what is the first taxable year that bradbury corp is not exempt from the alternative 625445

Aug 30, 2021 | Uncategorized

Bradbury Corp., a calendar-year corporation, was formed on January 2, 2004, and had gross receipts for its first four taxable years as follows:

What is the first taxable year that Bradbury Corp. is not exempt from the alternative minimum tax (AMT)?

1. 2005
2. 2006
3. 2007
4. Bradbury is exempt from AMT for its first four taxable years.

for 2007 what amount should brown corp deduct for organizational expenses 625452

Aug 30, 2021 | Uncategorized

Brown Corp., a calendar-year taxpayer, was organized and actively began operations on July 1, 2007, and incurred the following costs:

For 2007, what amount should Brown Corp. deduct for organizational expenses?

1. $1,980
2. $2,814
3. $5,940
4. $6,812

silo corp was organized on march 1 2007 began doing business on september 1 2007 and 625454

Aug 30, 2021 | Uncategorized

Silo Corp. was organized on March 1, 2007, began doing business on September 1, 2007, and elected to file its income tax return on a calendar-year basis. The following qualifying organizational expenditures were incurred in organizing the corporation:

The maximum allowable deduction for organizational expenditures for 2007 is

1. $ 600
2. $3,000
3. $5,000
4. $5,080

what is the amount of jackson corp rsquo s charitable contribution carryover to 2008 625455

Aug 30, 2021 | Uncategorized

During 2007, Jackson Corp. had the following income and expenses:

What is the amount of Jackson Corp.’s charitable contribution carryover to 2008?

1. $0
2. $2,500
3. $5,500
4. $6,300

tapper corp an accrual basis calendar year corporation was organized on january 2 20 625457

Aug 30, 2021 | Uncategorized

Tapper Corp., an accrual-basis calendar-year corporation, was organized on January 2, 2006. During 2006, revenue was exclusively from sales proceeds and interest income. The following information pertains to Tapper:

What is the maximum allowable deduction that Tapper may take as a charitable contribution on its tax return for the year ended December 31, 2006?

1. $0
2. $10,000
3. $30,000
4. $40,000

in 2007 best corp an accrual basis calendar year c corporation received 100 000 in d 625462

Aug 30, 2021 | Uncategorized

In 2007, Best Corp., an accrual-basis calendar-year C corporation, received $100,000 in dividend income from the common stock that it held in a 15%-owned domestic corporation. The stock was not debt-financed, and was held for over a year. Best recorded the following information for 2007:

Best’s dividends received deduction on its 2007 tax return was

1. $100,000
2. $ 80,000
3. $ 70,000
4. $ 63,000

the dividends were received from a corporation of which acorn owns 30 in acorn rsquo 625463

Aug 30, 2021 | Uncategorized

In 2007, Acorn, Inc. had the following items of income and expense:

The dividends were received from a corporation of which Acorn owns 30%. In Acorn’s 2007 corporate income tax return, what amount should be reported as income before special deductions?

1. $525,000
2. $505,000
3. $275,000
4. $250,000

if taylor makes no special election to waive a net operating loss carryback period w 625470

Aug 30, 2021 | Uncategorized

For the year ended December 31, 2007, Taylor Corp. had a net operating loss of $200,000. Taxable income for the earlier years of corporate existence, computed without reference to the net operating loss, was as follows:

If Taylor makes no special election to waive a net operating loss carryback period, what amount of net operating loss will be available to Taylor for the year ended December 31, 2008?

1. $200,000
2. $130,000
3. $110,000
4. $ 95,000

what is dorsett rsquo s net operating loss for 2007 625473

Aug 30, 2021 | Uncategorized

Dorsett Corporation’s income tax return for 2007 shows deductions exceeding gross income by $56,800. Included in the tax return are the following items:

What is Dorsett’s net operating loss for 2007?

1. $56,800
2. $50,000
3. $41,800
4. $35,000

for the year ended december 31 2007 maple corp rsquo s book income before federal in 625477

Aug 30, 2021 | Uncategorized

For the year ended December 31, 2007, Maple Corp.’s book income, before federal income tax, was $100,000. Included in this $100,000 were the following:

Maple’s taxable income for 2007 was

1. $ 96,000
2. $ 97,000
3. $100,000
4. $101,000

C

for the year ended december 31 2007 dodd corp had net income per books of 100 000 in 625478

Aug 30, 2021 | Uncategorized

For the year ended December 31, 2007, Dodd Corp. had net income per books of $100,000. Included in the computation of net income were the following items:

Dodd’s 2007 taxable income was

1. $127,000
2. $130,000
3. $132,000
4. $135,000

for the year ended december 31 2007 bard corp rsquo s income per accounting records 625479

Aug 30, 2021 | Uncategorized

For the year ended December 31, 2007, Bard Corp.’s income per accounting records, before federal income taxes, was $450,000 and included the following:

Bard’s 2007 taxable income was

1. $435,000
2. $451,000
3. $455,000
4. $470,000

find coca cola s basic eps for 2006 listed in its income statement if the common sto 625271

Aug 30, 2021 | Uncategorized

The following questions are based on the Coca-Cola Company”s 2006 annual report. To view the report, go to the Coca-Cola web site at After you activate the web site, click on The Coca-Cola Company. Go to investors and a menu will drop down that has financials as an option with Financial Statements (select this) to its right. Click on Balance Sheet and then open it to find the total cost of treasury shares. Then go to Selected Financial Data and open it to find the number of common shares outstanding.

a. Based on the information in the balance sheet and the note, determine the number of common shares outstanding; and the total cost of treasury stock shares on hand at the end of 2006.

b. In writing, discuss what reasons Coca-Cola might have to acquire treasury stock.

c. Find Coca-Cola”s basic EPS for 2006 listed in its Income Statement. If the common stock”s market price at 2006 December 31, was USD 30, what was the price earnings ratio?

compute the difference between cost and book value in each of the following cases 625292

Aug 30, 2021 | Uncategorized

On 2009 January 1, Company J acquired 85 percent of the outstanding voting common stock of Company K. On that date, Company K”s stockholders” equity consisted of:

Compute the difference between cost and book value in each of the following cases:

a. Company J pays USD 2,868,750 cash for its interest in Company K.

b. Company J pays USD 3,375,000 cash for its interest in Company K.

c. Company J pays USD 2,610,000 cash for its interest in Company K.

he 2010 january 1 stockholders equity section of saye company s balance sheet follow 625293

Aug 30, 2021 | Uncategorized

he 2010 January 1, stockholders” equity section of Saye Company”s balance sheet follows

Ninety percent of Saye Company”s outstanding voting common stock was  acquired by Tim Company on 2011 January 1, for USD 24,048,000. Compute

(a) the book value of the investment, (b) the difference between cost and book value, and

(c) the minority interest.

platt owns land that is operated as a parking lot a shed was erected on the lot for 625338

Aug 30, 2021 | Uncategorized

Platt owns land that is operated as a parking lot. A shed was erected on the lot for the related transactions with customers. With regard to capital assets and Section 1231 assets, how should these assets be classified?

in june 2007 olive bell bought a house for use partially as a residence and partiall 625342

Aug 30, 2021 | Uncategorized

In June 2007, Olive Bell bought a house for use partially as a residence and partially for operation of a retail gift shop. In addition, Olive bought the following furniture:

How much of this furniture comprises capital assets?

1. $0
2. $ 8,000
3. $12,000
4. $20,000

evon corporation which was formed in 2004 had 50 000 of net sec 1231 gain for its 20 625344

Aug 30, 2021 | Uncategorized

Evon Corporation, which was formed in 2004, had $50,000 of net Sec. 1231 gain for its 2007 calendar year. Its net Sec. 1231 gains and losses for its three preceding tax years were as follows:

for the year ended december 31 2007 mcewing corporation a calendar year corporation 625351

Aug 30, 2021 | Uncategorized

For the year ended December 31, 2007, McEwing Corporation, a calendar-year corporation, reported book income before income taxes of $120,000. Included in the determination of this amount were the following gain and losses from property that had been held for more than one year:

For the year ended December 31, 2007, McEwing’s taxable income was

1. $113,000
2. $120,000
3. $125,000
4. $128,000

what amount should hoff a cash basis taxpayer report in his 2007 return as income fo 625355

Aug 30, 2021 | Uncategorized

Ola Associates is a limited partnership engaged in real estate development. Hoff, a civil engineer, billed Ola $40,000 in 2007 for consulting services rendered. In full settlement of this invoice, Hoff accepted a $15,000 cash payment plus the following:

What amount should Hoff, a cash-basis taxpayer, report in his 2007 return as income for the services rendered to Ola?

1. $15,000
2. $28,000
3. $32,000
4. $40,000

basic partnership a cash basis calendar year entity began business on february 1 200 625361

Aug 30, 2021 | Uncategorized

Basic Partnership, a cash-basis calendar-year entity, began business on February 1, 2007. Basic incurred and paid the following in 2007:

Basic elected to deduct costs. What was the maximum amount that Basic could deduct on the 2007 partnership return?

1. $15,600
2. $ 3,600
3. $ 660
4. $ 220

which of the following limitations will apply in determining a partner rsquo s deduc 625364

Aug 30, 2021 | Uncategorized

Which of the following limitations will apply in determining a partner’s deduction for that partner’s share of partnership losses?

the partnership of felix and oscar had the following items of income during the taxa 625367

Aug 30, 2021 | Uncategorized

The partnership of Felix and Oscar had the following items of income during the taxable year ended December 31, 2007.

What is the total ordinary income of the partnership for 2007?

1. $156,000
2. $174,000
3. $176,000
4. $182,000

what amount of income should chris report from vista partnership on her 2007 tax ret 625369

Aug 30, 2021 | Uncategorized

Chris, a 25% partner in Vista partnership, received a $20,000 guaranteed payment in 2007 for deductible services rendered to the partnership. Guaranteed payments were not made to any other partner. Vista’s 2007 partnership income consisted of

What amount of income should Chris report from Vista Partnership on her 2007 tax return?

1. $37,500
2. $27,500
3. $22,500
4. $20,000

dean is a 25 partner in target partnership dean rsquo s tax basis in target on janua 625381

Aug 30, 2021 | Uncategorized

Dean is a 25% partner in Target Partnership. Dean’s tax basis in Target on January 1, 2007, was $20,000. At the end of 2007, Dean received a nonliquidating cash distribution of $8,000 from Target. Target’s 2007 accounts recorded the following items:

What was Dean’s tax basis in Target on December 31, 2007?

1. $15,000
2. $23,000
3. $25,000
4. $30,000

gray is a 50 partner in fabco partnership gray rsquo s tax basis in fabco on january 625383

Aug 30, 2021 | Uncategorized

Gray is a 50% partner in Fabco Partnership. Gray’s tax basis in Fabco on January 1, 2007, was $5,000. Fabco made no distributions to the partners during 2007, and recorded the following:

What is Gray’s tax basis in Fabco on December 31, 2007?

1. $21,000
2. $16,000
3. $12,000
4. $10,000

which of the following should be used in computing the basis of a partner rsquo s in 625386

Aug 30, 2021 | Uncategorized

Which of the following should be used in computing the basis of a partner’s interest acquired from another partner?

doris and lydia are sisters and also are equal partners in the capital and profits o 625388

Aug 30, 2021 | Uncategorized

Doris and Lydia are sisters and also are equal partners in the capital and profits of Agee & Nolan. The following information pertains to 300 shares of Mast Corp. stock sold by Lydia to Agee & Nolan.

The amount of long-term capital loss that Lydia recognized in 2007 on the sale of this stock was

1. $5,000
2. $3,000
3. $2,500
4. $0

irving aster dennis brill and robert clark were partners who shared profits and loss 625395

Aug 30, 2021 | Uncategorized

Irving Aster, Dennis Brill, and Robert Clark were partners who shared profits and losses equally. On February 28, 2007, Aster sold his interest to Phil Dexter. On March 31, 2007, Brill died, and his estate held his interest for the remainder of the year. The partnership continued to operate and for the fiscal year ending June 30, 2007, it had a profit of $45,000. Assuming that partnership income was earned on a pro rata monthly basis and that all partners were calendar-year taxpayers, the distributive shares to be included in 2007 gross income should be

1. Aster $10,000, Brill $0, Estate of Brill $15,000, Clark $15,000, and Dexter $5,000.
2. Aster $10,000, Brill $11,250, Estate of Brill $3,750, Clark $15,000, and Dexter $5,000.
3. Aster $0, Brill $11,250, Estate of Brill $3,750, Clark $15,000, and Dexter $15,000.
4. Aster $0, Brill $0, Estate of Brill $15,000, Clark $15,000, and Dexter $15,000.

at november 1 2007 the real estate and insurance business is separated and two partn 625400

Aug 30, 2021 | Uncategorized

Partnership Abel, Benz, Clark & Day is in the real estate and insurance business. Abel owns a 40% interest in the capital and profits of the partnership, while Benz, Clark, and Day each owns a 20% interest. All use a calendar year. At November 1, 2007, the real estate and insurance business is separated, and two partnerships are formed: Partnership Abel & Benz takes over the real estate business, and Partnership Clark & Day takes over the insurance business. Which one of the following statements is correct for tax purposes?

1. Partnership Abel & Benz is considered to be a continuation of Partnership Abel, Benz, Clark & Day.
2. In forming Partnership Clark & Day, partners Clark and Day are subject to a penalty surtax if they contribute their entire distributions from Partnership Abel, Benz, Clark & Day.
3. Before separating the two businesses into two distinct entities, the partners must obtain approval from the IRS.
4. Before separating the two businesses into two distinct entities, Partnership Abel, Benz, Clark & Day must file a formal dissolution with the IRS on the prescribed form.

the personal service partnership of allen baker amp carr had the following cash basi 625404

Aug 30, 2021 | Uncategorized

Items 1 and 2 are based on the following:

The personal service partnership of Allen, Baker & Carr had the following cash basis balance sheet at December 31, 2006:

Carr, an equal partner, sold his partnership interest to Dole, an outsider, for $154,000 cash on January 1, 2007. In addition, Dole assumed Carr’s share of the partnership’s liability.

What was the total amount realized by Carr on the sale of his partnership interest?

1. $174,000
2. $154,000
3. $140,000
4. $134,000

What amount of ordinary income should Carr report in his 2007 income tax return on the sale of his partnership interest?

1. $0
2. $ 20,000
3. $ 34,000
4. $140,000

stone and frazier decided to terminate the woodwest partnership as of december 31 on 625407

Aug 30, 2021 | Uncategorized

Stone and Frazier decided to terminate the Woodwest Partnership as of December 31. On that date, Woodwest’s balance sheet was as follows:

The fair market value of the equipment was $3,000. Frazier’s outside basis in the partnership was $1,200. Upon liquidation, Frazier received $1,500 in cash. What gain should Frazier recognize?

