A company sells a plant asset that originally cost $300,000 for $90,000 on December 31, 2015. The accumulated depreciation account had a balance of $140,000 after the current year's depreciation of $25,000 had been recorded. The company should recognize a: (a) $90,000 gain on disposal (b) $70,000 loss on disposal (c) $50,000 gain on disposal (d) $70,000 gain on disposal
Q: What are the proceed
A: To calculate the proceeds from the note on July 1, we use the formula for the discount amount:…
Q: none
A: A) Equity Multiplier = 1_Debt-Equity ratioEquity Multiplier = 1+1.42Equity Multiplier = 2.42 B)…
Q: Kindly help me with this question general Accounting
A: Step 1: Define Percentage Rate of ReturnPercentage Rate of Return measures the profit earned on an…
Q: Want solution. please provide
A: Step 1: Definition of Retained EarningsRetained earnings represent the portion of a company's net…
Q: What is the firm's PE ratio for this financial accounting question?
A: Step 1: Define P/E RatioThe Price-to-Earnings (P/E) ratio is a valuation metric that compares a…
Q: Can you please solve this financial accounting problem?
A: Step 1: Definition of Inventory Turnover RatioThe Inventory Turnover Ratio measures how efficiently…
Q: Determine the predetermined overhead rate for the year 2021?
A: Step 1: The predetermined Overhead rate is the rate at which overhead is applied to the products…
Q: How much of the customers support will be assigned ?
A: Explanation of Activity-Based Costing (ABC): Activity-Based Costing is a costing method that…
Q: Can you please solve this issue
A: Step 1: Definition of Gross Profit PercentageThe Gross Profit Percentage is a financial metric that…
Q: What are the net sales ?
A: Step 1: Definition of Net SalesNet sales refer to the total revenue generated by a company from…
Q: General Accounting
A: Detailed Calculation with Formulas and Step-by-Step Solution To calculate the initial cash flow, we…
Q: Calculate gross profit
A: Step 1: Definition of Gross Profit and COGSGross Profit is the difference between sales revenue and…
Q: General Accounting
A: Step 1: Define Credit SalesCredit sales refer to transactions where a company sells goods or…
Q: Help this question
A: Step 1: Compute Revenue per ShowStep 2: Compute Cast Salaries per ShowStep 3: Compute Program…
Q: Correct answer please
A: Step 1: Definition of Variable CostingUnder variable costing, the fixed manufacturing overhead cost…
Q: Number of barrel completed... please given answer
A: Step 1: Definition of Work-in-Process (WIP) Inventory Work-in-Process inventory represents partially…
Q: Provide correct answer general Accounting question
A: To calculate Inventory Days on Hand, follow these steps:Step 1: Understand the FormulaInventory Days…
Q: Can you please solve this general accounting question?
A: Part (a): Calculation of Recognised Gain or (Loss), when the equipment is sold for $28,000Recognized…
Q: Calculate this company's gross profit.
A: Step 1: Definition of Gross ProfitGross Profit is the profit a company earns from sales after…
Q: Accurate answer
A: Explanation of Manufacturing Overhead Costs: Manufacturing overhead costs represent all…
Q: What is the net opreting income
A: Step 1: Definition of Absorption Costing and Variable CostingAbsorption Costing includes all…
Q: Calculate the depreciation expense for the first year
A: Explanation of Straight-Line Depreciation Method: This is a depreciation method that allocates an…
Q: Correct answer please
A: Calculation of Gross ProfitGross Profit = Sales - Cost of Goods Sold (COGS) =…
Q: Sol This question answer
A: Substituting the values: ROCE = $0.69/$49.00 * 100 ROCE=1.41% Thus, the analysts were forecasting a…
Q: Good sold would cause net income to
A: Explanation of Over/Underapplied Overhead:Over/underapplied overhead refers to the difference…
Q: Please given step by step explanation general Accounting question
A: Step 1: Define APR CalculationThe Annual Percentage Rate (APR) is the nominal interest rate…
Q: Manufacturing overhead is allocated based on estimate direct labor hours
A: Explanation of Predetermined Overhead Rate:The Predetermined Overhead Rate is an estimated rate used…
Q: Based on the material in Module Six, what do you think is the most difficult part of selecting and…
A: Another major challenge is supplier management and communication. Operating across multiple time…
Q: GENERAL ACCOUNTING PROBLEM
A: Explanation of Return on Equity (ROE): Return on Equity is a financial metric that measures how…
Q: Tutor need your help
A: Explanation of Net Profit Margin:Net profit margin is a financial ratio that measures how much of a…
Q: hello tutor please help me
A: First, use the debt ratio to determine equity in order to compute Return on Equity (ROE). 58% of…
Q: John was a civil servant with the Trinidad & Tobago (T&T) Government for over 30 years and…
A: Detailed Explanation:Detailed Income Tax Computation for John Henry - Fiscal Year 2011We will…
Q: Get correct answer accounting questions
A: Step 1: Definition of Net Income (or Loss)Net income (or loss) is the amount by which a company's…
Q: A company produces a single product, with a selling price of $12 and a variable cost of $7. Fixed…
A: Explanation of Selling Price: Selling price is the amount charged to customers for each unit of…
Q: help me cost accounting
A: Step 1: Definition of LiabilitiesLiabilities represent obligations a company owes to external…
Q: I want to this question answer general Accounting
A: Step 1: Define TurnoverTurnover refers to the efficiency with which a company utilizes its assets to…
Q: Financial Accounting
A: To calculate the current yield of the bond, use the formula:Current Yield =(Annual Interest Payment…
Q: What is the coupon rate of this financial accounting question?
