Jason Company offered a contest in which the winner would receive P1,000,000 payable over twenty years. On December 31, 2019, Jason Company announced the winner of the contest and signed a note payable to the winner for P1,000,000 payable in P50,000 installments every January 31. On December 31, 2019, Jason Company purchased an annuity for P418,250 to provide the P950,000 prize remaining after the first P50,000 installment which was paid on January 31, 2020. On December 31, 2019, what amount should be reported as note payable-contest winner, net of current portion?
In: Accounting
|
Question 5 On January 1, 2020, Splish Company purchased $350,000, 8% bonds of Aguirre Co. for $322,973. The bonds were purchased to yield 10% interest. Interest is payable semiannually on July 1 and January 1. The bonds mature on January 1, 2025. Splish Company uses the effective-interest method to amortize discount or premium. On January 1, 2022, Splish Company sold the bonds for $324,733 after receiving interest to meet its liquidity needs. |
| (e) | Prepare the journal entry to record the sale of the bonds on January 1, 2022. |
In: Accounting
Sunland Company, a manufacturer of audio systems, started its
production in October 2020. For the preceding 3 years, Sunland had
been a retailer of audio systems. After a thorough survey of audio
system markets, Sunland decided to turn its retail store into an
audio equipment factory.
Raw material costs for an audio system will total $77 per unit.
Workers on the production lines are on average paid $13 per hour.
An audio system usually takes 6 hours to complete. In addition, the
rent on the equipment used to assemble audio systems amounts to
$5,100 per month. Indirect materials cost $5 per system. A
supervisor was hired to oversee production; her monthly salary is
$3,700.
Factory janitorial costs are $2,000 monthly. Advertising costs for
the audio system will be $9,000 per month. The factory building
depreciation expense is $6,000 per year. Property taxes on the
factory building will be $8,400 per year.
Assuming that Sunland manufactures, on average, 1,000 audio systems per month, enter each cost item on your answer sheet, placing the dollar amount per month under the appropriate headings. Total the dollar amounts in each of the columns.
|
Cost Item |
Direct |
Direct |
Manufacturing |
Period |
||||
| Raw materials |
$ |
$ |
$ |
$ |
||||
| Wages for workers | ||||||||
| Rent on equipment | ||||||||
| Indirect materials | ||||||||
| Factory supervisor’s salary | ||||||||
| Janitorial costs | ||||||||
| Advertising | ||||||||
| Depreciation on factory building | ||||||||
| Property taxes on factory building | ||||||||
|
$ |
$ |
$ |
$ |
Compute the cost to produce one audio system.
In: Accounting
Assume that a Parent company acquires an 80% interest in its Subsidiary on January 1, 2020. On January 1, 2020, the book value of net assets and the fair value of the identifiable net assets equaled the book value of identifiable net assets (i.e. there was no AAP or Goodwill). The parent uses the equity method to account for its investment in the subsidiary.
On December 31, 2021, the Subsidiary company issued $1,000,000 (face) 6 percent, five-year bonds to an unaffiliated company for $1,085,379. The bonds pay interest annually on December 31, and the bond premium is amortized using the straight-line method. This results in annual bond-payable premium amortization equal to $17,076 per year.
On December 31, 2023, the Parent paid $974,229 to purchase all of the outstanding Subsidiary company bonds. The bond discount is amortized using the straight-line method, which results in annual bond-investment discount amortization equal to $8,590 per year.
The Parent and the Subsidiary report the following financial statements for the year ended December 31, 2024:
| Income Statement | ||
|---|---|---|
| Parent | Subsidiary | |
| Sales | $1,100,000 | $800,000 |
| Cost of goods sold | -440,000 | -450,000 |
| Gross Profit | 660,000 | 350,000 |
| Income (loss) from subsidiary | 119,995 | |
| Bond interest income | 68,590 | |
| Bond interest expense | -42,924 | |
| Operating expenses | -230,000 | -125,000 |
| Net income | $618,585 | $182,076 |
| Statement of Retained Earnings | ||
|---|---|---|
| Parent | Subsidiary | |
| BOY Retained Earnings | $4,000,000 | $450,000 |
| Net income | 618,585 | 182,076 |
| Dividends | -200,000 | -25,000 |
| EOY Retained Earnings | $4,418,585 | $607,076 |
| Balance Sheet | ||
|---|---|---|
| Parent | Subsidiary | |
| Assets: | ||
| Cash | $1,750,000 | $800,000 |
| Accounts receivable | 800,000 | 750,000 |
| Inventory | 1,200,000 | 250,000 |
| Equity Investment | 2,095,393 | |
| Investment in subsidiary | 982,819 | |
| PPE, net | 14,046,480 | 4,677,227 |
| $20,874,692 | $6,477,227 | |
| Liabilities and Stockholders’ Equity: | ||
| Accounts payable | $1,600,000 | $838,000 |
| Current Liabilities | 2,200,000 | 1,100,000 |
| Bonds payable | 1,034,152 | |
| Long-term Liabilities | 2,226,100 | 950,000 |
| Common Stock | 1,162,000 | 398,000 |
| APIC | 9,268,007 | 1,550,000 |
| Retained Earnings | 4,418,585 | 607,076 |
| $20,874,692 | $6,477,227 | |
Required
Provide the consolidation entries worksheet for the year ended December 31, 2024.
