On January 1, 2016, Cougar Company purchased a piece of machinery and signed a zero-interest-bearingnote in payment. The note requires Cougar to pay 100,000 in three years. The interest rate that properlyreflected the time value of money at the time was 5% and an equipment dealer in St. Louis sells theidentical piece of machinery for $86,000. Cougar expected the machinery to have an 8 year useful life,and $6,000 salvage value. Cougar depreciated the machine using the straight-line method. On June 30,2018, Cougar exchanged the machinery for a newer model. In addition to the old equipment, Cougar paid$10,000 cash. At the time of the exchange, the old machinery had a fair value of $70,000. Prepare thejournal entry to record this exchange, assuming the arrangement has commercial substance.Prepare the journal entry to record the exchange, assuming the arrangement lacks commercial substance.ICHY-

Given: Cougar to pay 100,000 identical piece of machinery $86,000 Cougar paid=$10,000 fair…

Answered: requires alue of money at machinery for…

Business

Accounting

requires alue of money at machinery for $86- value. Cougar d anged the machin

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Perkins National Bank has collected the following information for four activities and two types of…

A: The activity rate is the rate used under the ABC costing system for allocation of overhead to the…

Q: Perkins National Bank has collected the following information for four activities and two types of…

A: Particulars Classis Gold Processing transaction 12000*0.2= 2400 7200*0.2 = 1440…

Q: The Ivanhoe Law Office has the following monthly telephone records and costs: Calls 6,500 4,600…

A: The costs incurred for the production are classified as fixed and variable costs. The high-low…

Q: QUESTION 7 There are 500 wood pallets for the transportation of the final product cases. Each pallet…

A: Unit cost is cost per case. The Cost per case (or) unit cost will be obtained using the below…

Q: 33. The cost of goods manufactured for May was: A. $78,500 B. $78,100 C. $77,150 D. $74,822

A: Cost of Goods Manufactured is Total Cost to Manufacture complete Units . It is determined by adding…

Q: A junk yard pulls parts off of wrecked vehicles and sells them to a wholesaler. If its total revenue…

A: The amount of revenue required to cover all expenses is calculated using a break-even point…

Q: Given the following information, what is the cost of unused capacity? Cost of material supplied is…

A: Step 1:Step 2:Step 3:Since supplied cost is only $3200 which means $200 cost is unused capacity

Q: Marsden Company has three departments occupying the following amount of floor space: Department 1…

A: The costs incurred for production are classified as direct and indirect costs. The costs are…

Q: QUESTION 2 (CHAPTER 3) A Umar and Osman manufacture and sell energy drinks. The drinks are sold for…

A: *As per bartleby guidelines, in case of interlinked question answer first 3 only Fixed Cost - are…

Q: Complete the following table: Purchase price of product Pre-owned Specialized Mountain Bike $ Down…

A: The Installment is equal to Interest and Principal amount.

Q: Complete the following table: Purchase price of product Pre-owned Specialized Mountain Bike $ Down…

A: In this question, we need to compute the following: Amount financed Total of Monthly payments,…

Q: 9. What is the total amount of this invoice? Materials: $458.00 7.75% sales tax on materials. 28…

A: The total amount will be the sum total of material and labor after discount plus sales tax

Q: Total Manufacturing Cost. Income Statement, Unit Cost, and Selling Price Two inventors, recently…

A: Business companies prepare the income statements in order to determine how much gross profit or net…

Q: Imperial Jewelers manufactures and sells a gold bracelet for $401.00. The company's accounting…

A: When making decisions, it is crucial to identify and consider the relevant costs to ensure accurate…

Q: (a) Identify the high and low points. High point Low point Machine Hours tA $ tA $ $ GA Using the…

A: High-low method is one of the techniques that is used to separate fixed and variable components from…

Q: Gary is the operating manager of Crane, a company that manufactures three different types of…

A: Reciprocal method The reciprocal method is the most accurate method compared to other cost…

Q: The following information is for Sandhill Inc. for the year 2022: Manufacturing costs Number of…

A: Cost of Goods Sold -The cost of Goods Sold is the cost incurred to manufacture the product and make…

Concept explainers

Cash Book

So, before coming to the topic of cash books, I will let you briefly explain about the cash so that you all can be familiar with the word cash. Cash comes under the category of the current asset which is used as a medium of exchange for all the financial transactions in the firm. Cash is something that is universally accepted as a mode of payment. So, now comes to the topic i.e., cash book.

