The following account balances are taken from Sherwood Ltd.’s adjusted trial balance at June 30, 2020:

Prepare a single-step statement of income for the year ended June 30, 2020.

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Prepare a multi-step statement of income for the year ended June 30, 2020.

On the 1st March 2019, Concept Limited purchased printing equipment costing $186,000 by issuing a 5 year, 4% unsecured note payable. The note requires $42,000 annual principal repayments plus interest each 1st March. Journalise the transactions to account for the acquisition of equipment. (Remember to allocate the current and non-current portions of the liability) Accrue interest on the note payable at the 31st December, 2019. Record the payment of the first instalment (including interest) of the note payable on 1st March, 2020 and then accrue interest as at 31st December, 2020. Prepare an excerpt from the Balance Sheet as at 31st December, 2020 showing liabilities.

Habiby, Inc., began operations in 2018 and has the following income and expenses for 2018 through 2021.

a. What is the amount of tax that Habiby should pay each year? If an amount is zero, enter "0".

b. How much would Habiby have paid in tax if the old NOL rules were in place but the corporate tax rate was 21 percent?. If an amount is zero, enter "0".

During 2020, Sweet Company started a construction job with a contract price of $1,620,000. The job was completed in 2022. The following information is available.

(a)

Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.

On December 31, 2020, Jen & Mink Clothing (J&M) performed the inventory count and determined the year-end ending inventory value to be $75,500. It is now January 8, 2021, and you have been asked to double-check the year-end inventory listing. J&M uses a perpetual inventory system. Note: Only relevant items are shown on the inventory listing.

The following situations have been brought to your attention:

1. On January 3, 2021, J&M received a shipment of 100 blue jackets, for $2,000 (Item #7649). The inventory was purchased December 23, 2020, FOB destination from Global Threads. This inventory was included in J&M’s inventory count and inventory listing.
2. On December 29, 2020, J&M sold scarves (Item #5566) to a customer with a sale price of $700 and cost of $500, FOB shipping. The order was shipped on December 30, 2020. J&M has not included this inventory.
3. Red Blazers (Item #6193) were purchased and shipped from International Co. on December 30, 2020, for $3,300, FOB shipping. The shipment arrived January 5, 2021, and the appropriate party paid for the shipping charges of $320. Additional costs were $220 for import duties and $60 for insurance during shipment. J&M has not included this inventory.
4. At year-end, J&M is holding $5,000 of black pants (Item #10824) on consignment for designer Duke Co. This inventory was included in J&M’s inventory count and inventory listing.
5. On December 31, 2020, J&M shipped white shirts (Item #4291), FOB destination costing $1,000 to a customer. The customer was charged $1,400 and the customer received the goods on January 3, 2021. J&M has not included this inventory.

Required:
1. In situations (a) to (e) determine whether inventory should be included or excluded in inventory at December 31, 2020. If the inventory should be included, determine the correct inventory cost. (Do not leave any empty spaces; input a 0 wherever it is required.)

2. Determine the correct ending inventory value at December 31, 2020. Starting with the unadjusted inventory value of $75,500, add or subtract any errors based on your analysis in Part 1. Assume all items that are not shown in the inventory listing are recorded correctly.

Next

14.       Cleaverland purchased 100% of Omaha on January 1, 2019 for $650,000. On that date, Omaha's stockholders' equity was $650,000, and the recognized book values of Ottowa’s individual net assets approximated their fair values. Omaha had net incomes of $150,000 and $190,000 for 2019 and 2020, respectively. The subsidiary paid dividends amounting to $30,000 in both years. Cleaverland uses the equity method to account for its pre-consolidation investment in Omaha.

