INTER. ACCOUNTING - CONNECT+ALEKS ACCESS
10th Edition
ISBN: 9781264770335
Author: SPICELAND
Publisher: MCG
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Chapter 12, Problem 12.17Q
To determine
Equity method: Equity method is the method used for accounting equity investments which claim a significant influence of above 20% but less than 50% in the outstanding stock of the investee company.
To describe: The effect of the given situation on the investment account, when it is accounted by equity method
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I.
Prepare a flexible budget for overhead based on the following data:
Percent of capacity
90%
100%
110%
Direct labor hours
3,600
4,000
4,400
Units of output
900
1,000
1,100
Variable overhead
Fixed overhead
$3,600
$ 4,000
$ 4,400
$6,000
$ 6,000
Total overhead
$9,600
$10,000
$ 6,000
$10,400
II.
Normal capacity = 100% and overhead is applied based on direct labor hours
Standard overhead rate = $10,000/4,000 = $2.50 per direct labor hour
Direct materials are $67.50 per unit.
Direct labor is $23.50 per hour.
Use the following standard cost card for 1 gallon of ice cream to answer the
questions.
Product: Gallon of Ice Cream
STANDARD COST CARD
Manufacturing
Standard
Cost Information
Quantity
Standard Cost
per Unit
Cost
Summary
Direct Materials
Cream
6 quarts
$1.00 per quart
$6.00
Sugar
15 ounces
$0.07 per ounce
$1.05
Direct Labor
3 minutes
$38.00 per hour
$1.90
Total Direct Costs
$8.95
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Actual direct costs incurred to make 50 gallons of ice cream:
•
275 quarts of cream at…
[The following information applies to the questions displayed below.]
Demarco and Janine Jackson have been married for 20 years and have four children who qualify as their
dependents (Damarcus; Jasmine, Michael, and Candice). The Jacksons file a joint tax return. The couple received
salary income of $95,000 and qualified business income of $20,000 from an investment in a partnership, and they
sold their home this year. They initially purchased the home three years ago for $250,000 and they sold it for
$300,000. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons
incurred $18,500 of itemized deductions, and they had $4,000 withheld from their paychecks for federal taxes. They
are also allowed to claim a child tax credit for each of their children. However, because Candice was 18 years of age
at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. (Use the
tax rate schedules.)
Chapter 12 Solutions
INTER. ACCOUNTING - CONNECT+ALEKS ACCESS
Ch. 12 - All investments in debt securities are classified...Ch. 12 - When market rates of interest rise after a...Ch. 12 - Does GAAP distinguish between fair values that are...Ch. 12 - When a debt investment is acquired to be held for...Ch. 12 - Prob. 12.5QCh. 12 - What is comprehensive income? Its composition...Ch. 12 - Why are holding gains and losses treated...Ch. 12 - Prob. 12.8QCh. 12 - Prob. 12.9QCh. 12 - Prob. 12.10Q
Ch. 12 - Under IFRS No. 9, which reporting categories are...Ch. 12 - Prob. 12.12QCh. 12 - Do U.S. GAAP and IFRS differ in the amount of...Ch. 12 - Under what circumstances is the equity method used...Ch. 12 - The equity method has been referred to as a...Ch. 12 - In the application of the equity method, how...Ch. 12 - Prob. 12.17QCh. 12 - Prob. 12.18QCh. 12 - Prob. 12.19QCh. 12 - How does IFRS differ from U.S. GAAP with respect...Ch. 12 - What is the effect of a company electing the fair...Ch. 12 - Define a financial instrument. Provide three...Ch. 12 - Some financial instruments are called derivatives....Ch. 12 - (Based on Appendix 12A) Northwest Carburetor...Ch. 12 - Prob. 12.25QCh. 12 - Prob. 12.26QCh. 12 - (Based on Appendix 12B) Reporting an investment at...Ch. 12 - Prob. 12.28QCh. 12 - Prob. 12.17BECh. 12 - Prob. 12.18BECh. 12 - Prob. 12.20BECh. 12 - Prob. 12.8ECh. 12 - Prob. 12.15PCh. 12 - Prob. 12.2DMPCh. 12 - Prob. 12.4DMPCh. 12 - Continuing Cases Target Case LO12-4, LO12-6...
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