UBetcha Corporation acquired 30 percent of the voting stock of Trunks Corporation on January 2, 2019, for $1.6 million in cash. Trunks’ balance sheet and estimated fair values of its assets and liabilities on January 2, 2019 are as follows (in thousands).

In addition to its reported assets, Trunks has unreported franchise agreements (5‑year life) valued at $500,000. Its property and equipment has a 20‑year average remaining life. Trunks reported income of $750,000 and paid no dividends in 2019. Please note that Trunks uses the FIFO inventory method.

Required

1. How many shares of Trunks stock did Ubetcha acquire? Please show calculations so that partial credit can be granted.
2. Prepare a schedule, in good form, that shows the computation of Ubetcha’s equity in Trunks’ net income for 2019. Please show calculations so that partial credit can be granted.

Build the statement of comprehensive income and statement of financial position based on the information given below, as of December 31, 2016. Round numbers to the nearest integer.

The manager of a small hotel resort is considering expansion. He would like to issue bonds but do not quite understand why he may or may not receive what amount of money is stated on the face of the bond but he has to repay what is on the face of the bond. Write a report to the manager explaining the market forces that determine how much money will be collected. Also explain how the interest payment on bonds are calculated and paid. bear in mind that the stated interest rate and the market interest rate are the two interest rate that work together to determine the market price of a bond. write in essay format no log explanation.

Kruger Financing is a boutique investment firm with big ambitions. Masai, their CFO has been featured in multiple financial magazines and newspapers because the company has grown its investment revenues by an average of 25% in the past three years, while the industry average is about 7%.

On April 1, you read an article in the Financial Post Magazine in which Masai explains that he has been able to achieve this level of growth by providing a lot of autonomy to his sales staff. He says, “they are the people on the ground, talking to the clients, and they understand what they need. Businesses these days move fast; waiting a month for a loan to be disbursed could mean a lost opportunity for the businesses and for us. This is why our salespeople have the autonomy to disburse loans of up to $500,000 without going through our central credit department. I hire only the best, and I trust them to know a good opportunity when they see one. The small business loan has actually proven to be one of our most lucrative products.”

Masai goes on to explain that he motivates his sales staff by providing them with a large bonus incentive. For example, a salesperson at his company makes on average $68,000 of base salary, which is much lower than the industry average of $105,000. However, Kruger Financing has a very generous bonus system where employees receive a percentage of the fees earned on each financing transaction they close. With this, a salesperson could have a bonus of up to $150,000, while other companies in the industry normally cap bonuses at $40,000. The bonuses are paid out one month after year-end when all the results for the year have been reviewed.

On July 5, the cover of the Business Journal has a headline “Kruger Financing reports third-quarter loss due to internal fraud.” The article goes on to say that 20 Kruger Financing salespeople had issued loans in the range of $200,000 - $499,000 to themselves and close family members. The default rate on these loans was very high, so Kruger Financing has to take a write-down for its small business loans receivable.

A salesperson in the article was quoted as saying, “It was just hard sometimes to make it through the year on our base salary. You know you have all this money coming with your bonus at year-end, so you think you will just borrow the money and pay it back when you get your bonus. But then the bonus comes and you decide to keep it as you already spent the amount you borrowed and realize you need the bonus money for other expenses. If taking out a small business loan for yourself was so bad, why was it so easy to do?”

Required:

1.       Based on the fraud triangle, explain how each of the three factors (incentive, opportunity, and rationalization) were present, allowing a fraud to take place.

2.       What are some potential strategies and measures that Masai could put in place to reduce the risk of such occurrences happening again?

Explain the three main classifications of a statement of cash flows

Larkspur Company sponsors a defined benefit pension plan. The corporation’s actuary provides the following information about the plan.

(a) Compute the actual return on the plan assets in 2017.

(b) Compute the amount of the other comprehensive income (G/L) as of December 31, 2017. (Assume the January 1, 2017, balance was zero.) (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

(c) Compute the amount of net gain or loss amortization for 2017 (corridor approach).

(d) Compute pension expense for 2017.

Pitman Company is a small editorial services company owned and operated by Jan Pitman. On October 31, 2019, the end of the current year, Pitman Company's accounting clerk prepared the following unadjusted trial balance:

The data needed to determine year-end adjustments are as follows:

Required:

• Unexpired insurance at October 31, $4,560.
• Supplies on hand at October 31, $560.
• Depreciation of building for the year, $3,010.
• Depreciation of equipment for the year, $2,610.
• Unearned rent at October 31, $1,690.
• Accrued salaries and wages at October 31, $2,950.
• Fees earned but unbilled on October 31, $17,300.

1. Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; Depreciation Expense—Equipment; and Supplies Expense.

Feedback

1. Before you begin, identify which adjusting entry goes with which additional account. As you go through each of these, consider the other sides of the adjusting entry transaction and identify related accounts. Keep in mind that you will be making an adjusting entry for each of these that affects at least one income statement account (revenues or expenses) and one balance sheet account (assets or liabilities). In the case of the insurance transaction, you will have to calculate the amount of insurance expired. In the case of supplies, you will need to calculate the amount of supplies used (expense). In the case of rent, you will need to calculate the amount of rent earned (revenue).