1. $0
2. $250
3. $300
4. $500

prepare the balance sheet of the company as of 2009 march 1 625216

Aug 30, 2021 | Uncategorized

On 2009 January 1, Cowling Company was authorized to issue 500,000 shares of USD 5 par value common stock. It then completed the following transactions:

2009

Jan. 14 Issued 90,000 shares of common stock at USD 24 per share for cash. 29 Gave the promoters of the corporation 50,000 shares of common stock for their services in organizing the company. The board of directors valued these services at USD 620,000.

Feb. 19 Exchanged 100,000 shares of common stock for the following assets at the indicated fair market values:

a. Prepare general journal entries to record the transactions.

b. Prepare the balance sheet of the company as of 2009 March 1.

repeat a for the t accounts involving stockholders equity assuming the stock is no p 625217

Aug 30, 2021 | Uncategorized

On 2009 July 3, Barr Company was authorized to issue 15,000 shares of common stock; 3,000 shares were issued immediately to the incorporators of the company for cash at USD 320 per share. On July 5 of that year, an additional 300 shares were issued to the incorporators for services rendered in organizing the company. The board valued these services at USD 96,000. On 2009 July 6, legal and printing costs of USD 12,000 were paid. These costs related to securing the corporate charter and the stock certificates.

a. Set up T-accounts and post these transactions. Then prepare the balance sheet of the Barr Company as of the close of 2009 July 10, assuming the authorized stock has a USD 160 par value.

b. Repeat (a) for the T-accounts involving stockholders” equity, assuming the stock is no-par stock with a USD 240 stated value. Prepare the stockholders” equity section of the balance sheet.

c. Repeat (a) for the T-accounts involving stockholders” equity, assuming the stock is no-par stock with no stated value. Prepare the stockholders” equity section of the balance sheet.

compute the amount payable to each class of stock the stockholders equity sections f 625220

Aug 30, 2021 | Uncategorized

compute the amount payable to each class of stock. The stockholders” equity sections from three different corporations” balance sheets follow.

Compute the book values per share of the preferred and common stock of each corporation assuming that in a liquidation the preferred stock receives par value plus dividends in arrears.

compute the amount the remaining brothers must pay to the estate of james lehman for 625221

Aug 30, 2021 | Uncategorized

Mendell, Inc., is a corporation in which all of the outstanding preferred and common stock is held by the four Lehman brothers. The brothers have an agreement stating that the remaining brothers will, upon the death of a brother, purchase from the estate his holdings of stock in the company at book value.

The stockholders” equity section of the balance sheet for the company on 2009 December 31, the date of the death of James Lehman, shows:

No dividends have been paid for the last year on the preferred stock, which is cumulative. At the time of his death, James Lehman held 2,000 shares of preferred stock and 10,000 shares of common stock of the company.

a. Compute the book value of the preferred stock.

b. Compute the book value of the common stock.

c. Compute the amount the remaining brothers must pay to the estate of James Lehman for the preferred and common stock that he held at the time of his death.

which company s stock would you buy why 625222

Aug 30, 2021 | Uncategorized

Rudd Company and Clay Company have extremely stable net income amounts of USD 4,800,000 and USD 3,200,000, respectively. Both companies distribute all their net income as dividends each year. Rudd Company has100,000 shares of USD 80 par value, 6 percent preferred stock, and 500,000 shares of USD 8 par value common stock outstanding. Clay Company has 50,000 shares of USD 40 par value, 8 percent preferred stock, and 400,000 shares of USD 8 par value common stock outstanding. Both preferred stocks are cumulative.

a. Compute the annual dividend per share of preferred stock and per share of common stock for each company.

b. Based solely on the preceding information, which common stock would youpredict to have the higher market price per share? Why?

c. Which company”s stock would you buy? Why?

on may 30 benton sent the certificate to the transfer agent of park corporation for 625238

Aug 30, 2021 | Uncategorized

The following dates are associated with a cash dividend of USD 80,000: July 15, July 31, and August 15. Identify each of the three dates, and give the journal entry required on each date, if any.

How should a declared but unpaid cash dividend be shown on the balance sheet? How should a declared but unissued stock dividend be shown?

On May 8, the board of directors of Park Corporation declared a dividend, payable on June 5, to stockholders of record on May 17. On May 10, James sold his capital stock in Park Corporation directly to Benton for USD 20,000, endorsing his stock certificate and giving it to Benton. Benton placed the stock certificate in her safe. On May 30, Benton sent the certificate to the transfer agent of Park Corporation for transfer. Who received the dividend? Why?

calculate eps for the year ended 2009 december 31 present the information in the sam 625251

Aug 30, 2021 | Uncategorized

The following information relates to Perry Corporation for the year ended 2009 December 31:

Calculate EPS for the year ended 2009 December 31. Present the information in the same format used in the corporation”s income statement.

prepare the correct stockholders equity section of the balance sheet at 2009 decembe 625253

Aug 30, 2021 | Uncategorized

The bookkeeper of Hart Company has prepared the following incorrect statement of stockholders” equity for the year ended 2009 December 31:

The authorized stock consists of 12,000 shares of preferred stock with a USD 120 par value and 75,000 shares of common stock, USD 48 par value. The preferred stock was issued on two occasions: (1) 5,000 shares at par, and (2) 3,000 shares at USD 134.40 per share. The 50,000 shares of common stock were issued at USD 62.40 per share. Five thousand shares of treasury common stock were reacquired for USD 264,000. The bookkeeper deducted the cost of the treasury stock from the Common Stock account. Prepare the correct stockholders” equity section of the balance sheet at 2009 December 31.

on 2009 august 4 a 4 percent cash dividend was declared payable on september 3 on no 625254

Aug 30, 2021 | Uncategorized

The only stockholders” equity items of Jody Company at 2009 June 30, are:

On 2009 August 4, a 4 percent cash dividend was declared, payable on September 3. On November 16, a 10 percent stock dividend was declared. The shares were issued on December 1. The market value of the common stock was USD 360 per share on November 16 and USD 354 per share on December 1. Prepare journal entries for these dividend transactions.

following are selected transactions of white corporation 625255

Aug 30, 2021 | Uncategorized

Following are selected transactions of White Corporation:

2002

Dec. 31 The board of directors authorized the appropriation of USD 50,000 of retained earnings to provide for the future acquisition of a new plant site and the construction of a new building. (On the last day of the next six years, the same action was taken. You need not make entries for these six years.)

2007

Jan. 2 Purchased a new plant site for cash, USD 100,000. Mar. 29 Entered into a contract for construction of a new building, payment to be made within 30 days following completion.

2009

Feb. 10 Following final inspection and approval of the new building, Dyer

Construction Company was paid in full, USD 500,000.

Mar. 10 The board of directors authorized release of the retained earnings appropriated for the plant site and building.

Apr. 2 A 5 percent stock dividend on the 100,000 shares of USD 50 par value common stock outstanding was declared. The market price on this date was USD 55 per share. Prepare journal entries for all of these transactions.

prepare a statement of retained earnings for the year ended 2009 december 31 625256

Aug 30, 2021 | Uncategorized

Following are selected data of Kane Corporation at 2009 December 31:

Prepare a statement of retained earnings for the year ended 2009 December 31.

prepare journal entries as necessary for these transactions 625257

Aug 30, 2021 | Uncategorized

The stockholders” equity of Sayers Company at 2009 January 1, is as follows:

During 2009, the following transactions occurred in the order listed:

•Issued 10,000 shares of stock for USD 368,000.

•Declared a 4 percent stock dividend when the market price was USD 48 per share.

•Sold 1,000 shares of treasury stock for USD 43,200.

•Issued stock certificates for the stock dividend declared in transaction 2.

•Bought 2,000 shares of treasury stock for USD 67,200.

•Increased the appropriation by USD 43,200 per loan agreement.

Prepare journal entries as necessary for these transactions.

prepare journal entries for these dividend transactions 625262

Aug 30, 2021 | Uncategorized

The stockholders” equity section of Carson Company”s 2008 December 31, balance sheet follows:

On 2009 July 15, the board of directors declared a cash dividend of USD 12 per share, which was paid on 2009 August 1. On 2009 December 1, the board declared a stock dividend of 10 percent, and the shares were issued on 2009 December 15. Market value of the stock was USD 144 on December 1 and USD 168 on December 15. Prepare journal entries for these dividend transactions.

prepare the journal entries to record these transactions of falcone company 625263

Aug 30, 2021 | Uncategorized

The ledger of Falcone Company includes the following account balances on 2009 September 30:

During October 2009, the company took action to:

•Increase the appropriation for contingencies by USD 60,000.

•Decrease the appropriation for plant expansion by USD 160,000.

•Establish an appropriation per loan agreement, with an annual increase of USD 48,000.

•Declare a cash dividend of USD 140,000.

Prepare the journal entries to record these transactions of Falcone Company.

prepare journal entries to record all of these transactions 625264

Aug 30, 2021 | Uncategorized

Following are selected transactions of Taylor Corporation:

2004

Dec. 31 By action of the board of directors, USD 450,000 of retained earnings was appropriated to provide for future expansion of the company”s main building. (On the last day of each of the next four years, the same action was taken. You need not make entries for these years.)

2009

Jan. 3 Obtained, at a cost of USD 4,500, a building permit to construct a new wing on the main plant building.

July 30 Paid USD 1,800,000 to Starke Construction Company for completion of the new wing.

Aug. 4 The board of directors authorized the release of the sum appropriated for expansion of the plant building. 4 The board of directors declared a 10 percent common stock dividend on the 25,000 shares of USD 500 par value common stock outstanding. The market price on this date was USD 660 per share. Prepare journal entries to record all of these transactions.

prepare a statement of retained earnings for the year ended 2009 december 31 625265

Aug 30, 2021 | Uncategorized

The following information relates to Dahl Corporation for the year 2009:

Prepare a statement of retained earnings for the year ended 2009 December 31.

prepare the stockholders equity section of the 2009 december 31 balance sheet 625266

Aug 30, 2021 | Uncategorized

The stockholders” equity of Acorn Company as of 2008 December 31, consisted of 20,000 shares of authorized, issued, and outstanding USD 50 par value common stock, paid-in capital in excess of par of USD 240,000, and retained earnings of USD 400,000. Following are selected transactions for 2009:

May 1 Acquired 3,000 shares of its own common stock at USD 100 per share.

June 1 Reissued 500 shares at USD 120.

30 Reissued 700 shares at USD 90.

Oct. 1 Declared a cash dividend of USD 5 per share.

31 Paid the cash dividend declared on October 1.

Net income for the year was USD 80,000. No other transactions affecting retained earnings occurred during the year.

a. Prepare general journal entries for these transactions.

b. Prepare the stockholders” equity section of the 2009 December 31, balance sheet.

prepare the stockholders equity section of the 2009 december 31 balance sheet 625267

Aug 30, 2021 | Uncategorized

The stockholders” equity section of Sager Company”s 2008 December 31, balance sheet follows:

Following are selected transactions that occurred in 2009:

Jan. 13 Cash was received for 550 shares of previously unissued common stock at USD 13.20.

Feb. 4 A plot of land was accepted as payment in full for 500 shares of common stock, and the stock was issued. Closing market price of the common stock on this date was USD 12 per share.

Mar. 24 All of the treasury stock was reissued at USD 14.40 per share.

June 23 The regular semiannual dividend on the preferred stock was declared.

30 The preferred dividend was paid.

July 3 A 10 percent stock dividend was declared on the common stock. Market price on this date was USD 16.80.

18 The stock dividend shares were issued.

Oct. 4 The company reacquired 105 shares of its common stock at USD 14.40.

Dec. 18 The regular semiannual dividend on the preferred stock and a USD 0.24 per share dividend on the common stock were declared.

31 Both dividends were paid.

31 An additional appropriation of retained earnings of USD 3,000 for plant expansion was authorized.

a. Prepare journal entries to record the 2009 transactions.

b. Prepare a statement of retained earnings for the year 2009, assuming net income for the year was USD 25,800.

c. Prepare the stockholders” equity section of the 2009 December 31, balance sheet.

prepare an income statement and a statement of retained earnings for 2009 625268

Aug 30, 2021 | Uncategorized

Selected data of Ace Company for the year ended 2009 December 31, are:

Assume the applicable federal income tax rate is 40 percent. All of the preceding items of expense, revenue, and loss are included in the computation of taxable income. The litigation loss resulted from a court award of damages for patent infringement on a product that the company produced and sold in 2005 and 2006, but was discontinued in 2006. In addition, the company discovered that in 2005 it had erroneously charged to expense the USD 250,000 cost of a tract of land purchased that year and had made the same error on its tax return for 2008. Retained earnings as of 2009 January 1, were USD 5,600,000. Assume there were 10,000 shares of common stock and 5,000 shares of preferred stock outstanding for the entire year.

Prepare an income statement and a statement of retained earnings for 2009.

the following journal entries are for keel corporation 625270

Aug 30, 2021 | Uncategorized

The following journal entries are for Keel Corporation:

The management of Keel Corporation has asked you, a CPA, to analyze these journal entries and decide whether each is correct. The explanations are all correct. Wherever a journal entry is incorrect, prepare the journal entry that should have been made.

prepare the annual year end adjusting journal entries at december 31 624986

Aug 30, 2021 | Uncategorized

Alternate problem A The trial balance of Caribbean Vacation Tours, Inc., at December 31 of the current year includes, among other items, the following account balances:

The balance in the Prepaid Insurance account is the advance premium for one year from September 1 of the current year.

The buildings are expected to last 25 years, with an expected residual value of USD 30,000.

Salaries incurred but not paid as of December 31 amount to USD 8,400.

The balance in Prepaid Rent is for a one-year period that started March 1 of the current year.

Prepare the annual year-end adjusting journal entries at December 31.

open ledger accounts for each of the accounts involved enter the balances as shown i 624987

Aug 30, 2021 | Uncategorized

Among the account balances shown in the trial balance of Dunwoody Mail Station, Inc., at December 31 of the current year are the following:

The inventory of supplies on hand at December 31 amounts to USD 3,000.

The balance in the Prepaid Insurance account is for a two-year policy taken out June 1 of the current year.

Depreciation for the buildings is based on the cost shown in the Buildings account, less residual value estimated at USD18,000. When acquired, the lives of the buildings were estimated at 50 years each.

a. Prepare the year-end adjusting journal entries at December 31.

b. Open ledger accounts for each of the accounts involved, enter the balances as shown in the trial balance, post the adjusting journal entries, and calculate year-end balances.

where possible record the original transaction so that no adjusting entry would be n 624990

Aug 30, 2021 | Uncategorized

On 2010 June 1, Richard Cross opened a swimming pool cleaning and maintenance service, Cross Pool Company. He vaguely recalled the process of making journal entries and establishing ledger accounts from a high school bookkeeping course he had taken some years ago.

At the end of June, he prepared an income statement for the month of June, but he had the feeling that he had not proceeded correctly. He contacted his brother, John, a recent college graduate with a major in accounting, for assistance. John immediately noted that his brother had kept his records on a cash basis.

June 1 Received cash of USD 28,000 from various customers in exchange for service agreements to clean and maintain their pools for June, July, August, and September.

5 Paid rent for automotive and cleaning equipment to be used during the period June through September, USD 8,000. The payment covered the entire period.

8 Purchased a two-year liability insurance policy effective June 1 for USD 12,000 cash.

10 Received an advance of USD 9,000 from a Florida building contractor in exchange for an agreement to help service pools in his housing development during October through May.

16 Paid salaries for the first half of June, USD 8,400.

17 Paid USD 900 for advertising to be run in a local newspaper for two weeks in June and four weeks in July.

19 Paid the rent of USD 24,000 under a four-month lease on a building rented and occupied on June 1.

26 Purchased USD 5,400 of supplies for cash. (Only USD 900 of these supplies were used in June.)

29 Billed various customers for services rendered, USD 16,000.

30 Unpaid employee services received in the last half of June amounted to USD 12,600.

30 Received a bill for USD 600 for gas and oil used in June.

a. Prepare the entries for the transactions as Richard must have recorded them under the cash basis of accounting.

b. Prepare journal entries as they would have been prepared under the accrual basis. Where the entry is the same as under the cash basis, merely indicate “same”. Where possible, record the original transaction so that no adjusting entry would be necessary at the end of the month. Ignore explanations.

what journal entries are required to record the equipment s disposal under each of t 625165

Aug 30, 2021 | Uncategorized

Equipment costing USD 330,000, on which USD 225,000 of up-to date accumulated depreciation has been recorded, was disposed of on 2009 January 2. What journal entries are required to record the equipment”s disposal under each of the following unrelated assumptions?

a. The equipment was sold for USD 120,000 cash.

b. The equipment was sold for USD 87,000 cash.

c. The equipment was retired from service and hauled to the junkyard. No material was salvaged.

d. The equipment was exchanged for similar equipment having a cash price of USD 450,000. A trade-in allowance of USD 150,000 from the cash price was received, and the balance was paid in cash. The exchange has no commercial substance.

e. The equipment was exchanged for similar equipment having a cash price of USD 450,000. A trade-in allowance of USD 75,000 was received, and the balance was paid in cash. The exchange has commercial substance.

on 2007 january 2 blake company purchased a delivery truck for usd 78 750 cash the t 625174

Aug 30, 2021 | Uncategorized

On 2007 January 2, Blake Company purchased a delivery truck for USD 78,750 cash. The truck has an estimated useful life of six years and an estimated salvage value of USD 6,750. The straight-line method of depreciation is being used.

a. Prepare a schedule showing the computation of the book value of the truck on 2009 December 31.

b. Assume the truck is to be disposed of on 2010 July 1. Prepare the journal entry to record depreciation for the six months ended 2010 June 30.

c. Prepare the journal entries to record the disposal of the truck on 2010 July 1,under each of the following unrelated assumptions:

i. The truck was sold for USD 26,250 cash.

ii. The truck was sold for USD 48,000 cash.

iii .The truck was retired from service, and it is expected that USD 20,625 will be received from the sale of salvaged materials.

iv. The truck and USD 60,000 cash were exchanged for office equipment that had a cash price of USD 105,000. The exchange has commercial substance.

v. The truck and USD 67,500 cash were exchanged for a new deliver  truck that had a cash price of USD 112,500. The exchange has no commercial substance.

vi. The truck was completely destroyed in an accident. Cash of USD 25,500 is expected to be recovered from the insurance company.

compute the depletion charge for 2009 round to the nearest cent 625176

Aug 30, 2021 | Uncategorized

On 2009 January 2, York Mining Company acquired land with ore deposits at a cash cost of USD 1,800,000. Exploration and development costs amounted to USD 192,000. The residual value of the land is expected to be USD 360,000. The ore deposits contain an estimated 6 million tons. Present technology will allow the economical extraction of only 85 percent of the total deposit. Machinery, equipment, and temporary sheds were installed at a cost of USD 255,000. The assets will have no further value to the company when the ore body is exhausted; they have a physical life of 12 years. In 2007, 200,000 tons of ore were extracted. The company expects the mine to be exhausted in 10 years, with sharp variations in annual production.

a. Compute the depletion charge for 2009. Round to the nearest cent.

b. Compute the depreciation charge for 2009 under the units-of-production method.

c. If all other mining costs, except depletion, amounted to USD 1,260,000, what was the average cost per ton mined in 2009? (The depreciation calculated in b is included in the USD 1,260,000.)

following are selected transactions and other data relating to long company for the 625178

Aug 30, 2021 | Uncategorized

Following are selected transactions and other data relating to Long Company for the year ended 2009 December 31.

a. The company rented the second floor of a building for five years on 2009 January 2, and paid the annual rent of USD 18,000 for the first and fifth years in advance.

b. In 2008, the company incurred legal fees of USD 54,000 paid to an outside law firm in applying for a patent and paid a fee of USD 18,000 to a former employee who conceived a device that substantially reduced the cost of manufacturing one of the company”s products. The patent on the device has a market value of USD 540,000 and is expected to be useful for 10 years.

c. In 2008, the company entered into a 10-year operating lease on several floors of a building, paying USD 36,000 in cash immediately and agreeing to pay USD 18,000 at the end of each of the 10 years of life in the lease. The company then incurred costs of USD 72,000 to install partitions, shelving, and fixtures. These items would normally last 25 years.

d. The company spent USD 21,600 promoting a trademark in a manner that it believed enhanced the value of the trademark considerably. The trademark has an indefinite life.

e. The company incurred costs amounting to USD 180,000 in 2008 and USD234,000 in 2009 for research and development of new products that are expected to enhance the company”s revenues for at least five years.

f. The company paid USD 180,000 to the author of a book that the company published on 2009 July 2. Sales of the book are expected to be made over a two-year period from that date. For each of the situations just described, prepare only the journal entries to record the expense applicable to 2009.

the truck was stolen july 1 and insurance proceeds of usd 7 560 were expected 625180

Aug 30, 2021 | Uncategorized

On 2007 January 1, Wood Company purchased a truck for USD 43,200 cash. The truck has an estimated useful life of six years and an expected salvage value of USD 5,400. Depreciation on the truck was computed using the straight-line method.

a. Prepare a schedule showing the computation of the book value of the truck on 2009 December 31.

b. Prepare the journal entry to record depreciation for the six months ended 2010 June 30.

c. Prepare journal entries to record the disposal of the truck on 2010 June 30, under each of the following unrelated assumptions:

(a)The truck was sold for USD 3,600 cash.

(b)The truck was sold for USD 25,200 cash.

(c)The truck was scrapped. Used parts valued at USD 6,660 were salvaged.

(d)The truck (which has a fair market value of USD 10,800) and USD 32,400 of cash were exchanged for a used back hoe that did not have a known market value. The transaction has commercial substance.

(e)The truck and USD 29,700 cash were exchanged for another truck that had a cash price of USD 51,300. The exchange has no commercial substance.

(f) The truck was stolen July 1, and insurance proceeds of USD 7,560 were expected.

kine company purchased a new model ii computer 2009 october 1 cash price of the new 625181

Aug 30, 2021 | Uncategorized

Kine Company purchased a new Model II computer 2009 October 1. Cash price of the new computer was USD 24,960; Jackson received a trade-in allowance of USD 9,300 from the cash price for a Model I computer. The old computer was acquired on 2007 January 1, at a cost of USD 23,040. Depreciation has been recorded through 2008 December 31, on a straight-line basis, with an estimated useful life of four years and USD 3,840 expected salvage value. The exchange has commercial substance. Prepare the journal entries to record the exchange. Alternate problem D On 2009 July 1, Morgan Company had the following balances in some of its accounts:

The leasehold covers a plot of ground leased on 2004 July 1, for a period of 25 years under an operating lease. The office building is on the leased land and was completed on 2005 July 1, at a cost of USD 967,680; its physical life is set at 40 years. The factory building is on the owned land and was completed on 2004 July 1, at a cost of USD 2,184,000; its life is also set at 40 years with no expected salvage value. The equipment has a 15-year useful life with no expected salvage value. The company owns three trucks—A, B, and C. Truck A, purchased on 2007 July 1, at a cost of USD 53,760, had an expected useful life of three years and a salvage value of USD 3,360. Truck B, purchased on 2008 January 2, at a cost of USD 84,000, had an expected life of four years and an estimated salvage value of USD 6,720. Truck C, purchased on 2009 January 2, at a cost of USD 100,800, had an expected life of five years and an estimated salvage value of USD 10,080. The following transactions occurred in the fiscal year ended 2010 June 30: 2009

July 1 Rent for2009 July 1, through 2010 June 30, on leased land was paid, USD 31,920.

Oct. 1 Truck A was traded in on truck D. Cash price of the new truck was USD 107,520. Cash of USD 90,720 was paid. Truck D has an expected life of four years and a salvage value of USD 5,880. The exchange has no commercial substance. 2010

Feb. 2 Truck B was sold for USD 47,040 cash.

June 1 Truck C was completely demolished in an accident. The truck was not insured. Prepare journal entries to record these transactions and the necessary 2010 June 30, adjusting entries. Use the straight-line depreciation method.

in december 2008 brown company acquired a mine for usd 2 700 000 the mine contained 625182

Aug 30, 2021 | Uncategorized

In December 2008, Brown Company acquired a mine for USD 2,700,000. The mine contained an estimated 10 million tons of ore. It was also estimated that the land would have a value of USD 240,000 when the mine was exhausted and that only 4 million tons of ore could be economically extracted. A building was erected on the property at a cost of USD 360,000. The building had an estimated useful life of 35 years and no salvage value. Specialized mining equipment was installed at a cost of USD 495,000. This equipment had an estimated useful life of seven years and an estimated USD 33,000 salvage value. The company began operating on 2009 January 1, and put all of its assets into use on that date. During the year ended 2009 December 31, 400,000 tons of ore were extracted. The company decided to use the units-of-production method to record depreciation on the building and the straight-line method to record depreciation on the equipment. Prepare journal entries to record the depletion and depreciation charges for the year ended 2009 December 31. Show calculations.

compute the patent amortization expense for 2010 and give the entry to record it 625183

Aug 30, 2021 | Uncategorized

Trask Company purchased a patent for USD 108,000 on 2009 January 2. The patent was estimated to have a finite life of 10 years. The USD 108,000 cost was properly charged to an asset account and amortized in 2009. On 2010 January 1, the company incurred legal and court costs of USD 32,400 in a successful defense of the patent in a lawsuit. The legal work was performed by an outside law firm.

a. Compute the patent amortization expense for 2009 and give the entry to record it.

b. Compute the patent amortization expense for 2010 and give the entry to record it.

Alternate problem G Selected transactions and other data for Grant Company:

a. The company purchased a patent in early January 2006 for USD 144,000 and began amortizing it over its finite life of 10 years. In early January 2008, the company hired an outside law firm and successfully defended the patent in an infringement suit at a cost of USD 38,400.

b. Research and development costs incurred in 2008 of USD 43,200 were expected to provide benefits over the three succeeding years.

c. On 2009 January 2, the company rented space in a warehouse for five years at an annual fee of USD 9,600. Rent for the first and last years was paid in advance.

d. A total of USD 96,000 was spent uniformly throughout 2009 by the company in promoting its lesser known trademark, which is expected to have a finite useful life of 20 years.

e. In January 2007, the company purchased all of the assets and assumed all of the liabilities of another company, paying USD 192,000 more than the fair market value of all identifiable assets acquired, less the liabilities assumed. The company expects the cash flow benefits for which it paid the USD 192,000 to last 10 years (finite useful life). For each of these unrelated transactions, prepare journal entries to record only those entries (required for 2009. Note any items that do not require an entry in 2009.

how should machine b be reported on the 2010 december 31 balance sheet 625184

Aug 30, 2021 | Uncategorized

During your audit examination of the Shirley Company”s Plant, Property, and Equipment accounts, the following transaction came to your attention. On 2009 January 2, machine A was exchanged for machine B. Shirley Company acquired machine A for USD 90,000 on 2007 January 2. Machine A had an estimated useful life of four years and no salvage value, and the machine was depreciated on the straight-line basis. Machine B had a cash price of USD 108,000. In addition to machine A, cash of USD 30,000 was given up in the exchange. Machine B has an estimated useful life of five years and no salvage value, and the machine is being depreciated using the straight-line method. The exchange has no commercial substance. Upon further analysis, you discover that the company recorded the transaction as an exchange of nonmonetary assets having commercial substance instead of one not having commercial substance. You must now determine the following:

a. What journal entry did the Shirley Company make when it recorded the exchange of machines? (Show computations.)

b. What journal entry should the Shirley Company have made to record the exchange of machines?

c. Assume the error was discovered on 2010 December 31, before adjusting journal entries have been made. What journal entries should be made to correct the accounting records? (Adjustments of prior years” net income because of errors should be debited or credited to Retained Earnings.) What adjusting journal entry should be made to record depreciation for 2010? (Ignore income taxes.)

d. What effect did the error have on reported net income for 2009? (Ignore income taxes.)

e. How should machine B be reported on the 2010 December 31, balance sheet?

use the total assets turnover ratios you computed for rational software as an exampl 625185

Aug 30, 2021 | Uncategorized

Currently, many corporations are looking for acquisition opportunities. Tyre, Inc., is trying to decide whether to buy Amite Company or Beauman Company. Tyre, Inc., has hired you as a consultant to analyze the two companies” financial information and to determine the more advantageous aquisition. Your review of the companies” books has revealed that both Amite and Beauman have assets with the following book values and fair market values:

Liabilities assumed on the purchase of either company include accounts payable, USD 300,000, and notes payable, USD 75,000. The only difference between the companies is that Amite has net income that is about average for the industry, while Beauman”s net income is greatly above average for the industry. Top-level management at Tyre, Inc., has asked you to respond in writing to the following possible situations:

a. Assume Tyre, Inc., can buy Amite Company for USD 2,700,000 or Beauman Company for USD 3,450,000. Prepare the journal entries to record the acquisition of Amite Company and Beauman Company. What accounts for the difference between the purchase price of the two companies?

b. Assume Tyre, Inc, can buy either company for USD 2,700,000. Write a report for Tyre, Inc., advising which company to buy. Annual report analysis C The mission of Rational Software Corporation is to ensure the success of customers constructing the software systems that they depend on. Using the following excerpts from Rational Software”s annual reports, calculate the firm”s total assets turnover for 2004 and 2003. (Amounts are in USD thousands.)

In a written report, discuss the meaning of the total assets turnover ratio and what the ratio means to management and investors. Use the total assets turnover ratios you computed for Rational Software as an example in your report.

indicate whether each of the following statements is true or false 625189

Aug 30, 2021 | Uncategorized

Indicate whether each of the following statements is true or false.

A person may favor the corporate form of organization for a risky business enterprise primarily because a corporation”s shares can be easily transferred.

In the event of corporate liquidation, stockholders whose stock is preferred as to assets are entitled to receive the par value of their shares before any amounts are distributed to creditors or common stockholders.

The par value of a share of capital stock is no indication of the market value or book value of the share of stock.

When 10,000 shares of USD 20 par value common stock are issued in payment for a parcel of land with a fair market value of USD 300,000, the Common Stock account is credited for USD 200,000, and the Paid-In Capital in Excess of Par Value —Common account is credited for USD 100,000.

compute the average price at which the 70 000 issued shares of common stock were sol 625207

Aug 30, 2021 | Uncategorized

The stockholders” equity of Graf Company”s balance is as follows:

Compute the average price at which the 70,000 issued shares of common stock were sold. Compute the book value per share of common stock.

prepare a schedule showing the dividends declared each year on each class of stock a 625208

Aug 30, 2021 | Uncategorized

The outstanding capital stock of Robbins Corporation consisted of 3,000 shares of 10 percent preferred stock, USD 250 par value, and 30,000 shares of no-par common stock with a stated value of USD 250. The preferred was issued at USD 412, the common at USD 480 per share. On 2005 January 1, the retained earnings of the company were USD 250,000. During the succeeding five years, net income was as follows:

No dividends were in arrears as of 2005 January 1, and during the five years 2005-2009, the board of directors declared dividends in each year equal to net income of the year. Prepare a schedule showing the dividends declared each year on each class of stock assuming the preferred stock is:

a. Cumulative.

b. Noncumulative.

prepare the balance sheet of the company as of 2009 march 1 625209

Aug 30, 2021 | Uncategorized

On 2008 December 27, Glade Company was authorized to issue 250,000 shares of USD 24 par value common stock. It then completed the following transactions: 2009

Jan. 14 Issued 45,000 shares of common stock at USD 30 per share for cash. 29 Gave the promoters of the corporation 25,000 shares of common stock for their services in organizing the company. The board of directors valued these services at USD 744,000. 19 Exchanged 50,000 shares of common stock for the following assets at the indicated fair market values:

a. Prepare general journal entries to record the transactions.

b. Prepare the balance sheet of the company as of 2009 March 1.

repeat part a for the stockholders equity accounts assuming the stock authorized has 625210

Aug 30, 2021 | Uncategorized

In the corporate charter that it received on 2009

May 1, Norris Company was authorized to issue 15,000 shares of common stock. The company issued 1,000 shares immediately for USD 82 per share, cash.

On July 2, the company issued 100 shares of stock to a lawyer to satisfy a USD 8,400 bill for legal services rendered in organizing the corporation.

On July 5, the company issued 1,000 shares to the principal promoter of the corporation in exchange for a patent. Another 200 shares were issued to this same person for costs incurred and services rendered in bringing the corporation into existence. The market value of the stock was USD 84 per share.

a. Set up T-accounts, and post these transactions. Then prepare a balance sheet for the Norris Company as of 2009 July 5, assuming the authorized stock has a par value of USD 75 per share.

b. Repeat part (a) for the stockholders” equity accounts, and prepare the stockholders” equity section of the July 5 balance sheet assuming the stock authorized has no par value but has a USD 30 per share stated value.

c. Repeat part (a) for the stockholders” equity accounts assuming the stock authorized has neither par nor stated value. Prepare the stockholders” equity section of the balance sheet.

assume that retained earnings were usd 200 000 prepare the stockholders equity secti 625211

Aug 30, 2021 | Uncategorized

On 2009 May 1, Farmington Company received a charter that authorized it to issue:

•4,000 shares of no-par preferred stock to which a stated value of USD 12 per share is assigned. The stock is entitled to a cumulative dividend of USD 9.60, convertible into two shares of common stock, callable at USD 208, and entitled to USD 200 per share in liquidation.

•1,500 shares of USD 400 par value, USD 20 cumulative preferred stock, which is callable at USD 420 and entitled to USD 412 in liquidation.

•60,000 shares of no-par common stock to which a stated value of USD 40 is assigned.

May 1 All of the USD 9.60 cumulative preferred was issued at USD 204 per share, cash.

2 All of the USD 20 cumulative preferred was exchanged for merchandise inventory, land, and buildings valued at USD 128,000, USD 160,000, and USD 425,000, respectively.

3 Cash of USD 15,000 was paid to reimburse promoters for costs incurred for accounting, legal, and printing services. In addition, 1,000 shares of common stock were issued to the promoters for their services. The value of all of the services (including those paid in cash) was USD 55,000.

a. Prepare journal entries for these transactions.

b. Assume that retained earnings were USD 200,000. Prepare the stockholders” equity section of the 2009 May 31, balance sheet.

alternate problem a on 2005 january 1 the retained earnings of quigley company were 625215

Aug 30, 2021 | Uncategorized

Alternate problem A On 2005 January 1, the retained earnings of Quigley Company were USD 432,000. Net income for the succeeding five years was as follows:

The outstanding capital stock of the corporation consisted of 2,000 shares of preferred stock with a par value of USD 480 per share that pays a dividend of USD 19.20 per year and 8,000 shares of no-par common stock with a stated value of USD 240 per share. No dividends were in arrears as of 2005 January 1. Prepare schedules showing how the net income for these five years was distributed to the two classes of stock if in each of the years the entire current net income was distributed as dividends and the preferred stock was:

a. Cumulative.

b. Noncumulative.

prepare a summary of transactions using column headings as given in the preceding ba 624913

Aug 30, 2021 | Uncategorized

The following data are for Central District Parking Corporation:

The summarized transactions for October 2010 are as follows:

Oct.1 The accounts payable owed as of September 30 (USD 94,000) were paid.

1 The company paid rent for the premises for October, USD 19,200.

7 The company received cash of USD 4,200 for parking by daily customers during the week.

10 The company collected USD 14,400 of the accounts receivable in the balance sheet at September 30.

14 Cash receipts for the week from daily customers were USD 6,600.

15 Parking revenue earned but not yet collected from fleet customers was USD 6,000.

16 The company paid salaries of USD 2,400 for the period October 1–15.

19 The company paid advertising expenses of USD 1,200 for October.

21 Cash receipts for the week from daily customers were USD 7,200.

24 The company incurred miscellaneous expenses of USD 840. Payment will be due November 10.

31 Cash receipts for the last 10 days of the month from daily customers were USD 8,400.

31 The company paid salaries of USD 3,000 for the period October 16–31.

31 Billings to monthly customers totaled USD 21,600 for October.

31 Paid cash dividends of USD 24,000.

a. Prepare a summary of transactions using column headings as given in the preceding balance sheet. Determine balances after each transaction.

b. Prepare an income statement for October 2010.

c. Prepare a statement of retained earnings for October 2010.

d. Prepare a balance sheet as of 2010 October 31.

state the probable causes of the changes in each of the balance sheet accounts from 624914

Aug 30, 2021 | Uncategorized

The following balance sheets for 2010 June 30, and 2010 May 31, and the income statement for June are for Beach Camping Trailer Storage, Inc. (Common practice is to show the most recent period first.)

A cash dividend of USD 6,000 was declared and paid in June.

State the probable causes of the changes in each of the balance sheet accounts from May 31 to 2010 June 30.

prepare a trial balance 624915

Aug 30, 2021 | Uncategorized

Green Hills Riding Stable, Incorporated, had the following balance sheet on 2010 June 30:

a. Prepare the journal entries to record the transactions for July 2010.

b. Post the journal entries to the ledger accounts after entering the beginning balances in those accounts. Insert cross-indexing references in the journal and ledger. Use the following chart of accounts:

c. Prepare a trial balance.

prepare journal entries to record each of the following transactions for sanchez com 624935

Aug 30, 2021 | Uncategorized

Prepare journal entries to record each of the following transactions for Sanchez Company. Use the letter of the transaction in place of the date. Include an explanation for each entry.

a. Capital stock was issued for cash, USD 300,000.

b. Purchased trucks by signing a note bearing no interest, USD 210,000.

c. Earned service revenue on account, USD 4,800.

d. Collected the account receivable resulting from transaction (c), USD 4,800.

e. Paid the note payable for the trucks purchased, USD 210,000.

f. Paid utilities for the month in the amount of USD 1,800.

g. Paid salaries for the month in the amount of USD 7,500.

h. Incurred supplies expenses on account in the amount of USD 1,920.

i. Purchased another truck for cash, USD 48,000.

j. Performed delivery services on account, USD 24,000.

prepare a trial balance as of 2010 august 31 624941

Aug 30, 2021 | Uncategorized

Economy Laundry Company had the following transactions in August 2010:

Aug. 1 Issued capital stock for cash, USD 150,000.

3 Borrowed USD 40,000 from the bank on a note.

4 Purchased cleaning equipment for USD 25,000 cash.

6 Performed services for customers who promised to pay later, USD 16,000.

7 Paid this month”s rent on a building, USD 2,800.

10 Collections were made for the services performed on August 6, USD 3,200.

14 Supplies were purchased on account for use this month, USD 3,000.

17 A bill for USD 400 was received for utilities for this month.

25 Laundry services were performed for customers who paid immediately, USD 22,000.

31 Paid employee salaries, USD 6,000.

31 Paid cash dividend, USD 2,000.

a. Prepare journal entries for these transactions.

b. Post the journal entries to T-accounts. Enter the account number in the Posting Reference column of the journal as you post each amount. Use the following account numbers:

c. Prepare a trial balance as of 2010 August 31.

prepare general ledger accounts for all of these accounts except retained earnings t 624942

Aug 30, 2021 | Uncategorized

Clean-Sweep Janitorial, Inc., a company providing janitorial services, was organized 2010 July 1. The following account numbers and titles constitute the chart of accounts for the company:

July 1 The company issued USD 600,000 of capital stock for cash.

5 Office space was rented for July, and USD 5,000 was paid for the rental.

8 Desks and chairs were purchased for the office on account, USD 28,800.

10 Equipment was purchased for USD 50,000; a note was given, to be paid in 30 days.

15 Purchased trucks for USD 150,000, paying USD 120,000 cash and giving a 60-day note to the dealer for USD 30,000.

July 18 Paid for supplies received and already used, USD 2,880.

23 Received USD 17,280 cash as service revenue.

27 Insurance expense for July was paid, USD 4,500.

30 Paid for gasoline and oil used by the truck in July, USD 576.

31 Billed customers for janitorial services rendered, USD 40,320.

31 Paid salaries for July, USD 51,840.

31 Paid utilities bills for July, USD 5,280.

31 Paid cash dividends, USD 9,600.

a. Prepare general ledger accounts for all of these accounts except Retained Earnings. The Retained Earnings account has a beginning balance of zero and maintains this balance throughout the period.

b. Journalize the transactions given for July 2010 in the general journal.

c. Post the journal entries to ledger accounts.

d. Prepare a trial balance as of 2010 July 31.

prepare entries in the general journal for the preceding transactions for december 2 624943

Aug 30, 2021 | Uncategorized

Trim Lawn, Inc., is a lawn care company. Thus, the company earns its revenue from sending its trucks to customers” residences and certain commercial establishments to care for lawns and shrubbery. Trim Lawn”s trial balance at the end of the first 11 months of the year follows:

Dec. 2 Paid rent for December, USD 3,000.

5 Paid the accounts payable of USD 33,600.

8 Paid advertising for December, USD 1,500.

10 Purchased a new office desk on account, USD 1,050.

13 Purchased USD 240 of supplies on account for use in December.

15 Collected cash from customers on account, USD 75,000.

20 Paid for customer entertainment, USD 450.

24 Collected an additional USD 6,000 from customers on account.

26 Paid for gasoline used in the trucks in December, USD 270.

28 Billed customers for services rendered, USD 79,500.

30 Paid for more December supplies, USD 12,000.

31 Paid December salaries, USD 15,300.

31 Paid a USD 4,000 cash dividend. (The Dividends account is No. 320.)

a. Open three-column general ledger accounts for each of the accounts in the trial balance under the date of 2010 December 1. Place the word Balance in the explanation space of each account. Also open an account for Dividends, No. 320.

b. Prepare entries in the general journal for the preceding transactions for December 2010.

c. Post the journal entries to three-column general ledger accounts.

d. Prepare a trial balance as of 2010 December 31.

prepare journal entries for these transactions in the general journal 624944

Aug 30, 2021 | Uncategorized

Speedy Laundry Company, Inc., entered into the following transactions in August 2010:

Aug. 1 Received cash for capital stock issued to owners, USD 400,000.

3 Paid rent for August on a building and laundry equipment rented, USD 3,000.

6 Performed laundry services for USD 2,000 cash.

8 Secured an order from a customer for laundry services of USD 7,000. The services are to be performed next month.

13 Performed laundry services for USD 6,300 on account for various customers.

15 Received and paid a bill for USD 430 for supplies used in operations.

23 Cash collected from customers on account, USD 2,600.

31 Paid USD 2,400 salaries to employees for August.

31 Received the electric and gas bill for August, USD 385, but did not pay it at this time.

31 Paid cash dividend, USD 1,000.

Prepare journal entries for these transactions in the general journal.

how profitable is this new venture should jacobs stay in this business 624947

Aug 30, 2021 | Uncategorized

Business decision case A John Jacobs lost his job as a carpenter with a contractor when a recession hit the construction industry. Jacobs had been making USD 50,000 per year. He decided to form his own company, Jacobs Corporation, and do home repairs.

The following is a summary of the transactions of the business during the first three months of operations in 2010:

Jan. 15 Stockholders invested USD 40,000 in the business.

Feb. 25 Received payment of USD 4,400 for remodeling a basement into a recreation room. The homeowner purchased all of the building materials.

Mar. 5 Paid cash for an advertisement that appeared in the local newspaper, USD 150.

Apr. 10 Received USD 7,000 for converting a room over a garage into an office for a college professor. The professor purchased all of the materials for the job.

11 Paid gas and oil expenses for automobile, USD 900.

12 Miscellaneous business expenses were paid, USD 450.

15 Paid dividends of USD 2,000.

a. Prepare journal entries for these transactions.

b. Post the journal entries to T-accounts.

c. How profitable is this new venture? Should Jacobs stay in this business?

could its philosophy regarding its employees be the major factor in its outstanding 624949

Aug 30, 2021 | Uncategorized

In The Home Depot”s recent Annual Report, the following passages appear:

The primary key to our success is our 39,000 employees who wear those orange aprons you see in our stores.