| Account | Debit | Credit | |
|---|---|---|---|
| [C] | Income (loss) from subsidiary | Answer | Answer |
| AnswerDividendsIncome attributable to noncontrolling interestInterest expenseInterest incomeNoncontrolling interestsRetained earnings | Answer | Answer | |
| AnswerDividendsIncome attributable to noncontrolling interestInterest expenseInterest incomeNoncontrolling interestsRetained earnings | Answer | Answer | |
| Equity investment | Answer | Answer | |
| Noncontrolling interest | Answer | Answer | |
| [E] | Common stock | Answer | Answer |
| APIC | Answer | Answer | |
| AnswerDividendsIncome attributable to noncontrolling interestInterest expenseInterest incomeNoncontrolling interestsRetained earnings | Answer | Answer | |
| Equity investment | Answer | Answer | |
| AnswerDividendsIncome attributable to noncontrolling interestInterest expenseInterest incomeNoncontrolling interestsRetained earnings | Answer | Answer | |
| [Ibond] | Bond payable (net) | Answer | Answer |
| AnswerDividendsIncome attributable to noncontrolling interestInterest expenseInterest incomeNoncontrolling interestsRetained earnings | Answer | Answer | |
| Equity investment | Answer | Answer | |
| Investment in bonds (net) | Answer | Answer | |
| AnswerDividendsIncome attributable to noncontrolling interestInterest expenseInterest incomeNoncontrolling interestsRetained earnings | Answer | Answer |
If it says "Answer" in the box that is the question/missing data. If it says Answer with a bunch of words after it those are the choices from the drop down menu. (For example the journal entries some of the descriptions are missing along with the debit/credit amount)
In: Accounting
The following information relates to a company ABC Ltd for the year ended 30 June 2020:
|
Transaction totals for the year ended 30 June 2020 |
R |
|
Credit purchases of raw materials |
503750 |
|
Freight on raw materiasl purchased (on credit) |
99833 |
|
Sales of finished producgts |
11440000 |
|
Direct Labour: |
|
|
Factory wages |
828600 |
|
Pension fund contributions paid by employer |
172500 |
|
Medical aid paid by employer |
227200 |
|
UIF Contributions paid by employer |
8144 |
|
Indirect Labour |
500250 |
|
Electricity |
|
|
Factory |
211450 |
|
Administration offices |
127900 |
|
Rent Expenses |
|
|
Factory |
82700 |
|
Administration offices |
105900 |
|
Telephone and fax |
|
|
Facotry |
111166 |
|
Administrative offices |
145438 |
|
Insurance |
|
|
Factory |
205894 |
|
Administration offices |
132716 |
|
Selling and administration costs |
327195 |
|
Stationary |
60445 |
|
Salaries and administration staff |
488250 |
|
Sales returns of finished products |
49361 |
|
Consumabiles stores (indirect materials issued to the factory) |
144710 |
|
Depreciation on factory machinery |
180211 |
|
Balances on 1 July 2019 |
R |
|
Raw Materials inventory |
127894 |
|
Work in progress inventory |
43394 |
|
Finished goods inventory |
216450 |
|
Balances on 30 June 2020 |
R |
|
Work in process goods on hand |
617450 |
|
Raw material on hand |
99000 |
|
Finished products on hand |
477716 |
Required:
Prepare the production cost statement, trading statement and the relevant notes for the year ended 30 June 2020.
In: Accounting
Elias Company has prepared a budget for the first six months of
2020. Monthly budgets for revenues are provided at left. Experience
indicates that Elias will collect 75% of sales in the month of
sale, 15% in the month following the sale, and 7.5% in the second
month after the sale. The remaining 2.5% of sales are expected to
be uncollectible.
Prepare a cash collections budget
for Elias for the months of March, April, and May
2020. Show your work.
| Revenues budget: | |
| January | 8,537,500 |
| February | 9,748,615 |
| March | 10,250,324 |
| April | 8,904,561 |
| May | 12,358,975 |
| June | 14,548,289 |
| 64,348,264 | |
| Collections experience: | |
| Month of sale | 75.0% |
| Month after sale | 15.0% |
| 2 months after sale | 7.5% |
| Uncollectible | 2.5% |
| 100.0% | |
Please so some calculations, I'm having difficulty trying to follow just numbered answers.
