Use actual sales (revenue) data from previous 4 years to estimate sales using the linear trend function. Please show work in excel!!

On January 2, 2018, the Mulberry Street Corporation (a calendar year corporation) purchased heavy equipment in the amount of $550,000. It is expected to be used for 10 years, with a residual value at the end of that time of $70,000. Expenditures required to place the asset in service amounted to $120,000. The company also purchased a patent at a cost of $80,000 on July 1, 2018. It is expected to be used for six years, with no value at the end of that time. The management of Mulberry Street depreciates heavy equipment by the declining-balance method at 200 percent of the straight line. It amortizes intangible assets by the straight-line method.

1) Calculate depreciation and amortization for 2018 and 2019.

2) Prepare the journal entries for 2018 and 2019.

3) How much more depreciation was taken in the two years than if the company used straightline? What was the effect on the financial statements?

4) Prepare the plant and intangible assets section of Mulberry's balance sheet at the end of 2019.

Purkerson, Smith, and Traynor have operated a bookstore for a number of years as a partnership. At the beginning of 2018, capital balances were as follows:

Due to a cash shortage, Purkerson invests an additional $12,000 in the business on April 1, 2018.

Each partner is allowed to withdraw $900 cash each month.

The partners have used the same method of allocating profits and losses since the business's inception:

Each partner is given the following compensation allowance for work done in the business: Purkerson, $10,000; Smith, $26,000; and Traynor, $6,000.

Each partner is credited with interest equal to 20 percent of the average monthly capital balance for the year without regard for normal drawings.

Any remaining profit or loss is allocated 4:2:4 to Purkerson, Smith, and Traynor, respectively. The net income for 2018 is $28,000. Each partner withdraws the allotted amount each month.

What are the ending capital balances for 2018?

During 2016 and 2017, Faulkner Manufacturing used the sum-of-the-years’-digits (SYD) method of depreciation for its depreciable assets, for both financial reporting and tax purposes. At the beginning of 2018, Faulkner decided to change to the straight-line method for both financial reporting and tax purposes. A tax rate of 40% is in effect for all years. For an asset that cost $16,000 with an estimated residual value of $1,000 and an estimated useful life of 10 years, the depreciation under different methods is as follows: Year Straight Line SYD Difference 2016 $ 1,500 $ 2,727 $ 1,227 2017 1,500 2,455 955 $ 3,000 $ 5,182 $ 2,182 Required: 1. Prepare the journal entry that Faulkner will record in 2018 related to the change. 2. Suppose instead that Faulkner previously used straight-line depreciation and changed to sum-of-the-years’- digits in 2018. Prepare the journal entry that Faulkner will record in 2018 related to the change.

Fuzzy Monkey Technologies, Inc., purchased as a short-term investment $240 million of 6% bonds, dated January 1, on January 1, 2018. Management intends to include the investment in a short-term, active trading portfolio. For bonds of similar risk and maturity the market yield was 8%. The price paid for the bonds was $219 million. Interest is received semiannually on June 30 and December 31. Due to changing market conditions, the fair value of the bonds at December 31, 2018, was $230 million. Required: 1. to 3. Prepare the relevant journal entries on the respective dates (record the interest at the effective rate). 4-a. At what amount will Fuzzy Monkey report its investment in the December 31, 2018, balance sheet? 4-b. Prepare any entry necessary to achieve this reporting objective. 5. How would Fuzzy Monkey's 2018 statement of cash flows be affected by this investment?

Consider that 2018 was Rail Company's first year of operations. Rail reported $665,000 of total revenue for the twelve months ended 12/31/2018, and reported the following normal account balances as of 12/31/2018:

1 Accounts Payable $4,000 10 Note Payable $68,950

2 Accounts Receivable 50,000 11 Office Supplies 2,300

3 Accumulated Depreciation 84,070 12 Prepaid Advertising Expense 5,000

4 Cash 23,950 13 Prepaid Insurance Expense 3,300

5 Common Stock 172,500 14 Rent Payable 3,200

6 Dividends 50,000 15 Salaries Payable 5,200

7 Dividends Payable 5,500 16 Shop Supplies 5,800

8 Equipment 267,200 17 Utilities Payable 1,630

9 Land 35,000

Consider the above information and determine the amount of total expense incurred by Rail Company for the year ended 12/31/2018.

-Kathy is 60 years of age and self-employed. During 2018 she reported $100,000 of revenues and $40,000 of expenses relating to her self-employment activities. If Kathy has no other retirement accounts in her name, what is the maximum amount she can contribute to a simplified employee pension (SEP) IRA for 2018? (Round your final answer to the nearest whole number)

A) $11,152.

B) $17,152.

C) $12,000

D) $55,000.

-Kathy is 60 years of age and self-employed. During 2018 she reported $500,000 of revenues and $100,000 of expenses relating to her self-employment activities. If Kathy has no other retirement accounts in her name, what is the maximum amount she can contribute to a simplified employee pension (SEP) IRA for 2018? (Round your final answer to the nearest whole number)

A) $55,000.

B) $61,000.

C) $77,337.

D) $369,400.

Potter Corporation buys 30% of Sunshine Supply Company on January 1, 2017, for

     $300,000.  The equity method of accounting is to be used.  Sunshine’s net assets on

     that date were $750,000.  Any excess of cost over book value is attributable to a

     customer list with a 10-year remaining life.  Sunshine immediately begins supplying

     inventory to Potter as follows:

Inventory held at the end of one year by Potter is sold at the beginning of the next.

Sunshine’s net income was $80,000 for 2017 and is $110,000 for 2018.  Sunshine

paid dividends of $30,000 each year.

Required:

Prepare all of Potter’s entries for 2017 and 2018 related to its investment in Sunshine.

You are auditing a retail apparel company as of December 2018. The inventory for black down jackets show 1,263 jackets. When you look at the invoices for the jackets from the wholesaler from which the company purchases those jackets, you see the following:

1.Assuming the company uses LIFO as the inventory valuation method, determine the cost of inventory at December 31, 2018.

2.The company can buy the same jacket from the wholesaler at $270 in December 2018. Determine the total carrying value of inventory as of December 31, 2018.

3.Then replace the price of $270 with $277 or $ 282 in the question 2 above and see how your answer changes.