record entries in proper journal entry format. show work if needed

March

10. Purchased a parcel of land on March 1, 2019 for $650,000 by paying $425,000 in cash and signing a short-term note payable with the seller for $225,000. You must repay the $225,000 in exactly one year on March 1, 2020. You agree to pay the seller 4.5 percent interest (annual rate) on a quarterly basis (June 1, September 1, December 1, 2019, and March 1, 2020).

    [Adjusting Entry Required]

11. On March 19th you purchased $33,480 of office supplies from Super Office Supplies with cash.

12. On March 20th you received a payment of $125,000 for 260 hours of service to be performed in the future.

April

13. April 21st, your customers bought 15,000 units of your product for $125 per unit (you decide what your company sells). The cost of this product is determined by the method of inventory valuation used by your company. Customers paid you 55% in cash and the remainder was on account.

14. On April 27nd you purchased 9,250 units at a cost of $67 per unit. You paid 45% in cash and purchased the remainder on account.

15. On April 29th you pay $550,000 cash toward your accounts payable.

Accounting for leases Kapiti Ltd runs a successful chain of fashion boutiques, but has been experiencing significant cash flow problems. The directors are examining a proposal made by an accounting consultant that all the shops currently owned by the company be sold and either leased back or the businesses moved to alternative leased shops. The directors are keen on the plan but are puzzled by the consultant’s insistence that all lease agreements for the shops be ‘operating’ rather than ‘finance’ leases.

Meanwhile, Scarlett Ltd agreed to lease their 5 buildings to Kapiti Ltd. The lease agreement details are as follows:

Length of lease 10 years Commencement date 1 July 2020 Annual lease payment, payable 1 July each year commencing 1 July 2020 ($120000 x 5) $600 000 Estimated economic life of the building 10 years Annual Interest rate implicit in the lease 10% The Chairman of the Board directed the Company Accountant to submit a detailed report on the above project.

Required A. Explain the difference between a finance lease and an operating lease.

B. Explain, by reference to the requirements of AASB 117, why the consultant prefers operating to finance leases.

C. Show how to record the lease of the buildings in the books of the Kapiti in accordance with AASB 6 as at 30 June 2021.

Accounting for leases

Kapiti Ltd runs a successful chain of fashion boutiques, but has been experiencing significant cash flow problems. The directors are examining a proposal made by an accounting consultant that all the shops currently owned by the company be sold and either leased back or the businesses moved to alternative leased shops. The directors are keen on the plan but are puzzled by the consultant’s insistence that all lease agreements for the shops be ‘operating’ rather than ‘finance’ leases.

Meanwhile, Scarlett Ltd agreed to lease their 5 buildings to Kapiti Ltd.

The lease agreement details are as follows:

The Chairman of the Board directed the Company Accountant to submit a detailed report on the above project.

Required

1. Explain the difference between a finance lease and an operating lease.               
2. Explain, by reference to the requirements of AASB 117, why the consultant prefers operating to finance leases.                                                                                                

Show how to record the lease of the buildings in the books of the Kapiti in accordance with AASB 6 as at 30 June 2021.         

On January 1, 2017, Cullumber Corporation granted 18,300 options to key executives. Each option allows the executive to purchase one share of Cullumber’ common shares at a price of $26 per share. The options were exercisable within a two–year period beginning January 1, 2019, if the grantee was still employed by the company at the time of the exercise. On the grant date, Cullumber’s shares were trading at $22 per share, and a fair value options pricing model determined total compensation to be $720,000. Management has assumed that there will be no forfeitures as they do not expect any of their key executives to leave.

On May 1, 2019, 6,900 options were exercised when the market price of Cullumber’s shares was $33 per share. The remaining options lapsed in 2020 because executives decided not to exercise their options. Management was indeed correct in their assumption regarding forfeitures in that all executives remained with the company. Assume that Cullumber follows IFRS.

a) Prepare the necessary journal entries related to the stock option plan for the years ended December 31, 2017, through 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 5,275.)

Stacey Company operates a small manufacturing facility as a supplement to its regular service activities. At the beginning of 2021, an asset account for the company showed the following balances:

In early January 2021, the following expenditures were incurred for repairs and maintenance:

The equipment is being depreciated on a straight-line basis over an estimated life of 12 years, with a $4,500 estimated residual value. The company’s fiscal year ends on December 31.

Required:

1. Calculate the depreciation expense for the manufacturing equipment for 2020.

2. Prepare the journal entries to record the two expenditures that occurred during 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

3. Prepare the adjusting entry at December 31, 2021, to record the depreciation of the manufacturing equipment, assuming no change in the estimated life or residual value of the equipment. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

4. Indicate the accounts affected and the amount of the effects of the journal entries you prepared for (1) to (3) on the accounting equation. (Enter any decreases to account balances with a minus sign.)

Elegant Furniture Company(Elegant) manufactures and sells modern furniture. The company’s products only include two models of dining table: Deluxe and Simplicity. The selling prices and costs data for each unit of the products are as follows: Deluxe Simplicity $ $ Selling price 10,000 8,000 Direct materials (variable) 2,600 2,300 Direct labour (variable) 500 400 Manufacturing overhead (semi-variable, 90% fixed) 5,000 4,000 Selling expenses (variable) 400 400 Administrative expenses (fixed) 1,000 800 According to Elegant’s 2020 business plan, the company wants to achieve the target of manufacturing and selling at least 5,000 units of Deluxe and 2,000 units of Simplicity every month. Currently the company’s manufacturing process is limited by the machine capacity in the machining department. The total machine time available in the machining department is 78,000 minutes per month. Apart from this, there is no other relevant constraint on the manufacturing process. Each unit of Deluxe requires 12 minutes of machine time and each unit of Simplicity requires 6 minutes of machine time. Required:

(c) Assuming that there is unlimited demand for Deluxe and Simplicity at current selling prices, what product mix, i.e. how many units of Deluxe and Simplicity should Elegant produce and sell that will maximize its operating income while meeting its 2020 business plan? Show your calculations clearly.

(d) Assuming that the demand of Simplicity is limited to 2,500 units, what product mix should the company adopt to maximize operating income while meeting its 2020 business plan? Show your calculations clearly. (e) In view of the constraint on machining time, the production manager suggests to outsource the manufacture of Simplicity to a vendor who has offered a very competitive price. The management accountant has analysed and confirmed that there will be cost advantages from the outsourcing proposal. Suggest TWO strategic and qualitative issues that Elegant’s management may consider before making the decision. Question 2 Advanced Electronics Ltd (Advanced) manufactures and sells high-end electronic

Cycle Fit Company is a manufacturer of commercial grade exercise bikes that are sold to hotels and health clubs. Maintaining the bikes is an important area of customer satisfaction. Because of increase industry​ competition, Cycle Fit​'s financial performance has suffered.​ However, the introduction of a new model and a predicted upturn in the economy are leading Cycle Fit​'s managers to predict improved performance in 2021. The following income statement shows results for 2020.

Cycle Fit Company Income Statement for the Year Ended December​ 31, 2020 ​(in thousands)

Cycle Fit​'s management team is preparing the 2021 budget and is studying the following​ information:

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.

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?