A: Step 1: Definition of Coupon RateThe coupon rate is the fixed annual interest rate that a bond…
Q: Please give me true answer this financial accounting question
A: Step 1: Definition of Expected Return (CAPM Model)The expected return in the Capital Asset Pricing…
Q: What is the journal entry to apply overhead?
A: Given:Direct labor = $90,000Overhead = 80% of Direct labor = 0.80 * 90,000…
Q: provide correct answer
A: Let's calculate the Degree of Operating Leverage (DOL) for Newcombe & Associates' project using…
Q: What is the total gross profit of this general accounting question?
A: Step 1: Define Gross ProfitGross Profit is the financial gain a company makes after deducting the…
Q: Accounting question
A: Part (a): Calculation of Fixed Production Cost per unitFixed Production Cost per unit = Fixed…
Q: I want answer
A: Explanation of Special Order: A special order refers to a one-time order that is outside a company's…
Q: Provide correct answer general accounting
A: Step 1: Define Adjusted RevenueAdjusted revenue (or revenue recognized) refers to the actual revenue…
Q: What was the underapllied or overapplied overhead for the month?
A: Explanation of Direct Labor Hours: Direct labor hours refer to the time spent by workers who are…
Q: What is the return on total assets of this financial accounting question?
A: Step 1: Define Return on Total Assets (ROA)The Return on Total Assets (ROA) is a financial ratio…
Q: I want answer
A: Operating cash flow = EBIT + Depreciation - TaxesOperating cash flow = 1,450 + 690 - 500Operating…
Q: Hello tutor please provide this question solution general accounting
A: DSO = Accounts receivable / Average daily sales30 days = Accounts receivable / 15,000Accounts…
Q: Correct answer please
A: Step 1: Definition of Labor Efficiency VarianceLabor Efficiency Variance measures the difference…
MCQ
Step by step
Solved in 2 steps
- On May 1, 2015, Zoe Inc. purchased Branta Corp. for $15,000,000 in cash. They only received $12,000,000 in net assets. In 2016, the market value of the goodwill obtained from Branta Corp. was valued at $4,000,000, but in 2017 it dropped to $2,000,000. Prepare the journal entry for the creation of goodwill and the entry to record any impairments to it in subsequent years.On January 1, 2014, Klinefelter Company purchased a building for 520,000. The building had an estimated life of 20 years and an estimated residual value of 20,000. The company has been depreciating the building using straight-line depreciation. At the beginning of 2020, the following independent situations occur: a. The company estimates that the building has a remaining life of 10 years (for a total of 16 years). b. The company changes to the sum-of-the-years-digits method. c. The company discovers that it had ignored the estimated residual value in the computation of the annual depreciation each year. Required: For each of the independent situations, prepare all journal entries related to the building for 2020. Ignore income taxes.On July 1, 2018, Mundo Corporation purchased factory equipment for 50,000. Residual value was estimated at 2,000. The equipment will be depreciated over 10 years using the double-declining balance method. Counting the year of acquisition as one-half year, Mundo should record 2019 depredation expense of: a. 7,680 b. 9,000 c. 9,600 d. 10,000
- Kam Company purchased a machine on January 2, 2019, for 20,000. The machine had an expected life of 8 years and a residual value of 300. The double-declining-balance method of depreciation is used. Required: 1. Compute the depreciation expense for each year of the assets life and book value at the end of each year. 2. Assuming that the company has a policy of always changing to the straight-line method at the midpoint of the assets life, compute the depreciation expense for each year of the assets life. 3. Assuming that the company always changes to the straight-line method at the beginning of the year when the annual straight-line amount exceeds the double-declining-balance amount, compute the depreciation expense for each year of the assets life.At the end of 2020, Magenta Manufacturing Company discovered that construction cost had been capitalized as a cost of the factory building in 2015 when it should have been treated as a cost of production equipment installation costs. As a result of the misclassification, the depreciation through 2018 was understated by 110,000, and depreciation for 2019 was understated by 90,000. What would be the consequences of correcting for the misclassification of the property cost? a. The taxpayer uses the FIFO inventory method, and 25% of goods produced during the period were included in the ending inventory. b. The taxpayer uses the LIFO inventory method, and no new LIFO layer was added during 2019.Change in Estimate Assume that Bloomer Company purchased a new machine on January 1, 2016, for $80,000. The machine has an estimated useful life of nine years and a residual value of $8,000. Bloomer has chosen to use the straight-line method of depreciation. On January 1, 2018, Bloomer discovered that the machine would not be useful beyond December 31, 2021, and estimated its value at that time to be $2,000. Required Calculate the depreciation expense, accumulated depreciation, and book value of the asset for each year 2016 to 2021. Was the depreciation recorded wrong in 2016 and 2017? If so, why was it not corrected?
