Problem: The following transactions occurred at BBS Company in 2022. 1. The company purchased a new building for $258,000. A down payment of $43,000 was made. The balance is due in f annual installments (plus interest) beginning July 1, 2023. 2. The company bought 1,000 shares of its own common stock for $13,000. 3. The company purchased as an investment $42,000 par value of Ridge Company's 8 percent bonds, maturing in five ye purchase price was $42,000. Required: Compute the company's net cash flow from investing activities. (Amounts to be deducted should be indicated with a mi Journal Entries: Purchase of investment in bonds Purchase of new building Purchase of treasury stock

Problem: The following transactions occurred at BBS Company in 2022. 1. The company purchased a new building for $258,000. A down payment of $43,000 was made. The balance is due in f annual installments (plus interest) beginning July 1, 2023. 2. The company bought 1,000 shares of its own common stock for $13,000. 3. The company purchased as an investment $42,000 par value of Ridge Company's 8 percent bonds, maturing in five ye purchase price was $42,000. Required: Compute the company's net cash flow from investing activities. (Amounts to be deducted should be indicated with a mi Journal Entries: Purchase of investment in bonds Purchase of new building Purchase of treasury stock

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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On 4/1/22, Little Inc. borrowed funds on a 9%, one-year note to finance the construction of a new building to be used for its own purposes. Construction on the project began on 5/1/22 and was completed on 9/1/22. Rounded to the nearest whole month, how many total months in 2022 should interest be capitalized under the interest capitalization rules? 0 months 4 months 5 months 8 months 9 months 12 months
6. Answer what is required of the problem.
On January 1, 2020, Ferdie Company entered into a contract to acquire a new machine for its factory. The machine, which has a cash price of P295,000, was paid for as follows: Down payment P80,000 6% Notes payable (payable in four equal annual payments starting December 31, 2020) 200,000 500 ordinary shares of Gemrey Co. P100 par with a market value of P110. 50,000 At what amount should Ferdie initially measure its machine?
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Case A: On January 1, 2021, your company purchased 60,000 shares of Freeze Company's $10 par common stock for $26 per share in cash plus paid $10,000 of broker's fees. On that date, Freeze Company's assets and liabilities had a book value equal to market value except for their building which had a market value which was $80,000 higher than its book value and had a 20-year remaining life. 2021 a. Purchased 60,000 shares of Freeze Company's $10 par common stock for $26 per share in cash plus paid $10,000 in broker's fees.. b. Received $30,000 in cash dividends. On December 31, 2021: 1. Freeze Company's stock had a market value of $25 per share. с. 2. Freeze Company reported net income of $400,000. 2022 d. Received a 10% stock dividend. On December 31, 2022: 1. Freeze Company's stock had a market value of $24 per share. е. 2. Freeze Company reported net income of $500,000. Assume the 60,000 shares you purchased represented 30% of the outstanding shares of Freeze Company so you were using…
Jackson Company's transactions for the year ended December 31, 2020 included the following: • Acquired 50% of Regal Corp.'s common stock for $300,000 cash which was borrowed from a bank. • Issued 5,000 shares of its preferred stock for land having a fair value of $480,000. • Issued 600 of its 11% debenture bonds, due 2026, for $588,000 cash. • Purchased a patent for $330,000 cash. • Paid $180,000 toward a bank loan. • Sold available-for-sale securities for $1,194,000. • Had a net increase in returnable customer deposits (long-term) of $132,000. Jackson's net cash provided by investing activities for 2020 was a. $414,000 O b. $894,000 O c. $564,000 d. $864,000
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Ace Company purchased 10,000 bonds issued by Jack Company in 2018 for $63 per bond and classified the investment as securities available-for-sale. The value of the Jack investment was $81 per bond on December 31, 2019, and $110 per bond on December 31, 2020. During 2021, Ace sold all of its Jack investment at $145 per bond. In its 2021 income statement, Ace would report: Multiple Choice A gain of $350,000. A gain of $470,000. A gain of $1,290,000. A gain of $820,000.
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On January 1, 2018, Dreamworld Co. began construction of a new warehouse. The building was finished and ready for use on September 30, 2019. Expenditures on the project were as follows: January 1, 2018 September 1, 2018 December 31, 2018 $340,000 $510, 000 $510,000 $510,000 $340,000 March 31, 2019 September 3e, 2019 Dreamworld had $7,000,000 in 14% bonds outstanding through both years. Dreamworld's average accumulated expenditures for 2018 was:
Tanner-UNF Corporation acquired as a long-term investment $250 million of 8% bonds, dated July 1, on July 1, 2021. Company management has classified the bonds as an available-for-sale investment. The market interest rate (yield) was 10% for bonds of similar risk and maturity. Tanner-UNF paid $210 million for the bonds. The company will receive interest semiannually on June 30 and December 31. As a result of changing market conditions, the fair value of the bonds at December 31, 2021, was $220 million.Required:1. & 2. Prepare the journal entry to record Tanner-UNF’s investment in the bonds on July 1, 2021 and interest on December 31, 2021, at the effective (market) rate.3. Prepare any additional journal entry necessary for Tanner-UNF to report its investment in the December 31, 2021, balance sheet.4. Suppose Moody’s bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2022, for $200 million. Prepare the journal entries…
Answer is c. $125,000 Please explain the reasoning and calculations