If a company writes off a Bad Debt Account at the end of a year and subsequently recovers the written off amount the following year, what should it do to record this transaction – explain?
In: Accounting
A company has the option to purchase a building for $500,000 at the begining of year one. This building is larger than needed; however, the excess space can be sublet for 12 years at a net annual rental of $8,000. Rental payments will be received at the end of each year and the risk associated with this investment is 10%. Calculate the present value of the investment in the building.
In: Accounting
|
You are engaged in the audit of the financial statements of Holman Corporation for the year ended December 31, 20X6. The accompanying analyses of the Property, Plant, and Equipment and related accumulated depreciation accounts have been prepared by the chief accountant of the client. You have traced the beginning balances to your prior year’s audit working papers. |
| HOLMAN CORPORATION | ||||||||
| Analysis of Property, Plant, and Equipment | ||||||||
| and Related Accumulated Depreciation Accounts | ||||||||
| Year Ended December 31, 20X6 | ||||||||
| Final |
Assets |
Per Ledger | ||||||
| Description | 12/31/X5 | Additions | Retirements | 12/31/X6 | ||||
| Land | $ | 443,500 | $ | 6,400 | $ | 449,900 | ||
| Buildings | 134,000 | 24,500 | 158,500 | |||||
| Machinery and equipment | 399,000 | 43,200 | $ | 31,500 | 410,700 | |||
| $ | 976,500 | $ | 74,100 | $ | 31,500 | $ | 1,019,100 | |
| Final |
Accumulated Depreciation |
Per Ledger | ||||||
| Description | 12/31/X5 | Additions* | Retirements | 12/31/X6 | ||||
| Buildings | $ | 67,000 | $ | 5,850 | $ | 72,850 | ||
| Machinery and equipment | 179,550 | 41,935 | 221,485 | |||||
| $ | 246,550 | $ | 47,785 | $ | 294,335 | |||
*Depreciation expense for the year.
|
All plant assets are depreciated on the straight-line basis (no residual value taken into consideration) based on the following estimated service lives: building, 25 years; and all other items, 10 years. The company’s policy is to take one half-year’s depreciation on all asset additions and disposals during the year. |
| Your audit revealed the following information: |
| 1. |
On April 1, the company entered into a 10-year lease contract for a die casting machine, with annual rentals of $6,400 payable in advance every April 1. The lease is cancelable by either party (60 days' written notice is required), and there is no option to renew the lease or buy the equipment at the end of the lease. The estimated service life of the machine is 10 years with no residual value. The company recorded the die casting machine in the Machinery and Equipment account at $43,200, the present value at the date of the lease, and $2,160 applicable to the machine has been included in depreciation expense for the year. |
| 2. |
The company completed the construction of a wing on the plant building on June 30. The service life of the building was not extended by this addition. The lowest construction bid received was $23,100, the amount recorded in the Buildings account. Company personnel constructed the addition at a cost of $20,200 (materials, $8,900; labor, $6,900; and overhead, $4,400). |
| 3. |
On August 18, $6,400 was paid for paving and fencing a portion of land owned by the company and used as a parking lot for employees. The expenditure was charged to the Land account. |
| 4. |
The amount shown in the machinery and equipment asset retirement column represents cash received on September 5 upon disposal of a machine purchased in July 20X2 for $58,000. The chief accountant recorded depreciation expense of $4,300 on this machine in 20X6. |
| 5. |
Harbor City donated land and a building appraised at $240,000 and $540,000, respectively, to Holman Corporation for a plant. On September 1, the company began operating the plant. Since no costs were involved, the chief accountant made no entry for the above transaction. |
| Required: | |
|
Prepare the adjusting journal entries that you would propose at December 31, 20X6, to adjust the accounts for the above transactions. Disregard income tax implications. The accounts have not been closed. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round any division. Round your answers to the nearest dollar amount.) |
|
Journal entry worksheet
Record the entry to correct the April 1, 20X6 entry for the lease of a die casting machine under a ten-year, cancelable lease having no renewal or purchase option.
Note: Enter debits before credits.
|
In: Accounting
You are a reporter working in a year in the past and writing an article about a new vaccine. Your article will take place in the year the vaccine was invented (or approved for use on the general public) and should be written as if it were a current event. It is your job to deliver information about the new vaccine and create public awareness. Choose one vaccine and list the date and person(s) or company responsible for creating it. Describe the disease the vaccine was developed to prevent including the microorganism that causes it. Provide a short background about the severity and effects of the disease at the “current” time period. Describe the way the vaccine was invented or discovered. Relay to your readers the exact way the vaccine works to create a protective result against the microorganism. Communicate the risks, benefits, the method of vaccination, and contraindications of the vaccine. Your readers trust you to give them objective information. At the same time, the vaccine is likely to benefit the general public and your readers may need some gentle persuasion to follow through with immunization.
