In 2018, Gray Corporation, a calendar year C corporation, has a $75,000 charitable contribution carryover from a gift made in 2013. Gray is contemplating a gift of land to a qualified charity in either 2018 or 2019. Gray purchased the land as an investment five years ago for $100,000 (current fair market value is $250,000). Before considering any charitable deduction, Gray projects taxable income of $1,000,000 for 2018 and $1,200,000 for 2019.

Should Gray make the gift of the land to charity in 2018 or in 2019?

If an amount is zero, enter "0".

a. If Gray makes the gift of the land to charity in 2018:
The amount of the deduction would be $ and the corporation is able to use $ of the $75,000 carryover. Therefore, Gray has a $ carryover to 2019, of which $ would be used in 2019, leaving
$ to be carried over to 2020.

b. If Gray waits and makes the gift of the land to charity in 2019:
The corporation would have $ carryover from 2013 and $ carryover from 2018. In 2019, the amount of the deduction would be $ and the excess of $ would carryover to 2020.

c. Therefore, Gray should make the gift of the land to charity in ????.

On January 1, 2018, Essence Communications issued $610,000 of its 10-year, 6% bonds for $457,961. The bonds were priced to yield 10%. Interest is payable semiannually on June 30 and December 31. Essence Communications records interest at the effective rate and elected the option to report these bonds at their fair value. On December 31, 2018, the market interest rate for bonds of similar risk and maturity was 9%. The bonds are not traded on an active exchange. The increase in the market interest rate was due to a 1% increase in general (risk-free)interest rates. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Using the information provided, estimate the fair value of the bonds at December 31, 2018. 2. to 4. Prepare the journal entry to record interest on June 30, 2018 (the first interest payment), on December 31, 2018 (the second interest payment) and to adjust the bonds to their fair value for presentation in the December 31, 2018, balance sheet.

Diaz Company issued $80,000 face value of bonds on January 1, 2018. The bonds had a 6 percent stated rate of interest and a ten-year term. Interest is paid in cash annually, beginning December 31, 2018. The bonds were issued at 98. The straight-line method is used for amortization. Required a. Use a financial statements model like the one shown below to demonstrate how (1) the January 1, 2018, bond issue and (2) the December 31, 2018, recognition of interest expense, including the amortization of the discount and the cash payment, affect the company’s financial statements. Use + for increase, − for decrease, and NA for not affected. b. Determine the carrying value (face value less discount or plus premium) of the bond liability as of December 31, 2018. c. Determine the amount of interest expense reported on the 2018 income statement. d. Determine the carrying value (face value less discount or plus premium) of the bond liability as of December 31, 2019. e. Determine the amount of interest expense reported on the 2019 income statement.

Problem 17-6 Determine the PBO; plan assets; pension expense; two years [LO17-3, 17-4, 17-6]

Stanley-Morgan Industries adopted a defined benefit pension plan on April 12, 2018. The provisions of the plan were not made retroactive to prior years. A local bank, engaged as trustee for the plan assets, expects plan assets to earn a 10% rate of return. The actual return was also 10% in 2018 and 2019.* A consulting firm, engaged as actuary, recommends 4% as the appropriate discount rate. The service cost is $150,000 for 2018 and $280,000 for 2019. Year-end funding is $160,000 for 2018 and $170,000 for 2019. No assumptions or estimates were revised during 2018.

*We assume the estimated return was based on the actual return on similar investments at the inception of the plan and that, since the estimate didn’t change, that also was the actual rate in 2019.

Required:

Calculate each of the following amounts as of both December 31, 2018, and December 31, 2019: (Enter your answers in thousands (i.e., 200,000 should be entered as 200).)

Fantasy Fashions had used the LIFO method of costing inventories, but at the beginning of 2018 decided to change to the FIFO method. The inventory as reported at the end of 2017 using LIFO would have been $17 million higher using FIFO.

Retained earnings reported at the end of 2016 and 2017 was $237 million and $257 million, respectively (reflecting the LIFO method). Those amounts reflecting the FIFO method would have been $247 million and $269 million, respectively. 2017 net income reported at the end of 2017 was $25 million (LIFO method) but would have been $27 million using FIFO. After changing to FIFO, 2018 net income was $33 million. Dividends of $7 million were paid each year. The tax rate is 40%.
  
Required:
1. Prepare the journal entry at the beginning of 2018 to record the change in accounting principle.
2. In the 2018–2017 comparative income statements, what will be the amounts of net income reported for 2017 and 2018?
3. Prepare the 2018–2017 retained earnings column of the comparative statements of shareholders’ equity.
  

On Jan 1, 2018, Rising Star purchased a crane for $ 1,200,000 and paid $200,000 as a downpyament while the balance will be paid over the next five years in installments of $100,000 every six months , starting July 1, 2018. The market rate on Jan 1, 2018 was 9%.

Requirements:
a.   For the how much the company should recognize the crane on Jan 1, 2018? Show your calculation along with your accounting entry to recognize the purchase of the crane.
b.   On Jan 1, 2020, the company will pay installment payment of $100,000. How much of this payment represents a payment of the principal and how much of it represents a payment of the interest? Show your calculation (fill in the following table Jan 1 2018 – Jan 2020).

c.   What is the total interest expense for the year ended on Dec 31, 2018?
d.   What will be the carrying value of the notes on Dec 31, 2019?

A team of sports scientists want to know if having a dietitian as part of the staff is better at producing divisional basketball champions than current ad-libitum (as desired) nutritional practices. Of the ad-libitum, 12 were champions and 18 were non-champions. Of the dietician-tailored, 7 were champions and 8 were non-champtions. What can they conclude?

Choose the most correct answer.

Select one:

a. After performing a 2 x 2 chi square test, no significant difference between champion and non-champion basketball teams was found between the two dietary approaches (χ2 = 0.18, df = 1, p < .05).

b. After performing a 2 x 2 chi square test, no significant difference between champion and non-champion basketball teams was found between the two dietary approaches (χ2 = 0.18, df = 1, p > .05).

c. After performing a 2 x 2 chi square test, no significant difference between champion and non-champion basketball teams was found between the two dietary approaches (χ2 = 0.01, df = 1, p < .05).

d. After performing a 2 x 2 chi square test, a significant difference between champion and non-champion basketball teams was found between the two dietary approaches (χ2 = 0.01, df = 1, p < .05).

e. After performing a 2 x 2 chi square test, a significant difference between champion and non-champion basketball teams was found between the two dietary approaches (χ2 = 3.84, df = 1, p < .05).

A random sample of 2000 workers in a particular city found 820 workers who had full health insurance coverage. Find a 95% confidence interval for the true percent of workers in this city who have full health insurance coverage. Express your results to the nearest hundredth of a percent.

City of Indianapolis v Edmond 2000: Indianapolis police set up roadblocks in an effort to intercept unlawful drugs by stopping and searching every single care that passed the checkpoint. Edmond, an attorney, sued for a class of motorists stopped at checks saying they violated the 4th amendment.

Did it? Why? Why not?