Question

On January 1, 2016, Cougar Company purchased a piece of machinery and signed a zero-interest-bearing
note in payment. The note requires Cougar to pay 100,000 in three years. The interest rate that properly
reflected the time value of money at the time was 5% and an equipment dealer in St. Louis sells the
identical piece of machinery for $86,000. Cougar expected the machinery to have an 8 year useful life,
and $6,000 salvage value. Cougar depreciated the machine using the straight-line method. On June 30,
2018, Cougar exchanged the machinery for a newer model. In addition to the old equipment, Cougar paid
$10,000 cash. At the time of the exchange, the old machinery had a fair value of $70,000. Prepare the
journal entry to record this exchange, assuming the arrangement has commercial substance.
Prepare the journal entry to record the exchange, assuming the arrangement lacks commercial substance.
ICHY-

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Accounting for Cash and cash equivalents

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

Calculating ABC Unit Costs Perkins National Bank has collected the following information for four activities and two types of credit cards: Activity Driver Classic Gold Activity Rate ($) Processing transactions Transactions processed 12,000 7,200 0.20 Preparing statements Number of statements 12,000 7,200 0.95 Answering questions Number of calls 24,000 36,000 4.00 Providing ATMs ATM transactions 48,000 14,400 1.50 There are 4,900 holders of Classic cards and 20,400 holders of Gold cards. Required: Calculate the unit cost (rounded to the nearest cent) for Classic and Gold credit cards. Unit cost for Classic: Unit cost for Gold:
A transport company has a fleet of three trucks of 10 tonnes capacity each playing in different directions for transport of customer's goods. The trucks run loaded with goods and return empty. The distance travelled, number of trips made and the load carried per day each truck are as under: Truck No. One way Distance Km. 16 40 30 No. of trips per day 4 2 3 Load carried per trip/day tonnes 6 9 3 The analysis of maintenance cost and the total distance travelled during the last two years is as under : Year Maintenance Cost $ 46,050 45,175 Total distance travelled 1,60,200 1,56,700 1 Following are the details of expenses for the year under review: Diesel :$ 10 per litre. Each litre gives 4 km. per litre of diesel on an average. Drivers' Salary: $ 2,000 per month. Licence and Taxes : $ 5,000 per annum per truck. Insurance :$ 5,000 per annum for all the three vehicles. Purchase Price per Truck : $ 3,00,000. Life 10 years. Scrap value at the end of life is $ 10,000. Oil and Sundries :$ 25 per…
Required _ what is the average cost per tractor.....
D2.
N1. Account
Calculating ABC Unit Costs Perkins National Bank has collected the following information for four activities and two types of credit cards: Activity Driver Classic Gold Activity Rate ($) Processing transactions Transactions processed 12,000 7,200 0.20 Preparing statements Number of statements 12,000 7,200 0.95 Answering questions Number of calls 24,000 36,000 4.00 Providing ATMs ATM transactions 48,000 14,400 1.50 There are 5,000 holders of Classic cards and 21,000 holders of the Gold cards. Required: Calculate the unit cost (rounded to the nearest cent) for Classic and Gold credit cards. Unit cost for Classic $fill in the blank 1 Unit cost for Gold $fill in the blank 2
Godo
Kindly provide the correct option for number 6. Thankyou
V5
A10 please help.....
Do not give image format
ФЫ В А П Р О ВАПРОЛДЗАПРОЛДЖЭ ЯЧСМИТНЧСМИТЬБНСМИТЬБЮ SOLVE STEP BY STEP 2 Carp, Inc. wants to evaluate two machines for 3 packaging their products. 4 Machine A: 5 6 7 8 9 10 11 12 13 14 Initial cost is $70,000 1st year O&M cost is 18,000; this cost increases $900 each year. The annual benefits are $154,000 It can be sold at the end of 10 years useful life for $145,000 Machine B: Initial cost is $1,600,00 1st year O&M cost is 28,000; this cost 15 16 The annual benefits are $300,000 17 18 It can be sold at the end of 20 years useful 19 life for $210,000 20 The companies uses an interest rate of 15% 21 22 Use annual cash flow analysis to decide 23 which is the most desirable alternative. 24 Build model ИЦУКЕНГ ШУКЕНГ Ш Щ ЭКЕНГШЩзхъ increases $650 each year.