EquipmentCashSales Revenueta Depreciation expense on the building for the year was $60,000. Because the building was increasing in value durine uyear,InstructionsComment on the appropriateness of the accounting procedures followed by Cramer, inc.lowing entry is recorded.60,000Retained EarningsAccumulated Depreciation-Buildings60,000 (elgbnih1o(b) Materials were purchased on January 1, 2017, for $120,000 and this amount was entered in the Materials account. OnDecember 31, 2017, the materials would have cost $141,000, so the following entry is made.enoitouInventory21,000Gain on Inventories21,000(c) During the year, the company purchased equipment through the issuance of common stock. The stock had a valueof $135,000 and a fair value of $450,000. The fair value of the equipment was not easily determinable. The companyrecorded this transaction as follows.parEquipmentCommon StockupaP Edmbu bag135,000yanqmoo orfT slde135,000(d) During the year, the company sold certain equipment for $285,000, recognizing a gain of $69,000. Because the controllerbelieved that new equipment would be needed in the near future, she decided to defer the gain and amortize it over thelife of any new equipment purchased.obrm esw Concepts for Analysis 69(e) An order for $61,500 has been received from a customer for products on hand. This order was shipped on January 9,2018. The company made the following entry in 2017.Accounts Receivable61,500Sales Revenue61,500

Name: EquipmentCashSales Revenueta Depreciation expense on the building for
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Description: EquipmentCashSales Revenueta Depreciation expense on the building for the year was $60,000. Because the building was increasing in value durine uyear,InstructionsComment on the appropriateness of the accounting procedures followed by Cramer, inc.low

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2-10 (LO6) GROUPWORK (Accounting Principles- ustructions omment on the appropriateness of the accounting procedures followed by Cramer, Inc. ta) Depreciation expense on the building for the vear was $60,000. Because the building was in year, the controller decided to charge the depreciation expense to retained earnings instea. lowing entry is recorded. Retained Earnings Accumulated Depreciation-Buildings 60,000 60,000 (b) Materials were purchased on January 1, 2017, for $120,000 and this amount was entered in December 31, 2017, the materials would have cost $141,000, so the following entry is made.

2-10 (LO6) GROUPWORK (Accounting Principles- ustructions omment on the appropriateness of the accounting procedures followed by Cramer, Inc. ta) Depreciation expense on the building for the vear was $60,000. Because the building was in year, the controller decided to charge the depreciation expense to retained earnings instea. lowing entry is recorded. Retained Earnings Accumulated Depreciation-Buildings 60,000 60,000 (b) Materials were purchased on January 1, 2017, for $120,000 and this amount was entered in December 31, 2017, the materials would have cost $141,000, so the following entry is made.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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