- Gray Companys financial statements showed income before income taxes of 4,030,000 for the year ended December 31, 2020, and 3,330,000 for the year ended December 31, 2019. Additional information is as follows: Capital expenditures were 2,800,000 in 2020 and 4,000,000 in 2019. Included in the 2020 capital expenditures is equipment purchased for 1,000,000 on January 1, 2020, with no salvage value. Gray used straight-line depreciation based on a 10-year estimated life in its financial statements. As a result of additional information now available, it is estimated that this equipment should have only an 8-year life. Gray made an error in its financial statements that should be regarded as material. A payment of 180,000 was made in January 2020 and charged to expense in 2020 for insurance premiums applicable to policies commencing and expiring in 2019. No liability had been recorded for this item at December 31, 2019. The allowance for doubtful accounts reflected in Grays financial statements was 7,000 at December 31, 2020, and 97,000 at December 31, 2019. During 2020, 90,000 of uncollectible receivables were written off against the allowance for doubtful accounts. In 2019, the provision for doubtful accounts was based on a percentage of net sales. The 2020 provision has not yet been recorded. Net sales were 58,500,000 for the year ended December 31, 2020, and 49,230,000 for the year ended December 31, 2019. Based on the latest available facts, the 2020 provision for doubtful accounts is estimated to be 0.2% of net sales. A review of the estimated warranty liability at December 31, 2020, which is included in other liabilities in Grays financial statements, has disclosed that this estimated liability should be increased 170,000. Gray has two large blast furnaces that it uses in its manufacturing process. These furnaces must be periodically relined. Furnace A was relined in January 2014 at a cost of 230,000 and in January 2019 at a cost of 280,000. Furnace B was relined for the first time in January 2020 at a cost of 300,000. In Grays financial statements, these costs were expensed as incurred. Since a relining will last for 5 years, Grays management feels it would be preferable to capitalize and depreciate the cost of the relining over the productive life of the relining. Gray has decided to nuke a change in accounting principle from expensing relining costs as incurred to capitalizing them and depreciating them over their productive life on a straight-line basis with a full years depreciation in the year of relining. This change meets the requirements for a change in accounting principle under GAAP. Required: 1. For the years ended December 31, 2020 and 2019, prepare a worksheet reconciling income before income taxes as given previously with income before income taxes as adjusted for the preceding additional information. Show supporting computations in good form. Ignore income taxes and deferred tax considerations in your answer. The worksheet should have the following format: 2. As of January 1, 2020, compute the retrospective adjustment of retained earnings for the change in accounting principle from expensing to capitalizing relining costs. Ignore income taxes and deferred tax considerations in your answer.Chapman Inc. purchased a piece of equipment in 2018. Chapman depreciated the equipment on a straight-line basis over a useful life of 10 years and used a residual value of $12,000. Chapmans depreciation expense for 2019 was $11,000. What was the original cost of the building? a. $98,000 b. $110,000 c. $122,000 d. $134,000On May 10, 2019, Horan Company purchased equipment for 25,000. The equipment has an estimated service life of 5 years and zero residual value. Assume that the straight-line depreciation method is used. Required: Compute the depreciation expense for 2019 for each of the following four alternatives: 1. Horan computes depreciation expense to the nearest day. (Use 12 months of 30 days each and round the daily depreciation rate to 2 decimal places.) 2. Horan computes depreciation expense to the nearest month. Assets purchased in the first half of the month are considered owned for the whole month. 3. Horan computes depreciation expense to the nearest whole year. Assets purchased in the first half of the year are considered owned for the whole year. 4. Horan records one-half years depreciation expense on all assets purchased during the year.
- Referring to PA7 where Kenzie Company purchased a 3-D printer for $450,000, consider how the purchase of the printer impacts not only depreciation expense each year but also the assets book value. What amount will be recorded as depreciation expense each year, and what will the book value be at the end of each year after depreciation is recorded?Revision of Depreciation On January 1, 2017, Blizzards-R-Us purchased a snow-blowing machine for $125,000. The machine was expected to have a residual value of $12,000 at the end of its 5-year useful life. On January 1, 2019, Blizzards-R-Us concluded that the machine would have a remaining useful life of 6 years with a residual value of $3,600. Required: 1. Determine the revised annual depreciation expense for 2019 using the straight-line method. 2. CONCEPTUAL CONNECTION How does the revision in depreciation affect the Blizzards-R-Us financial statements?Hathaway Company purchased a copying machine for 8,700 on October 1, 2019. The machines residual value was 500 and its expected service life was 5 years. Hathaway computes depreciation expense to the nearest whole month. Required: 1. Compute depredation expense (rounded to the nearest dollar) for 2019 and 2020 using the: a. straight-line method b. sum-of-the-years-digits method c. double-declining-balance method 2. Next Level Which method produces the highest book value at the end of 2020? 3. Next Level Which method produces the highest charge to income in 2020? 4. Next Level Over the life of the asset, which method produces the greatest amount of depreciation expense?
