Sheridan Company uses the LCNRV method, on an individual-item
basis, in pricing its inventory items. The inventory at December
31, 2020, consists of products D, E, F, G, H, and I. Relevant per
unit data for these products appear below.
|
Item D |
Item E |
Item F |
Item G |
Item H |
Item I |
|||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Estimated selling price |
$130 | $119 | $103 | $97 | $119 | $97 | ||||||||||||
|
Cost |
81 | 86 | 86 | 86 | 54 | 39 | ||||||||||||
|
Cost to complete |
32 | 32 | 27 | 38 | 32 | 32 | ||||||||||||
|
Selling costs |
11 | 19 | 11 | 22 | 11 | 22 | ||||||||||||
Using the LCNRV rule, determine the proper unit value for balance
sheet reporting purposes at December 31, 2020, for each of the
inventory items above.
|
Item D |
$enter a dollar amount |
||
|---|---|---|---|
|
Item E |
$enter a dollar amount |
||
|
Item F |
$enter a dollar amount |
||
|
Item G |
$enter a dollar amount |
||
|
Item H |
$enter a dollar amount |
||
|
Item I |
$enter a dollar amount |
In: Accounting
Federated Fabrications leased a tooling machine on January 1, 2018, for a three-year period ending December 31, 2020. The lease agreement specified annual payments of $30,000 beginning with the first payment at the beginning of the lease, and each December 31 through 2019. The company had the option to purchase the machine on December 30, 2020, for $39,000 when its fair value was expected to be $54,000 a sufficient difference that exercise seems reasonably certain. The machine's estimated useful life was six years with no salvage value. Federated was aware that the lessor’s implicit rate of return was 11%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Calculate the amount Federated should record as a right-of-use asset and lease liability for this finance lease. 2. Prepare an amortization schedule that describes the pattern of interest expense for Federated over the lease term. 3. Prepare the appropriate entries for Federated from the beginning of the lease through the end of the lease term.
In: Accounting
On January 1, 2017, AJ Corporation purchased bonds with a face value of $300,000 for $308,373.53. The bonds are due June 30, 2020, carry a 13% stated interest rate, and were purchased to yield 12%. Interest is payable semiannually on June 30 and December 31. On March 31, 2018, in contemplation of a major acquisition, the company sold one-half the bonds for $159,500 including accrued interest; the remainder were held until maturity.
In: Accounting
The COVID-19 pandemic, which hit Sri Lanka on 27 January 2020
with the first
case, and as at 21 st May 2020 reached 1,045 confirmed cases and
have reported 9
deaths. The country has been undergoing a long lock-down period of
more than 50
days, bringing most of the business to a standstill over a period
of 2 months. The
pandemic has brought in many changes, and along with that
challenges to the
organization, both economical as well as managerial.
Identify a public quoted company or a private organization, which
employs more than
100 staff in Sri Lanka and is undergoing difficulties due to the
COVID-19 pandemic.
Critically analyze the challenges the organization has at hand in
handling its
workforce.
As an organization development professional, what would be the
recommendation
and solution you would suggest to improve or resolve the current
challenges related
to the workforce.
Critically evaluate,
1. The challenges and issues the organization faces
2. The applicability of theories in analyzing the situation and
challenges
3. The recommendations and how it would help to overcome the
challenges and
issues.
In: Operations Management
On January 1, 2018, Lawson Brothers Enterprises (LBE) granted restricted stock units (RSUs) representing 40 million of its $1 par common shares to executives, subject to forfeiture if employment is terminated within four years. After the recipients of the RSUs satisfy the vesting requirement, the company will distribute the shares. The common shares had a market price of $10 per share on the grant date. At the date of grant, LBE anticipated that 5% of the recipients would leave the firm prior to vesting. Ignore taxes.
Required:
1. Prepare the appropriate journal entry to record compensation expense on December 31, 2018. Show calculations.
2. Prepare the appropriate journal entry to record compensation expense on December 31, 2019. Show calculations.
3. During 2020 third year, LBE revised its estimate of forfeitures from 5% to 10%. Prepare the appropriate journal entry to record compensation expense on December 31, 2020. Show calculations.
4. Prepare the appropriate journal entry to record compensation expense on December 31, 2021. Show calculations.
In: Accounting
Indigo Steel Company, as lessee, signed a lease agreement for equipment for 5 years, beginning December 31, 2020. Annual rental payments of $56,000 are to be made at the beginning of each lease year (December 31). The interest rate used by the lessor in setting the payment schedule is 6%; Indigo’s incremental borrowing rate is 8%. Indigo is unaware of the rate being used by the lessor. At the end of the lease, Indigo has the option to buy the equipment for $5,000, considerably below its estimated fair value at that time. The equipment has an estimated useful life of 7 years, with no salvage value. Indigo uses the straight-line method of depreciation on similar owned equipment.
question:
1.Prepare the journal entries, that Indigo should record on December 31, 2020.
2.Prepare the journal entries, that Indigo should record on December 31, 2021.
3.Prepare the journal entries, that Indigo should record on December 31, 2022
4.What amounts would appear on Indigo’s December 31, 2022, balance sheet relative to the lease arrangement?
In: Accounting
Federated Fabrications leased a tooling machine on January 1,
2018, for a three-year period ending December 31, 2020. The lease
agreement specified annual payments of $31,000 beginning with the
first payment at the beginning of the lease, and each December 31
through 2019. The company had the option to purchase the machine on
December 30, 2020, for $40,000 when its fair value was expected to
be $55,000 a sufficient difference that exercise seems reasonably
certain. The machine's estimated useful life was six years with no
salvage value. Federated was aware that the lessor’s implicit rate
of return was 11%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD
of $1 and PVAD of $1) (Use appropriate factor(s) from the
tables provided.)
Required:
1. Calculate the amount Federated should record as
a right-of-use asset and lease liability for this finance
lease.
2. Prepare an amortization schedule that describes
the pattern of interest expense for Federated over the lease
term.
3. Prepare the appropriate entries for Federated
from the beginning of the lease through the end of the lease
term.
In: Accounting
Your Task COMPLETE ON SPREAD SHEET
SHOW FORMULAS
Red Company purchased a machine on January 1, 2018.
Cost $210,000
Residual value 24,000
Useful life in years 5 *
Useful life in hours 25,000
*Write the formulas assuming useful life in years will always be five years Useful life in hours 25,000 but that the other three amounts given may vary.
Determine the annual depreciation expense under each of four depreciation methods
| Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2022 | |
| Hours used | 4,800 | 4,900 | 5,200 | 5,500 | 5,300 |
| Straight line | |||||
| Units of production | |||||
| Double-declining balance | |||||
| Sum-of-the-years’-digits |
Determine the machine's book value at the end of each year under each of the four depreciation methods
| Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2022 | |
| Straight line | |||||
| Units of production | |||||
| Double-declining balance | |||||
| Sum-of-the-years’-digits |
In: Accounting
1/ On January 1, 2018, Badger Inc. adopted the dollar-value LIFO method. The inventory cost on this date was $100,300. The ending inventory, valued at year-end costs, and the relative cost index for each of the next three years is below:
| Year-end |
Ending inventory at year-end costs |
Cost Index | |||||
| 2018 | $ | 126,945 | 1.05 | ||||
| 2019 | 144,320 | 1.10 | |||||
| 2020 | 154,860 | 1.20 | |||||
What inventory balance would Badger report on its 12/31/2020
balance sheet?
Multiple Choice
$129,050.
$130,895.
$154,860.
None of these answer choices are correct.
2/ Nu Company reported the following pretax data for its first year of operations.
| Net sales | 2,960 | ||
| Cost of goods available for sale | 2,450 | ||
| Operating expenses | 820 | ||
| Effective tax rate | 40 | % | |
| Ending inventories: | |||
| If LIFO is elected | 830 | ||
| If FIFO is elected | 1,220 | ||
What is Nu's net income if it elects LIFO?
Multiple Choice
$546.
$910.
$520.
$312.
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In: Accounting
The fact that generally accepted accounting principles allow
companies flexibility in choosing between certain allocation
methods can make it difficult for a financial analyst to compare
periodic performance from firm to firm.
Suppose you were a financial analyst trying to compare the
performance of two companies. Company A uses the
double-declining-balance depreciation method. Company B uses the
straight-line method. You have the following information taken from
the 12/31/2021 year-end financial statements for Company
B:
| Income Statement | |||
| Depreciation expense | $ | 14,500 | |
| Balance Sheet | ||||
| Assets: | ||||
| Plant and equipment, at cost | $ | 145,000 | ||
| Less: Accumulated depreciation | (58,000 | ) | ||
| Net | $ | 87,000 | ||
You also determine that all of the assets constituting the plant
and equipment of Company B were acquired at the same time, and that
all of the $145,000 represents depreciable assets. Also, all of the
depreciable assets have the same useful life and residual values
are zero.
Required:
1. In order to compare performance with Company
A, estimate what B's depreciation expense would have been for 2021
if the double-declining-balance depreciation method had been used
by Company B since acquisition of the depreciable assets.
2. If Company B decided to switch depreciation
methods in 2021 from the straight line to the
double-declining-balance method, prepare the 2021 journal entry to
record depreciation for the year, assuming no journal entry for
depreciation in 2021 has yet been recorded.
In: Accounting