Integrated Physicians & Associates, an investor-owned company,
had the following general ledger account balances at the end of
2015: Gross patient service revenue (total charges) Contractual
discounts and allowances to third-party payers Charges for charity
(indigent) care Estimated provision for bad debts $975,000 250,000
100,000 50,000 a. Construct the revenue section of Integrated
Physicians & Associates’ income statement for the year ended
December 31, 2015. Suppose the 2015 contractual discounts and
allowances balance reported above is understated by $50,000. In
other words, the correct balance should be $300,000. Assuming a 40
percent income tax rate, what would be the effect of the
misstatement on Integrated Physicians & Associates’ 2015
reported: 1. Net patient service revenue? 2. Total expenses,
including income tax expense? 3. Net income? For each item (1–3),
indicate whether the balance is overstated, understated, or not
affected by the misstatement. If overstated or understated,
indicate by how much

In 2021, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2023. Information related to the contract is as follows:

Westgate recognizes revenue over time according to percentage of completion.

4. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the following costs incurred and costs to complete information. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign.)

In 2021, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2023. Information related to the contract is as follows:

Westgate recognizes revenue over time according to percentage of completion.

5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the following costs incurred and costs to complete information. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign.)

1. You own 15 barrels of oil that you can sell this year or next year and is otherwise worthless. The price of abarrelofoilineachyearisp0 =21−1q0 andp0 =17−1q1 withadiscountfactorof.95andacostof

   1 dollars per barrel. Find the optimal extraction plan, the prices in each period and total discounted net revenue.

2. You own 15 barrels of oil that you can sell this year, next year, or the year after next year and is otherwise worthless. The price of a barrel of oil in each year is pi = 14 − 1 qi with a discount factor of .96 and no costs.

   2

   Find the optimal extraction plan, the prices in each period and total discounted net revenue.

3. You own 30 barrels of oil that you can sell this year or next year and is otherwise worthless. The price of a barrel of oil in each year is pi = 6 − qi with a discount factor of .92 and no costs. Find the optimal extraction plan, the prices in each period and total discounted net revenue.

1. An error in the physical count of goods on hand at the end of the current period resulted in a $2,500 overstatement of the ending inventory. The effect of this error in the current period is to:

a) overstate cost of goods sold

b) understate cost of goods available for sale.

c) understate gross profit.

d) overstate net income.

e) understate ending retained earnings.

2. Under the equity method of accounting for investments in common stock, when a dividend is received from the investee company:

a) the Dividend Revenue account is credited.

b) the Investments account is increased.

c) no entry is necessary.

d) the Dividend Revenue account is debited.

e) the Investments account is decreased.

3. A purchase of common stock of Ajax Corporation for $14,000 was sold three months later for $15,000. The entry to record the sale would include a:

a) debit to Cash of $14,000.

b) credit to Gain on Sale of Investments of $1,000.

c) credit to Investments of $15,000.

d) credit to Interest Revenue of $1,000.

e) debit to Gain on Sale of Investments of $1,000.

Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,200 pounds of oysters in August. The company’s flexible budget for August appears below: Quilcene Oysteria Flexible Budget For the Month Ended August 31 Actual pounds (q) 7,200 Revenue ($4.05q) $ 29,160 Expenses: Packing supplies ($0.35q) 2,520 Oyster bed maintenance ($3,500) 3,500 Wages and salaries ($2,000 + $0.25q) 3,800 Shipping ($0.65q) 4,680 Utilities ($1,260) 1,260 Other ($460 + $0.01q) 532 Total expense 16,292 Net operating income $ 12,868 The actual results for August appear below: Quilcene Oysteria Income Statement For the Month Ended August 31 Actual pounds 7,200 Revenue $ 26,800 Expenses: Packing supplies 2,690 Oyster bed maintenance 3,360 Wages and salaries 4,210 Shipping 4,410 Utilities 1,070 Other 1,152 Total expense 16,892 Net operating income $ 9,908 Required: Calculate the company’s revenue and spending variances for August.

The following are three independent, unrelated sets of facts relating to accounting changes.

For each of the situations described, provide the information indicated below.

Type of accounting change.

Manner of reporting the change under current generally accepted accounting principles, including a discussion where applicable of how amounts are computed.

Effect of the change on the balance sheet and income statement.

1. You are The Chief Finance Officer for your company Blue Label Inc. and a Fellow of the local accountancy body, The Zambia Institute of Chartered Accountants (ZICA).   You have just received an invitation from ZICA requesting you to be one of the presenters at a workshop organized by the institute to fulfill its mandate of enhancing professional competence in its members amid many new standards that have evolved in the recent past. Your specific role will be to talk about the evolution of IFRS 15 Revenue from Contracts with Customers. The workshop organizer has asked you to send your presentation beforehand for review by a relevant official.

Required:

Write briefing notes to the organizer that explain the following in relation to IFRS 15 Revenue from Contracts with Customers:

1. The five step revenue recognition criteria (using simple illustrations as far as possible)

2. Recognition and measurement requirements for:

1. sale and repurchase arrangements;
2. Consignment inventory and
3. Bill and hold arrangements (use simple illustrations as far as possible).

Solomon Company, which expects to start operations on January 1, 2018, will sell digital cameras in shopping malls. Solomon has budgeted sales as indicated in the following table. The company expects a 15 percent increase in sales per month for February and March. The ratio of cash sales to sales on account will remain stable from January through March.

1. Complete the sales budget by filling in the missing amounts.

2. Determine the amount of sales revenue Solomon will report on its first quarter pro forma income statement.

• Required A
• Required B

Complete the sales budget by filling in the missing amounts. (Round intermediate calculations and final answers to 2 decimal places.)

Determine the amount of sales revenue Solomon will report on its first quarter pro forma income statement. (Round intermediate calculations and final answer to 2 decimal places.)

To study how social media may influence the products consumers​ buy, researchers collected the opening weekend box office revenue​ (in millions of​ dollars) for 23 recent movies and the social media message rate​ (average number of messages referring to the movie per​ hour). The data are available below. Conduct a complete simple linear regression analysis of the relationship between revenue​ (y) and message rate​ (x).

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