Few great achievements—in business or in any aspect of life—are reached and sustained without the support and involvement of large numbers of people committed to shared values and goals they deem worthy. Indeed, one need look no further than the business section of the morning newspaper to read of how yet another “blue chip” American business, entrenched in and isolated by its own bureaucracy, has lost the support of its employees and customers…

Frankly, the biggest difference between The Home Depot and our competitors is not the products on our shelves, it is our people and their ability to forge strong bonds of loyalty and trust with our customers……Contrary to conventional management wisdom, those at the top of organization charts are not the source of all wisdom. Many of our best ideas come from the people who work on the sales floor. We encourage our employees to challenge senior management directives if they feel strongly enough about their dissenting opinions…

…We want our people to be themselves and to be bold enough to apply their talents as individuals. Certainly, people can often perceive great risk acting this way. Thus, we go to great lengths to empower our employees to be mavericks, to express differences of opinion without fear of being fired or demoted…We do everything we can to make people feel challenged and inspired at work instead of being threatened and made to feel insecure. An organization can, after all, accomplish more when people work together instead of against each other.

Write answers to the following questions:

a. Do you think The Home Depot management regards its employees more as expenses or assets?

Explain.

b. What does The Home Depot regard as its most valuable asset? Explain your answer.

c. Is The Home Depot permitted to list its human resources as assets on its balance sheet? Why or why not?

d. Could its philosophy regarding its employees be the major factor in its outstanding financial performance? Explain.

what motivated larry to go along with unethical and illegal actions explain 624950

Aug 30, 2021 | Uncategorized

Writing experience D Refer to “An ethical perspective: Financial deals, Inc.”. Write out the answers to the following questions:

a. What motivated Larry to go along with unethical and illegal actions? Explain.

b. What are Larry”s options now? List each possibility.

c. What would you do if you were Larry? Describe in detail.

d. What do you think the real Larry did? Describe in detail.

Group project E In teams of two or three students, interview in person or by speakerphone a new staff member who has worked for a CPA firm for only one or two years. Seek information on the advantages and disadvantages of working for a CPA firm. Also, inquire about the nature of the work and the training programs offered by the firm for new employees. As a team, write a memorandum to the instructor summarizing the results of the interview. The heading of the memorandum should contain the date, to whom it is written, from whom, and the subject matter.

Group project F With one or two other students and using library resources, write a report on the life of Luca Pacioli, sometimes referred to as the father of accounting. Pacioli was a Franciscan monk who wrote a book on double-entry accounting in 1494. Be careful to cite sources and treat direct quotes properly. (If you do not know how to do this, ask your instructor.)

select the best answer for each of the following questions 624953

Aug 30, 2021 | Uncategorized

Select the best answer for each of the following questions.

An insurance policy premium of USD 1,200 was paid on 2010 September 1, to cover a one-year period from that date. An asset was debited on that date. Adjusting entries are prepared once a year, at year-end. The necessary adjusting entry at the company’s year-end, 2010 December 31, is:

The Supplies on Hand account has a balance of USD 1,500 at year-end. The actual amount of supplies on hand at the end of the period was USD 400. The necessary adjusting entry is:

A company purchased a truck for USD 20,000 on 2010 January 1. The truck has an estimated residual value of USD 5,000 and is expected to last five years. Adjusting entries are prepared only at year-end. The necessary adjusting entry at 2010 December 31, the company’s year-end, is:

A company received cash of USD 24,000 on 2010 October 1, as subscriptions for a one-year period from that date. A liability account was credited when the cash was received. The magazine is to be published by the company and delivered to subscribers each month. The company prepares adjusting entries at the end of each month because it prepares financial statements each month. The adjusting entry the company would make at the end of each of the next 12 months would be:

When a company earns interest on a note receivable or on a bank account, the debit and credit are as follows:

If USD 3,000 has been earned by a company’s workers since the last payday in an accounting period, the necessary adjusting entry would be:

a. Debit an expense and credit a liability.

b. Debit an expense and credit an asset.

c. Debit a liability and credit an asset.

d. Debit a liability and credit an expense.

what adjusting entry is necessary at december 31 the end of the accounting year show 624968

Aug 30, 2021 | Uncategorized

One-year insurance policy was purchased on August 1 for USD 2,400, and the

following entry was made at that time:

What adjusting entry is necessary at December 31, the end of the accounting year? Show how the T-accounts for Prepaid Insurance and Insurance Expense would appear after the entries are posted.

you know that the gross amount of rent paid was usd 4 500 which was to cover a one y 624970

Aug 30, 2021 | Uncategorized

At 2010 December 31, an adjusting entry was made as follows:

You know that the gross amount of rent paid was USD 4,500, which was to cover a one-year period.

Determine:

a. The opening date of the year to which the USD 4,500 of rent applies.

b. The entry that was made on the date the rent was paid.

in the following table indicate the effects of failing to recognize each of the indi 624979

Aug 30, 2021 | Uncategorized

In the following table, indicate the effects of failing to recognize each of the indicated adjustments by writing “O” for overstated and “U” for understated.

using 1989 as the base year calculate the trend percentages and comment on the resul 624980

Aug 30, 2021 | Uncategorized

The following data regarding net income (loss) are for Perkins Parts, a medium-sized automotive supplier, for the period 2004–2009.

Using 1989 as the base year, calculate the trend percentages, and comment on the results.

prepare the annual year end adjusting journal entries at december 31 624981

Aug 30, 2021 | Uncategorized

Among other items, the trial balance of Filmblaster, Inc., a movie rental company, at December 31 of the current year includes the following account balances:

Examination of the records shows that adjustments should be made for the following items:

a. Of the prepaid insurance in the trial balance, USD 4,000 is for coverage during the months after December 31 of the current year.

b. The balance in the Prepaid Rent account is for a 12-month period that started October 1 of the current year.

c. USD 300 of interest has been earned but not received.

d. Supplies used during the year amount to USD 1,800.

Prepare the annual year-end adjusting journal entries at December 31.

prepare the year end adjusting journal entries at december 31 624982

Aug 30, 2021 | Uncategorized

Marathon Magazine, Inc., has the following account balances, among others, in its trial balance at December 31 of the current year:

The inventory of supplies on hand at December 31 amounts to USD 720.

The balance in the Prepaid Rent account is for a one-year period starting October 1 of the

current year.

One-third of the USD 15,000 balance in Unearned Subscription Fees has been earned. Since the last payday, the employees of the company have earned additional salaries in the amount of USD 5,430.

a. Prepare the year-end adjusting journal entries at December 31.

b. Open ledger accounts for each of the accounts involved, enter the balances as shown in the trial balance, post the adjusting journal entries, and calculate year-end balances.

prepare the annual year end adjusting entries indicated by the additional data 624983

Aug 30, 2021 | Uncategorized

Hillside Apartments, Inc., adjusts and closes its books each December 31. Assume the accounts for all prior years have been properly adjusted and closed. Following are some of the company’s account balances prior to adjustment on 2010 December 31:

The Prepaid Insurance account balance represents the remaining cost of a four-year insurance policy dated 2011 June 30, having a total premium of USD 12,000.

The physical inventory of the office supply stockroom indicates that the supplies on hand cost USD 3,000.

The building was originally acquired on 1994 January 1, at which time management estimated that the building would last 40 years and have a residual value of USD 15,000. Salaries earned since the last payday but unpaid at December 31 amount to USD 5,000.

Interest earned but not collected on a savings account during the year amounts to USD 400.

The Unearned Rent account arose through the prepayment of rent by a tenant in the building for 12 months beginning 2010 October 1.

Prepare the annual year-end adjusting entries indicated by the additional data.

calculate the correct net income for 2010 and 2011 in your answer start with the rep 624984

Aug 30, 2021 | Uncategorized

The reported net income amounts for Gulf Coast Magazine, Inc., for calendar years 2010 and 2011 were USD 200,000 and USD 222,000, respectively. No annual adjusting entries were made at either year-end for any of the following transactions:

A fire insurance policy to cover a three-year period from the date of payment was purchased on 2010 March 1 for USD 3,600. The Prepaid Insurance account was debited at the date of purchase.

Subscriptions for magazines in the amount of USD 72,000 to cover an 18-month period from 2010 May 1, were received on 2010 April 15. The Unearned Subscription Fees account was credited when the payments were received.

A building costing USD 180,000 and having an estimated useful life of 50 years and a residual value of USD 30,000 was purchased and put into service on 2010 January 1.

On 2011 January 12, salaries of USD 9,600 were paid to employees. The account debited was Salaries Expense. One-third of the amount paid was earned by employees in December of 2010.

Calculate the correct net income for 2010 and 2011. In your answer, start with the reported net income. Then show the effects of each correction (adjustment), using a plus or a minus to indicate whether reported income should be increased or decreased as a result of the correction. When the corrections are added to or deducted from the reported net income amounts, the result should be the correct net income amounts. The answer format should appear as follows:

in january 2007 joan hill bought one share of orban corp stock for 300 on march 1 20 624684

Aug 30, 2021 | Uncategorized

Items 1 and 2 are based on the following data:

In January 2007, Joan Hill bought one share of Orban Corp. stock for $300. On March 1, 2007, Orban distributed one share of preferred stock for each share of common stock held. This distribution was nontaxable. On March 1, 2007, Joan’s one share of common stock had a fair market value of $450, while the preferred stock had a fair market value of $150.

After the distribution of the preferred stock, Joan’s bases for her Orban stocks are

The holding period for the preferred stock starts in

1. January 2007.
2. March 2007.
3. September 2007.
4. December 2007.

what is tom gow rsquo s recognized gain and basis in his new investment real estate 624686

Aug 30, 2021 | Uncategorized

Tom Gow owned a parcel of investment real estate that had an adjusted basis of $25,000 and a fair market value of $40,000. During 2007, Gow exchanged his investment real estate for the items of property listed below.

What is Tom Gow’s recognized gain and basis in his new investment real estate?

the following information pertains to the acquisition of a six wheel truck by sol ba 624691

Aug 30, 2021 | Uncategorized

The following information pertains to the acquisition of a six-wheel truck by Sol Barr, a self-employed contractor:

The basis of the new truck is

1. $27,000
2. $25,000
3. $23,000
4. $19,000

the following information pertains to the sale of al and beth oran rsquo s principal 624694

Aug 30, 2021 | Uncategorized

The following information pertains to the sale of Al and Beth Oran’s principal residence:

Al and Beth owned their home jointly and had occupied it as their principal residence since acquiring the home in 1991. In June 2007, the Orans bought a condo for $190,000 to be used as their principal residence. What amount of gain must the Orans recognize on their 2007 joint return from the sale of their residence?

1. $ 90,000
2. $150,000
3. $340,000
4. $400,000

on january 3 2007 smith sold the shares purchased on december 15 2006 for 13 000 wha 624697

Aug 30, 2021 | Uncategorized

Smith, an individual calendar-year taxpayer, purchased 100 shares of Core Co. common stock for $15,000 on December 15, 2006, and an additional 100 shares for $13,000 on December 30, 2006. On January 3, 2007, Smith sold the shares purchased on December 15, 2006, for $13,000. What amount of loss from the sale of Core stock is deductible on Smith’s 2006 and 2007 income tax returns?

also in 2007 nam sustained a long term capital loss of 24 000 from the sale of marke 624709

Aug 30, 2021 | Uncategorized

In 2007, Nam Corp., which is not a dealer in securities, realized taxable income of $160,000 from its business operations. Also, in 2007, Nam sustained a long-term capital loss of $24,000 from the sale of marketable securities. Nam did not realize any other capital gains or losses since it began operations. In Nam’s income tax returns, what is the proper treatment for the $24,000 long-term capital loss?

1. Use $3,000 of the loss to reduce 2007 taxable income, and carry $21,000 of the long-term capital loss forward for five years.
2. Use $6,000 of the loss to reduce 2007 taxable income by $3,000, and carry $18,000 of the long-term capital loss forward for five years.
3. Use $24,000 of the long-term capital loss to reduce 2007 taxable income by $12,000.
4. Carry the $24,000 long-term capital loss forward for five years, treating it as a short-term capital loss.

determine balances after each transaction to show that the basic accounting equation 624880

Aug 30, 2021 | Uncategorized

On 2010 June 1, Green Hills Riding Stable, Incorporated, was organized. The following transactions occurred during June:

June 1 Shares of capital stock were issued for USD 10,000 cash.

4 A horse stable and riding equipment were rented (and paid for) for the month at a cost of USD 1,200.

8 Horse feed for the month was purchased on credit, USD 800.

15 Boarding fees of USD 3,000 for June were charged to those owning horses boarded at the stable. (Fee is due on July 10.)

20 Miscellaneous expenses of USD 600 were paid.

29 Land was purchased from a savings and loan association by borrowing USD 40,000 on a note from that association. The loan is due to be repaid in five years. Interest payments are due at the end of each month beginning July 31.

30 Salaries of USD 700 for the month were paid.

30 Riding and lesson fees were billed to customers in the amount of USD 2,800. (Fees are due on July 10.)

Prepare a summary of the preceding transactions. Use columns headed Cash, Accounts Receivable, Land, Accounts Payable, Notes Payable, Capital Stock, and Retained Earnings. Determine balances after each transaction to show that the basic accounting equation is in balance.

Prepare an income statement for June 2010.

Prepare a statement of retained earnings for June 2010.

Prepare a balance sheet as of 2010 June 30.

a match the descriptions in column b with the appropriate terms in column a 624894

Aug 30, 2021 | Uncategorized

A Match the descriptions in Column B with the appropriate terms in Column A.

for each of the following events determine if it has an effect on the specific items 624898

Aug 30, 2021 | Uncategorized

For each of the following events, determine if it has an effect on the specific items (such as cash) in the accounting equation. For the events that do have an effect, present an analysis of the transaction showing its two sides or dual nature.

a. Purchased equipment for cash, USD 12,000.

b. Purchased a truck for USD 40,000, signed a note (with no interest) promising payment in 10 days.

c. Paid USD 1,600 for the current month’s utilities.

d. Paid for the truck purchased in (b).

e. Employed Mary Childers as a salesperson at USD 1,200 per month. She is to start work next week.

f. Signed an agreement with a bank in which the bank agreed to lend the company up to USD 200,000 any time within the next two years.

bradley company engaged in a courier service business completed the following 624899

Aug 30, 2021 | Uncategorized

Bradley Company, engaged in a courier service business, completed the following

selected transactions during July 2010:

a. Purchased office equipment on account.

b. Paid an account payable.

c. Earned service revenue on account.

d. Borrowed money by signing a note at the bank.

e. Paid salaries for month to employees.

f. Received cash on account from a charge customer.

g. Received gas and oil bill for month.

h. Purchased delivery truck for cash.

i. Declared and paid a cash dividend.

