Described below are six independent and unrelated situations involving accounting changes. Each change occurs during 2018 before any adjusting entries or closing entries were prepared. Assume the tax rate for each company is 40% in all years. Any tax effects should be adjusted through the deferred tax liability account. Fleming Home Products introduced a new line of commercial awnings in 2017 that carry a one-year warranty against manufacturer’s defects. Based on industry experience, warranty costs were expected to approximate 4% of sales. Sales of the awnings in 2017 were $2,800,000. Accordingly, warranty expense and a warranty liability of $112,000 were recorded in 2017. In late 2018, the company’s claims experience was evaluated and it was determined that claims were far fewer than expected: 3% of sales rather than 4%. Sales of the awnings in 2018 were $3,300,000, and warranty expenditures in 2018 totaled $75,075. On December 30, 2014, Rival Industries acquired its office building at a cost of $860,000. It was depreciated on a straight-line basis assuming a useful life of 40 years and no salvage value. However, plans were finalized in 2018 to relocate the company headquarters at the end of 2022. The vacated office building will have a salvage value at that time of $630,000. Hobbs-Barto Merchandising, Inc., changed inventory cost methods to LIFO from FIFO at the end of 2018 for both financial statement and income tax purposes. Under FIFO, the inventory at January 1, 2018, is $620,000. At the beginning of 2015, the Hoffman Group purchased office equipment at a cost of $253,000. Its useful life was estimated to be 10 years with no salvage value. The equipment was depreciated by the sum-of-the-years’-digits method. On January 1, 2018, the company changed to the straight-line method. In November 2016, the State of Minnesota filed suit against Huggins Manufacturing Company, seeking penalties for violations of clean air laws. When the financial statements were issued in 2017, Huggins had not reached a settlement with state authorities, but legal counsel advised Huggins that it was probable the company would have to pay $130,000 in penalties. Accordingly, the following entry was recorded: Loss—litigation 130,000 Liability—litigation 130,000 Late in 2018, a settlement was reached with state authorities to pay a total of $273,000 in penalties. At the beginning of 2018, Jantzen Specialties, which uses the sum-of-the-years’-digits method, changed to the straight-line method for newly acquired buildings and equipment. The change increased current year net earnings by $368,000. Required: For each situation: 1. Identify the type of change. 2. Prepare any journal entry necessary as a direct result of the change as well as any adjusting entry for 2018 related to the situation described.

1. What should you do if a person changes their end-of-life requests? Create a step-by-step outline of what you should do that could be used to train other care workers.

2. When a person who is accessing services informs you that they wish to die at home, what action should you take?

3. What are three things that you should document when a person is reporting that they have pain?

4. Research one of the pain management/comfort promotion techniques mentioned in this section to learn more about it. How might this help people in palliative care? How can it be applied and is a specialist practitioner/health professional required? Where can you learn more and/or find a qualified practitioner?

5. Explain three observations that you would make to see if the pain relief is effective or not effective.

a. You are the dealer in one of the reputable banks and one of your roles is related to trading and
monitoring of changes in the derivative markets. You are interested in one stock for Bally
International hedgers; the stock under consideration is currently trading at K25 it can either go up
or down by 15 percent in any given period. The risk-free rate is 10 percent. You decide to take
the long position in this stock at an exercise price of 20 with the contract expiry date 6 months
from now
Required:
i. At how much are you going to purchase the rights today?
ii. What is the time value of this Option
iii. At how much will the rights in a Put option be trading at?
iv. If the main difference between a Forward and Futures contract is that of standardization and
market trading, then how are futures contracts superior to Forwards

The following changes took place last year in Pavolik Company’s balance sheet accounts:

D = Decrease; I = Increase.

Long-term investments that cost the company $25 were sold during the year for $54 and land that cost $53 was sold for $28. In addition, the company declared and paid $22 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and equipment took place during the year. Pavolik did not retire any bonds during the year or issue any new common stock.

The company’s income statement for the year follows:

The company’s beginning cash balance was $136 and its ending balance was $112.

Required:

1. Use the indirect method to determine the net cash provided by operating activities for the year.

2. Prepare a statement of cash flows for the year.

Question 4

Sometimes corporations make Fundamental Changes. Describe the change below.

1. Alphabet Company (Google) decides to move from the US to Korea.
2. Microsoft will split into the Software Company, Cloud Company, and Xbox Company
3. Company P will buy Company E.
4. Company F will create an additional class of shares with more voting rights than existing shares.
5. Company R decides to sell all assets and give the money to the shareholders.

P10-45. Analyzing and Interpreting Effects of TCJA Tax Law Changes.

Pfizer Inc. reports the following footnote disclosure in its 2018 Form 10-K.

The following table provides the components of Income from continuing operations before provision (benefit) for taxes on income:

Year Ended December 31, $ millions                                                   2018                 2017                2016

United States                                                                                         $(4,403)            $(6,879)       $(8,534)

International                                                                                            16,288              19,184          16,886

Income from continuing operations before provision of taxes…   11,885              12,305            8,351

The following table provides the components of Provision (benefit) for taxes on income based on the location of the taxing authorities:

$ millions                                                                                                    2018                  2017               2016

United States

Current income taxes:

Federal                                                                                                        $668                  $1,267           $342

State and Local                                                                                                 9                         45               (52)

Deferred income taxes:

Federal                                                                                                        (1,663)              (2,064)            (419)

State and local                                                                                                  16                   (304)            (106)

Total U.S. tax provision                                                                                 (970)              (1,055)           (235)   

TCJA

Current income taxes                                                                              (3,035)                13,135                 -

Deferred income taxes                                                                             2,439                 (23,795)               -

