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Problem Regardin Notes Payable

On the balance sheet we've had a note payable for 7 years as a balance of just say with interest all in is $50,000. We negotiated and paid the payable off for $20,000.00. So we credit cash (Reduce Cash) and debit the payable but what do we do with the balance $30,000? This liability is gone because both parties agreed and s

Book Value of common stock and preferred: Cleveland Company

Cleveland Company reports the following information as of 12/31/2012: -10% cumulative preferred stock, par value $100, One-year of dividends in arrears; 20,000 shares authorized; issued, 10,000 shares; $1,000,000 -Common stock - authorized 500,000; 40,000 outstanding

Taxation: Office in Home, Casualty loss, Hobby loss

Problem 39 David is a college professor who does some consulting work on the side. He uses 25% of his home exclusively for the consulting practice. He is single and 63 years old. His AGI (without consideration of consulting income) is $45,000. Other information follows: Income from consulting business $4,000 Consulting

Intervention in auto companies; reduce taxes

This is about government involvement in private business. There are 2 main issues and related questions. First, after 2000 the American automobile industry took heavy losses jeopardizing the main corporations, the numerous suppliers and approximately 300,000 workers. President Bush and the Republicans initiated a bail-out pla

Understanding Management Accounting

Scapens, R.W (2006) 'Understanding Management Accounting Practices'. The British Accounting Review, 38(1) pp.1-30. What are the achievements of the Burns and Scapens frame work for studying management accounting change? What are the limitations and extensions of the study? Mention some processes shaping the management accou

Marginal costing

Rapid Auto has over 200 auto-maintenance service outlets nationwide. It provides primarily two lines of service: oil changes and brake repair. Oil change-related services represent 63% of its sales and provide a contribution margin ratio of 20%. Brake repair represents 37% of its sales and provides a 60% contribution margin rati

What if any is the correct action?

Gevok Industries has just started business as a computer-based gaming company. Knowing that small computer businesses rarely remain in business longer than 5 years, Gevok depreciates all his assets for 5 years. The assets include a building, integrated circuit shaper, and vehicles. Is this ethical? What impact will this action h

Fluctuating numbers

The benefit of vertical analysis is certainly the benefit of comparing companies of two different sizes. Looking beyond the numbers and focusing on the changes in the numbers can provide a seasoned analyst some very useful information about the company operational effectiveness. The usefulness tends to breakdown when you c

Pre-tax profits from sales

Southwest U's Campus Book Store sells course packs for $15 each, the variable cost per pack is $9, fixed costs to produce the packs are $200,000, and expected annual sales are 49,000 packs. What are the pre-tax profits from sales of course packs? a. $108,100 b. $94,000 c. $109,040 d. $81,780 e. $98,700

After tax salvage value

Marshall-Miller & Company is considering the purchase of a new machine for $50,000, installed. The machine has a tax life of 5 years, and it can be depreciated according to the following rates. The firm expects to operate the machine for 4 years and then to sell it for $12,000. If the marginal tax rate is 40%, what will the a

Relevant and Irrrelevant costs

Skanda Inc. manufactures table lamps, and it has traditionally made its own lampshades for its lamps. It computes the cost of manufacturing each lampshade as follows: Direct materials $4.00 Direct labor 6.00 Applied variable overhead 50% of direct labor cost Skanda currently manufactures 40,000 table lamps and l


1. If during the current accounting period the company's assets increased by $24,000 and equity increased by $5,000, then how did liabilities change? A. Increased by $29,000 B. Increased by $24,000 C. Decreased by $5,000 E. Decreased by $19,000 F.Increased by $19,00

Process for Developing the Common Size Statements

Describe the process for developing the common size statements and illustrate, using a company of your choosing, the development and interpretation of this analysis. Once the common size statements are developed, what comparisons (of the metrics in the common size statements) seem relevant in generating meaningful conclusions? D

Accounting: Annual Report Analysis

See the attached file. The annual report to use is The Buckle, Inc 2009. Stock symbol is BKE. Problem 1. State the values of the following accounts or variable names as reported by Buckle in its 2009 financial statements (p. 31-34) and explain their meaning (no more than one or two sentences). (1) "Income from oper

Product cost flow - Devon Motor Company

April Battery purchases at cost 8000 10 80000 Inventory withdrawn -7600 Batteries used 100 90% transferred to finished goods 30% unsold in April Calculate COGS and explain how you got it.

Business Startup; organization expenses; date a business begins.

Read IRC at Read IRS Pub 535, pages 26 - 27 Read Treas. Reg. 1.195-1 Discuss the issues and consequences inherent in IRC section 195 including, but not limited to, the following:

Journalize the transactions Accounting

4. Milner Corporation had the following transactions pertaining to debt investments. Jan. 1 Purchased 60, 8%, $1,000 Welch Company bonds for $60,000, plus brokerage fees of $800. July 1 Sold 20 Welch Company bonds for $18,000, less $400 brokerage fees. Instructions:Prepare journal entries for the purchase and sale of the We

Lowe's Home Improvements - Preparing Income Chart and Profit Sales

As the fund manager for a large mutual fund, you are preparing for a conference call with all your major investors. You plan to e-mail everyone with an attachment that will serve as a guide for the upcoming call. You know investors' time is limited, so you want to be focused in your brief report. Because there are numerous figur

Identify Events that might Change EPS for Delta

Delta Airlines: 1. Determine the earnings per share that was published for 2009 year end results. 2. Read about the company's activities since year end 2009, and tell me whether you predict the 2010 earnings per share will increase or decrease by year end 2010. 3. Give me details of why you believe the ratio will inc

Can any accounting step after a worksheet be skipped?

The worksheet often facilitates the end-of-period (monthly, quarterly, or annually) accounting and reporting process. The use of a worksheet helps a company prepare the financial statements on a more timely basis. The main reason is that the company does not have to wait until it journalizes and posts the adjusting and closing

EPS using tax rate and expenses

Use the information for Sports Baseballs, Inc. Sports Baseballs, Inc. is a corporation that manufacturers and sells baseballs across several states in the Southeast. It had sales of $2.7 million during the last year. Expenses were as follows: Cost of goods sold............................... $1.2 million Admin

941 Employers Federal Tax Return

Instructions: Prepare the Form 941 Employer Quarterly Federal Tax Return for ABC Consulting Services Inc. for the 3rd Quarter of 2010. Utilize the following payroll information to complete the return. HINT: Students will need to access the IRS website ( and utilize the Forms and Publications link under the Bu

Compute effect of error on earnings and RE

A bookkeeper prepared the year-end financial statements of Giftwrap, Inc. The income statement showed net income of $47,400, and the balance sheet showed ending retained earnings of $182,000. The firm's accountant reviewed the bookkeeper's work and determined that adjusting should be made that would increase revenues by $10,000,

Taxes with Stocks and Trusts

A) Raquel transferred $100,000 of stock to a trust, with income to be paid to her nephew for 18 years and the remainder to her nephew's children (or their estates). Raquel named a bank as independent trustee but retained the power to determine how much income, if any, will be paid in any particular year. Is this transfer a co