On December 31, 20X3, Broadway Corporation reported common stock
outstanding of $200,000, additional paid-in capital of $300,000,
and retained earnings of $100,000. On January 1, 20X4, Johe Company
acquired control of Broadway in a business combination.
Required:
Give the Consolidation entry that would be needed in preparing a
consolidated balance sheet immediately following the combination if
Johe acquired all of Broadway’s outstanding common stock for
$600,000. (If no entry is required for a transaction/event,
select "No journal entry required" in the first account
field.)
A) Record the basic consolidation entry
In: Accounting
50. Falzone Company has two shareholders, Rita and Sal Corporation. Rita acquired her 300 shares in 2003 for $30,000 and Sal Corporation acquired its 200 shares in 1999 for $15,000. On August 2, 2013, Falzone Company sold one of its businesses that it had held since 1999. Due to this sale, Falzone Company redeemed 50 shares from each shareholder in exchange for $20,000 each. Falzone’s E&P at the time of the redemption was $250,000. What are the tax consequences of this transaction to Rita and Sal Corporation?
In: Accounting
To add to his growing chain of grocery stores, on January 1, 2016, Danny Marks bought a grocery store of a small competitor for $520,000. An appraiser, hired to assess the acquired assets’ values, determined that the land, building, and equipment had market values of $200,000, $150,000, and $250,000, respectively.
Required:
Danny plans to depreciate the operating assets on a straight-line basis for 20 years. Determine the amount of depreciation expense for 2016 on these newly acquired assets. You can assume zero residual value for all assets.
In: Accounting
Assume that is produced only two products; Coffee bean and plastic where are the price and quantity produced are:
Year | Coffee bean | Plastic |
2018 (base year) | P= 10 Q= 1,000 | P= 5 Q= 2,000 |
2019 | P= 10 Q= 1,100 | P= 5 Q= 2,100 |
2020 | P= 12 Q= 900 | P= 6 Q= 1,900 |
Calculate GDP deflator for the years 2018, 2019 and 2020. Also, calculate the Nominal and real GDP growth on 2019 & 2020, compare between them by explaining why they are different. Calculate the 2019 & 2020 inflation rates.
In: Economics
The Bridgeport Corporation had income from continuing operations
of $12 million in 2020. During 2020, it disposed of its restaurant
division at a loss of $98,000 (net of tax of $38,000). Before the
disposal, the division operated at a loss of $202,000 (net of tax
of $135,000) in 2020. Blue Collar also had an unrealized gain-OCI
of $44,000 (net of tax of $18,000) related to its FV-OCI equity
investments. Bridgeport had 10 million common shares outstanding
during 2020.
Prepare a partial statement of financial performance for
Bridgeport, beginning with income from continuing
operations.
In: Accounting
4. Suppose you are hired on January 1, 2020 and start depositing $400 at the end of each month, with the first deposit on February 1, 2020, in a pension fund that pays interest of 9% per year compounded monthly on the minimum monthly balance and credited at the end of each month.
(a) How much money is in the pension fund on March 1, 2020?
(b) How much money is in the pension fund on April 1, 2020?
(c) How much money will be in the pension fund on January 1, 2040?
(d) What is the total amount of interest earned in this pension fund during these 20 years?
In: Finance
(a) ABC Company purchased land at a cost of $400,000,000 during 2018. ABC chooses to use the revaluation method of accounting for land. The fair value of the land is as follows at December 31, 2018 2019 and 2020:
2018 - $450,000,000
2019 - $360,000,000
2020 - $385,000,000
Required
(a) Record the journal entries to account for revaluation of the
land at 31 December 2018, 2019 and 2020.
(b) Assume ABC Company chooses to apply the cost method for the land and that the above amounts are the recoverable amount of the land at 31 December each year. Record the necessary journal entries to account for the land at 31 December 2018, 2019 and 2020.
In: Accounting
Tim (40) and Tina (42) live in California. They have one son, Todd (age 10; Todd is a qualifying child of Tim and Tina). Tim’s brother, Bob, lives in New York. Although Bob did not live with Tim and Tina at all in 2020, Tim and Tina provided 90% of Bob's support. Bob is single and had $1,000 gross income in 2020.
What is the amount of Tim and Tina’s 2020 child tax credit (including other dependent tax credit)?
Assume that Tim and Tina's 2020 AGI is below the phaseout threshold for the child tax credit.
In: Accounting
The following information was available for Wild Oat Company for the month ended May 31, 2020.
(a) The book balance at May 31, 2020 was $6,890.22.
(b) The bank balance at May 31, 2020 was $8,660.22.
(c) Outstanding cheques amounted to $6,310.
(d) The may 31st cash receipts of $5,600 were deposited but have not yet appeared on the bank statement.
(e) A $50 debit memorandum for cheques printed by the bank was included with the cancelled cheques.
(f) A customer's note for $1,000 was collected by the bank. In addition interest on the note was $110.
Prepare a bank reconciliation for Wild Oat Company at May 31, 2020.
In: Finance
On January 1, 2018, Grumpy Contractors agreed to construct a building at a contract price of $5,000,000. Grumpy estimates that the project will be finished in 2020. Information related to the costs and billings for this contract are as follows:
| 2018 | 2019 | 2020 | |
| Total costs incurred to date | $1,500,000 | $3,300,000 | $4,400,000 |
| Estimated costs to complete | 2,500,000 | 1,000,000 | -0- |
| Customer billings to date | 1,200,000 | 2,700,000 | 4,400,000 |
| Collections to date | 1,000,000 | 2,500,000 | 4,400,000 |
Instructions:
Assuming the building was finished in 2020, calculate the gross
profit that would be recorded for 2018, 2019 and 2020 using
the:
a) Completed contract method.
b) Percentage of completion method.
In: Accounting