In: Civil Engineering
Read the following scenario and answer the question in 5-10 sentences.
You are the CEO of a small company that sells transportation and logistics software. Your company has not been doing well because of competition from larger rivals. You learn of a lucrative opportunity to sell licenses of your software to the Lackria Department of Transportation, a government agency of the nation of Lackria. Closing the deal could save your company from bankruptcy. In an impulsive moment, you meet with a Lackrian government minister and offer her ownership of a luxury lakeside home in exchange for a guaranteed software contract with the Lackrian government. The minister refuses your offer and asks you to leave her office. The next day you regret your decision. Discuss any possible violations of white collar laws.
In: Finance
ABC Corp. provides its employees with a defined benefit pension plan. The company's actuary has provided you with the following information as of December 31, 2020: PBO $ 1,200,000 Fair Value Plan Assets 1,650,000 Current Service Cost 480,000 Interest Cost 48,000 PSC amortization 120,000 Expected and actual return on assets 165,000 In the past, contributions made to the pension plan have been equal to the pension expense for the corresponding year. The company has not made any contribution in 2020. In the statement of financial position as of December 31, 2020, ABC must report
a. a net pension asset of $ 1,650,000
b. a net pension debt of $ 78,000
c. a net pension debt of $ 450,000
d. a net pension asset of $ 450,000
In: Accounting
Mariner Corporation, which manufactures sail boats, ordered dry dock equipment from Brown Corporation. This equipment was built for the specialized needs of Mariner, and could not be used by any other company. Instead of purchasing the equipment, Mariner elected to enter into a long term lease agreement with Brown Co. The lease contract was signed on January 1, 2020. It calls for 12 payments of $15,000, with the first one due on December 31, 2020. The lessor’s implicit interest rate is not known. Mariner’s incremental borrow rate is 8%.
a. Is this lease a finance or operating lease? Explain.
b. Present the journal entry to be made by Mariner when the lease is signed.
c. Show the journal entry that Mariner will make for the December 31, 2020 payment.
In: Accounting
Mariner Corporation, which manufactures sail boats, ordered dry dock equipment from Brown Corporation. This equipment was built for the specialized needs of Mariner, and could not be used by any other company. Instead of purchasing the equipment, Mariner elected to enter into a long term lease agreement with Brown Co. The lease contract was signed on January 1, 2020. It calls for 12 payments of $15,000, with the first one due on December 31, 2020. The lessor’s implicit interest rate is not known. Mariner’s incremental borrow rate is 8%. a. Is this lease a finance or operating lease? Explain. b. Present the journal entry to be made by Mariner when the lease is signed. c. Show the journal entry that Mariner will make for the December 31, 2020 payment.
In: Accounting
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In: Accounting
Parker Corp. develops computer video games for sale. A new development project which began in 2018 reached technological feasibility at the end of Sept. 2019 and the project was available for release to customers early in 2020. Development costs incurred prior to Sept. 30 were $1,600,000 and costs incurred from Oct. 1 to product availability were $1,200,000. Revenues in 2020 from the sale of the new product were $4,000,000 and the company anticipates another $12,000,000 in revenues. The economic life of the software is 3 years.
(a) What amount should Parker capitalize as an intangible asset?
(b) What amount should be amortized in 2020?
(c) At the beginning of 2021, Parker estimates the net realizable value of the software to be $500,000. Prepare any entries required.
In: Accounting
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In: Accounting
Dobbs Company issues 9%, two-year bonds, on December 31, 2018,
with a par value of $104,000 and semiannual interest
payments.
| Semiannual Period-End | Unamortized Discount | Carrying Value | ||||||
| (0) | 12/31/2018 | $ | 6,080 | $ | 97,920 | |||
| (1) | 6/30/2019 | 4,560 | 99,440 | |||||
| (2) | 12/31/2019 | 3,040 | 100,960 | |||||
| (3) | 6/30/2020 | 1,520 | 102,480 | |||||
| (4) | 12/31/2020 | 0 | 104,000 | |||||
Use the above straight-line bond amortization table and prepare
journal entries for the following.
Required:
(a) The issuance of bonds on December 31,
2018.
(b) The first through fourth interest payments on
each June 30 and December 31.
(c) The maturity of the bonds on December 31,
2020.
In: Accounting
In: Accounting