Homework Help is Here – Start Your Trial Now!
Business
Accounting
QUESTION 1 In January, 2020, Harmony Inc. has the following expenditures related to manufacturing a new generation of widgets. Match each expenditure to the appropriate accounting treatment on the right. V Takes possession of a widget- manufacturing machine. The vendor sends B. Expense, an invoice for $550,000. Pays employees $95,000 for research and development to finalize the widget design. ✓ Receives an invoice for $4,250 from the company that shipped the machine. V Pays sales tax of $33,000 on the machine to the government. Pays employees $16,500 to install, customize, and test the widget- manufacturing machine. Pays $3,000 for a one-year warranty (insurance) plan for the machine, with coverage beginning when the machine is placed into service on February 1. A. Capitalize to a different asset account. C. Capitalize to the Machine account. D. No accounting entry is necessary.

QUESTION 1 In January, 2020, Harmony Inc. has the following expenditures related to manufacturing a new generation of widgets. Match each expenditure to the appropriate accounting treatment on the right. V Takes possession of a widget- manufacturing machine. The vendor sends B. Expense, an invoice for $550,000. Pays employees $95,000 for research and development to finalize the widget design. ✓ Receives an invoice for $4,250 from the company that shipped the machine. V Pays sales tax of $33,000 on the machine to the government. Pays employees $16,500 to install, customize, and test the widget- manufacturing machine. Pays $3,000 for a one-year warranty (insurance) plan for the machine, with coverage beginning when the machine is placed into service on February 1. A. Capitalize to a different asset account. C. Capitalize to the Machine account. D. No accounting entry is necessary.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
QUESTION 1 In January, 2020, Harmony Inc. has the following expenditures related to manufacturing a new generation of widgets. Match each expenditure to the appropriate accounting treatment on the right. V V Takes possession of a widget- manufacturing machine. The vendor sends an invoice for $550,000. Pays sales tax of $33,000 on the machine to the government. Pays employees $95,000 for research and development to finalize the widget design. Receives an invoice for $4,250 from the company that shipped the machine. Pays employees $16,500 to install, customize, and test the widget- manufacturing machine. Pays $3,000 for a one-year warranty (insurance) plan for the machine, with coverage beginning when the machine is placed into service on February 1. A. Capitalize to a different asset account. B. Expense, C. Capitalize to the Machine account. D. No accounting entry is necessary.
Transcribed Image Text:QUESTION 1 In January, 2020, Harmony Inc. has the following expenditures related to manufacturing a new generation of widgets. Match each expenditure to the appropriate accounting treatment on the right. V V Takes possession of a widget- manufacturing machine. The vendor sends an invoice for $550,000. Pays sales tax of $33,000 on the machine to the government. Pays employees $95,000 for research and development to finalize the widget design. Receives an invoice for $4,250 from the company that shipped the machine. Pays employees $16,500 to install, customize, and test the widget- manufacturing machine. Pays $3,000 for a one-year warranty (insurance) plan for the machine, with coverage beginning when the machine is placed into service on February 1. A. Capitalize to a different asset account. B. Expense, C. Capitalize to the Machine account. D. No accounting entry is necessary.
Expert Solution
steps

Step by step

Solved in 3 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Accounting Policies, Changes in Accounting Estimates and Errors
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS