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    Accounting: Ratio, depreciation, Cash flow statement etc.

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    PLEASE SHOW A DESCRIPTION ON HOW TO DO ALL OF THESE:

    Prepare a schedule of cash payments for
    partnership liquidation

    Prepare journal entries for bond issuance and first interest payment with amortization of discount/premium

    Prepare operating section of Statement of Cash Flows using indirect method

    Prepare journal entries for transactions under equity method of accounting

    Prepare Income Statement including intra-period tax allocation for
    irregular items

    PLEASE HELP ME UNDERSTAND THESE:
    Ch 10 Depreciation terminology
    Ch 10 Calculate Depreciation
    Ch 11 Calculate interest expense on note
    Ch 11 Payroll taxes versus employee withholdings
    Ch 12 Advantages/disadvantages of partnerships
    Ch 12 Steps in partnership liquidation
    Ch 13 Issue stock to acquire non-cash asset
    Ch 13 Stock terminology
    Ch 14 Journal entry for stock dividend
    Ch 14 Calculate Earnings Per Share (EPS)
    Ch 15 Bond terminology
    Ch 15 Bond terminology
    Ch 15 Bond prices versus interest rates
    Ch 16 Valuation of short term investments
    Ch 16 Methods of accounting for stock investments
    Ch 17 Meaning of statement of Cash Flows activities
    Ch 17 Classify items into activities
    Ch 17 Calculate cash received from customers
    Ch 18 Ratio
    Ch 18 Extraordinary item

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    Solution Preview

    1. Prepare a schedule of cash payments for partnership liquidation
    Example:
    Capital
    Share 30% 40% 30%
    Item Cash Non-cash assets Liabilities Partner 1 Partner 2 Partner 3
    Balances before liquidation xxxx xxxx xxxx xxxx xxxx xxxx
    Sale of assets and gain/(loss) xxxx xxxx xxxx xxxx xxxx xxxx
    New balances xxxx xxxx xxxx xxxx xxxx xxxx
    Payment of liabilities (xxxx) (xxxx)
    New balances xxxx
    Cash distribution xxxx xxxx xxxx

    2. Prepare journal entries for bond issuance and first interest payment with amortization of discount/premium
    General Journal
    Date Description Debit Credit
    xx-xx-xxxx Cash xxxx
    Bonds payable xxxx
    (Being the cash receipts from sale of bonds)
    Interest expense xxxx
    Discount on bond payable xxxx
    Cash xxxx
    (Being the amount paid as interest on bond with amortization of discount)
    or
    Interest expense xxxx
    Premium on bond xxxx
    Cash xxxx
    (Being the amount paid as interest on bond with amortization of premium)

    3. Prepare operating section of Statement of Cash Flows using indirect method
    Statement of cash flow (Indirect method)
    Cash flow from operating activities
    Net income xxxx
    Add:
    Depreciation xxxx
    Decrease in inventories xxxx
    Increase in accrued inventories xxxx
    Loss on sale of land xxxx
    xxxx

    Less:
    Increase in accounts receivable xxxx
    Decrease in accounts payable xxxx
    Decrease in income taxes payable xxxx
    Gain on sale of land xxxx
    Net cash flow from operating activities xxxx

    4. Prepare journal entries for transactions under equity method of accounting

    The equity method is an accounting technique which an investment is recorded at its initial cost. However, the cost is adjusted for any gains or losses in value subsequent to the purchase. For example, assume company S paid $100,000 for more than 50% ownership in firm Z, the necessary transactions would include:
    Example:
    General Journal
    Date Description Debit Credit
    xx-xx-xxxx Investment in Company Z 100,000
    Cash 100,000
    (Being the amount invested for 50% stock of company Z)
    Investment in Company Z 10,000
    Investment income 10,000
    (Being the recognition of share of $20,000 income of Company Z)

    5. Prepare Income Statement including intra-period tax allocation for irregular items
    Income statement
    Revenue xxxx
    Less: Cost of service (xxxx)
    Gross profit xxxx

    Less: Expenses
    Rent xxxx
    Administration xxxx
    Telephone xxxx
    Insurance (less prepayment or add accurals) xxxx
    Total expenses (xxxx)

    Earnings before interest and tax xxxx
    Interest xxxx
    xxxx
    Tax (xxxx)
    Earnings after interest and tax xxxx

    Earnings after interest and tax xxxx
    Less: Dividends xxxx
    Retained earnings xxxx

    6. Depreciation terminology

    Depreciation is an accounting technique which apportions costs, of an asset, over a given period of time. There are three major terms in depreciation:
    1. Salvage amount: The amount that an asset would be worth after its useful ...

    Solution Summary

    The problem deals with topics under accounting: Cash flow statement, calculation of depreciation etc.

    $2.19

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