What was the balance in Equity Investment at December 31, 2020?

a. $650,000

b. $710,000

c. $990,000

d. $930,000

15.       Brendon, Inc. acquired 100% of Weston Enterprises on January 2, 2020. During 2020, Brendon sold Weston for $700,000 goods which had cost $500,000. Weston still owned 40% of the goods at the end of the year. In 2021, Brendon sold goods with a cost of $500,000 to Weston for $700,000, and the buyer still owned 40% of the goods at year-end. For 2021, cost of goods sold was $1,000,000 for Brendon and $990,000 for Weston.

What was consolidated cost of goods sold for 2021?

a.   $1,370,000

b.   $1,290,000

c.   $1,870,000

d.   $1,990,000

Clearwater Co. owned all of the voting common stock of Kelley, Inc. On January 2, 2020 Clearwater sold equipment to Kelley for $350,000. The equipment had cost Clearwater $425,000. At the time of the sale, the balance in accumulated depreciation was $125,000. The equipment had a remaining useful life of eight years and no salvage value.

16.       For the consolidated balance sheet at December 31, 2021, at would amount would the equipment (net) be included?

a.   $225,000

b. $262,500

c.   $306,250

d. $-0-

On April 1, 2020, Republic Company sold equipment to its wholly owned subsidiary, Barre Corporation, for $40,000. At the time of the transfer, the asset had an original cost (to Republic) of $60,000 and accumulated depreciation of $25,000. The equipment has a five year estimated remaining life.Barre reported net income of $250,000, $270,000 and $310,000 in 2020, 2021, and 2022, respectively. Republic received dividends from Barre of $90,000, $105,000 and $120,000 for 2020, 2021, and 2022, respectively.

17.        What was the amount of the gain or loss on the sale of equipment reported by Republic on its pre-consolidation income statement in 2020?

a. $-0-

b. $ 5,000 gain

c.    $20,000 loss

d. $35,000 gain

18.       What was the amount of the credit to depreciation expense on the 2021 consolidation worksheet?

a. $   750

b.   $-0-

c.   $1,000

d.   $1,600

Let: C = consumption, Ip = investment spending (as a function of price level), G = government spending, Tx = tax revenue, Yd = after-tax income, Assume for a given closed economy:

C=100 + 0.9 Yd – 20P

Ip= 400 – 40P G=300

T=100

Moreover, aggregate supply curve for this economy is defined by the following equation:

P=1.41 + 0.0001Y

a. According to the investment equation (Ip= 400 – 40P) as overall price level in the economy increases investment spending decreases. How could you explain this situation? Please use graphs to elaborate your answer.

b. Find the equilibrium level of overall price and aggregate output in this economy. What would be the value of consumption and investment spending at this equilibrium?

c. How would the equilibrium aggregate output and price level change if government spending increases to Gnew=400? What would be the value of consumption and investment spending at this new equilibrium?

d. Compare equilibrium values of investment spending and consumption you find in parts (c) and (d). How would you explain the changes? Elaborate your answer for both investment and consumption.

Lab: Exploration of Avogadro's Law-Determination of Percentage of Sodium Bicarbonate in an Alka-Seltzer Tablet

1) One concern with setting up a closed system experiment where gas is evolved during a reaction is the presence of leaks (another concern is that the system will explode if too much gas evolves!). We know that some leaking of pressure occurs because after a maximum pressure is achieved it slowly starts to decrease with time. Will a leak during gas evolution overstate or understate the amount of sodium bicarbonate in an Alka-Seltzer tablet and why?

2)In our rearranged Ideal Gas Law Δn=(ΔPV)/(RT) we considered V and T to remain constant. Is this a reasonable assumption and why? Assuming that T increased as a function of the reaction, would this cause an overestimation or underestimation of the amount of sodium bicarbonate?

3) To calculate the amount of sodium bicarbonate, we assume that there was enough citric acid to react completely with the sodium bicarbonate. However, if the citric acid is the limiting reagent, then the calculated amount for sodium bicarbonate would be incorrect. How could we experimentally test this possibility? Describe in two sentences how you would change the reaction conditions to account for this.