On January 1, 2020, Panther, Inc., issued securities with a total fair value of $577,000 for 100 percent of Stark Corporation’s outstanding ownership shares. Stark has long supplied inventory to Panther. The companies expect to achieve synergies with production scheduling and product development with this combination.

Although Stark’s book value at the acquisition date was $300,000, the fair value of its trademarks was assessed to be $45,000 more than their carrying amounts. Additionally, Stark’s patented technology was undervalued in its accounting records by $232,000. The trademarks were considered to have indefinite lives, and the estimated remaining life of the patented technology was eight years.

In 2020, Stark sold Panther inventory costing $75,000 for $125,000. As of December 31, 2020, Panther had resold 74 percent of this inventory. In 2021, Panther bought from Stark $140,000 of inventory that had an original cost of $70,000. At the end of 2021, Panther held $38,000 (transfer price) of inventory acquired from Stark, all from its 2021 purchases.

During 2021, Panther sold Stark a parcel of land for $88,000 and recorded a gain of $16,000 on the sale. Stark still owes Panther $62,000 (current liability) related to the land sale.

At the end of 2021, Panther and Stark prepared the following statements for consolidation.

1. Show how Panther computed its $39,000 equity in Stark’s earnings balance.

2. Prepare a 2021 consolidated worksheet for Panther and Stark.

PART I-- Peak, Inc. acquired a machine that involved the following expenditures and related factors:

PART II-- On January 1, 2019, Ivey Company purchased a bottle-capping machine for $160,000.  During its useful life, the company expects that the machine will cap 1,500,000 bottles.  The machine’s expected salvage value is $10,000.  During 2019, the machine capped 250,000 bottles and during 2020, the machine capped 300,000 bottles.  

Required:  Assuming units-of-production depreciation, 2020 depreciation expense is what amount?

PART III-- The cost of an asset is $1,020,000, and its residual value is $160,000. Estimated useful life of the asset is five years.

Required:   
                 1.  Compute first –year depreciation using the straight-line method.
               2.  Compute first-year and second –year depreciation using double-declining-balance method.

PART IV-- An asset was purchased for $37,000 on January 1, 2019. The asset's estimated useful life was five years, and its residual value was $9,000. The straight-line method of depreciation was used.

The asset was sold on December 31, 2019.

Required:  Compute the gain or loss on the sale of the asset and prepare the required journal entry
                   under both of the following assumptions:

                        1.  The selling price was $19,000.

                        2.  The selling price was $37,000.

PART V-- Saul Company purchased a tractor at a cost of $120,000 on January 1, 2019.  The tractor has an estimated salvage value of $20,000 and an estimated life of 8 years.

Required:  If Saul uses the straight-line method, what is the book value at January 1, 2023?

PART VI-- Steve Company purchased a tractor at a cost of $180,000.  The tractor has an estimated salvage value of $20,000 and an estimated life of 8 years, or 10,000 hours of operation.  The tractor was purchased on January 1, 2019 and was used 2,400 hours in 2019 and 2,100 hours in 2020.  On January 1, 2021, the company decided to sell the tractor for $70,000.  Steve uses the units-of-production method to account for the depreciation on the tractor.  

Required:  

            1.  Compute the book value of the tractor on January 1, 2021.

            2.  Compute the gain or loss on sale.

            3.  Prepare the journal entry to record the sale.

Presented here are the comparative balance sheets of Hames Inc. at December 31, 2020 and 2019. Sales for the year ended December 31, 2020, totaled $1,700,000.

Required:

1. Calculate ROI for 2020.
2. Calculate ROE for 2020. (Round your answer to 1 decimal place.)
3. Calculate working capital at December 31, 2020.
4. Calculate the current ratio at December 31, 2020. (Round your answer to 2 decimal places.)
5. Calculate the acid-test ratio at December 31, 2020. (Round your answer to 2 decimal places.)
6. Assume that on December 31, 2020, the treasurer of Hames decided to pay $50,000 of accounts payable. What impact, if any, this payment will have on the answers you calculated for parts a-d (increase, decrease, or no effect)
7. Assume that instead of paying $50,000 of accounts payable on December 31, 2020. Hames collected $50,000 of accounts receivable. What impact, if any, this receipt will have on the answers you calculated for parts a-d (increase, decrease, or no effect).

Africa Ltd manufacture tennis racquets. The company uses the job costing system to cost its production. The following information relates to Poma Africa Ltd for the month of April 2020:

Additional information

• Factory overheads are applied at a rate of 10% of total direct cost.
• The only job still in process at 30 April 2020 was L49. All other jobs were completed during the month.
• Job C23 was completed at a total cost of R25 630, this amount includes applied overhead costs of R1 410.
• Sales during April were as follows: A33: All 20 racquets were sold at cost plus 40% mark‐up.
• F54: 23 racquets were sold at a price of R290 per racquet. C23: All 55 racquets were sold at cost plus 35% mark‐up.
• Actual factory overheads for April 2020 were R3 250.
• Marketing and distribution expenses amount to R4 700 for the month of April 2020.
• Ignore spoilage.

