During 2020, Shamrock Company started a construction job with a contract price of $1,600,000. The job was completed in 2022. The following information is available.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Costs incurred to date |
$405,900 | $830,680 | $1,074,000 | |||
|
Estimated costs to complete |
584,100 | 262,320 | –0– | |||
|
Billings to date |
302,000 | 898,000 | 1,600,000 | |||
|
Collections to date |
272,000 | 818,000 | 1,420,000 |
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 |
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.) |
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
CSI Products Ltd., a public company, purchased a patent on January 1, 2020, for $ 1,120,000. At the time of the purchase, the patent had a remaining legal life of 20 years. In January 2023, CSI spent $ 92,000 successfully defending the patent in court. One of the other results of the court case was the discovery that the patent would only have a remaining useful life of 9 years. CSI’s year end was December 31.
Instructions Prepare the entries on the books of CSI to record
a) To record the purchase of the patent
b) To record the legal defence of the patent
c) To record 2023 amortization
Part B. The owners of Amazon Corp. are planning to sell the business. The cumulative earnings for the past five years are $ 600,000 including non-recurring losses of $ 100,000. The annual earnings based on an average rate of return for this industry would be $ 80,000. If excess earnings are to be capitalized at 12%, what is the implied goodwill?
In: Accounting
Bell Company, a manufacturer of audio systems, started its
production in October 2020. For the preceding 3 years, Bell had
been a retailer of audio systems. After a thorough survey of audio
system markets, Bell 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 $15 per hour.
An audio system usually takes 7 hours to complete. In addition, the
rent on the equipment used to assemble audio systems amounts to
$6,000 per month. Indirect materials cost $5 per system. A
supervisor was hired to oversee production; her monthly salary is
$3,800.
Factory janitorial costs are $2,200 monthly. Advertising costs for
the audio system will be $9,200 per month. The factory building
depreciation expense is $6,000 per year. Property taxes on the
factory building will be $9,600 per year.
Assuming that Bell 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.
|
Product Costs |
||||||||
|
|
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 | ||||||||
|
$ |
$ |
$ |
$ |
|||||
In: Accounting
Marigold Company has the following investments as of December 31, 2020:
| Investments in common stock of Laser Company | $1,430,000 | |
| Investment in debt securities of FourSquare Company | $3,090,000 |
In both investments, the carrying value and the fair value of these
two investments are the same at December 31, 2020. Marigold’s stock
investments does not result in significant influence on the
operations of Laser Company. Marigold’s debt investment is
considered held-to-maturity. At December 31, 2021, the shares in
Laser Company are valued at $990,000; the debt investment
securities of FourSquare are valued at $2,310,000 and are
considered impaired.
New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is partially correct.
Prepare the journal entry to record the impairment of the debt securities at December 31, 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.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
| Dec. 31, 2021 | |||
eTextbook and Media
Assistance Used
List of Accounts
Partially correct answer iconYour answer is partially correct.
Assuming the fair value of the Laser shares is $1,320,000 and the value of its debt investment is $2,790,000, what entries, if any, should be recorded in 2022 related to impairment? (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.)
|
Date |
Account Titles and Explanation |
Debit |
Credit |
| Dec. 31, 2022 | |||
eTextbook and Media
List of Accounts
New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is partially correct.
Assume that the debt investment in FourSquare Company was available-for-sale and the expected credit loss was $880,000. Prepare the journal entry to record this impairment on December 31, 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.)
|
Account Titles and Explanation |
Debit |
Credit |
In: Accounting
Cullumber Company purchased a patent on January 1, 2020 for
$712000. The patent had a remaining useful life of 10 years at that
date. In January of 2021, Cullumber successfully defends the patent
at a cost of $302400, extending the patent’s life to 12/31/32. What
amount of amortization expense would Cullumber record in
2021?
