Sweet Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2020. Jim Alcide, controller for Sweet, has gathered the following data concerning inventory.

At May 31, 2020, the balance in Sweet’s Raw Materials Inventory account was $485,520, and Allowance to Reduce Inventory to NRV had a credit balance of $27,670. Alcide summarized the relevant inventory cost and market data at May 31, 2020, in the schedule below.

Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Sweet’s May 31, 2020, financial statements for inventory under the LCNRV rule as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle.

(a)

Determine the proper balance in Allowance to Reduce Inventory to NRV at May 31, 2020.

Whispering Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2020. Jim Alcide, controller for Whispering, has gathered the following data concerning inventory.

At May 31, 2020, the balance in Whispering’s Raw Materials Inventory account was $424,320, and Allowance to Reduce Inventory to NRV had a credit balance of $27,440. Alcide summarized the relevant inventory cost and market data at May 31, 2020, in the schedule below.

Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Whispering’s May 31, 2020, financial statements for inventory under the LCNRV rule as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle.

(a)

Determine the proper balance in Allowance to Reduce Inventory to NRV at May 31, 2020.

Rooey Ltd, the retailer of Zara clothing, is preparing its end of year financial statements at 31 December 2020. The balance sheet shows only two non-current assets, buildings and equipment. After depreciation entries were completed for the year ending 31 December 2020, the accumulated depreciation of its non-current assets were as follows:

                                                                                                       $

                                 Buildings                                                 24,200,000

                                 Accumulated Depreciation                     (5,000,000)

                                 Equipment                                                7,000,000

                                 Accumulated Depreciation                      (3,800,000)

The company applies the revaluation model to buildings and the cost model to equipment. At 31 December 2020, the following values relating to the assets have been determined:

Required:

1. Prepare the necessary general journal entries in relation to the equipment for the year ended 31 December 2020 and justify in accordance with appropriate accounting standards. Show all workings (narrations are not required).

2. Prepare the necessary general journal entries in relation to the buildings for the year ended 31 December 2020 and justify in accordance with appropriate accounting standards. Show all workings (narrations are not required).

3. Prepare the necessary general journal entries in relation to the buildings for the year ended 31 December 2021 and justify in accordance with appropriate accounting standards. Assume the depreciation for the year is $1,000,000 and the fair value of the buildings at 31 December 2021 was $25,000,000. Show all workings (narrations are not required).

Cheyenne Inc. had the following balance sheet at December 31, 2019.

During 2020, the following occurred.

Prepare a statement of cash flows for 2020

Prepare an unclassified balance sheet as it would appear at December 31, 2020. (List Assets in order of liquidity.)

Compute two cash flow ratios

Tamarisk Gas Inc., an oil and gas company had the following information on its financial statements for the fiscal years ended December 31. All figures are in millions of dollars.

A)

Calculate Tamarisk’s (Round answers to 1 decimal place, e.g. 52.7 or 52.7%.)

B)

Determine from the results obtained in part (a) if Tamarisk’s

Crane Inc., a publicly traded company, had 291,000 common shares outstanding on December 31, 2019. During 2020, the company issued 6,600 shares on May 1 and retired 15,000 shares on October 31. For 2020, the company reported net income of $294,530 after a loss from discontinued operations of $44,000 (net of tax). Calculate earnings per share for 2020 as it should be reported to shareholders. (Round answer to 2 decimal places, e.g. 15.25.) Earnings per share Income per share before discontinued operations $ Discontinued operations loss per share, net of tax $ Net income per share $ Assume that Crane Inc. issued a 3-for-1 stock split on January 31, 2021, and that the company’s financial statements for the year ended December 31, 2020 were issued on February 15, 2021. Calculate earnings per share for 2020 as it should be reported to shareholders. b(Round answer to 2 decimal places, e.g. 15.25.) Earnings per share Income per share before discontinued operations $ Discontinued operations loss per share, net of tax $ Net income per share $ Is it possible for a corporation to have a simple capital structure one fiscal year and a complex capital structure in another fiscal year? Choose the answer from the menu in accordance to the question statement

1. Complete the pension worksheet using the information provided below:

2020 records of Lexxus Company provided the following data related to its noncontributory defined benefit pension plan.

ACCOUNT BALANCES (‘000s)    Jan. 1, 2020                Activity (‘000s)                                              2020

Projected Benefit Obligation $300 cr                                    Service cost                                                     $ 50

Plan Assets                             170 dr                                    Contributions                                                  110

Accumulated OCI – PSC            40 dr                                    Actual return on plan assets                                 8

Accumulated OCI - G/L            25 dr                                    Amortization of PSC                                          4

Remaining Service Life              10 years                               Pension benefits paid to retirees                       124

OTHER                                                         

Expected rate of return on plan assets            6%

Discount/Settlement rate                                8%

2. Perform the corridor test of OCI-Gains/Losses. Show your work here:
3. Provide the end of year journal entry based on worksheet amounts.
4. Explain the difference between a defined contribution pension plan and a defined benefit pension plan. Explain how the employer’s obligation differs between the two types of plans.

Condensed financial data of Martinez Company for 2020 and 2019 are presented below.

Additional information:

During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2020.

Prepare a statement of cash flows using the direct method. (Show amounts in the investing and financing sections that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Blossom Company began operations on January 2, 2019. It employs 9 individuals who work 8-hour days and are paid hourly. Each employee earns 10 paid vacation days and 6 paid sick days annually. Vacation days may be taken after January 15 of the year following the year in which they are earned. Sick days may be taken as soon as they are earned; unused sick days accumulate. Additional information is as follows.

Blossom Company has chosen not to accrue paid sick leave until used, and has chosen to accrue vacation time at expected future rates of pay without discounting. The company used the following projected rates to accrue vacation time.

(a)Prepare journal entries to record transactions related to compensated absences during 2019 and 2020. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,125.)

B Inc. began operations in January 2018 and reported the following results for each of its 3 years of operations.

At December 31, 2020, B Inc. capital accounts were as follows.

B Inc. has never paid a cash or stock dividend. There has been no change in the capital accounts since B began operations. The state law permits dividends only from retained earnings.

(a) Compute the book value of the common stock at December 31, 2020. (Round answers to 2 decimal places, e.g. $38.50.)

(b) Compute the book value of the common stock at December 31, 2020, assuming that the preferred stock has a liquidating value of $104 per share. (Round answers to 2 decimal places, e.g. $38.50.)