Western Bank & Trust purchased land and a building for the lump sum of $3 million dollars. To get the maximum tax deduction, Western allocated 90% of the purchase price to the building and only 10% to the land. A more realistic allocation would have been 70% to the building and 30% to the land. Explain the tax advantage of al
BrainMass Solutions Available for Instant Download
Dos Passos Company sells televisions at an average price of $909 and also offers to each customer a separate 3 year warranty contract for $204 that requires the company to perform periodic services and to replace defective parts. During 2012, the company sold 303 televisions and 285 warranty contracts for cash. It estimates the
Quest Tech, Inc. manufactures and sells specialized data storage equipment and services to entertainment and media companies. The equipment is used to efficiently store large data files. Quest Tech is currently marketing its latest equipment, which includes the Company's new patented technology that significantly increases it
Employees are paid every Saturday for the preceding work week. If a balance sheet is prepared on Wednesday, December 31st, what does the amount of wages earned during the first three days of the week (12/29, 12/30, 12/31) represent? Explain. What journal entry would be made for the days worked and what entry would be made when t
Discuss some tax planning strategies that can maximize the benefit of itemized deductions.
School District #25 formally integrates the budget into the accounting system and uses the encumbrance system. All appropriations lapse at year-end. At year-end, before closing entries, the district had the following balances in its accounts. All accounts had normal balances. (a) Prepare the necessary closing entries. (b)
150 word min This is not an assignment completion request. Regarding the topic adjustment of preferred dividend from net income in order to calculate EPS, would a cumulative vs non-cumulative preferred dividend make a difference in this adjustment?
Real Manufacturing Company provided the following information for the year 2014: Purchases—direct materials $180,000 Direct materials used in production $192,000 Direct labor $235,000 Indirect materials
Please explain this question: The fundamental relationship between bond price and yield is that they relate to each other inversely. How is this so?
In a troubled debt situation, why might the creditor grant concessions to the debtor? b. What type of concessions might a creditor grant the debtor in a troubled debt situation? c. What is meant by "impairment" of a loan? Under what circumstances should a creditor or debtor recognize an impaired loan?
Why would a company want to reduce its bond indebtedness before its bonds reach maturity? Indicate how this can be done and the correct accounting treatment for such a transaction.
On July 31, 2012, Bismarck Company engaged Duval Tooling Company to construct a special-purpose piece of factory machinery. Construction began immediately and was completed on November 1, 2012. To help finance construction, on July 31 Bismarck issued a $628,800, 3-year, 12% note payable at Wellington National Bank, on which inte
1. What is activity-based Costing? How can banks use it in their business? Explain. 2. How can banks link activity-based costing to performance management? Explain. 3. How can activity-based costing provide useful information on costs? Explain. 4. How is activity-based costing useful in measuring customer profitability?
Explain how a business can be classified as a hobby. Give examples of businesses that can be for profit-seeking or for personal pleasure.
Jog Road Company's cost system assigns MSDA expenses to customers using a rate of 33% of sales revenue. The new CFO has discovered that Jog Roads's customers differ greatly in their ordering patterns and interaction with the company's sales force. Because the CFO believes Jog Road's cost system does not accurately assign MSDA ex
Beeline Manufacturing produces two types of industrial ventilation machines: heavy-duty and standard. The assignment basis for overhead costs has always been direct labor hours. For 2013, Beeline compiled the following data for the two products: Heavy-duty Standard Sales in units 4,000 45,000 Sales price per unit
What is the two-tier test used to determine if a fixed asset has suffered impairment and to calculate the amount of the impairment loss?
On the issue of exchange (trade-in) of old asset for a new one, pre-FASB153's rule was based on exchange of similar and dissimilar assets, where gains on similar trade-ins are deferred (if cash was paid), much like how they are treated for taxes. FASB153 (implemented as a part of the harmonization effort with international stan
Year-end inventory cannot merely be based on a company's cost and whichever cost flow method the company is currently using. It needs to be further tested under the Lower of Cost or Market Rule for the potential need to mark it down. What are the "tests" used to determine the ceiling and the floor values to which the market va
In need some help in answering these questions: 1) What is your opinion on the questions below? FASB promulgates US GAAP (Generally Accepted Accounting Standards) and IASB creates IFRS (International Financial Reporting Standards). US GAAP is a rule-based system while IFRS are principle-based. The accounting standards only
I need some help in answering these questions: 1. What is life-cycle costing? Under what circumstances can it be most useful? What are some potential problems with this approach? 2. What is target pricing? Under what circumstances can it be most useful? What are some potential problems with this approach? 3. What is cost-p
Review the information in the Los Lobos Ledger Data. Prepare a statement of cash flows using the direct and indirect methods. Prepare a classified balance sheet. 12-31 2007 2006 Cash $35,000 $32,000 Accounts receivable 33,000 30,000 Allowance for doubt
When it comes to taxes, one should always be mindful of the fact that without the Internal Revenue Service, there would not be tax issues to worry about. As a follow-up question to this statement, consider the tax issues brought about by permanent differences and temporary differences. Define each type of timing difference and g
What happens if a company doesn't expect to become profitable for the foreseeable future, thus calling into question whether the company will ever get to use the tax benefit of its deferred tax asset from the NOL carryforward?
Jane O'Reilly is a staff accountant and earns $39,000 annually. She is married to Sid Metcalf, a full-time student at State University. Sid earned $1,200 from securities his grandmother had given him in 2007. Jane pays all of the expenses incurred by the family, including their six-year-old adopted daughter, Tari. The three indi
On January 1, 2015, Slidell Company received a two-year, $500,000 loan, with interest payments occurring at the end of each year and the principal to be repaid on December 31, 2016. The interest rate for the first year is the prevailing market rate of 7%, and the rate in 2016 will be equal to the market interest rate on January
Rapture Company's 2011 income statement and selected balance sheet data at December 31, 2010 and 2011, follow ($ thousands). RAPTURE COMPANY Income Statement For Year Ended December 31, 2011 Sales revenue $ 64,000 Expenses Cost of goods sold 19,000 Depreciation expense 5,000
Quincy Inc. has 20,000 shares of $10 par value common stock and 1,000 shares of $100 par value, 9% cumulative preferred stock. No dividends were paid the previous year. This year Quincy wishes to distribute $30,000 in cash dividends. How much would the common stockholders receive?
(Please see the attached file for the complete problem description). Please assist with this project on Production Cost and explain your answer. The following informtion provides the amount of cost incurred in August for the cost items indicated. During August, 7,700 units of the firm's single product were manufactured.
Accounting for Leases 1. Which of the following is false? A. The lessee uses the lower of its incremental borrowing rate or the lessor's desired return rate (if known) when determining the present value of minimum lease payments. B. A lease is capitalized if the present value of the minimum lease payments is greater than o