PartA： Jan 1^st, 2020: Tony Inc. buys a machine from Avengers Inc. and will make 3 equal payments of 200,000 over the next 18 months (payments on June 30, 2020; Dec 31, 2020; and June 30, 2021). The interest rate on this annuity is 14%. Record all the journal entries from Jan 1^st 2020 until the expiration of the annuity. (4 points) Assume the machine does not depreciate.

Part B: Create the balance sheet as of December 31^st, 2020 along with the income statement and cash flow statement for the time period of Jan 1^st, 2020 to Dec 31^st,2020 (6 points) (There might have a $1 rounding issue ）

Thank you so much guys!!!

Recording Revenue Under Different Repurchase Agreements

On January 1, 2020, Miller Inc. sells equipment to Smith Inc. for $132,000. As stipulated in the revenue contract, Miller Inc. will buy back the equipment on December 31, 2020, for $141,240. The relevant interest rate is 7%

a. Prepare the seller’s journal entry on January 1, 2020.

b. Prepare the seller’s journal entry on December 31, 2020.

c. Assume instead that Miller has the option to buy back the equipment and the fair value of the equipment is expected to
decline through 2020. How would the answers to parts a and b change (if at all)?

d. Assume instead that Smith has the option to require Miller to buy back the equipment after one year for $141,240 (an amount greater than
the expected market value of the equipment at that time). How would the answers to parts a and b change (if at all)?

Exercise 10-13

Presented below is information related to Nash Company.

1. On July 6, Nash Company acquired the plant assets of Doonesbury Company, which had discontinued operations. The appraised value of the property is:

Nash Company gave 12,500 shares of its $100 par value common stock in exchange. The stock had a market price of $188 per share on the date of the purchase of the property.

2. Nash Company expended the following amounts in cash between July 6 and December 15, the date when it first occupied the building. (Prepare consolidated entry for all transactions below.)

3. On December 20, the company paid cash for equipment, $269,700, subject to a 2% cash discount, and freight on equipment of $11,200.

Exercise 20-22 (Algo) Error correction; accrued interest on bonds [LO20-6]

At the end of 2020, Majors Furniture Company failed to accrue $68,500 of interest expense that accrued during the last five months of 2020 on bonds payable. The bonds mature in 2032. The discount on the bonds is amortized by the straight-line method. The following entry was recorded on February 1, 2021, when the semiannual interest was paid:

   
Required:
1-a. Prepare any journal entries necessary to correct the error, as well as any adjusting entry for 2021 related to the situation described. (Ignore income taxes.)
1-b. Prepare the journal entries that should have been recorded, if done correctly to start.

Dobbs Company issues 6%, two-year bonds, on December 31, 2019, with a par value of $106,000 and semiannual interest payments. Semiannual Period-End Unamortized Discount Carrying Value (0) 12/31/2019 $ 6,120 $ 99,880 (1) 6/30/2020 4,590 101,410 (2) 12/31/2020 3,060 102,940 (3) 6/30/2021 1,530 104,470 (4) 12/31/2021 0 106,000 Use the above straight-line bond amortization table and prepare journal entries for the following. Required: (a) The issuance of bonds on December 31, 2019. (b) The first through fourth interest payments on each June 30 and December 31. (c) Record the maturity of the bonds on December 31, 2021

At the end of 2019, Headland Company has $174,800 of cumulative temporary differences that will result in reporting the following future taxable amounts.

Tax rates enacted as of the beginning of 2018 are:

Headland’s taxable income for 2019 is $310,600. Taxable income is expected in all future years.

(a) Prepare the journal entry for Headland to record income taxes payable, deferred income taxes, and income tax expense for 2019, assuming that there were no deferred taxes at the end of 2018.

(b) Prepare the journal entry for Headland to record income taxes payable, deferred income taxes, and income tax expense for 2019, assuming that there was a balance of $21,600 in a Deferred Tax Liability account at the end of 2018

Presented below are two independent situations. Answer the question at the end of each situation.

1.   During 2020, Salt-n-Pepa Inc. became involved in a tax dispute with the IRS. Salt-n-Pepa Inc. believe it is probable that the company will lose this dispute and have to pay the IRS $900,000. How should Salt-n-Pepa Inc. report this contingency as of December 31^st, 2020 (fiscal year end)? If needed, prepare the journal entry for Salt-n-Pepa Inc.

2.   Etheridge Inc. had a manufacturing plant in Sudan, which was destroyed in the civil war. Etheridge has been assured by governmental officials that it will receive a definite amount for this plant. The amount of the compensation will be more than its book value. How should Etheridge Inc. report this contingency?

The following figures have been extracted from statement of comprehensive income of Rochester (Pty) LTD for the year ended 31 December 2019 Sales R 3600 000 Cost of sale R 2160 000 Operation expenses R 864 000 Interest expenses 72 000 Company tax ( 30% of profit before tax 151 200 Net profit 352 800 Additional information 1 . The sales forecast for the year ended 31 December 2020 is 4 000 000 2. Rochester has identified cost of sales, operating expenses and interest expenses as varying in production to sales Required Prepare the pro- for a statement of comprehensive income for the year ended 31 December 2020 using the percentage of sales method .

Multiple Regression Analysis

The company has been able to determine that its sales in dollars depend on advertising and

of the number of sellers and for this reason, it uses the data from previous years to

be able to forecast possible sales for the year 2020.

Y           X1 ($ 000)   X2 ($ 000)

Year          Sales    Advertising   Salesman

2013        $ 10          $ 1                       1

2014       $ 15            $ 2                     1

2015       $ 25            $ 3                      2

2016      $ 40            $ 5 3

2017      $ 70             $6                       3

2018      $ 110         $ 8                        4

2019      $ 150          $ 9                        6

INSTRUCTIONS:

a) Calculate the values ​​of the letters a, b1, b2. (excel)

b) Write down the problem Regression equation

c) Calculate sales by 2020 if the advertising were $ 14,000 and the number of sellers out of 10.