Halvorson & Co., CPAs, was hired as the auditor for Machinetron, Inc., a company that manufactured highprecision, computer-operated lathes. The owner, Al Trent, hired Halvorson to conduct the upcoming audit and assist with an initial public offering registration with the SEC. Because Machinetron’s machines were large and complex, they were expensive. Each sale was negotiated individually by Trent, and the sales often transpired over several months. Improper recording of one or two machines could represent a material misstatement of the financial statements. The engagement partner in charge of the Machinetron audit was Bob Lehman, who had significant experience auditing manufacturing companies. He recognized the risk for improper recording of sales, and he insisted that his staff confirm all receivables at year end directly with customers. Lehman conducted his review of the Machinetron audit files the same day that Trent wanted to file the company’s registration statement for the initial public stock offering with the SEC. Lehman saw that a receivable for a major sale at year-end was supported by a fax, rather than the usual written confirmation reply. Apparently, relations with this customer were “touchy,” and Trent had discouraged the audit staff from communicating with the customer. At the end of the day, there was a meeting attended by Lehman, Trent, the underwriter of the stock offering, and the company’s attorney. Lehman indicated that a better form of confirmation would be required to support the receivable. After hearing this, Trent blew his stack. Machinetron’s attorney offered to write a letter to Halvorson & Co. stating that in his opinion, a fax had legal substance as a valid confirmation reply. Lehman, feeling tremendous pressure, accepted this proposal and signed off on an unmodified audit opinion. Any comments to Lehman?

Prepare adjusting entries.

A review of the ledger of Monkey Ltd at 30 June 2019 produced the following data relating to the preparation of annual adjusting entries:

1. Prepaid insurance $37260: the entity has separate insurance policies on its buildings and its motor vehicles. Policy B4564 on the building was purchased on 1 January 2018 for $33300. The policy has a term of 3 years. Policy A2958 on the vehicles was purchased on 1 July 2018 for $9510. This policy has a term of 2 years.

2. Subscriptionrevenue received inadvance $135200:theentitybegan sellingmagazine subscriptions on 1 April 2019 on an annual basis. The selling price of a subscription is $130. A review of subscription contracts reveals the following:
Subscription start date Number of subscriptions

1 April 200

1 May 300

1 June 540

1040
The annual subscription is for 12 monthly issues. The June magazine for all of the subscriptions had been delivered to the subscribers at 30 June 2019.

3. Bank loan $100000: the loan was taken out on 1 April at an annual interest rate of 6%.

4. Salaries payable: There are eight salaried employees. Salaries are paid every Friday for the current week. Four employees receive a salary of $1050 each per week, and three employees earn $1350 each per week. 30 June is a Tuesday. Employees do not work on weekends. All employees worked the last 2 days of June.

Required

(a) Prepare the adjusting journal entries at 30 June 2019.

(b) Explain why the business would not recognise the full subscription revenue when the customers sign up for the magazines and pay for the subscription.

uring the past year, Jim Hunt, CEO of KMP Corporation, read about several different frauds occurring in his industry. As a result of these recent frauds, Jim would like to know if fraud is present in his company. As Jim's new assistant, he has asked you to help him determine whether or not fraud is occurring. In preparation for the investigation, Jim has asked you to create a list of five types of fraud symptoms and briefly define and discuss each type.

Question 2

Norio Manufacturing uses powdered plastics (PPS) to manufacture a high-pressure board used in a digital equipment product, Flex 10. Information concerning its operation in June is as follows:

Assume that Norio does not maintain an inventory of materials, so that the amount of materials used is equal to the amount of materials purchased. The cost of PPS in the flexible budget for the number of units manufactured this period (rounded to nearest dollar) is:

Multiple Choice

• $396,720.

• $392,160.

• $554,496.

• $465,120.

• $516,800.

Lucky Company's direct labor information for the month of February is as follows:

The total standard direct labor cost allowed for February, rounded to the nearest dollar, was:

Multiple Choice

• $668,160.

• $682,560.

• $696,000.

• $710,400.

• $720,000.

Assume that TDW Corporation (calendar-year-end) has 2020 taxable income of $656,000 for purposes of computing the §179 expense. The company acquired the following assets during 2020: (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.)

a. What is the maximum amount of §179 expense TDW may deduct for 2020?

b. What is the maximum total depreciation, including §179 expense, that TDW may deduct in 2020 on the assets it placed in service in 2020, assuming no bonus depreciation? (Round your intermediate calculations and final answer to the nearest whole dollar amount.)