1. Journalize the adjusting entries using the following additional accounts, Salaries and Wages Payable, Rent Revenue, Insurance Expense, Depreciation Expense—Building, Depreciation Expense—Equipment, and Supplies Expense.

Please answer questions in the order listed. You do not need to be completely correct, but I do need to see an honest effort. For this post, YOU MUST SHOW YOUR WORK, on any question requiring math. This is to make it so that I can see where exactly where you mis-stepped in your calculation or logic, and/or so that your classmates can learn from you.

5.) MicroServe needs $100,000 to upgrade its warehouse. Dayna, the CEO of MicroServe, thinks they can put off the upgrade for 5 years. The company will make 5 annual deposits to fund this expansion. If the account earns 8% interest, how much does Dayna need to deposit every year? (Round your answers to the nearest dollar and show your work!!!)

6.) How is the carrying value of a bond computed?

7.) When the effective interest rate is higher than the stated interest rate on a bond issue, will the bond sell at a discount or premium? Why?

8.) Explain the difference between the straight-line and the effective interest method of amortization of bond premiums and discounts.

The budget director for Solomon Cleaning Services prepared the following list of expected selling and administrative expenses. All expenses requiring cash payments are paid for in the month incurred except salary expense and insurance. Salary is paid in the month following the month in which it is incurred. The insurance premium for six months is paid on October 1. October is the first month of operations; accordingly, there are no beginning account balances.

Required

1. Complete the schedule of cash payments for S&A expenses by filling in the missing amounts.

2. Determine the amount of salaries payable the company will report on its pro forma balance sheet at the end of the fourth quarter.

3. Determine the amount of prepaid insurance the company will report on its pro forma balance sheet at the end of the fourth quarter.

4. October November December Budgeted S&A Expenses Equipment lease expense $6,800 $6,800 $6,800 Salary expense 5,100 5,600 6,000 Cleaning supplies 2,850 2,760 3,080 Insurance expense 1,400 1,400 1,400 Depreciation on computer 1,900 1,900 1,900 Rent 1,900 1,900 1,900 Miscellaneous expenses 710 710 710 Total operating expenses $20,660 $21,070 $21,790 Schedule of Cash Payments for S&A Expenses Equipment lease expense $6,800 $6,800 $6,800 Prior month’s salary expense, 100% 0 5,100 5,600 Cleaning supplies 2,850 2,760 3,080 Insurance premium 0 0 Depreciation on computer 0 0 0 Rent 1,900 1,900 1,900 Miscellaneous expenses 710 710 710 Total disbursements for operating expenses $20,660 $17,270 $18,090

Middler Corporation, a manufacturer of electronics and communications systems, uses a service department charge system to charge profit centers with Computing and Communications Services (CCS) service department costs. The following table identifies an abbreviated list of service categories and activity bases used by the CCS department. The table also includes some assumed cost and activity base quantity information for each service for October. CCS Service Category Activity Base Budgeted Cost Budgeted Activity Base Quantity Help desk Number of calls $96,750 2,500 Network center Number of devices monitored 660,250 9,500 Electronic mail Number of user accounts 71,000 7,100 Handheld technology support Number of handheld devices issued 142,400 8,900 One of the profit centers for Middler Corporation is the Communication Systems (COMM) sector. Assume the following information for the COMM sector: The sector has 2,000 employees, of whom 60% are office employees. Almost all office employees (90%) have a computer on the network. 95 percent of the employees with a computer also have an e-mail account. The average number of help desk calls for October was 1 calls per individual with a computer. There are 290 additional printers, servers, and peripherals on the network beyond the personal computers. All the nonoffice employees have been issued a handheld device. a. Determine the service charge rate for the four CCS service categories for October. Round your answers to two decimal places. CCS Service Category Service Charge Rate Help desk $ Per call Network center $ Per device monitored Electronic mail $ Per user or e-mail account Handheld technology support $ Per device b. Determine the charges to the COMM sector for the four CCS service categories for October. October charges to the COMM sector: Help desk charge $ Network center charge $ Electronic mail charge $ Handheld technology support $

1. Hickory Furniture Company paid for the following costs during the month of May:

Hickory sold $32,000 of the inventory and has agreed to pay warranty expenses for its customers. These are expected to be $1,600 and occur evenly over the next four months (i.e., starting in June).

What is the amount of Hickory’s cash-basis expenses for the month of May?

Multiple Choice

• $33,600

• $50,000

• $42,400

• $51,600

2. The residual approach to allocate transaction prices to multiple performance obligations in a contract is appropriate when:

Multiple Choice

• None of the goods and services included in the contract are not sold on a stand-alone basis.

• None of the answer choices are correct.

• The stand-alone price of all of the goods or services is known.