Required:

Round to two decimal places where necessary.

7.1 Calculate the cost of jobs A33 and F54 completed during April 2020.

7.2 Calculate the closing work‐in‐process as at 30 April 2020.

7.3 Calculate the net income for the month of April 2020.

7.4 Calculate the closing balance of finished goods as at 30 April 2020.

7.5 Calculate the over/under applied overhead for April 2020.

Problem Facts Information related to the Sosa Company for the year 2020: Common Stock As of the end of 2020, Sosa had 240,000 shares of common stock outstanding. The shares are due to the following common stock transactions:  January 1, 2020 – 100,000 shares of common stock outstanding  April 1, 2020 – issued an additional 50,000 shares for cash  July 1, 2020 - issued a 2 for 1 stock split  September 1, 2020 – purchased 60,000 shares for treasury stock Preferred Stock As of the end of 2020, Sosa had 30,000 shares of 6%, $10 par value, cumulative, convertible preferred stock outstanding. The stock had been outstanding all year and the conversion ratio was each share of preferred stock is convertible into 3 shares of common stock. Bonds Payable As of the end of 2020, Sosa had $800,000, 7% bonds payable outstanding. The bonds had been outstanding for the entire year and each $1,000 bond was convertible into 10 shares of common stock. Options Sosa also had 10,000 common stock options outstanding all year. Each option allowed the holder to purchase 1 share of Sosa’s common stock for $45. During 2020, the average market price of Sosa’s common stock was $48 per share. Additional Information Sosa’s 2020 net income was $580,000, and the company’s income tax rate was 34%. REQUIRED 1. Compute the weighted average number of common shares Sosa will use to compute basic earnings per share. (5 points) 2. Compute 2020 basic earnings per share (3 points) 3. Identify which of the potentially dilutive securities (preferred stock, bonds, options) are dilutive (support must be shown to receive credit for this question) (8 points) 4. Compute diluted earnings per share (4 points)

Basic EPS = $2.20

Diluted EPS = $1.68

Problem Facts Information related to the Sosa Company for the year 2020: Common Stock As of the end of 2020, Sosa had 240,000 shares of common stock outstanding. The shares are due to the following common stock transactions:  January 1, 2020 – 100,000 shares of common stock outstanding  April 1, 2020 – issued an additional 50,000 shares for cash  July 1, 2020 - issued a 2 for 1 stock split  September 1, 2020 – purchased 60,000 shares for treasury stock Preferred Stock As of the end of 2020, Sosa had 30,000 shares of 6%, $10 par value, cumulative, convertible preferred stock outstanding. The stock had been outstanding all year and the conversion ratio was each share of preferred stock is convertible into 3 shares of common stock. Bonds Payable As of the end of 2020, Sosa had $800,000, 7% bonds payable outstanding. The bonds had been outstanding for the entire year and each $1,000 bond was convertible into 10 shares of common stock. Options Sosa also had 10,000 common stock options outstanding all year. Each option allowed the holder to purchase 1 share of Sosa’s common stock for $45. During 2020, the average market price of Sosa’s common stock was $48 per share. Additional Information Sosa’s 2020 net income was $580,000, and the company’s income tax rate was 34%. REQUIRED 1. Compute the weighted average number of common shares Sosa will use to compute basic earnings per share. (5 points) 2. Compute 2020 basic earnings per share (3 points) 3. Identify which of the potentially dilutive securities (preferred stock, bonds, options) are dilutive (support must be shown to receive credit for this question) (8 points) 4. Compute diluted earnings per share (4 points) Check Figures:

Basic EPS = $2.20

Diluted EPS = $1.68

Access www.ahrq.gov/clinic/prevenix.htm and compile a list of screenings appropriate for both men and women aged 50 and over. Based on Health People 2020 (https://www.healthypeople.gov/2020/topics-objectives/topic/older-adults) choose one screening tool that would assist in addressing Healthy People 2020.

On January 1, 2020, Blossom Company makes the two following acquisitions.

The company has to pay 12% interest for funds from its bank.

A) 1.

2.

B) 1.

2.

The information below was provided by Phil’s Retail at 31 December 2020.

Required:

(a) Prepare an income statement for Phil’s Retail for the year ending 31 December 2020.
(b) Prepare a balance sheet for Phil’s Retail as at 31 December 2020.
(c)Calculate the following ratios for Phil’s Retail for the year ending 31 December 2020:
(i)Profit margin
(ii) Return on assets  
Note: total assets at 31 December 2020 amounted to $650,000.