Total TCJA tax provision                                                                            (596)                 (10,660)              -

International

Current income taxes                                                                               2,831                   2,709              1,532

Deferred income taxes                                                                              (558)                      (42)              (175)

Total international tax provision                                                            2,273                   2,667              1,358

a.In the fourth quarter of 2017, we recorded an estimate of certain tax effect of the TCJA, including (i) the impact of deferred tax assets and liabilities from reduction in the U.S. Federal corporate tax rate from 35% to 21%, (ii) the impact on valuation allowances and other state income tax considerations, (iii) the $15.2 billion repatriation tax liability on accumulated post-1986 foreign earnings for which we plan to elect, with the filing of our 2018 U.S. Federal Consideration Income Tax Return, payments over eight years through 2026 that is reported in Other taxes payable in our consolidated balance sheet as of December 31, 2017 and (iv) deferred taxes on basis differences expected to give rise to future taxes on global intangible low-taxed income. As a result of the TCJA, in the fourth quarter of 2017, we reversed an estimate of the deferred taxes that are no longer expected to be needed due to the change to the territorial tax system.

Required.

1. What is the amount of the income tax expense reported by Pfizer for each year? What amount is current versus deferred?
2. What is Pfizer’s effective (average) tax rate for each year?
3. Use the pretax information to determine the effective tax rate for U.S. operations for each year.
4. The footnotes include amounts related to the TCJA of 2017. What was the effect on the company’s tax expense in 2017 and 2018 due to the TCJA?
5. Pfizer lists four TCJA items that impacted their 2017 tax provision. Explain how each of the four items might have affected Pfizer’s 2017 tax expens

Aging includes the cognitive, physical, and social-emotional changes that occur during late adulthood. Varying cultures take different approaches to aging. At the same time, individuals within these cultures and societies may have varied and distinctly personal views regarding aging. When addressing aging in late adulthood, one must also address death, dying, and bereavement. Religious and spiritual beliefs, gender, personality, and coping style can all impact an individual's responses to and beliefs about death (Berk, 2014). Today, web-based virtual cemeteries are a new way for people to connect and grieve with each other, even when separated by distance. Nonetheless, varying cultures approach aging in many different ways.

For this Discussion, you will examine how different countries approach aging.

To prepare for this Discussion:

Consider how different countries approach aging. As you consider different countries, think about the following:

Do older adults live with their children, or are they more likely to live in a nursing home?

Are older adults seen as wise individuals to be respected and revered, or are they a burden to their family and to society?

Next, select two different countries and compare and contrast their approaches to aging.

By Day 4

Post and identify each of the countries you selected.

Then, explain two similarities and two differences in how the countries approach aging.

Be specific and provide examples.

Use your Learning Resources to support your post. Use proper APA format and citations.

The following changes took place last year in Pavolik Company’s balance sheet accounts:

D = Decrease; I = Increase.

Long-term investments that cost the company $9 were sold during the year for $22 and land that cost $21 was sold for $12. In addition, the company declared and paid $6 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and equipment took place during the year. Pavolik did not retire any bonds during the year or issue any new common stock.

The company’s income statement for the year follows:

The company’s beginning cash balance was $104 and its ending balance was $96.

Required:

1. Use the indirect method to determine the net cash provided by operating activities for the year.

2. Prepare a statement of cash flows for the year.

Described below are six independent and unrelated situations involving accounting changes. Each change occurs during 2021 before any adjusting entries or closing entries were prepared. Assume the tax rate for each company is 25% in all years. Any tax effects should be adjusted through the deferred tax liability account.

1. Fleming Home Products introduced a new line of commercial awnings in 2020 that carry a one-year warranty against manufacturer’s defects. Based on industry experience, warranty costs were expected to approximate 3% of sales. Sales of the awnings in 2020 were $4,100,000. Accordingly, warranty expense and a warranty liability of $123,000 were recorded in 2020. In late 2021, the company’s claims experience was evaluated, and it was determined that claims were far fewer than expected: 2% of sales rather than 3%. Sales of the awnings in 2021 were $4,600,000, and warranty expenditures in 2021 totaled $104,650.
2. On December 30, 2017, Rival Industries acquired its office building at a cost of $1,120,000. It was depreciated on a straight-line basis assuming a useful life of 40 years and no salvage value. However, plans were finalized in 2021 to relocate the company headquarters at the end of 2025. The vacated office building will have a salvage value at that time of $760,000.
3. Hobbs-Barto Merchandising, Inc., changed inventory cost methods to LIFO from FIFO at the end of 2021 for both financial statement and income tax purposes. Under FIFO, the inventory at January 1, 2021, is $750,000.
4. At the beginning of 2018, the Hoffman Group purchased office equipment at a cost of $396,000. Its useful life was estimated to be 10 years with no salvage value. The equipment was depreciated by the sum-of-the-years’-digits method. On January 1, 2021, the company changed to the straight-line method.
5. In November 2019, the State of Minnesota filed suit against Huggins Manufacturing Company, seeking penalties for violations of clean air laws. When the financial statements were issued in 2020, Huggins had not reached a settlement with state authorities, but legal counsel advised Huggins that it was probable the company would have to pay $260,000 in penalties. Accordingly, the following entry was recorded:

Late in 2021, a settlement was reached with state authorities to pay a total of $416,000 in penalties.

6. At the beginning of 2021, Jantzen Specialties, which uses the sum-of-the-years’-digits method, changed to the straight-line method for newly acquired buildings and equipment. The change increased current year net earnings by $511,000.

Required:
For each situation:
1. Identify the type of change.
2. Prepare any journal entry necessary as a direct result of the change, as well as any adjusting entry for 2021 related to the situation described.