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.

a. 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 4% of sales. Sales of the awnings in 2020 were $2,500,000. Accordingly, warranty expense and a warranty liability of $100,000 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: 3% of sales rather than 4%. Sales of the awnings in 2021 were $3,000,000, and warranty expenditures in 2021 totaled $68,250.

b. On December 30, 2017, Rival Industries acquired its office building at a cost of $800,000. 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 $600,000.

c. 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 $590,000.

d. At the beginning of 2018, the Hoffman Group purchased office equipment at a cost of $220,000. 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.

e. 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 $100,000 in penalties. Accordingly, the following entry was recorded:

Late in 2021, a settlement was reached with state authorities to pay a total of $240,000 in penalties.

f. 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 $335,000.

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

What changes might a pregnant woman make to her diet? What things might she avoid? What things might she increase or decrease? Why? What Nutrients are vital to a newborn? Have you ever known anyone while they were pregnant? Did they follow these dietary habits during their pregnancy/

What Nutrients are most important for a growing child? Why? What did you eat growing up?

Is the food you buy from your local street vendor or restaurant 'safe?' What do you think? How about the food from your local grocery store or a big chain store? Is frozen food good for you? Packaged food? Fresh food? Tell me what you think and why.

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 2% of sales. Sales of the awnings in 2020 were $3,600,000. Accordingly, warranty expense and a warranty liability of $72,000 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: 1% of sales rather than 2%. Sales of the awnings in 2021 were $4,100,000, and warranty expenditures in 2021 totaled $93,275.
2. On December 30, 2017, Rival Industries acquired its office building at a cost of $1,020,000. 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 $710,000.
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 $700,000.
4. At the beginning of 2018, the Hoffman Group purchased office equipment at a cost of $341,000. 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 $210,000 in penalties. Accordingly, the following entry was recorded:

Late in 2021, a settlement was reached with state authorities to pay a total of $361,000 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 $456,000.

1. 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. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

• Record journal entry as a direct result of the change.

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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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:

Late in 2018, a settlement was reached with state authorities to pay a total of $273,000 in penalties.

6. 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.

  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. Record Journal Entry as direct result of change.

2. Record adjusting entry for change in warranty.

3. as a direct result of the change.

4. Adjusting entry for depreciation.

5. a direct result of the change.

6. adjusting entry for change in inventory cost method.

7. as a direct result of the change.

8. adjusting entry for depreciation.

9. as a direct result of the change.

10. as a direct result of the change.

11. adjusting entry for change in depreciation method from sum-of-the-years'-digits method to straight-line method.

Fiscal Policy Recommendation

Write recommendations for government fiscal policy (specific spending and taxation changes) that you feel would be best for the Canadian economy using your understanding of the economics concepts taught in the course. Use the following guidelines as you write your recommendations: Give consideration to the impact your decisions would have on each of the economic indicators. Your discussion might consider some of the following topics: government debt and the budget surplus or deficit; the impact of these recommendations on government services; how Canadians will benefit from the recommended policies in the short term and in the long term; the multiplier effect; any potential problems with your recommendations. These are just some suggestions. Your argument should discuss several ways that your ideas will impact the economy. The recommendations you discuss could include several of these areas but you can use any relevant course concepts to justify your recommendations.

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

Asset and Contra-Asset Accounts Liabilities and Stockholders' Equity Accounts
Cash $ 30 D Accounts payable $ 92 I
Accounts receivable $ 34 I Accrued liabilities $ 34 D
Inventory $ 78 D Income taxes payable $ 39 I
Prepaid expenses $ 29 I Bonds payable $ 284 I
Long-term investments $ 31 D Common stock $ 136 D
Property, plant, and equipment $ 545 I Retained earnings $ 112 I
Accumulated depreciation $ 112 I

D = Decrease; I = Increase.

Long-term investments that cost the company $31 were sold during the year for $66 and land that cost $65 was sold for $34. In addition, the company declared and paid $28 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:

Sales $ 1,320
Cost of goods sold 586
Gross margin 734
Selling and administrative expenses 520
Net operating income 214
Nonoperating items:
Loss on sale of land $ (31 )
Gain on sale of investments 35 4
Income before taxes 218
Income taxes 78
Net income $ 140

The company’s beginning cash balance was $148 and its ending balance was $118.

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.

What can you infer about the changes in U.K. pound–euro exchange rate during July and August 2014? Can you think of a reason for the behavior of that exchange rate?

If the dollar continues its upward path against the euro, what do you predict will be the consequences for U.S. and European relative inflation rates?

You will investigate how unnatural amino acid mutagenesis works. Take time to examine what changes needed to be made to the tRNA to allow for an unnatural amino acid to be used instead of the native substrate. Also focus on what codons are used to recognize the modified tRNA. How many different codons are there that can be used? What are they called?

Discussion Question 1:

Budget vs. Actual

Describe why percentage changes identified in the budgeted vs. actual reports need to be interpreted carefully.
Provide a numerical example to aid in your explanation.

Discussion Question 2:

Paper vs. Excel vs. QuickBooks

Based on what you have learned in studying accounting in textbooks and in some cases utilizing Microsoft Excel templates for completing assignments, would you prefer to use paper, Excel, or QuickBooks to prepare financial statements and reports? Would you use just one program, both, or some other software?