On July 1, 2018 a full year’s insurance premium of $2,400, covering the period July 1, 2018,to June 30, 2019 was paid and debited to insurance expense. Assume the following:



The company has a calendar fiscal year.



January 1, 2018, retained earnings balance is $20,000.



2018 reported net income (assuming the error is not discovered)is $22,800.



2019 net income (assuming the error is not discovered) is $30,000.



2020 net income is $40,000. Ignore taxes

REQUIRED:

a.

List the effects of the error on affected accounts and on net income in 2018 and 2019,assuming no adjusting entry is made on December 31, 2018.

b.

Prepare the entry to record the error if discovered in 2018.

c.

Prepare the entry to record the error if discovered in 2019, and the 2018 and 2019 retained earnings sections of the statement of stockholders’ equity.

d.

Prepare the entry (if needed) to record the error if discovered in 2020, and the 2019 and 2020 retained earnings sections of the statement of stockholders’ equity.

On February 1, 2020 Britney contacts Fancy Weddings, Inc. about being the event management company to coordinate her wedding in June 2020. They discuss what Britney is interested in for the wedding and agree to perform all the wedding services at a cost of $10,000. Fancy sends a written contract to Britney outlining everything both parties had agreed to and Britney calls Fancy back and advises she received the letter and is an accurate description of their agreement, but Britney never signs the contract. On March 1, 2020 Britney calls back Fancy and tells them the deal is off because she thinks she can do a better job by herself. Fancy sues Britney and Britney argues a lack of consideration as a defense.

A. Will this defense be successful? Please explain.

B. Under the same facts as above Britney argues that the contract is not binding because of the Statute of Frauds. Will this defense be successful? Please explain.

Calculate the total depreciation for these various assets - All assets are business use. Joe purchased a 5 year asset for $1,190,000 on 6/13/2020. Joe wants to take the maximum amount of Sec 179 depreciation as possible. Taxable income for 2020 was $1,125,000. Calculate the depreciation expense for 2020. Joe sold the asset in 2021. Additional first year depreciation was not taken in 2020. Calculate the depreciation for 2021. 2020: 2021:

Case Study Pork from Canada Case Name and tribunal Fresh, chilled, or Frozen pork from Canada (ECC, 1991) Facts In 1990, the US International trade Commission found that the US domestic pork industry was threatened with material injury from imports of fresh, chilled, or frozen pork from Canada. In reviewing the decision of the U.S. International Trade Commission, the binational panel remanded the decision to the ITC with instructions to re-determine the matter. The panel had determined that the ITC erred in reviewing evidence outside the scope of what it ought to have reviewed.

Issue

Did the binational panel seriously depart from a fundamental rule of procedure or manifestly exceed its powers, authority or jurisdiction in instructing the ITC to re-determine the matter with a reduction in the evidence it should consider ?

Assume that your company or agency is concerned about near-term economic conditions and wishes to obtain a qualitative forecast of sales or service in the upcoming quarter. Assume also that you are the market analyst for your company or agency planning to use one or more of the leading economic indicators (LEI) published by the US Department of Commerce to formulate your qualitative forecast. You can Google TheLeading Economic Indicator

You’ve just won the lottery which promises to pay you $5,000 per month for the next 30 years, starting in one month. The lottery company is require to buy US Treasury securities to guarantee that it can meet its obligation to you. If Treasury securities earned 5% APR compounded monthly, how much would the lottery company have to invest today to cover its obligation?

My commute to university, follows a NORMAL distribution with a 35.5 minutes as mean and a standard deviation of 2.5 min. If my commute starts at 8:20 am and ideally I must be at university by 9am.

Define two random variables and formulate two questions, one involving binomial distribution and the other involving geometric distribution.

Marydale Products permits its customers to defer payment by giving personal notes instead of cash. All the notes bear interest and require the customer to pay the entire note in a single payment 6 months after issuance. Consider the following transactions, which describe Marydale’s experience with two such notes:

Information for the economy of Pogo

2019

• Interest payments received from Foreign on Foreign assets owned by Pogo:                     $45M
• Interest payments paid to Foreign citizens on Pogo assets owned by Foreign:                   $48M
• Federal Reserve Bank of Pogo’s holding of interest-free Foreign assets, start of 2019:   $85M

2020

• Interest payments received from Foreign on Foreign assets owned by Pogo:                     $46M
• Interest payments paid to Foreign citizens on Pogo assets owned by Foreign:                   $52M
• Federal Reserve Bank of Pogo’s holding of interest-free Foreign assets, start of 2020:   $77M

Assumptions:            

• Interest rate on Foreign assets is 5% and the Interest rate on Pogo assets is 8% for both 2019 & 2020.
• Foreign central bank does not hold Pogo assets
• There are no Foreigners working in Pogo and no Pogo citizens working in Foreign during these years.

Questions:

What is Pogo’s balance of payments in 2019? Show your work

Presented below is information related to Donaldson Corp., for the year 2020. Prepare an income statement and answer the question below and other questions requiring the use of this income statement. Net sales $1,820,000 Cost of goods sold 1,240,000 Selling expenses 86,000 Administrative expenses 74,000 Dividend revenue 25,000 Interest revenue 20,000 Interest expense 50,000 Write-off of goodwill due to impairment 40,000 Depreciation expense omitted in 2018 105,000 Dividends declared 12,000 Effect on prior year’s of change in accounting principle (credit) 230,000 Loss from operations of discontinued component of business, net of tax 190,000 Gain from disposal of component of business, net of tax 260,000 Federal tax rate of 20% on all items Assume the 200,000 shares of common stock were outstanding during 2020. In the multiple-step income statement for 2020, how much was net income?