Example 1: Accrual basis of accounting is the recognized of revenues when the sale or service occurs regardless of when actual cash is received. It recognizes expenses incurred. Company X sells $10,000 of widgets on August 8, 2000 (recognized). Company Z pays Company X $10,000 for widgets on October 25, 2000 $10,000 (c
In your team's investigation of Fitness Solutions, your interviews with current and past employees and an initial review of the accounting books reveal the following events:
In your team's investigation of Fitness Solutions, your interviews with current and past employees and an initial review of the accounting books reveal the following events: Fitness Solutions constantly overstates purchases to produce high cost of sales and lower net income for income tax purposes. Last year, Fitness Soluti
Please help with the following problems. 1) On October 1, 2006, Parton Industries borrowed $12 million cash to provide working capital. The loan was made by Second Bank under a short-term line of credit. Parton issued an 8-month, "noninterest-bearing note." 8% is the bank's stated "discount rate." Parton's fiscal period is t
2. Arnold and Barbara Cane were divorced in June 2008. Pursuant to the divorce decree, Arnold is obliged to preform as follows: A. Transfer title of their personal home to Barbara. They purchased the house in 1992 and their basis today is $400,000. The fair market value of the house is $500,000. The house is subject to a 25 y
Tax: Fred Peters $10,000 payment on behalf of son Jack. Is it a deduction for tax purposes for Fred?
Please help with the following problem. In the current year, Fred Peters paid $10,000 of the business interest expense on a loan made to his son Jack, age 30, during the year. Jack was planning to file for bankruptcy and avoid making the interest payment, but Fred made the payment in order to avoid embarrassment for the fami
Please help with the following problem. Provide at least 300 words. What are the tax consequences of liquidating a partnership?
At December 31, 2007 and 2006, Broken Arrow Corp. had 180,000 shares of common stock ad 10,000 shares of 5%, $100 par value cumulative preferred stock outstanding. No dividends were declared on either the preferred or common stock in 2007 or 2006. Net income for 2007 was $400,000. For 2007, earnings per common share amounted to?
In 2006, HMS Ghost Corp. acquired 9,000 shares of its own $1 par value common stock at $18 per share. In 2007, HMS Ghost issued 4,000 of these shares at $25 per share. HMS Ghost uses the cost method to account for its treasury stock transactions. What accounts and what amounts should HMS Ghost credit in 2007 to record the issuan
1. Robert Reed, a bachelor, maintains his parents in a nursing home. They have no income of their own and are completely dependent on their son. His parents are 75 and 72 years of age. Robert has the following sources of income. Salary... $45,000 Interest on municipal bonds... 750 Interest on bank accounts... 800 Dividends
On its December 31, 2006 balance sheet, Carl Corp. reported bonds payable of $6,000,000 and related unamortized bond issue costs of $320,000. The bonds had been issued at par. On January 2, 2007, Carl retired $3,000,000 of he outstanding bonds at par plus a call premium of $70,000. What amount should Carl report in its 2007 inco
1. John Smith, as the owner of an apartment building, receives and makes the following payments during 2008. Received in Jan 2008 rent that was due in Dec 2007.... $5,000 Received in Dec 2008 rent not due until Jan 2009.... $4,000 Security deposit which is to be refunded when tenant vacates the apartment... $500 How
On September 1, 2006, Olsen Co. issued a note payable to National Bank in the amount of $1,200,000, bearing interest at 12%, and payable in three equal annual principal payments of $400,000. On this date, the bank's prime rate was 11%. The first payment for interest and principal was made on September 1, 2007. On December 31, 20
Why banks have bad loans? For the most part I feel that it was the lenders who are the most responsible. They were willing to ignore the ability to pay on the loans in order to lend as much as possible. The lowering or even turning of the back on the qualifications of the borrower turned out to kick them in the backside. However
Underwriter had the guidelines that could have helped maybe lessen the overall situation (bad loans)(I do not think that this alone has caused the economic crisis). Was it just greed by the banks and lenders?
Notes Payable: Grant Co partial refunding of debt. Journalize the entry including the adjusting entry at December 31.