Using a tabular form similar to Exhibit 4 (Part A), indicate the effect of each transaction on the accounting equation using (+) for increase and (–) for decrease. No dollar amounts are needed, and you need not fill in the Explanation column.

prepare an income statement for july 2010 624903

Aug 30, 2021 | Uncategorized

Assume that the following items were included in the Retained Earnings column in the

summary of transactions for Cinck Company for July 2010:

Prepare an income statement for July 2010.

prepare a balance sheet we have purposely listed the accounts out of order 624904

Aug 30, 2021 | Uncategorized

Given the following facts, prepare a statement of retained earnings for Brindle Company, a tanning salon, for August 2010:

Balance in retained earnings at end of July, USD 188,000.

Dividends paid in August, USD 63,600.

Net income for August, USD 72,000.

The column totals of a summary of transactions for Speedy Printer Repair, Inc., as of 2010 December 31, were as follows:

Prepare a balance sheet. We have purposely listed the accounts out of order.

given the following data for merck calculate the equity ratios for 2003 and 2002 the 624905

Aug 30, 2021 | Uncategorized

Merck & Co., Inc. is a world leader in the discovery, development, manufacture and marketing of a broad range of human and animal health products. The company, which has 70,000 employees, spends over USD 2 billion every year on the research and development of new drugs. As of the end of 2, its 2.2 billion shares are valued in the stock market for a total of USD 132 billion. Given the following data for Merck, calculate the equity ratios for 2003 and 2002. Then comment on the results.

prepare a summary of transactions see part a of exhibit 4 use money columns headed c 624906

Aug 30, 2021 | Uncategorized

Lakewood Personal Finance Company, which provides financial advisory services,

engaged in the following transactions during May 2010:

May 1Received USD 300,000 cash for shares of capital stock issued when company was organized.

2 The company borrowed USD 40,000 from the bank on a note.

7 The company bought USD 182,400 of computer equipment for cash.

11 Cash received for services performed to date was USD 15,200.

14 Services performed for a customer who agreed to pay within a month were USD 10,000.

15 Employee wages were paid, USD 13,200.

19 The company paid USD 14,000 on the note to the bank.

31 Interest paid to the bank for May was USD 140. (Interest is an expense, which reduces retained earnings.)

31 The customer of May 14 paid USD 3,200 of the amount owed to the company.

31 An order was received from a customer for services to be rendered next week, which will be billed at USD 12,000.

Prepare a summary of transactions (see Part A of Exhibit 4). Use money columns headed Cash, Accounts Receivable, Equipment, Notes Payable, Capital Stock, and Retained Earnings. Determine balances after each transaction to show that the accounting equation balances.

determine balances after each transaction to show that the basic accounting equation 624907

Aug 30, 2021 | Uncategorized

Reliable Lawn Care Service, Inc., a company that takes care of lawns and shrubbery of

personal residences, engaged in the following transactions in April 2010:

Apr.1 The company was organized and received USD 400,000 cash from the owners in exchange for capital stock issued.

4 The company bought equipment for cash, USD 101,760.

9 The company bought additional mowing equipment that cost USD 9,120 and agreed to pay for it in 30 days.

15 Cash received for services performed to date was USD 3,840.

16 Amount due from a customer for services performed totaled USD 5,280.

30 Of the receivable (see April 16), USD 3,072 was collected in cash.

30 Miscellaneous operating expenses of USD 6,240 were paid during the month.

30 An order was placed for miscellaneous equipment costing USD 28,800.

a. Prepare a summary of transactions (see Part A of Exhibit 4). Use money columns headed Cash, Accounts Receivable, Equipment, Accounts Payable, Capital Stock, and Retained Earnings. Determine balances after each transaction to show that the basic accounting equation balances.

b. Prepare a balance sheet as of April 30.

prepare an income statement for june 2010 624908

Aug 30, 2021 | Uncategorized

Analysis of the transactions of the Moonlight Drive-In Theater for June 2010 disclosed

the following:

Balance sheet amounts at June 30 include the following:

a. Prepare an income statement for June 2010.

b. Prepare a statement of retained earnings for June 2010.

c. Prepare a balance sheet as of 2010 June 30.

d. How solvent does this company appear to be?

prepare a summary of transactions see part a of exhibit 4 using column headings as g 624909

Aug 30, 2021 | Uncategorized

Little Folks Baseball, Inc., was formed by a group of parents to meet a need for a place for kids to play baseball. At the beginning of its second year of operations, its balance sheet appeared as follows:

The summarized transactions for May 2010 are as follows:

a. Issued additional capital stock for cash, USD 200,000.

b. Collected USD 80,000 on accounts receivable.

c. Paid USD 64,000 on accounts payable.

d. Received membership fees from parents (nonrefundable): in cash, USD 260,000; and on account, USD 120,000.

e. Incurred operating expenses: for cash, USD 60,000; and on account, USD 160,000.

f. Paid dividends of USD 16,000.

g. Purchased more land for cash, USD 96,000.

h. Placed an order for new equipment expected to cost USD 120,000.

a. Prepare a summary of transactions (see Part A of Exhibit 4) using column headings as given in the balance sheet. Determine balances after each transaction.

b. Prepare an income statement for May 2010.

c. Prepare a statement of retained earnings for May 2010.

d. Prepare a balance sheet as of 2010 May 31.

The balance sheets for 2010 May 31, and 2010 April 30, and the income statement for May of the Target-Line Golf Driving Range follow. (Common practice is to show the most recent period first.)

All revenues earned are on account.

State the probable cause(s) of the change in each of the balance sheet accounts from April 30 to 2010 May 31.

prepare a summary of transactions see part a of exhibit 4 for the company for these 624910

Aug 30, 2021 | Uncategorized

Preston Auto Paint Company had the temporary free use of an old building and completed the following transactions in September 2010:

Sept. 1 The company was organized and received USD 100,000 cash from the issuance of capital stock.

5 The company bought painting and sanding equipment for cash at a cost of USD 25,000.

7 The company painted the auto fleet of a customer who agreed to pay USD 8,000 in one week. The customer furnished the special paint.

14 The company received the USD 8,000 from the transaction of September 7.

20 Additional sanding equipment that cost USD 2,800 was acquired today; payment was postponed until September 28.

28 USD 2,400 was paid on the liability incurred on September 20.

30 Employee salaries for the month, USD 2,200, were paid.

30 Placed an order for additional painting equipment advertised at USD 20,000.

Prepare a summary of transactions (see Part A of Exhibit 4) for the company for these transactions.

Use money columns headed Cash, Accounts Receivable, Equipment, Accounts Payable, Capital Stock, and Retained Earnings. Determine balances after each transaction to show that the basic accounting equation balances.

determine balances after each transaction to show that the basic accounting equation 624911

Aug 30, 2021 | Uncategorized

Quick-Start Home Repair Company completed the following transactions in June 2010:

June 1 The company was organized and received USD 200,000 cash from the issuance of capital stock.

4 The company paid USD 48,000 cash for a truck.

7 The company borrowed USD 10,000 from its bank on a note.

9 Cash received for repair services performed was USD 4,500.

12 Expenses of operating the business so far this month were paid in cash, USD 3,400.

18 Repair services performed for a customer who agreed to pay within a month amounted to USD 5,400.

25 The company paid USD 4,065 on its loan from the bank, including USD 4,050 of principal and USD 15 of interest. (The principal is the amount of the loan. Interest is an expense, which reduces retained earnings.)

30 Miscellaneous expenses incurred in operating the business from June 13 to date were USD 3,825 and were paid in cash.

30 An order (contract) was received from a customer for repair services to be performed tomorrow, which will be billed at USD 3,000.

a. Prepare a summary of transactions (see Part A of Exhibit 4). Include money columns for Cash, Accounts Receivable, Trucks, Notes Payable, Capital Stock, and Retained Earnings. Determine balances after each transaction to show that the basic accounting equation balances.

b. Prepare a balance sheet as of 2010 June 30.

prepare an income statement for the year ended 2010 june 30 624912

Aug 30, 2021 | Uncategorized

Following are summarized transaction data for Luxury Apartments, Inc., for the year ending 2010 June 30. The company owns and operates an apartment building.

Of the USD 150,000 rent revenue, USD 5,000 was not collected in cash until 2010 July 5. Prepare an income statement for the year ended 2010 June 30.

what portion of the 1 120 would qualify as itemized deductions for 2007 624586

Aug 30, 2021 | Uncategorized

During 2007, William Clark was assessed a deficiency on his 2005 federal income tax return. As a result of this assessment he was required to pay $1,120 determined as follows:

What portion of the $1,120 would qualify as itemized deductions for 2007?

1. $0
2. $ 14
3. $150
4. $220

without regard to the 100 ldquo floor rdquo and the adjusted gross income percentage 624598

Aug 30, 2021 | Uncategorized

Alex and Myra Burg, married and filing joint income tax returns, derive their entire income from the operation of their retail candy shop. Their 2007 adjusted gross income was $50,000. The Burgs itemized their deductions on Schedule A for 2007. The following unreimbursed cash expenditures were among those made by the Burgs during 2007:

Without regard to the $100 “floor” and the adjusted gross income percentage threshold, what amount should the Burgs deduct for the casualty loss in their itemized deductions on Schedule A for 2007?

1. $0
2. $ 90
3. $300
4. $400

2 500 repairs in connection with 2007 fire damage to the hoyt residence this proper 624600

Aug 30, 2021 | Uncategorized

Items 1 and 2 are based on the following selected 2007 information pertaining to Sam and Ann Hoyt, who filed a joint federal income tax return for the calendar year 2007. The Hoyts had adjusted gross income of $34,000 and itemized their deductions for 2007. Among the Hoyts’ cash expenditures during 2007 were the following:

$2,500 repairs in connection with 2007 fire damage to the Hoyt residence. This property has a basis of $50,000. Fair market value was $60,000 before the fire and $55,000 after the fire. Insurance on the property had lapsed in 2006 for nonpayment of premium.

$800 appraisal fee to determine amount of fire loss.

What amount of fire loss were the Hoyts entitled to deduct as an itemized deduction on their 2007 return?

1. $5,000
2. $2,500
3. $1,600
4. $1,500

The appraisal fee to determine the amount of the Hoyts’ fire loss was

1. Deductible from gross income in arriving at adjusted gross income.
2. Subject to the 2% of adjusted gross income floor for miscellaneous itemized deductions.
3. Deductible after reducing the amount by $100.
4. Not deductible.

hall a divorced person and custodian of her twelve year old child submitted the foll 624603

Aug 30, 2021 | Uncategorized

Hall, a divorced person and custodian of her twelve-year-old child, submitted the following information to the CPA who prepared her 2006 return:

During 2006, Hall spent a total of $1,000 for state lottery tickets. Her lottery winnings in 2006 totaled $200.

Hall’s lottery transactions should be reported as follows:

joel rich is an outside salesman deriving his income solely from commissions and per 624604

Aug 30, 2021 | Uncategorized

Joel Rich is an outside salesman, deriving his income solely from commissions, and personally bearing all expenses without reimbursement of any kind. During 2007, Joel paid the following expenses pertaining directly to his activities as an outside salesman:

How should these expenses be deducted in Joel’s 2007 return?

how much can magda claim in 2007 as allowable miscellaneous deductions on schedule a 624605

Aug 30, 2021 | Uncategorized

Magda Micale, a public school teacher with adjusted gross income of $10,000, paid the following items in 2007 for which she received no reimbursement:

How much can Magda claim in 2007 as allowable miscellaneous deductions on Schedule A of Form 1040?

1. $ 80
2. $280
3. $252
4. $352

if brodsky were to itemize his personal deductions what amount should he claim as mi 624606

Aug 30, 2021 | Uncategorized

Harold Brodsky is an electrician employed by a contracting firm. His adjusted gross income is $25,000. During the current year he incurred and paid the following expenses:

If Brodsky were to itemize his personal deductions, what amount should he claim as miscellaneous deductible expenses?

1. $ 800
2. $ 900
3. $1,500
4. $1,700

for head of household filing status which of the following costs are considered in d 624623

Aug 30, 2021 | Uncategorized

For head of household filing status, which of the following costs are considered in determining whether the taxpayer has contributed more than one-half the cost of maintaining the household?

poole wishes to minimize his income tax what is poole rsquo s 2007 total income tax 624628

Aug 30, 2021 | Uncategorized

Poole, forty-five years old and unmarried, is in the 15% tax bracket. He had 2007 adjusted gross income of $20,000. The following information applies to Poole:

Poole wishes to minimize his income tax. What is Poole’s 2007 total income tax?

1. $3,000
2. $1,733
3. $1,665
4. $1,455

what are the amounts of tax preference items and adjustments that must be added to o 624630

Aug 30, 2021 | Uncategorized

Randy Lowe reported the following items in computing his regular federal income tax for 2007:

What are the amounts of tax preference items and adjustments that must be added to or subtracted from regular taxable income in order to compute Lowe’s alternative minimum taxable income for 2007?

an individual rsquo s alternative minimum tax adjustments include 624633

Aug 30, 2021 | Uncategorized

An individual’s alternative minimum tax adjustments include

alex berger a retired building contractor earned the following income during 2007 624641

Aug 30, 2021 | Uncategorized

Alex Berger, a retired building contractor, earned the following income during 2007:

Berger’s gross income from self-employment for 2007 is

1. $0
2. $ 600
3. $7,000
4. $7,600

assuming that the jasons do not claim any other credits against their tax what is th 624647

Aug 30, 2021 | Uncategorized

Robert and Mary Jason, filing a joint tax return for 2007, had a tax liability of $9,000 based on their tax table income and three exemptions. Robert and Mary had earned income of $30,000 and $22,000, respectively, during 2007. In order for Mary to be gainfully employed, the Jasons incurred the following employment-related expenses for their four-year-old son John in 2007:

Assuming that the Jasons do not claim any other credits against their tax, what is the amount of the child care tax credit they should report on their tax return for 2007?

1. $ 500
2. $ 600
3. $ 700
4. $1,050

to qualify for the child care credit on a joint return at least one spouse must 624648

Aug 30, 2021 | Uncategorized

To qualify for the child care credit on a joint return, at least one spouse must

which factor s may affect the amount of sunex rsquo s foreign tax credit available i 624649

Aug 30, 2021 | Uncategorized

Sunex Co., an accrual-basis, calendar-year domestic C corporation, is taxed on its worldwide income. In the current year, Sunex’s US tax liability on its domestic and foreign-source income is $60,000 and no prior year foreign income taxes have been carried forward. Which factor(s) may affect the amount of Sunex’s foreign tax credit available in its current year corporate income tax return?

what amount of foreign tax credit may wald claim for 2007 624650

Aug 30, 2021 | Uncategorized

The following information pertains to Wald Corp.’s operations for the year ended December 31, 2007:

What amount of foreign tax credit may Wald claim for 2007?

