On January 1, 2020, the Hardin Company budget committee has reached agreement on the following data for the 6 months ending June 30, 2020.
Sales units:First quarter 5,000; second quarter 6,900; third quarter 7,300.
Ending raw materials inventory:40% of the next quarter’s production requirements.
Ending finished goods inventory:25% of the next quarter’s expected sales units.
Third-quarter production:7,360 units.
The ending raw materials and finished goods inventories at December 31, 2019, follow the same percentage relationships to production and sales that occur in 2020. 3 pounds of raw materials are required to make each unit of finished goods. Raw materials purchased are expected to cost $6 per pound.
Prepare a production budget by quarters for the 6-month period ended June 30, 2020.
HARDIN COMPANY
Production Budget
For the Six Months Ending June 30, 2020For the Quarter Ending June 30, 2020June 30, 2020
HARDIN COMPANY
Direct Materials Budget
For the Six Months Ending June 30, 2020June 30, 2020For the Quarter Ending June 30, 2020
In: Accounting
Yes, this is a Taxation subject. But the system does not have that category, so selected Accounting.
Zero Corporation is the parent corporation of a consolidated group of corporations that file a consolidated calendar year tax return. Its members include subsidiaries Loss Corporation and Gain Corporation. As of the end of 2019, the consolidated group hada net operating loss carryforward of $5 million. All of the net operating loss carryforward is attributable to losses of Loss Corporation.
On April 30, 2020, Zero Corporation sold all of the stock of Loss Corporation at a purchase price that resulted in a gain of $100,000. Loss corporation’s taxable income for 2020 is $1.2 million, $400,000 of which was earned in the first 4 months of 2020.
For 2020, Zero Corporation earned $2 million of taxable income, including the $100,000 gain on the sale of loss corporation, and Gain corporation earned $4 million of taxable income.
How much of the $5 million net operating loss carryforward will Loss Corporation take with it when it leaves the Zero consolidated group on April 30, 2020? How must Loss corporation report its taxable income for 2020?
In: Accounting
ABC Co.'s balance sheet includes the following asset, at December 31, 2019 after annual depreciation has been recorded:
Equipment....................................................... $120000
Less: accumulated depreciation....................... (40000)
Net Book value ................................................. $80000
After performing its annual review for impairment, ABC Co. obtains the following data:
Equipment’s value in use.................................. $78000
Equipment’s fair value less disposal costs.......... 76000
The remaining useful life of the asset at January 1, 2020 is 8 years. ABC Co. applies straight-line depreciation to its equipment assets and the equipment has a $6000 residual value. ABC Co. uses IFRS.
Required:
In: Accounting
Bridgeport Inc. has a defined benefit plan for its employees. On December 31, 2019 the company’s records showed the following information related to the plan:
| Pension plan assets | $843,000 | |
| Defined benefit obligation | 923,000 |
All employees are expected to receive benefits under the plan. The
company’s actuary provided the following information as at December
31, 2020:
| Current year service cost | $178,000 | |
| Past service benefits, granted July 1, 2020 | 29,000 | |
| Discount rate | 5% | |
| Actual return on assets | 6% | |
| Contributions for the year | 265,000 | |
| Benefits paid to retirees | 125,000 |
New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is incorrect.
Calculate pension expense for Bridgeport Inc. for 2020, assuming ASPE is used.
| Pension expense, 2020 | $Enter your answer in accordance to the question statement |
eTextbook and Media
Assistance Used
New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is incorrect.
Calculate pension expense for Bridgeport Inc. for 2020, assuming IFRS is used.
| Pension expense, 2020 | $Enter your answer in accordance to the question statement |
In: Accounting
Beavis Construction Company was the low bidder on a construction
project to build an earthen dam for $1,730,000. The project was
begun in 2020 and completed in 2021. Cost and other data are
presented below:
| 2020 | 2021 | |||||
| Costs incurred during the year | $ | 476,000 | $ | 1,030,000 | ||
| Estimated costs to complete | 884,000 | 0 | ||||
| Billings during the year | 470,000 | 1,260,000 | ||||
| Cash collections during the year | 370,000 | 1,360,000 | ||||
Assume that Beavis recognizes revenue on this contract over time
according to percentage of completion.
Required:
Compute the amount of gross profit recognized during 2020 and
2021.