• The stand-along price of one or more of the goods or services is highly variable or uncertain.

3. A patient of Dr. Jones presents his Medicare card after his appointment. The total charge for the services was $100; however, Medicare will pay only $60 for this service and the patient is to pay $20. Acceptance of the patient’s Medicare insurance creates a contract:

Multiple Choice

• for payment of $60 and a price concession of $40.

• for $20 and an $80 discount or price concession.

• for payment of $100, regardless of what Medicare will pay.

• for payment of $80 and a $20 discount or price concession.

Mercury Bag Company produces cases of grocery bags. The managers at Mercury are trying to develop budgets for the upcoming quarter. The following data have been gathered. Projected sales in units 1,960 cases Selling price per case $ 240 Inventory at the beginning of the quarter 150 cases Target inventory at the end of the quarter 100 cases Direct labor hours needed to produce one case 2 hours Direct labor wages $ 10 per hour Direct materials cost per case $ 8 Variable manufacturing overhead cost per case $ 6 Fixed overhead costs for the upcoming quarter $ 220,000

a. Using the above information, develop Mercury's sales forecast in dollars and production schedule in units.

b. What is Mercury's budgeted variable manufacturing cost per case?

c. Prepare Mercury's manufacturing cost budget.

d. What is the projected ending value of the Inventory account?

Mercury Bag Company produces cases of grocery bags. The managers at Mercury are trying to develop budgets for the upcoming quarter. The following data have been gathered.

Since the beginning of the financial year, Large Mart has spent $100,000 to create a new computer program that is able to automatically summarise the content of a university lecture without any manual work being required by students. Large Mart decided to undertake this project because its programming department knew it had the technical knowledge to develop the program successfully, and college students had previously expressed strong interest to purchase such a program. This week, the program has been completed and it will go on sale next week. The Large Mart accounting department is unsure if the $100,000 that was spent on the creation of the program is regarded as a development or research cost. As a result, the accounting department is also unsure how to account for the monies spent on the creation of the program.

1) Provide a detailed discussion of the difference between development and research expenditures, and explain what criteria must be used to distinguish between development and research expenditures in the Australian financial accounting environment.  

2) Determine if the creation of the program represents development or research expenditure, using a detailed evaluation of the criteria you have identified in question 1, and explain how the funds spent on the creation of the program should be accounted for

Tastyfreeze Company is a small producer of fruit-flavored frozen desserts. For many years, its products have had strong regional sales because of brand recognition; however, other companies have begun marketing similar products in the area, and price competition has become increasingly important. Dan O’Mara, the company’s controller, is planning to implement a standard cost system for Tastyfreeze and has gathered considerable information from his coworkers about production and materials requirements for Tastyfreeze’s products. Dan believes that the use of standard costs will allow the company to improve cost control, make better pricing decisions, and enhance strategic management. Tastyfreeze’s most popular product is raspberry sherbet. The sherbet is produced in 10-gallon batches, each of which requires 6 quarts of good raspberries and 10 gallons of other ingredients. The fresh raspberries are sorted by hand before they enter the production process. Because of imperfections in the raspberries and normal spoilage, 1 quart of berries is discarded for every 4 accepted. The standard direct labor time for sorting to obtain 1 quart of acceptable raspberries is 5 minutes. The acceptable raspberries are then blended with the other ingredients; blending requires 15 minutes of direct labor time per batch. After blending, the sherbet is packaged in quart containers. Dan has gathered the following price information: Tastyfreeze purchases raspberries for $6 per quart. All other ingredients cost $2.90 per gallon. Direct labor is paid at the rate of $20 per hour. The total packaging cost (labor and materials) for the sherbet is $0.95 per quart. Required: 1. Develop the standard cost for the direct cost components of a 10-gallon batch of raspberry sherbet. For each direct cost component, the standard cost should identify the following: (Do not round intermediate calculations. Round your answers to 2 decimal places.) a. Standard quantity. b. Standard rate (or price). c. Standard cost per 10-gallon batch. Next Visit question mapQuestion 5 of 6 Total 5 of 6 Prev

The following transactions occurred during March 2021 for the Wainwright Corporation. The company owns and operates a wholesale warehouse.

1. Issued 48,000 shares of common stock in exchange for $480,000 in cash.
2. Purchased equipment at a cost of $58,000. $19,000 cash was paid and a notes payable to the seller was signed for the balance owed.
3. Purchased inventory on account at a cost of $114,000. The company uses the perpetual inventory system.
4. Credit sales for the month totaled $210,000. The cost of the goods sold was $88,000.
5. Paid $6,800 in rent on the warehouse building for the month of March.
6. Paid $7,800 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2021.
7. Paid $88,000 on account for the merchandise purchased in 3.
8. Collected $73,000 from customers on account.
9. Recorded depreciation expense of $2,800 for the month on the equipment.

Post the above transactions to the below T-accounts. Assume that the opening balances in each of the accounts is zero. Prepare a trial balance from the ending account balances