1. $28,800
2. $36,600
3. $38,400
4. $39,000

what is birch rsquo s tax basis for the land and building 624675

Aug 30, 2021 | Uncategorized

Ralph Birch purchased land and a building which will be used in connection with Birch’s business. The costs associated with this purchase are as follows:

What is Birch’s tax basis for the land and building?

1. $ 44,500
2. $394,500
3. $397,500
4. $402,500

laura rsquo s father albert gave laura a gift of 500 shares of liba corporation comm 624680

Aug 30, 2021 | Uncategorized

Items 1 through 3 are based on the following data:

Laura’s father, Albert, gave Laura a gift of 500 shares of Liba Corporation common stock in 2007. Albert’s basis for the Liba stock was $4,000. At the date of this gift, the fair market value of the Liba stock was $3,000.

If Laura sells the 500 shares of Liba stock in 2007 for $5,000, her basis is

1. $5,000
2. $4,000
3. $3,000
4. $0

If Laura sells the 500 shares of Liba stock in 2007 for $2,000, her basis is

1. $4,000
2. $3,000
3. $2,000
4. $0

If Laura sells the 500 shares of Liba stock in 2007 for $3,500, what is the reportable gain or loss in 2007?

1. $3,500 gain.
2. $ 500 gain.
3. $ 500 loss.
4. $0.

fred zorn died on january 5 2007 bequeathing his entire 2 000 000 estate to his sist 624682

Aug 30, 2021 | Uncategorized

Fred Zorn died on January 5, 2007, bequeathing his entire $2,000,000 estate to his sister, Ida. The alternate valuation date was validly elected by the executor of Fred’s estate. Fred’s estate included 2,000 shares of listed stock for which Fred’s basis was $380,000. This stock was distributed to Ida nine months after Fred’s death. Fair market values of this stock were

Ida’s basis for this stock is

1. $380,000
2. $400,000
3. $450,000
4. $480,000

on march 1 2007 lois rice learned that she was bequeathed 1 000 shares of elin corp 624683

Aug 30, 2021 | Uncategorized

Items 1 and 2 are based on the following data:

On March 1, 2007, Lois Rice learned that she was bequeathed 1,000 shares of Elin Corp. common stock under the will of her uncle, Pat Prevor. Pat had paid $5,000 for the Elin stock in 2002. Fair market value of the Elin stock on March 1, 2007, the date of Pat’s death, was $8,000 and had increased to $11,000 six months later. The executor of Pat’s estate elected the alternative valuation for estate tax purposes. Lois sold the Elin stock for $9,000 on May 1, 2007, the date that the executor distributed the stock to her.

Lois’ basis for gain or loss on sale of the 1,000 shares of Elin stock is

1. $ 5,000
2. $ 8,000
3. $ 9,000
4. $11,000

Lois should treat the 1,000 shares of Elin stock as a

1. Short-term Section 1231 asset.
2. Long-term Section 1231 asset.
3. Short-term capital asset.
4. Long-term capital asset.

with regard to the passive loss rules involving rental real estate activities which 624530

Aug 30, 2021 | Uncategorized

With regard to the passive loss rules involving rental real estate activities, which one of the following statements is correct?

1. The term “passive activity” includes any rental activity without regard as to whether or not the taxpayer materially participates in the activity.
2. Gross investment income from interest and dividends not derived in the ordinary course of a trade or business is treated as passive activity income that can be offset by passive rental activity losses when the “active participation” requirement is not met.
3. Passive rental activity losses may be deducted only against passive income, but passive rental activity credits may be used against tax attributable to non-passive activities.
4. The passive activity rules do not apply to taxpayers whose adjusted gross income is $300,000 or less.

with regard to depreciation computations made under the general macrs method the hal 624538

Aug 30, 2021 | Uncategorized

With regard to depreciation computations made under the general MACRS method, the half-year convention provides that

1. One-half of the first year’s depreciation is allowed in the year in which the property is placed in service, regardless of when the property is placed in service during the year, and a half-year’s depreciation is allowed for the year in which the property is disposed of.
2. The deduction will be based on the number of months the property was in service, so that one-half month’s depreciation is allowed for the month in which the property is placed in service and for the month in which it is disposed of.
3. Depreciation will be allowed in the first year of acquisition of the property only if the property is placed in service no later than June 30 for calendar-year corporations.
4. Depreciation will be allowed in the last year of the property’s economic life only if the property is disposed of after June 30 of the year of disposition for calendar-year corporations.

assuming that gilbert does not itemize deductions how much of these expenses should 624542

Aug 30, 2021 | Uncategorized

Charles Gilbert, a corporate executive, incurred business-related unreimbursed expenses in 2007 as follows:

Assuming that Gilbert does not itemize deductions, how much of these expenses should he deduct on his 2007 tax return?

1. $0
2. $ 700
3. $1,300
4. $1,600

in january 2007 he moved to houston to seek employment and obtained a full time job 624544

Aug 30, 2021 | Uncategorized

Martin Dawson, who resided in Detroit, was unemployed for the last six months of 2006. In January 2007, he moved to Houston to seek employment, and obtained a full-time job there in February. He kept this job for the balance of the year. Martin paid the following expenses in 2007 in connection with his move:

How much can Martin deduct in 2007 for moving expenses?

1. $0
2. $ 300
3. $ 800
4. $1,100

how much of the indirect expenses can be deducted by putney as moving expenses 624545

Aug 30, 2021 | Uncategorized

Richard Putney, who lived in Idaho for five years, moved to Texas in 2007 to accept a new position. His employer reimbursed him in full for all direct moving costs, but did not pay for any part of the following indirect moving expenses incurred by Putney:

How much of the indirect expenses can be deducted by Putney as moving expenses?

1. $0
2. $ 900
3. $1,500
4. $1,700

which of the following requirements must be met in order for a single individual to 624559

Aug 30, 2021 | Uncategorized

Which of the following requirements must be met in order for a single individual to qualify for the additional standard deduction?

carroll had no medical insurance for regular income tax purposes what was carroll rs 624560

Aug 30, 2021 | Uncategorized

Carroll, an unmarried taxpayer with an adjusted gross income of $100,000, incurred and paid the following unreimbursed medical expenses for the year:

Carroll had no medical insurance. For regular income tax purposes, what was Carroll’s maximum allowable medical expense deduction, after the applicable threshold limitation, for the year?

1. $0
2. $12,500
3. $15,000
4. $20,000

the blairs graciously paid the bill however they provided no other support for eric 624561

Aug 30, 2021 | Uncategorized

Charlene and Gene Blair are married and filed a joint return for 2007. Their medical related expenditures for 2007 included the following:

The emergency room fee related to an injury incurred by the Blair’s son, Eric, during a visit to their home. The Blairs graciously paid the bill; however, they provided no other support for Eric during the year. For 2007, Eric earned $12,000 as a self-employed house painter. Assuming the Blairs’ adjusted gross income was $30,000, what amount of medical expenses can the Blairs deduct as an itemized deduction for 2007?

1. $0
2. $ 150
3. $ 650
4. $1,750

without regard to the adjusted gross income percentage threshold what amount may the 624562

Aug 30, 2021 | Uncategorized

Tom and Sally White, married and filing joint income tax returns, derive their entire income from the operation of their retail stationery shop. Their 2007 adjusted gross income was $100,000. The Whites itemized their deductions on Schedule A for 2007. The following unreimbursed cash expenditures were among those made by the Whites during 2007:

Without regard to the adjusted gross income percentage threshold, what amount may the Whites claim in their 2007 return as qualifying medical expenses?

1. $8,600
2. $8,000
3. $ 600
4. $0

disregarding the adjusted gross income percentage threshold what amount could be cla 624563

Aug 30, 2021 | Uncategorized

In 2007, Wells paid the following expenses:

In 2007, Wells recovered $1,500 of the $2,000 that she paid for physical therapy through insurance reimbursement from a group medical policy paid for by her employer. Disregarding the adjusted gross income percentage threshold, what amount could be claimed on Wells’ 2007 income tax return for medical expenses?

1. $4,000
2. $3,500
3. $1,000
4. $ 500

before consideration of any ldquo floor rdquo or other limitation on deductibility w 624564

Aug 30, 2021 | Uncategorized

Mr. and Mrs. Sloan incurred the following expenses on December 15, 2007, when they adopted a child:

Before consideration of any “floor” or other limitation on deductibility, what amount of the above expenses may the Sloans deduct on their 2007 joint income tax return?

1. $16,000
2. $13,000
3. $11,000
4. $ 5,000

disregarding the adjusted gross income percentage threshold what total amount of the 624565

Aug 30, 2021 | Uncategorized

Ruth and Mark Cline are married and will file a joint 2007 income tax return. Among their expenditures during 2007 were the following discretionary costs that they incurred for the sole purpose of improving their physical appearance and self-esteem:

Disregarding the adjusted gross income percentage threshold, what total amount of the aforementioned doctors’ bills may be claimed by the Clines in their 2007 return as qualifying medical expenses?

1. $0
2. $3,600
3. $5,000
4. $8,600

stenger received 900 in 2007 as reimbursement for a portion of the doctors rsquo fee 624568

Aug 30, 2021 | Uncategorized

Jon Stenger, a cash-basis taxpayer, had adjusted gross income of $35,000 in 2007. During the year he incurred and paid the following medical expenses:

Stenger received $900 in 2007 as reimbursement for a portion of the doctors’ fees. If Stenger were to itemize his deductions, what would be his allowable net medical expense deduction?

1. $0
2. $ 150
3. $1,050
4. $2,475

what is the total amount of medical expenses before application of any limitation ru 624569

Aug 30, 2021 | Uncategorized

During 2007, Mr. and Mrs. Benson provided substantially all the support, in their own home, for their son John, age twenty-six, and for Mrs. Benson’s cousin Nancy, age seventeen. John had $3,900 of income for 2007, and Nancy’s income was $2,500. The Bensons paid the following medical expenses during the year:

What is the total amount of medical expenses (before application of any limitation rules), that would enter into the calculation of itemized deductions on the Bensons’ 2007 tax return?

1. $1,000
2. $1,300
3. $2,400
4. $2,700

what total amount was matthews entitled to claim for taxes on her 2006 schedule a of 624571

Aug 30, 2021 | Uncategorized

Matthews was a cash-basis taxpayer whose records showed the following:

What total amount was Matthews entitled to claim for taxes on her 2006 Schedule A of Form 1040?

1. $4,700
2. $2,200
3. $1,900
4. $1,500

the bronsons sold their house on june 30 2007 under an agreement in which the real e 624575

Aug 30, 2021 | Uncategorized

During 2007, Jack and Mary Bronson paid the following taxes:

The Bronsons sold their house on June 30, 2007, under an agreement in which the real estate taxes were not prorated between the buyer and sellers. What amount should the Bronsons deduct as taxes in calculating itemized deductions for 2007?

1. $1,800
2. $2,160
3. $2,700
4. $3,060

what amount can the wests deduct as property taxes in calculating itemized deduction 624577

Aug 30, 2021 | Uncategorized

During 2007 Mr. and Mrs. West paid the following taxes:

What amount can the Wests deduct as property taxes in calculating itemized deductions for 2007?

1. $2,100
2. $2,700
3. $3,100
4. $3,700

jackson owns two residences the second residence which has never been used for renta 624582

Aug 30, 2021 | Uncategorized

Jackson owns two residences. The second residence, which has never been used for rental purposes, is the only residence that is subject to a mortgage. The following expenses were incurred for the second residence in 2007:

how much can the parkers utilize as interest expense in calculating itemized deducti 624584

Aug 30, 2021 | Uncategorized

Robert and Judy Parker made the following payments during 2007:

How much can the Parkers utilize as interest expense in calculating itemized deductions for 2007?

1. $5,700
2. $4,620
3. $4,500
4. $3,600

what amount can wolfe utilize as interest expense in calculating itemized deductions 624585

Aug 30, 2021 | Uncategorized

Charles Wolfe purchased the following long-term investments at par during 2007:

$20,000 general obligation bonds of Burlington County (wholly tax-exempt)

$10,000 debentures of Arrow Corporation

Wolfe financed these purchases by obtaining a $30,000 loan from the Union National Bank. For the year 2007, Wolfe made the following interest payments:

What amount can Wolfe utilize as interest expense in calculating itemized deductions for 2007?

1. $3,000
2. $4,200
3. $5,400
4. $7,100

prepare journal entries to record all of these transactions and adjusting entries 624437

Aug 30, 2021 | Uncategorized

As of 2009 December 31, Fargo Company”s accounts prior to adjustment show: Allowance for uncollectible accounts (credit balance)

Fargo Company estimates uncollectible accounts at 1 percent of sales. On 2010 February 23, the account of Dan Hall in the amount of USD 300 was considered uncollectible and written off. On 2010 August 12, Hall remitted USD 200 and indicated that he intends to pay the balance due as soon as possible. By 2010 December 31, no further remittance had been received from Hall and no further remittance was expected.

a. Prepare journal entries to record all of these transactions and adjusting entries.

b. Give the entry necessary as of 2009 December 31, if Fargo Company estimated its uncollectible accounts at 8 percent of outstanding receivables rather than at 1 percent of sales.

prepare the entry to record the repairs made on 2010 january 8 624440

Aug 30, 2021 | Uncategorized

Honest Tim”s Auto Company sells used cars and warrants all parts for one year. The average price per car is USD 10,000, and the company sold 900 in 2009. The company expects 30 percent of the cars to develop defective parts within one year of sale. The estimated average cost of warranty repairs per defective car is USD 600. By the end of the year, 80 cars sold that year had been returned and repaired under warranty. On 2010 January 4, a customer returned a car purchased in 2009 for repairs under warranty. The repairs were made on January 8. The cost of the repairs included parts, USD 400, and labor, USD 210.

a. Calculate the amount of the estimated product warranty payable.

b. Prepare the entry to record the estimated product warranty payable on 2009 December 31.

c. Prepare the entry to record the repairs made on 2010 January 8.

celoron power boat company is in the power boat manufacturing business as of 2010 se 624441

Aug 30, 2021 | Uncategorized

Celoron Power Boat Company is in the power boat manufacturing business. As of 2010 September 1, the balance in its Notes Receivable account is USD

256,000. The balance in Dishonored Notes Receivable is USD 60,660 (includes the interest of USD 600 and the protest fee of USD 60). A schedule of the notes (including the dishonored note) is as follows:

Following are Celoron Power Boat Company”s transactions for September:

Sept. 10 Received USD 36,660 from N. Case Company as full settlement of the amount due from it. The company does not charge losses on notes to the Allowance for Uncollectible Accounts account.