| $101440 |
| $71200 |
| $78600 |
| $83600 |
In: Accounting
During 2020, Blossom Company started a construction job with a contract price of $1,590,000. The job was completed in 2022. The following information is available.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Costs incurred to date |
$410,000 | $901,180 | $1,067,000 | |||
|
Estimated costs to complete |
590,000 | 197,820 | –0– | |||
|
Billings to date |
297,000 | 903,000 | 1,590,000 | |||
|
Collections to date |
271,000 | 805,000 | 1,434,000 |
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 |
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.) |
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
Presented below is an aging schedule for the Ivan Company at December 31, 2020:
| Customer | Balance | Not Yet Due | 1-30 past due | 31-60 past due | 61-90 past due | Over 90 |
| Culberson | $24,000 | $ 9,000 | $15,000 | |||
| Samsa | 30,000 | $30,000 | ||||
| Burks | 50,000 | 5,000 | 5,000 | $40,000 | ||
| Greuel | 38,000 | $38,000 | ||||
| Others | 120,000 | 72,000 | 35,000 | 13,000 | ||
| $262,000 | $107,000 | $49,000 | $28,000 | $40,000 | $38.000 | |
| % estimated uncollectible | 3% | 7% | 12% | 24% | 60% | |
| Total estimated uncollectible | $42,400 | $3,210 | $3,430 | $3,360 | $9,600 | $22,800 |
At December 31 2020, the unadjusted balance in Allowance for Doubtful Account is a credit of $10,000.
Instructions: Cut and paste the general journal below in your window and use it to journalize your entries to answer questions A, C, And D.
[A] Using information above, record the adjusting entry to adjust the allowance for doubtful accounts at December 31, 2020.
General Journal:
| Question# | Account | Debit | Credit |
[B] What is the net (cash) realizable value of accounts receivable after the adjustment is made to record bad debt expense?
(please label answer clearly in your solution/window)
[C] Journalize the following events that occurred in 2021. If no journal entry is required please indicate that no entry is necessary. Use the general journal that you cut and paste in your solution to answer the question.
(1) March 1, a customer with an accounts receivable balance of $400 is deemed uncollectible.
(2) May 1, a check for $400 is received from the customer above.
[D] Journalize the entry to adjust the allowance for doubtful accounts at December 31, 2021 assuming that the unadjusted balance in Allowance for Doubtful Accounts is a debit of $1,400 and the aging schedule indicates that total estimated collectible accounts will be $36,700.
In: Accounting
For the year ended December 31, 2020, the job cost sheets of
DeVoe Company contained the following data:
| Job Number | Explanation | Direct Materials |
Direct Labour |
Manufacturing Overhead |
Total Costs |
||||||
| 7640 | Balance 1/1 | $25,100 | $24,500 | $29,800 | $79,400 | ||||||
| Current year’s costs | 31,000 | 35,300 | 43,300 | 109,600 | |||||||
| 7641 | Balance 1/1 | 11,600 | 18,800 | 21,900 | 52,300 | ||||||
| Current year’s costs | 43,900 | 48,400 | 58,600 | 150,900 | |||||||
| 7642 | Current year’s costs | 48,900 | 56,000 | 66,600 | 171,500 | ||||||
Other data:
| 1. | Raw materials inventory totalled $15,200 on January 1. During the year, $140,300 of raw materials were purchased on account. |
| 2. | Finished goods on January 1 consisted of Job No. 7638 for $87,200 and Job No. 7639 for $92,200. |
| 3. | Job No. 7640 and Job No. 7641 were completed during the year. |
| 4. | Jobs 7638, 7639, and 7641 were sold on account for $530,400. |
| 5. | Manufacturing overhead incurred on account totalled $118,000. |
| 6. |
Other manufacturing overhead consisted of indirect materials $13,600, indirect labour $19,500, and depreciation on factory machinery $8,000. |
Prove the agreement of Work in Process Inventory with job cost sheets pertaining to unfinished work. Calculate each of the following, then post each to the T account: (1) beginning balance, (2) direct materials, (3) direct labour, (4) manufacturing overhead, and (5) completed jobs. (Post entries in the order displayed in the problem statement.)
| 1. | beginning balance | $ | |
| 2. | direct materials | $ | |
| 3. | direct labour | $ | |
| 4. | manufacturing overhead | $ | |
| 5. | completed jobs | $ | |
| closing balance | $ |
Prepare the adjusting entry for manufacturing overhead, assuming
the balance is allocated entirely to Cost of Goods Sold.
(Credit account titles are automatically indented when
the amount is entered. Do not indent
manually.)
|
Account Titles and Explanation |
Debit |
Credit |
|
In: Accounting
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In: Accounting
At 2020 fye Poppers Corp. Net Income was $4.830 m and the
company had an issue of 24,000
options with a strike price of $50.00. There were 2.8 m shares of
common stock outstanding. The company’s market
cap was $127 m and its balance sheet showed $3.6m of $100 par, 4.3%
convertible preferred stock. Poppers uses the
treasury method for calculating diluted eps. The preferred stock
may be converted at the ratio of four common shares
per one share of preferred.
What is the basic and fully diluted eps?
Please explain how you got the answer
In: Accounting