Beavis Construction Company was the low bidder on a construction
project to build an earthen dam for $1,730,000. The project was
begun in 2020 and completed in 2021. Cost and other data are
presented below:
| 2020 | 2021 | |||||
| Costs incurred during the year | $ | 476,000 | $ | 1,030,000 | ||
| Estimated costs to complete | 884,000 | 0 | ||||
| Billings during the year | 470,000 | 1,260,000 | ||||
| Cash collections during the year | 370,000 | 1,360,000 | ||||
Assume that Beavis recognizes revenue on this contract over time
according to percentage of completion.
Required:
Compute the amount of gross profit recognized during 2020 and
2021.
In: Accounting
ABC's balance sheet includes the following asset, at December 31, 2019 after annual depreciation has been recorded:
Equipment......................................................... $95000
Less: accumulated depreciation....................... (25000)
Net Book value ................................................. $70000
After performing its annual review for impairment, ABC obtains the following data:
Equipment’s value in use.................................. $58000
Equipment’s fair value less disposal costs.......... 62000
The remaining useful life of the asset at January 1, 2020 is 5 years. ABC. applies straight-line depreciation to its equipment assets and the equipment has a $5000 residual value. ABC uses IFRS.
Required:
In: Accounting
(LO 3, 4 ) (Accounting for an Operating Lease) On January 1, 2020, a machine was purchased for $900,000 by Young Co. The machine is expected to have an 8-year life with no salvage value. It is to be depreciated on a straight-line basis. The machine was leased to St. Leger Inc. for 3 years on January 1, 2020, with annual rent payments of $150,955 due at the beginning of each year, starting January 1, 2020. The machine is expected to have a residual value at the end of the lease term of $562,500, though this amount is unguaranteed. Instructions
A. How much should Young report as income before income tax on this lease for 2020?
B. Record the journal entries St. Leger would record for 2020 on this lease, assuming its incremental borrowing rate is 6% and the rate implicit in the lease is unknown.
C. Suppose the lease was only for one year (only one payment of the same amount at commencement of the lease), with a renewal option at market rates at the end of the lease, and St. Leger elects to use the short-term lease exception. Record the journal entries St. Leger would record for 2020 on this lease.
In: Accounting
In: Accounting
a) Colbert sells 3D printer systems. Recently, Colbert provided a special promotion of zero-interest financing for 2 years on any new 3D printer system. Assume that Colbert sells Lyle Cartright a 3D system, receiving a $5,000 zero-interest-bearing note on January 1, 2020. The cost of the 3D printer system is $4,000. Colbert imputes a 6% interest rate on this zero-interest note transaction. Prepare the journal entry to record the sale on January 1, 2020, and compute the total amount of revenue to be recognized in 2020.
b) Colbert sells 20 nonrefundable $100 gift cards for 3D printer
paper on March 1, 2020. The paper has a standalone selling price of
$100 (cost $80). The gift cards expiration date is June 30, 2020.
Colbert estimates that customers will not redeem 10% of these gift
cards. The pattern of redemption is as follows.
| Redemption Total | |||
| March 31 | 50 | % | |
| April 30 | 80 | ||
| June 30 | 85 | ||
Prepare the 2020 journal entries related to the gift cards at March
1, March 31, April 30, and June 30.
In: Accounting
On January 1, 2020, Nivtop Corp. leased a machine from Nosnah
Inc. The lease agreement calls for
Nivtop to make four annual lease payments of $559,113 each January
1, with the first payment to be
made on January 1, 2020. Nivtop’s incremental borrowing rate is 8%;
this is the same rate Nosnah
used to calculate the lease payments. The fair market value of the
machine is $2,000,000 and its
expected useful life is 5 years. This is a non-specialized
machine.
Nosnah purchased the machine from a vendor on December 31, 2019 for
$1,573,000.
Required
a. List the 5 criteria used to determine whether a lease qualifies
as finance/sales-type or
operating. Review each criterion to determine which (if any) this
lease meets.
b. What type of lease is this for Nivtop?
c. What type of lease is this for Nosnah?
d. Show all of Nivtop’s journal entries relative to this lease
at
1) January 1, 2020
2) December 31, 2020
3) January 1, 2021
e. Show all of Nosnah’s journal entries relative to this lease
at
1) January 1, 2020
2) December 31, 2020
3) January 1, 2021
In: Accounting