In: Finance
Blossom Incorporated leases a piece of machinery to Pina Company
on January 1, 2020, under the following terms.
| 1. | The lease is to be for 4 years with rental payments of $15,557 to be made at the beginning of each year. | |
| 2. | The machinery’ has a fair value of $81,480, a book value of $60,800, and an economic life of 10 years. | |
| 3. | At the end of the lease term, both parties expect the machinery to have a residual value of $30,400. To protect against a large loss, Blossom requests Pina to guarantee $21,550 of the residual value, which Irving agrees to do. | |
| 4. | The lease does not transfer ownership at the end of the lease term, does not have any bargain purchase options, and the asset is not of a specialized nature. | |
| 5. | The implicit rate is 5%, which is known by Pina. | |
| 6. | Collectibility of the payments is probable. |
In: Accounting
During 2020, Martinez Company started a construction job with a contract price of $1,610,000. The job was completed in 2022. The following information is available.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Costs incurred to date |
$405,900 | $766,500 | $1,076,000 | |||
|
Estimated costs to complete |
584,100 | 328,500 | –0– | |||
|
Billings to date |
300,000 | 893,000 | 1,610,000 | |||
|
Collections to date |
267,000 | 809,000 | 1,435,000 |
Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.
|
Gross profit recognized in 2020 |
$enter a dollar amount |
|
|---|---|---|
|
Gross profit recognized in 2021 |
$enter a dollar amount |
|
|
Gross profit recognized in 2022 |
$enter a dollar amount |
List of Accounts
Question Part Score
--/3
Prepare all necessary journal entries for 2021. (Credit account titles are automatically indented when 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. For costs incurred use account Materials, Cash, Payables.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
(To record cost of construction.) |
||
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
(To record progress billings.) |
||
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
(To record collections.) |
||
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
(To recognize revenue.) |
List of Accounts
Question Part Score
--/9
Compute the amount of gross profit to be recognized each year, assuming the completed-contract method is used.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Gross profit |
$enter a dollar amount |
$enter a dollar amount |
$enter a dollar amount |
In: Accounting
During 2020, Martinez Company started a construction job with a contract price of $1,610,000. The job was completed in 2022. The following information is available.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Costs incurred to date |
$405,900 | $766,500 | $1,076,000 | |||
|
Estimated costs to complete |
584,100 | 328,500 | –0– | |||
|
Billings to date |
300,000 | 893,000 | 1,610,000 | |||
|
Collections to date |
267,000 | 809,000 | 1,435,000 |
Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.
|
Gross profit recognized in 2020 |
$enter a dollar amount |
|
|---|---|---|
|
Gross profit recognized in 2021 |
$enter a dollar amount |
|
|
Gross profit recognized in 2022 |
$enter a dollar amount |
List of Accounts
Question Part Score
--/3
Prepare all necessary journal entries for 2021. (Credit account titles are automatically indented when 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. For costs incurred use account Materials, Cash, Payables.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
(To record cost of construction.) |
||
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
(To record progress billings.) |
||
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
(To record collections.) |
||
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
(To recognize revenue.) |
List of Accounts
Question Part Score
--/9
Compute the amount of gross profit to be recognized each year, assuming the completed-contract method is used.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Gross profit |
$enter a dollar amount |
$enter a dollar amount |
$enter a dollar amount |
In: Accounting
On July 31, 2020, Ivanhoe Company paid $2,750,000 to acquire all of the common stock of Conchita Incorporated, which became a division (a reporting unit) of Ivanhoe. Conchita reported the following balance sheet at the time of the acquisition.
|
Current assets |
$830,000 |
Current liabilities |
$550,000 |
|||
|---|---|---|---|---|---|---|
|
Noncurrent assets |
2,450,000 |
Long-term liabilities |
450,000 |
|||
|
Total assets |
$3,280,000 |
Stockholders’ equity |
2,280,000 |
|||
|
Total liabilities and stockholders’ equity |
$3,280,000 |
It was determined at the date of the purchase that the fair value
of the identifiable net assets of Conchita was $2,425,000. Over the
next 6 months of operations, the newly purchased division
experienced operating losses. In addition, it now appears that it
will generate substantial losses for the foreseeable future. At
December 31, 2020, Conchita reports the following balance sheet
information.
| Current assets |
$400,000 |
||
| Noncurrent assets (including goodwill recognized in purchase) |
2,160,000 |
||
| Current liabilities |
(600,000 |
) |
|
| Long-term liabilities |
(400,000 |
) |
|
| Net assets |
$1,560,000 |
Finally, it is determined that the fair value of the Conchita
Division is $1,850,000.
(1) Compute the amount of goodwill recognized, if any, on July 31, 2020. (If answer is zero, do not leave answer field blank. Enter 0 for the amount.)
(2)Determine the impairment loss, if any, to be recorded on December 31, 2020. (If answer is zero, do not leave answer field blank. Enter 0 for the amount.)
(3)Assume that fair value of the Conchita Division is $1,490,000 instead of $1,850,000. Determine the impairment loss, if any, to be recorded on December 31, 2020. (If answer is zero, do not leave answer field blank. Enter 0 for the amount.)
(4)Prepare the journal entry to record the impairment loss, if any, and indicate where the loss would be reported in the income statement. (Credit account titles are automatically indented when 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.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title |
enter a debit amount |
enter a credit amount |
|
enter an account title |
enter a debit amount |
enter a credit amount |
| This loss will be reported in income as a separate line item before the subtotal |
In: Accounting