Springer Anderson Gymnastics prepared its annual financial statements dated December 31. The company reported its inventory using the LIFO inventory costing method but did not compare the cost of its ending inventory to its market value (replacement cost). The preliminary income statement follows:

Assume that you have been asked to restate the financial statements to incorporate the LCM/NRV rule. You have developed the following data relating to the ending inventory:

Required:

1. Restate the income statement to reflect LCM/NRV valuation of the ending inventory. Apply LCM/NRV on an item-by-item basis.
2. Compare the LCM/NRV effect on each amount that was changed in the preliminary income statement in requirement 1.
   1. LIFO cost, LCM/NRV basis and amount of increase (decrease) for ending inventory, cost of goods sold, gross profit, income from operations, income tax expense, net income

1. C has the following investments it bought during 2012. C still owns the stocks as of 12-31-14.

Original               Fair Value          

Cost        12-31-12       12-31-13       12-31-14

Jungle stock $20,000       $21,000       $24,000       $27,000

Regal stock $40,000       $41,000       $35,000       $42,000

Evan stock $14,000       $15,000       $17,000       $13,000

Leia stock $36,000       $37,000       $55,000

None of the stocks pay C a dividend. On 04-14-14, C sold all of the Leia stock for $54,000.

Assume C only prepares AJEs every December 31. Prepare the entries C should make on:

1. December 31, 2012.
2. December 31, 2013.
3. April 14, 2014.
4. December 31, 2014.

How does one determine a mark-up on a product or service?

Regarding Capital Expenditure Decisions, how does a manager go about evaluating an investment proposal? (from Ch 16 of Managerial Accounting: Creating Value in a Dynamic Business Environment (10th Edition)

Discuss the three common methods for allocating joint product cost.

[LO 8.2 & 8.3] Juno Corporation had ordinary taxable income of $167,000 in the current year before consideration of any of the following property transactions. It sold two blocks of stock held for investment. One yielded a short-term capital gain of $8,000 and the other a long-term capital loss of $14,000. In addition, Juno sold four pieces of machinery for $30,000. It purchased the machines three years ago for $80,000 and claimed $35,000 of depreciation deductions. Juno also sold a building for $400,000 that it had purchased fifteen years ago for $390,000. The depreciation deductions up to the date of sale for the building were $108,000.

1. Determine the amount and character of each gain or loss from the property transactions and Juno Corporation’s taxable income for the current year.
2. How would your answers to (a) change if Juno were a single individual with no dependents and $14,000 of itemized deductions instead of a corporation?
3. How would your answers to (b) change if Juno has $550,000 of ordinary taxable income?

Could you give me an answer fast you can please. Thank You.!

Learning Objectives: CHAPTER 5

1. Account for short-term investments
2. Apply GAAP for proper revenue recognition
3. Account for and control accounts receivable
4. Evaluate collectability using the allowance for uncollectible accounts
5. Account for notes receivable
6. Show how to speed up cash flow from receivables
7. Evaluate liquidity using three new ratios

EXAMPLE OF WHAT I'M LOOKING FOR:

One thing I found challenging was the credits and debits concept from chapter two and matching them up, (common stock would be a cash debit and stock credit). Once I got it down it was one of those "why didn't it make sense to me sooner" moments but at the time I didn't understand and would switch things. How I approached the chapter was really to make sure I understood all the terms, ie notes payable, accounts receivable, etc. Being able to understand them without going back to the textbook made the process a bit faster and overall easier. Another thing was really taking advantage of the internet and that if there was something in the textbook I didn't understand, looking it up on Google and going through different websites and tutorials. While going through the problems I made sure to take as thorough notes as I could with information that I knew would help me moving forward, targeting the problems that were difficult for me. Being able to go back and read through something that was written in a way that made the most sense to me as an individual definitely proved helpful. I also Skyped a friend who is currently enrolled in a financial accounting class and we would work through problems together.

55 What are the functions of management in an organization? Select one: a. Directing, controlling, and decision making b. Planning, controlling, and decision making c. Directing, planning, and decision making d. Planning, directing, and controlling