In: Nursing
In: Statistics and Probability
The Harris Company is the lessee on a four-year lease with the
following payments at the end of each year:
| Year 1: | $ | 12,500 |
| Year 2: | $ | 17,500 |
| Year 3: | $ | 22,500 |
| Year 4: | $ | 27,500 |
An appropriate discount rate is 7 percentage, yielding a present
value of $66,314.
a-1. If the lease is an operating lease, what will
be the initial value of the right-of-use asset?
a-2. If the lease is an operating lease, what will
be the initial value of the lease liability?
a-3. If the lease is an operating lease, what will
be the lease expense shown on the income statement at the end of
year 1?
a-4. If the lease is an operating lease, what will
be the interest expense shown on the income statement at the end of
year 1? (Leave no cells blank – be certain to enter “0”
wherever required.)
a-5. If the lease is an operating lease, what will
be the amortization expense shown on the income statement at the
end of year 1? (Leave no cells blank – be certain to enter
“0” wherever required.)
b-1. If the lease is a finance lease, what will be
the initial value of the right-of-use asset?
b-2. If the lease is a finance lease, what will be
the initial value of the lease liability?
b-3. If the lease is a finance lease, what will be
the lease expense shown on the income statement at the end of year
1? (Leave no cells blank – be certain to enter “0” wherever
required.)
b-4. If the lease is a finance lease, what will be
the interest expense shown on the income statement at the end of
year 1? (Round your answer to the nearest dollar
amount.)
b-5. If the lease is a finance lease, what will be
the amortization expense shown on the income statement at the end
of year 1? (Round your answer to the nearest dollar
amount.)
In: Accounting
Assume the payments will be made at the end of each year (The first payment is made on December 31, 2019.); recalculate your answer for case # 3. Calculate the annual payment required. Show your final answer and show all the work to support your answer. Prepare the amortization table for the loan using the format covered in class.
Case #3 info: On January 1, 2019, ABC Corp. borrowed $81,000 by signing an installment loan. The loan will be repaid in 20 equal payments, one at the beginning of each year. The first payment is made on January 1, 2017. The interest rate for the loan is 10%.
In: Accounting
GDP is a measure of a country's value of final goods and service for a year. Comparing the GDP of all countries shows how productive these countries are in relationship to each other. Please use two paragraphs, a) and b) to answer the questions. For paragraph a), look at the ranking of the U.S compared to the other countries listed. Pick one of the countries (each student must pick a different country) and discuss whether the GDP for that country means the country is better off or worse off than the U.S. Is there a better measure of a country's well-being than GDP? For paragraph b), compare the Better Life Index for the U.S. to other countries in the study. Why is the U.S. lower in this measure than some other countries and does that mean anything important concerning wealth and welfare? I'm sure everyone has an opinion about whether a government should address the welfare (in general) of its citizens. Do you believe it's the responsibility of the government to help those less fortunate? Will helping those in need lead to an improvement in future productivity? Please be respectful of the views of your fellow students since this is a volatile subject. Don't forget to do a spell check and reread your posts prior to posting them.
In: Economics
The Johnsons will buy a house for $348,000.00. They will get a 30 year loan for 4.63% annual interest rate compounded monthly. Calculate the payment needed for this loan and put your answer in F6. Then fill out the amortization schedule for the first year. After the table is done find the total interest paid in the first year and the total paid to principle for the first year. ON EXCELL!!
In: Economics
On December 1 of the current year, the following accounts and their balances appear in the ledger of Latte Corp., a coffee processor:
| Preferred 2% Stock, $50 par (240,000 shares authorized, 86,000 shares issued) | $4,300,000 |
| Paid-In Capital in Excess of Par—Preferred Stock | 516,000 |
| Common Stock, $30 par (1,000,000 shares authorized, 415,000 shares issued) | 12,450,000 |
| Paid-In Capital in Excess of Par—Common Stock | 1,245,000 |
| Retained Earnings | 184,170,000 |
At the annual stockholders’ meeting on March 31, the board of directors presented a plan for modernizing and expanding plant operations at a cost of approximately $11,000,000. The plan provided (a) that a building, valued at $3,360,000, and the land on which it is located, valued at $945,000, be acquired in accordance with preliminary negotiations by the issuance of 123,000 shares of common stock, (b) that 38,800 shares of the unissued preferred stock be issued through an underwriter, and (c) that the corporation borrow $3,700,000. The plan was approved by the stockholders and accomplished by the following transactions:
| May 11 | Issued 123,000 shares of common stock in exchange for land and a building, according to the plan. |
| 20 | Issued 38,800 shares of preferred stock, receiving $52 per share in cash. |
| 31 | Borrowed $3,700,000 from Laurel National, giving a 5% mortgage note. |
Journalize the entries to record the May transactions. Refer to the Chart of Accounts for exact wording of account titles.
| CHART OF ACCOUNTS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Latte Corp. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| General Ledger | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Journalize the entries to record the May transactions. Refer to the Chart of Accounts for exact wording of account titles.
All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback.
PAGE 10
JOURNAL
ACCOUNTING EQUATION
Score: 77/112
| DATE | DESCRIPTION | POST. REF. | DEBIT | CREDIT | ASSETS | LIABILITIES | EQUITY | |
|---|---|---|---|---|---|---|---|---|
|
1 |
||||||||
|
2 |
||||||||
|
3 |
||||||||
|
4 |
||||||||
|
5 |
||||||||
|
6 |
||||||||
|
7 |
||||||||
|
8 |
||||||||
|
9 |
In: Accounting