Marimarsh Corporation reported the following pretax financial income (loss) for the years 2019 to 2021.

Pretax financial income (loss) and taxable income (loss) were the same for all years. The applicable tax rates are 30% for 2019, and 20% for 2020 and 2021.

Instructions:

a) Prepare the journal entry in 2019 to record income tax expense.

b) Prepare the journal entries in 2020 for the tax effects of the loss carryforward, assuming that based on the weight of evidence it is more likely than not that one-quarter of the benefits of the loss carryforward will not be realized.

c) Prepare the journal entry in 2021 to record income tax expense.

Referring to information in Brief Exercise 14-18, assume that Henry Inc. sold its holdings of Container Corpora-tion bonds on July 2, 2020, for $4,800. Record the sale of the debt investment, eliminating the Fair Value Adjust-ment account upon sale.

brief 14-18 Henry Inc. purchased $5,000 of Container Corporation’s 5% bonds at par. The purchase is made on January 1,

2020, and the investment is classified as a trading security. At June 30, 2020, Henry Inc. received semiannual

interest of $125, and the fair value of the bonds was $4,800. Prepare Henry’s journal entries for (a) the purchase

of the investment, (b) the interest received, and (c) the fair value adjustment.

Problem 9-5A Calculating depreciation—partial periods LO2, 3

West Coast Tours runs boat tours along the west coast of British Columbia. On March 5, 2020, it purchased, with cash, a cruising boat for $936,000, having a useful life of 10 years or 13,800 hours, with a residual value of $246,000. The company’s year-end is December 31.

Required:
Calculate depreciation expense for the fiscal years 2020, 2021, and 2022 by completing a schedule. (Note: Depreciation is calculated to the nearest month. Assume actual hours of service were: 2020, 900; 2021, 1,960; 2022, 1,715.)
Depreciation MethodYearStraight-LineDouble-Declining BalanceUnits-of-Production202020212022

on April 1 2018, company sold 10,000 bonds ($1,000 face value) at 11% semi-annually. they are due April 1 2028.

proceeds from the bonds were 9,156,946 and their coupon dates are april 1 and october 1

on april 1 2020 , the company bough back 6,000 bonds for 5,331,000 cash.

- prepare journal entries for the bonds from sale (april 1, 2018 to the end of year 2020 (12/31/20)

- what are the 12/31/20 balances in the related bonds, discount, and interest payable (from T accounts)

- what amounts related to the bonds will appear in the income statement for 2020 and how will they be reported/classified?

La Extended, S.A. sold specialized equipment at a price of $ 900,000 each, with a unit cost of $ 400,000.
On March 1, 2020, it sold 2 pieces of equipment on credit that include a one-year warranty for defects in their components, with the commitment to replace those that present failures. It is estimated that $ 120,000 could be claimed for defects in these components. Both clients took the extended warranty offered and handed in $ 30,000 in cash each to cover an extra year.
On March 25, 2020, one of the customers claimed that the equipment's system was not working properly. La Extended, S.A. replaced the component that had failures, which had a cost of $ 20,000 and discarded the previous one.
On October 20, 2021, the other client claimed equipment failures, so La Extended, S.A. discarded the failed component and replaced it with a new one at a cost of $ 8,000.

a. The record (s) corresponding to the month of March 2020 will increase Net Income by:

b. The record (s) corresponding to the month of March 2020 will increase Net Income by:

On January 1, 2020, ABC Co. paid $800,000 to acquire common shares of XYZ Co., which

represented 30% of XYZ Co.’s shares outstanding. The value of XYZ’s net assets was

$1,850,000 on that date. The excess of the purchase price over ABC’s share of XYZ’s net assets

is attributed to unrecorded intangibles with a 20-year life. XYZ earned net income and

comprehensive income of $400,000 in 2020 and paid dividends of $80,000. The investment in

XYZ had a fair value of $1,025,000 at December 31, 2020. XYZ incurred a net loss and

comprehensive loss of $425,000 in 2021 and paid no dividends. At December 31, 2021, the fair

value of the investment was $720,000 and the recoverable amount was $765,000. Assume that

ABC follows IFRS.

Prepare all the journal entries that ABC is required to make related to the XYZ shares in

2020 and 2021, assuming ABC has no significant influence over XYZ, and uses the FV-NI

model for the investment

Prepare all the journal entries that ABC is required to make related to the XYZ shares in

On January 1, 2020, Bristol Corporation issued one 3-year, 10% (stated rate), $20,000 bond at a price which would yield the purchaser an 9% return. Payment of interest is made on December 31. The year end is December 31. The company uses the ‘effective interest’ method to account for bond interest.

1. Prepare the entry to record the sale of the bond on January 1, 2020.
2. Prepare a bond amortization schedule in good form for the bond.
3. Prepare the entry on December 31, 2020.
4. Assume that Bristol used the ‘straight-line’ method to account for bond interest. Record the journal entry for 2022 to account for interest.
5. Assume that Bristol repurchased the bond for $20,600 on January 1, 2021. Prepare the journal entry to record the repurchase. (Company had used the ‘effective interest’ method.)
6. Calculate the price of the bond if the bond had been issued on Oct. 1, 2020. Prepare the entry on that date for the issue of the bond. (Assume same rates as per information above.)

Stevens Ltd is the leading retailer of Gym equipment. The following information occurred during May 2020. Stevens Ltd had an opening inventory balance of $8,400,000.

May:

1            Returned to the suppliers $80,000 of the opening inventory and received cash.

12          Purchased additional inventory on credit from the supplier for $12,000,000.

18          Sold inventory for $6,000,000 cash (Cost price to Stevens Ltd $2,400,000).

19          Paid the suppliers the account from 12 May.

31          The closing stocktake at year-end revealed an inventory balance of $17,800,000.

Required:

1. Record the above information for the month of May 2020 in the general journal using the perpetual inventory method. Narrations are not required. Ignore GST.

2. Record the above information for the month of May 2020 in the general journal using the physical inventory method. Narrations are not required. Ignore GST.

3. Present the Income Statement extract for Stevens Ltd using the periodic inventory method for the month ended 31 May 2020.

4. Briefly explain two advantages of the perpetual inventory method for Stevens Ltd.

Use the following Adjusted Trial Balance and Statement of Retained Earnings to prepare the CLASSIFIED BALANCE SHEET for Hang in There Company for April 30, 2020

Hang in There Company

Statement of Retained Earnings

April 30, 2020

Retained Earnings, May 1, 2019                   $18,200

Net Income for the Year         10,200

Dividends0        

Retained Earnings, April 30, 2020                  $28,400

Blue Company in its first year of operations provides the following information related to one of its available-for-sale debt securities at December 31, 2020. Amortized cost $51,700 Fair value 43,400 Expected credit losses 12,900

What is the amount of the credit loss that Blue should report on this available-for-sale security at December 31, 2020?

Prepare the journal entry to record the credit loss, if any (and any other adjustment needed), at December 31, 2020. (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.)

Assume the same information as for part (c). Prepare the journal entry to record the credit loss, if necessary (and any other adjustment needed), at December 31, 2020. (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.)