 4,5,6

Milo Company manufactures beach umbrellas. The company is preparing detailed budgets for the third quarter and has assembled the following information to assist in the budget preparation:

1. The Marketing Department has estimated sales as follows for the remainder of the year (in units):

The selling price of the beach umbrellas is $15 per unit.

2. All sales are on account. Based on past experience, sales are collected in the following pattern:

Sales for June totaled $555,000.

3. The company maintains finished goods inventories equal to 15% of the following month’s sales. This requirement will be met at the end of June.

4. Each beach umbrella requires 4 feet of Gilden, a material that is sometimes hard to acquire. Therefore, the company requires that the ending inventory of Gilden be equal to 50% of the following month’s production needs. The inventory of Gilden on hand at the beginning and end of the quarter will be:

5. Gilden costs $0.80 per foot. One-half of a month’s purchases of Gilden is paid for in the month of purchase; the remainder is paid for in the following month. The accounts payable on July 1 for purchases of Gilden during June will be $66,920.

Required:

1. Calculate the estimated sales, by month and in total, for the third quarter.

2. Calculate the expected cash collections, by month and in total, for the third quarter.

3. Calculate the estimated quantity of beach umbrellas that need to be produced in July, August, September, and October.

4. Calculate the quantity of Gilden (in feet) that needs to be purchased by month and in total, for the third quarter.

5. Calculate the cost of the raw material (Gilden) purchases by month and in total, for the third quarter.

6. Calculate the expected cash disbursements for raw material (Gilden) purchases, by month and in total, for the third quarter.

Dean and Brittany are both 32 years old and have a three-year old child, Eddie. They came to your office and asked you to build a financial statement analysis for 2017, based on the information provided.

• Assets: They have $2,350 in their checking account, $12,320 in their money market account, $6,250 in a mutual fund investment account, $4,890 in the 529 plan for Eddie, and $25,000 in their retirement accounts. Their house has a fair market value of $195,320. Dean owns a 2015 Honda with a fair market value of $18,670, and Brittany owns a 2012 MiniCooper valued at $24,450. The furniture and household goods had an estimated value of $15,420; they have sporting equipment estimated at $2,430.
• Liabilities: Dean and Brittany owed $6,180 on their Visa credit cards when they came to you, and they usually just pay the minimum required payment for credit card balance. The balance on their home mortgage was $136,000 at the end of 2015; their auto loan balance for Dean’s car was $17,470, and for Brittany’s car was $19,000. Brittany had a student loan which balance was $10,390.
• Their total annual gross income was $98,207; total dedicated annual expenses were $55,085, and discretionary expenses were 3,808.
• Their savings last year included $4,890 towards their retirement savings accounts (no employer match); $47 reinvested money market investment interest; and $1,890 contribution to a 529 plan for Eddie.

Based on the above the information (total 5 points):

1) Make a balance sheet for Dean and Brittany (total asset-0.5 pt; total liabilities-0.5 pt; net worth-1 pt), and

2) Report the following financial ratios: (a) Current Ratio (1 pt); (b) Emergency Fund Ratio (1 pt); and (c) Savings Ratio (1 pt).

Please Show your calculations in excel with functions THANK YOU!

Match these 10 frauds/schemes with the corresponding definitions/scenarios.   On the homework assessment, the definitions will have multiple choice options.

Skimming, payroll fraud scheme, lapping, illegal gratuities, investment scam, expense scheme, disbursement fraud, check tampering, asset misappropriation, billing scheme.

1. Rick Grimes is a real person. He is a friend of Sam who works at Parry Corporation. Sam adds Rick to the payroll of Parry Corporation. Rick does not work at Parry Corporation but he does cash the checks he receives from Parry Corp. and splits the money with Sam.
2. Ted is a City Commissioner. He negotiated a land deal with a group of private investors. After the deal was approved, Ted and his girlfriend were rewarded with a free trip to Cancun Mexico, all expenses paid.
3. Theft that is committed by stealing receipts, stealing assets on hand, or committing some type of disbursement fraud.
4. An employee who works the cash register enters a “no sale” on their cash register so that it appears a sale is being rung up to the customer and other observers. The employee is stealing the customer’s payment.
5. Having an organization pay for something it shouldn’t pay for or pay too much for something it purchases.
6. An individual promises a high paying dividend on an investment product they are selling. However, instead of investing the funds received, the individual pays “dividends” to initial investors using the amounts “invested” by subsequent investors/victims.
7. An employee at a company manufactures fake receipts using his computer and laser printer. The employee seeks reimbursement on these invented purchases.
8. This is a method of concealing the theft of cash designated for accounts receivable by crediting one account while abstracting money from a different account. The process is continuously repeated to avoid detection.
9. Sam is trusted employee at Pear Corp. He has possession of the company’s checks. He makes a check payable to himself. He fraudulently affixes the signature of an authorized maker (signer).
10. Lilly works at Pear Corporation. She is in a position that approves invoices for payment. She creates a shell company called Hooks. She opens a bank account for Hooks. She authorizes payments for invoices submitted from Hooks.

At the beginning of his current tax year David invests $12,000 in original issue U.S. Treasury bonds with a $10,000 face value that mature in exactly 10 years. David receives $700 in interest ($350 every six months) from the Treasury bonds during the current year and the yield to maturity on the bonds is 5 percent.

a. How much interest income will he report this year if he elects to amortize the bond premium?

b. How much interest will he report this year if he does not elect to amortize the bond premium?