Notes payable On August 31, Grant Co. partially refunded $180,000 of its outstanding 10% note payable made one year ago to Arma State Bank by paying $180,000 plus $18,000 interest, having obtained the $198,000 by using $52,400 cash and signing a new one-year $160,000 note discounted at 9% by the bank. Instructions (1) M
Please help with this study guide. Study Guide Managerial Accounting 1. Whirl Company sells cordless razors for $50. Variable costs are 40% of sales and total fixed costs are $40,000. What is the firm's magnitude of operating leverage if 2,000 units are sold? A) 3.0 B) 2.0 C) 1.5 D) None of the above 2. Select
Wildlife Escapes generates average revenue of $4,000 per person on its five-day tours of top wildlife parks in Kenya. The variable costs per person are
The problem is attached herewith. Description Amount Airfare $1,500 Hotel accommodations 1,000 Meals 300 Ground transportation 600 Park tickets and other costs 200 Total $3,600 Annual fixed costs $480,000 Wildlife Escapes generates average revenue of $4,000 per person on its five-day tours of top wildlife parks i
Your firm uses return on assets (ROA) to evaluate investment centres and is considering changing the valuation basis of assets from historical cost to current value. When the cost of the asses is updated, a price index is used to approximate replacement value. For example, a metal fabrication press, which bends and shapes metal
Question 1: (11 points) Exercise 5-1 Fixed and Variable Cost Behavior [LO1] Koffee Express operates a number of espresso coffee stands in busy suburban malls. The fixed weekly expense of a coffee stand is $1,100 and the variable cost per cup of coffee served is $0.26. Requirement 1: Fill in the following table with your
Hobby Loss Presumptive Rule. Rachel Schutz is a high school English teacher. In her spare time, she likes to make her own body lotion, lip-gloss, and bath and shower gel. She uses the bath products herself and gives them to her friends and relatives as gifts. In 2005, Rachel started attending arts and crafts festivals to sell
For vs. from AGI. During the current year, Kent, a single taxpayer, reports the following items of income and expense: Income: Salary $170,000 Dividends from Alta Corporation 800 Interest income from a savings account 1,500 Rental income from a small apartment he owns 8,000 Expenses: Medical 6,000 Interest on a prin
Employee Benefits. Ursula is employed by USA Corporation. USA Corporation provides medical and health, disability, and group term life insurance coverage for its employees. Premiums attributable to Ursula were as follows: Medical and health $3,600 Disability 300 Group term life (face amount is $40,000) 200 During the year,
What is the matching principle. Describe the concept in your own words. Give an example of this principle that illustrates your understanding of this concept. Also, please identify what the pros and cons are of adhering to this principle.
Can someone help with the below question? From your understanding of the current economic crisis facing the United States and the entire global community, what advice do you think should be given to the managers of businesses as they seek to restore profitability to their businesses and stability to the economy?
What types of information you think should be included in a company's annual report. Explain why each item you have chosen is important to include, and what stakeholders would most benefit from viewing this information. Please be detailed in your answers.
I don't quite understand the difference between the concepts and I am wondering if you could help me. 1. Problem (you must show your work for this problem, as well as answer the multiple choice question) On January 1, 2004, Cobb Enterprises acquired 80% of Bob's Bricks Inc.'s outstanding common shares. In acquiring this i
You are working in the office of the vice president of administration at International Telecon (IT) as a senior financial planner. IT is a Fortune 500 firm with sales approaching $1 billion. IT provides long-distance satellite communications around the world. Deregulation of telecommunications in Europe has intensified worldwide
Problem 6-4 "Ice Storm" In March, a devastating ice storm struck Monroe County, New York, causing millions of dollars of damage. Mathews & Peat (M&P), a large horticultural nursery was hit hard. As a result of the storm $653,000 of additional labor and maintenance costs were incurred to clean up the nursery remove and replace
Analyze the situation and recommend a course of action. What should installation division managers do? What should valve division managers do? What should U.S. Pump's senior managers do? See attached.
Prepare a schedule of the cost of goods manufactured for Timmons Manufacturing Company for the month ended December 31, 2008. Account Balances Finished Goods Inventory, December 31 $42,000 Factory Supervisory Salaries 12,000 Income Tax Expense 18,000 Raw Materials Inventory, December 1 12,000 Work In Process Inve