1. Dodie Company completed its first year of operations on December 31. All of the year's entries have been recorded except for the following:

      a. At year-end, employees earned wages of $4,000, which will be paid on the next payroll date in January of next year.

      b. At year-end, the company had earned interest revenue of $1,500. The cash will be collected March 1 of the next year.

2. A+T Williamson Company is making adjusting entries for the year ended December 31 of the current year. In developing information for the adjusting entries, the accountant learned the following:

     a. A two-year insurance premium of $4,800 was paid on October 1 of the current year for coverage beginning on that date. The bookkeeper debited the full amount to Prepaid Insurance on October 1.

     b. At December 31 of the current year, the following data relating to Shipping Supplies were obtained from the records and supporting documents.

Required:

For each of the transactions in Dodie Company and A+T Williamson Company, indicate the amount and the direction of effects of the adjusting entry on the elements of the balance sheet and income statement. (Enter negative amounts with a minus sign.)

1. Dodie Company completed its first year of operations on December 31. All of the year's entries have been recorded except for the following:

      a. At year-end, employees earned wages of $4,200, which will be paid on the next payroll date in January of next year.

      b. At year-end, the company had earned interest revenue of $1,600. The cash will be collected March 1 of the next year.

2. A+T Williamson Company is making adjusting entries for the year ended December 31 of the current year. In developing information for the adjusting entries, the accountant learned the following:

     a. A two-year insurance premium of $5,040 was paid on October 1 of the current year for coverage beginning on that date. The bookkeeper debited the full amount to Prepaid Insurance on October 1.

     b. At December 31 of the current year, the following data relating to Shipping Supplies were obtained from the records and supporting documents.

Required:

For each of the transactions in Dodie Company and A+T Williamson Company, indicate the amount and the direction of effects of the adjusting entry on the elements of the balance sheet and income statement. Using the table below, indicate + for increase and − for decrease. (Enter negative amounts with a minus sign.)

A machine costing $213,600 with a four-year life and an estimated $16,000 salvage value is installed in Tonys Company’s factory on January 1. The factory manager estimates the machine will produce 494,000 units of product during its life. It actually produces the following units: 121,800 in Year 1, 123,500 in Year 2, 121,100 in Year 3, 137,600 in Year 4. The total number of units produced by the end of Year 4 exceeds the original estimate—this difference was not predicted. (The machine cannot be depreciated below its estimated salvage value.)

Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method.

1A. Compute depreciation for each year (and total depreciation of all years combined) for the machine under the Straight-line depreciation.

1B. Compute depreciation for each year (and total depreciation of all years combined) for the machine under the Units of production.

1C. Compute depreciation for each year (and total depreciation of all years combined) for the machine under the Double-declining-balance.

as part of your retirement package, your company has agreed to pay you monthly payments over the next three years that have the following characteristics.

1. you will receive 12 monthly payments each year, with the first payment for the year being made on January 1st, and the last payment for the year being made on December 1st
2. monthly payments for the first year will be $4,000 per month.
3. after year 1, you will receive an annual cost of living adjustment (COLA) of 10 percent that will be effective as of the January 1st payment for each subsequent year. That is, in Year 2, your monthly payment will be 1.0 percent higher than in Year 1 (i.e. $4,000*1.01=$4.040), and in Year 3, it will be 1.0 percent higher than in Year 2.
4. you believe that interest rates will increase in the future and that you will be able to deposit your payments into an investment account and receive the following effective annual rates of return (over the 12 months fro January 1st to December 31st of each year): Years 1 and 2 = 6.6759627%, Year 3(and after)= 8.2139158%

Given this information, determine how much you should expect to have in your investment account one month after your 36th deposit, on December 31st of Year 3.

Answer is whole dollars, rounded to the nearest dollar, with no punctuation. For example, if your answer is $150,224.75, enter “150225

A tractor for over-the-road hauling is to be purchased by AgriGrow for $90,000. It is expected to be of use to the company for 6 years, after which it will be salvaged for $4,000. Transportation cost savings are expected to be $170,000 per year; however, the cost of drivers is expected to be $70,000 per year, and operating expenses are expected to be $63,000 per year, including fuel, maintenance, insurance, and the like. The company’s marginal tax rate is 40 percent, and MARR is 10 percent on after-tax cash flows. Suppose that, to AgriGrow’s surprise, they actually dispose of the tractor at the end of the fourth tax year for $6,000. Develop tables using a spreadsheet to determine the ATCF for each year and the after-tax PW, AW, IRR, and ERR after only 4 years.

a) Use straight-line depreciation (no half-year convention) to find ATCF for each year (from End of Year 1 to 4), after-tax PW, AW, ERR, and IRR.

b) Use MACRS-GDS and state the appropriate property class to find ATCF for each year (from End of Year 1 to 4), after-tax PW, AW, ERR, and IRR.

c) Use double declining balance depreciation (no half-year convention, no switching) to find ATCF for each year (from End of Year 1 to 4), after-tax PW, AW, ERR, and IRR.

Individual A ("A"), Individual B ("B"), both calendar year taxpayers, and Corporation C ("C") with a fiscal year end June 30, form Partnership P ("P") on January 1 of Year 1. P manufactured widgets and is not a passive activity.   A contributes $300,000 cash in exchange for a 30% ownership interest (profits and capital), B contributes property with a fair market value ("FMV") of $400,000 and adjusted basis of $110,000, but subject to a non-recourse mortgage of $100,000 (which is not qualified non-recourse financing) in exchange for a 30% ownership interest (profits and capital) and C contributed a property FMV $400,000 adjusted basis $500,000 in exchange for a 40% ownership interest.

From January 1, Year 1 through December 31, Year 1 (12 months) P lost $10,000 a month from operations. From January 1 Year 2 through December 31 Year 2 P earned $15,000 per month from operations at which point it shuttered operations and earned $0 thereafter.

a. What income, gain or loss, of any does B recognize upon formation of P?        

b. What income does B report on B's income tax return for

                        Year 1

                        Year 2

                        Year 3

c. What income does C report on C's income tax return for

                      Year 1

                      Year 2

                     Year 3

Kingston Company uses the dollar-value LIFO method of computing inventory. An external price index is used to convert ending inventory to base year. The company began operations on January 1, 2021, with an inventory of $201,000. Year-end inventories at year-end costs and cost indexes for its one inventory pool were as follows: Year Ended Ending Inventory Cost Index December 31 at Year-End Costs (Relative to Base Year) 2021 $ 291,600 1.08 2022 376,420 1.18 2023 355,350 1.15 2024 349,650 1.11 Required: Calculate inventory amounts at the end of each year. (Round intermediate calculations and final answers to the nearest whole dollars.)

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