? The A. Lamp Company note was collected when due.

? The C. Glass Company note was not paid at maturity.

? C. Wall Company paid its note at maturity.

30 Received a new 60-day, 12 percent note from C. Glass Company for the total balance due on the dishonored note. The note was dated as of the maturity date of the dishonored note. Celoron Power Boat Company accepted the note in good faith. Prepare dated journal entries for these transactions.

prepare journal entries to record all of these transactions and the uncollectible a 624443

Aug 30, 2021 | Uncategorized

The following selected accounts are for Keystone, Inc., a name brand shoe wholesale store, as of 2009 December 31. Prior to closing the accounts and making allowance for uncollectible accounts entries, the USD 5,000 account of Morgan Company is to be written off (this was a credit sale of 2009 February 12)

a. Prepare journal entries to record all of these transactions and the uncollectible accounts expense for the period. Assume the estimated expense is 2 percent of net sales.

b. Give the entry to record the estimated expense for the period if the allowance account is to be adjusted to 5 percent of outstanding receivables instead of as in (a).

prepare the general journal entries to record the july 1 sales revenue and sales tax 624445

Aug 30, 2021 | Uncategorized

Beacham Hardware, Inc., sells merchandise in a state that has a 6 percent sales tax. On 2010 July 1, it sold goods with a sales price of USD 20,000 on credit. Sales taxes collected are recorded in a separate account. Assume that sales for the entire month were USD 400,000. On 2010 July 31, the company remitted the sales taxes collected to the state taxing agency.

a. Prepare the general journal entries to record the July 1 sales revenue and sales tax payable. Also prepare the entry to show the remittance of the taxes on July 31.

b. Now assume that the merchandise sold also is subject to federal excise taxes of 10 percent in addition to the 6 percent sales tax. The company remitted the federal excise taxes collected to the proper agency on July 31. Show the entries on July 1 and July 31.

prepare the entry to record the repairs made on 2010 january 3 624446

Aug 30, 2021 | Uncategorized

Quick Wheels, Inc., sells racing bicycles and warrants all parts for one year. The average price per bicycle is USD 560, and the company sold 4,000 in 2009. The company expects 20 percent of the bicycles to develop defective parts within one year of sale. The estimated average cost of warranty repairs per defective bicycle is USD 40. By the end of the year, 500 bicycles sold that year had been returned and repaired under warranty. On 2010 January 2, a customer returned a bicycle purchased in 2009 for repairs under warranty. The repairs were made on January 3. The cost of the repairs included parts, USD 25, and labor, USD 15.

a. Calculate the amount of the estimated product warranty payable.

b. Prepare the entry to record the estimated product warranty payable on 2009 December 31.

c. Prepare the entry to record the repairs made on 2010 January 3.

what other factors should she take into consideration 624449

Aug 30, 2021 | Uncategorized

Sally Stillwagon owns a hardware store; she sells items for cash and on account. During 2009, which seemed to be a typical year, some of her company”s operating data and other data were as follows:

A national credit card agency has tried to convince Stillwagon that instead of carrying her own accounts receivable, she should accept only the agency”s credit card for sales on credit. The agency would pay her two days after she submits sales charges, deducting 6 percent from the amount and paying her 94 percent.

a. Using the data given, prepare an analysis showing whether or not Stillwagonwould benefit from switching to the credit card method of selling on credit.

b. What other factors should she take into consideration?

calculate accounts receivable turnover and the number of days sales in accounts rece 624450

Aug 30, 2021 | Uncategorized

Jim Perry operates a large fruit and vegetable stand on the outskirts of a city. In a typical year he sells USD 600,000 of goods to regular customers. His sales are 40 percent for cash and 60 percent on credit. He carries all of the credit himself. Only after a customer has a USD 300 unpaid balance on which no payments have been made for two months does he refuse that customer credit for future purchases. His income before taxes is approximately USD 95,000. The total of uncollectible accounts for a given year is USD 48,000. You are one of Perry”s regular customers. He knows that you are taking a college course in accounting and has asked you to tell him your opinion of several alternatives recommended to him to reduce or eliminate the USD 48,000 per year uncollectible accounts expense. The alternatives are as follows:

•Do not sell on credit.

•Sell on credit by national credit card only.

•Allow customers to charge only until their account balances reach USD 50.

•Allow a bill collector to go after uncollectible accounts and keep half of the amount collected.

Write a report for Perry about the advisability of following any of these alternatives. Annual report analysis C Visit the Internet site: Locate the most recent annual reports of The Coca-Cola Company. Calculate accounts receivable turnover and the number of days” sales in accounts receivable and prepare a written comment on the results.

bolt company purchased a machine for use in its operations that had an invoice price 624484

Aug 30, 2021 | Uncategorized

Bolt Company purchased a machine for use in its operations that had an invoice price of USD 80,000 excluding sales tax. A 4 percent sales tax was levied on the sale. Terms were net 30. The company estimated the total cost of hauling the machine from the dealer”s warehouse to the company”s plant at USD 5,600, which did not include a fine of USD 1,600 for failure to secure the necessary permits to use city streets in transporting the machine. In delivering the machine to its plant, a Bolt employee damaged the truck used; repairs cost USD 3,600. The machine was also slightly damaged with repair costs amounting to USD 1,600. Bolt incurred installation costs of USD 32,000 that included the USD 4,000 cost of shoring up the floor under the machine. Testing costs amounted to USD 2,400. Safety guards were installed on the machine at a cost of USD 640, and the machine was placed in operation. Prepare a schedule showing the amount at which the machine should be recorded in Bolt”s accounts.

prepare schedules showing the proper valuation of the assets acquired by pressler co 624485

Aug 30, 2021 | Uncategorized

Pressler Company planned to erect a new factory building and a new office building in Atlanta, Georgia, USA. A report on a suitable site showed an appraised value of USD 180,000 for land and orchard and USD 120,000 for a building. After considerable negotiation, the company and the owner reached the following agreement: Pressler Company was to pay USD 216,000 in cash, assume a USD 90,000 mortgage note on the property, assume the interest of USD 1,920 accrued on the mortgage note, and assume unpaid property taxes of USD 13,200. Pressler Company paid USD 18,000 cash for brokerage and legal services in acquiring the property. Shortly after acquisition of the property, Pressler Company sold the fruit on the trees for USD 2,640, remodeled the building into an office building at a cost of USD 38,400, and removed the trees from the land at a cost of USD 9,000. Construction of the factory building was to begin in a week. Prepare schedules showing the proper valuation of the assets acquired by Pressler Company.

prepare the necessary journal entries to correct the records of peach company at 201 624487

Aug 30, 2021 | Uncategorized

Peach Company has the following entries in its Building account:

Peach acquired the original property on 2009 May 5. Orange immediately engaged a contractor to construct a new wing on the south end of the building. While the new wing was being constructed, the company leased the second floor as temporary warehouse space to Kellett Company. During this period (July 1 to 2009 December 31), the company installed new machinery costing USD 160,000 on the first floor of the building. Regular operations began on 2010 January 2.

a. Compute the correct balance for the Buildings account as of 2010 December 31. The company employs a calendar-year accounting period.

b. Prepare the necessary journal entries to correct the records of Peach Company at 2010 December 31. No depreciation entries are required.

brite company purchased a machine that had an invoice price of usd 400 000 excluding 624490

Aug 30, 2021 | Uncategorized

Brite Company purchased a machine that had an invoice price of USD 400,000 excluding sales tax. Terms were net 30. A 4 percent sales tax was levied on the sale. The company incurred and paid freight costs of USD 10,000. Special electrical connections were run to the machine at a cost of USD 14,000 and a special reinforced base for the machine was built at a cost of USD 18,000. The machine was dropped and damaged while being mounted on this base. Repairs cost USD 4,000. Raw materials with a cost of USD 1,000 were consumed in testing the machine. Safety guards were installed on the machine at a cost of USD 1,400, and the machine was placed in operation. In addition, USD 500 of costs were incurred in removing an old machine. Prepare a schedule showing the amount at which the machine should be recorded in Brite Company”s account.

prepare a schedule showing the amount at which the land should be carried on maxwell 624491

Aug 30, 2021 | Uncategorized

Maxwell Company purchased 2 square miles of farmland under the following terms: USD 968,000 cash; and liability assumed on mortgage= note of USD 320,000 and interest accrued on mortgage note assumed, USD 12,800. The company paid USD 67,200 of legal and brokerage fees and also paid USD 3,200 for a title search on the property. The company planned to use the land as a site for a new office building and a new factory. Maxwell paid clearing and leveling costs of USD 28,800. It sold crops on the land for USD 7,360 and sold one of the houses on the property for USD 19,200. The other buildings were torn down at a cost of USD 14,400; sale of salvaged materials yielded cash proceeds of USD 13,600. Approximately 1 percent of the land acquired was deeded to the county for roads. The cost of excavating a basement for the office building amounted to USD 9,120. Prepare a schedule showing the amount at which the land should be carried on Maxwell Company”s books.

prepare the journal entry to record depreciation at the end of the calendar year acc 624492

Aug 30, 2021 | Uncategorized

Dawson Towing Company purchased a used panel truck for USD 28,800 cash. The next day the company”s name and business were painted on the truck at a total cost of USD 1,488. The truck was then given a minor overhaul at a cost of USD 192, and new “super” tires were mounted on the truck at a cost of USD 1,920, less a trade-in allowance of USD 240 for the old tires. The truck was placed in service on 2009 April 1, at which time it had an estimated useful life of five years and a salvage value of USD 3,360.

a. Prepare a schedule showing the cost to be recorded for the truck.

b. Prepare the journal entry to record depreciation at the end of the calendar-year accounting period, 2009 December 31. Use the double-declining-balance method.

c. Assume that the straight-line depreciation method has been used. At the beginning of 2009 it is estimated the truck will last another four years. The estimated salvage value changed to USD 1,920. Prepare the entry to record depreciation for 2012.

dr berger a physician reports on the cash basis the following items pertain to dr be 624512

Aug 30, 2021 | Uncategorized

Dr. Berger, a physician, reports on the cash basis. The following items pertain to Dr. Berger’s medical practice in 2006:

What is Dr. Berger’s net income for 2006 from his medical practice?

1. $155,000
2. $156,000
3. $185,000
4. $186,000

under the uniform capitalization rules applicable to property acquired for resale wh 624518

Aug 30, 2021 | Uncategorized

Under the uniform capitalization rules applicable to property acquired for resale, which of the following costs should be capitalized with respect to inventory if no exceptions are met?

jason budd cpa reports on the cash basis in april 2006 budd billed a client 3 500 fo 624521

Aug 30, 2021 | Uncategorized

Jason Budd, CPA, reports on the cash basis. In April 2006, Budd billed a client $3,500 for the following professional services:

No part of the $3,500 was ever paid. In April 2007, the client declared bankruptcy, and the $3,500 obligation became totally uncollectible. What loss can Budd deduct on his 2007 tax return for this bad debt?

1. $0
2. $ 500
3. $1,500
4. $3,500

how much of these gifts was deductible as a business expense for 2007 624523

Aug 30, 2021 | Uncategorized

During the 2007 holiday season, Palo Corp. gave business gifts to seventeen customers. These gifts, which were not of an advertising nature, had the following fair market values:

How much of these gifts was deductible as a business expense for 2007?

1. $840
2. $365
3. $140
4. $0

what is the amount of jennifer rsquo s net operating loss for 2007 624524

Aug 30, 2021 | Uncategorized

Jennifer, who is single, has the following items of income and deduction for 2007:

What is the amount of Jennifer’s net operating loss for 2007?

1. $0
2. $15,000
3. $18,400
4. $45,000

robin moore a self employed taxpayer reported the following information for 2007 624525

Aug 30, 2021 | Uncategorized

Robin Moore, a self-employed taxpayer, reported the following information for 2007:

What is the amount of Moore’s net operating loss for 2007?

1. $4,500
2. $5,000
3. $6,000
4. $9,850

what amount of dividend income should gail report in her 2007 income tax return 624101

Aug 30, 2021 | Uncategorized

In 2007, Gail Judd received the following dividends from

What amount of dividend income should Gail report in her 2007 income tax return?

1. $900
2. $800
3. $500
4. $300

amy finch had the following cash receipts during 2007 624102

Aug 30, 2021 | Uncategorized

Amy Finch had the following cash receipts during 2007:

Total dividends received to date on the life insurance policy do not exceed the aggregated premiums paid by Amy. How much should Amy report for dividend income for 2007?

1. $1,375
2. $ 875
3. $ 500
4. $0

total dividends received to date on the life insurance policy do not exceed cumulati 624103

Aug 30, 2021 | Uncategorized

Jack and Joan Mitchell, married taxpayers and residents of a separate property state, elect to file a joint return for 2007 during which they received the following dividends:

Total dividends received to date on the life insurance policy do not exceed cumulative premiums paid. For 2007, what amount should the Mitchells report on their joint return as dividend income?

1. $550
2. $600
3. $750
4. $800

the exclusion is subject to a modified gross income limitation and a limit of aggreg 624106

Aug 30, 2021 | Uncategorized

In a tax year where the taxpayer pays qualified education expenses, interest income on the redemption of qualified US Series EE Bonds may be excluded from gross income. The exclusion is subject to a modified gross income limitation and a limit of aggregate bond proceeds in excess of qualified higher education expenses. Which of the following is(are) true?

1. I. The exclusion applies for education expenses incurred by the taxpayer, the taxpayer’s spouse, or any person whom the taxpayer may claim as a dependent for the year.
2. II. “Otherwise qualified higher education expenses” must be reduced by qualified scholarships not includible in gross income.
   1. a. I only.
   2. b. II only.
   3. c. Both I and II.
   4. d. Neither I nor II.

how much should drury report as gross income on her 2007 tax return 624128

Aug 30, 2021 | Uncategorized

The following information is available for Ann Drury for 2007:

How much should Drury report as gross income on her 2007 tax return?

1. $36,000
2. $36,500
3. $41,000
4. $41,500

lake had no restrictions on the use of the advanced rental payments and renders no s 624134

Aug 30, 2021 | Uncategorized

Lake Corp., an accrual-basis calendar-year corporation, had the following 2006 receipts:

Lake had no restrictions on the use of the advanced rental payments and renders no services. What amount of income should Lake report on its 2006 tax return?

1. $0
2. $ 50,000
3. $125,000
4. $175,000

in 2007 depreciation for the entire house was determined to be 5 000 what amount sho 624136

Aug 30, 2021 | Uncategorized

Emil Gow owns a two-family house that has two identical apartments. Gow lives in one apartment and rents out the other. In 2007, the rental apartment was fully occupied and Gow received $7,200 in rent. During the year ended December 31, 2007, Gow paid the following: