Use the following information below for The Cashew Company for March 31, 2020:

- Balance per bank statement is $27,248 and the balance per books is $30,851.

- Checks, amounting to $1,341, were still outstanding as of March 31

- A note receivable was collected by Persons’ Bank on behalf of Cashew and credited to the company’s account for $5,150.

- Bank service fees amounted to $120

- Interest was credited to Cashew’s account for $98.

- Check no. 114, for utilities expense, had erroneously been entered into the Cashew’s books as $608; the check cleared the bank for $806.

- Check No. 1272 for $500 was classified as “Not-Sufficient-Funds” (NSF) by Persons’ Bank and returned to Cashew. The check had been written by Jane Jones, who is one of Cashew’s customers

- Cashew deposited $9,374 into the ATM machine’s drop box at Persons’ Bank on March 31^st. The bank has not yet credited the account.

Directions:

Prepare the bank reconciliation and prepare all necessary adjusting entries to update the cash balance at the end of the month.

Blossom Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2020. The lease is for an 8-year period and requires equal annual payments of $32,207 at the beginning of each year. The first payment is received on January 1, 2020. Blossom had purchased the machine during 2016 for $146,000. Collectibility of lease payments by Blossom is probable. Blossom set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Blossom at the termination of the lease.

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Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to 0 decimal places e.g. 5,275.)

Crane Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2020. The lease is for an 8-year period and requires equal annual payments of $30,688 at the beginning of each year. The first payment is received on January 1, 2020. Crane had purchased the machine during 2016 for $115,000. Collectibility of lease payments by Crane is probable. Crane set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Crane at the termination of the lease.

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Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to 0 decimal places e.g. 5,275.)

Prepare all necessary journal entries for Crane for 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places e.g. 5,275.)

Suppose the collectibility of the lease payments was not probable for Crane. Prepare the necessary journal entry for the company in 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Suppose at the end of the lease term, Crane receives the asset and determines that it actually has a fair value of $1,150 instead of the anticipated residual value of $0. Record the entry to recognize the receipt of the asset for Crane at the end of the lease term. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places e.g. 5,275.)

Alexandria Company uses a standard costing system. At the beginning of the 2020 financial year Alexandria adopted the following standards:

Alexandria’s July 2019 budget was based on the denominator volume of 40,000 direct labour hours. Alexandria’s actual July production was 7,800 units. The records for July indicated the following:

The company’s policy is to record materials variances at the time materials are purchased.

Required

1. Compute all possible variances from the case facts for the month of July. Label each variance calculated and indicate whether each variance is favourable (F) or unfavourable (U).
2. Maggie is rushing to prepare for her ACFI2003 final exam. She cannot understand why variable overhead has an efficiency variance, but fixed overhead does not. She is puzzled why fixed overhead has a volume variance and variable overhead does not. She reasoned that, “After all, overhead is overhead. So fixed and variable overhead should have the same type of variances”. Do you agree with Maggie? Explain in full why you agree or disagree

On July 1, 2020, a company borrows $500,000 under a long-term loan. The $500,000 will be paid back in five annual instalments of $100,000 each, starting on June 30, 2021. What will be the company's long-term loan balance, shown in the long-term liability section of its statement of financial position, at December 31, 2021?

a)$400,000.

b)$350,000.

c)$300,000.

d)Cannot tell, as the interest rate on the loan has not been provided

Alexandria Company uses a standard costing system. At the beginning of the 2020 financial year Alexandria adopted the following standards:

Alexandria’s July 2019 budget was based on the denominator volume of 40,000 direct labour hours. Alexandria’s actual July production was 7,800 units. The records for July indicated the following:

The company’s policy is to record materials variances at the time materials are purchased.

Required

1. Compute all possible variances from the case facts for the month of July. Label each variance calculated and indicate whether each variance is favourable (F) or unfavourable (U).
2. Maggie is rushing to prepare for her ACFI2003 final exam. She cannot understand why variable overhead has an efficiency variance, but fixed overhead does not. She is puzzled why fixed overhead has a volume variance and variable overhead does not. She reasoned that, “After all, overhead is overhead. So fixed and variable overhead should have the same type of variances”. Do you agree with Maggie? Explain in full why you agree or disagree.

During 2020, Sage Company started a construction job with a contract price of $1,620,000. The job was completed in 2022. The following information is available. 2020 2021 2022 Costs incurred to date $444,400 $867,420 $1,060,000 Estimated costs to complete 565,600 230,580 –0– Billings to date 301,000 904,000 1,620,000 Collections to date 272,000 814,000 1,411,000 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 1060000 Gross profit recognized in 2021 $enter a dollar amount Gross profit recognized in 2022 $enter a dollar amount SHOW LIST OF ACCOUNTS 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.) SHOW LIST OF ACCOUNTS 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

The following information was gathered for Zeba Company for the year ended December 31, 2020:

Assume that the cost-allocation base is direct labor-hours.

The journal entry to write off over-/under-allocated overhead at year end is:

Group of answer choices

DR Manufacturing overhead allocated                   $660,000

                              CR Cost of Goods Sold $ 60,000

                              CR Manufacturing overhead control (actual)                      $600,000

DR Manufacturing overhead allocated                   $550,000

DR Cost of Goods Sold $ 50,000

                              CR Manufacturing overhead control (actual)                      $600,000

DR Manufacturing overhead allocated $600,000

                              CR Cost of Goods Sold $ 50,000                           

CR Manufacturing overhead control (actual) $550,000

DR Manufacturing overhead allocated                   $500,000

DR Cost of Goods Sold $100,000

                              CR Manufacturing overhead control (actual)                      $600,000

Sunland Incorporated leases a piece of machinery to Culver Company on January 1, 2020, under the following terms.

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Evaluate the criteria for classification of the lease, and describe the nature of the lease.

For the lessee, it is a _________________ , and for the lessor, it is a ___________________.   

Prepare the journal entries for Culver for the year 2020. (Credit account titles are automatically indented when the 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. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 5,275.)

Prepare the journal entries for Sunland for the year 2020. (Credit account titles are automatically indented when the 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. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 5,275.)

Evaluate the criteria for classification of the lease, and describe the nature of the lease, assuming that Culver did not guarantee any amount of the expected residual value.

For the lessee, it is a __________________ , and for the lessor, it is a _____________________.

Suppose Culver did not guarantee any amount of the expected residual value. Prepare the journal entries for Culver for the year 2020. (Credit account titles are automatically indented when the 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. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 5,275.)

Suppose Culver did not guarantee any amount of the expected residual value. Prepare the journal entries for Sunland for the year 2020. (Credit account titles are automatically indented when the 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. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 5,275.)