Unit 6 Discussion Board

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Before 2020, KnowieNowl Company used the cash basis of accounting. For the year ended December 31, KnowieNowl changed to the accrual basis. KnowieNowl cannot determine the beginning balance of supplies inventory. What effect of KnowieNowl’s inability to determine beginning supplies inventory on its 2020 accrual basis profit and December 31, 2020 accrual basis capital, respectively?     a. overstated; overstated b. no effect; no effect c. no effect; overstated d. overstated; no effect

Which of the following items has no effect on the Accumulated Adjustments Account (AAA) of an S Corporation? O Short-Term Capital Loss. O Additional stock purchases by a sharehoklder of the S Corporation. O Cost Of Goods Sold. O Administrative Expenses.

Listed below are the current Accounting Assumptions and Principles                               Economic Entity Assumption   Monetary Unit Assumption   Historical Cost Principle           Going Concern Assumption   Revenue Recognition Principle   Full Disclosure Principle           Time Period Assumption   Matching Principle                                   Required:                   For the following situations, identify whether the situation represents a violation or a correct application of GAAP, and which assumption/principle is applicable.                   g. Buckner Corp is being sued for $1,000,000. There is a probable chance they will lose. The company disclosed this fact in their notes to their financials.                       Violation: (Yes/No)                   Applicable Assumption/Principle:                                         h. Nixon Corp records and maintains their books at cost and/or current value, not at a liquidated value.…

Presented below is information related to Kingbird Company at December 31, 2025, the end of its first year of operations. Sales revenue Cost of goods sold Selling and administrative expenses Gain on sale of plant assets Unrealized gain on available-for-sale debt investments Interest expense Loss on discontinued operations Dividends declared and paid Compute the following: (Ignore income tax effects.) (a) (b) (c) (d) Income from operations Net income Comprehensive income Retained earnings balance at December 31, 2025 $287,320 126,540 53,200 31,270 10,590 10,870 $ $ 5 5,720 $ 4,570

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Except for the earnings per share statistics, the 2019, 2020, and 2021 income statements for Ace Group Inc. were originally presented as follows: Required: 1. Calculate the 11 missing amounts. (Loss should be indicated by a minus sign.) Sales Costs and expenses Profit from continuing operations Gain (loss) on discontinued operations Profit (loss) 2019 $ 477,855 $ 698,040 $314,935 2020 83,160 $ 155,994 $ 535,700 Information on Common Shares for Ace Group Inc. * Shares outstanding on December 31, 2018 Purchase and retirement of shares on March 1, 2019 Sale of shares on June 1, 2019 Share dividend of 5% on August 1, 2019 Shares outstanding on December 31, 2019 Sale of shares on February 1, 2020 Purchase and retirement of shares on July 1, 2020 Shares outstanding on December 31, 2020 Sale of shares on March 1, 2021 Purchase and retirement of shares on September 1, 2021 Share split of 3:1 on October 1, 2021 Shares outstanding on December 31, 2021 - + + + - + - + 2021 $1,009,900 329,070…

Consider the following worksheet with information extracted from a financial statement:2018                       Assets                     Liabilities                             EquityReported (P)           500 000                   100 000                               400 000An analyst makes an adjustment that decreases goodwill by P100 000 and equity (profit) by P100 000. This goodwill was acquired on consolidation, hence there are no tax adjustments. Using the worksheet approach, what would be the change in the debt to assets ratio?

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A company reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Year Pretax Income (Loss) Tax Rate 2018 $183,000 17% 2019 69,000 17 2020 (206,800) 23 2021 385,100 23 Assuming that the company uses the carryforward provision, what is the amount of income or loss that will be reported for 2020? (Enter the amount only. DO NOT put a plus or minus sign in front of the amount.)

Presented below is information related to Novak Corporation at December 31, 2025, the end of its first year of operations. Sales revenue Cost of goods sold Interest expense Selling and administrative expenses Dividends declared and paid Loss on sale of investments Unrealized gain on available-for-sale financial assets Gain on discontinued operations Compute the following: Ignore tax effects. (a) Income from operations $532,000 360,000 29,500 109,400 9,900 5,500 16,200 17,600 $ GA

What are the answers to Required 1 (filling in the Double-Declining balance sheet) and Required 2 (the journal entry for depreciation expense for 2021)?

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Required: 1. Prepare revised income statements according to generally accepted accounting principles, beginning with income from continuing operations before income taxes. Ignore EPS disclosures. 2. Assume that by December 31, 2016, the division had not yet been sold but was considered held for sale. The fair value of the division’s assets on December 31 was $5,000,000. How would the presentation of discontinued operations be different from your answer to requirement 1? 3. Assume that by December 31, 2016, the division had not yet been sold but was considered held for sale. The fair value of the division’s assets on December 31 was $3,900,000. How would the presentation of discontinued operations be different from your answer to requirement 1?

The following information is related to Tamarisk Company for 2025. Retained earnings balance, January 1, 2025 Sales revenue Cost of goods sold Interest revenue Selling and administrative expenses Write-off of goodwill Income taxes for 2025 Gain on the sale of investments Loss due to flood damage Loss on the disposition of the wholesale division (net of tax) Loss on operations of the wholesale division (net of tax) Dividends declared on common stock Dividends declared on preferred stock $1,176,000 30,000,000 19,200,000 84,000 5,640,000 984,000 1,492,800 (a1) 132,000 468,000 528,000 108,000 300,000 96,000 Tamarisk Company decided to discontinue its entire wholesale operations (considered a discontinued operation) and to retain its manufacturing operations. On September 15, Tamarisk sold the wholesale operations to Rogers Company. During 2025, there were 500,000 shares of common stock outstanding all year. Prepare a multiple-step income statement. (Round earnings per share to 2 decimal…

In its 2021 statement of retained earnings, what amount should Tricky report as the effect of this accounting change? During 2021, Tricky Company decided to change from FIFO method of inventory valuation to the weighted average method. Inventory balances under each method were as follows: FIFO January 1 1,420,000 1,580,000 Weighted Average 1,540,000 1,660,000 December 31 Income tax rate is 35%. In its 2021 statement of retained earnings, what amount should Tricky report as the effect of this accounting change? Your answer

V13

Crypt Inc. carries the following marketable equity financial assets on its books at December 31, 2018 and 2019. All financial assets were purchased during 2018 and there were no beginning balances in any market adjustment accounts. 1.Compute the unrealized gain or loss that will presented in the income statement of 2018. 2. Compute the unrealized gain or loss that will presented in the income statement of 2019 3. Compute the unrealized gain or loss that will presented in the other comprehensive income of 2018 4. Compute the unrealized gain or loss that will presented in the other comprehensive income of 2019. 5.Compute the amount of unrealized gain or loss that will be presented in the Stockholders equity for 2020.

Which limitation of an income statement occurs when one company uses an accelerated depreciation method while another company uses straight-line depreciation? O Companies omit from the income statement items they cannot measure reliably. O Income measurement involves judgment. O Income numbers are affected by the accounting methods employed. All of these answer choices are correct.

Emad LLC's Income Statement shows OMR 102,600 profit for the year 2020. The following information are provided to arrive the taxable income. Ø The actual value of closing inventory was OMR 82,700, it is recorded as OMR 82,200. Ø Provision for bad debts of OMR 1,500 has been included to calculate the above profit. Ø The firm earned dividend income of OMR 12,000. Since, the dividend income is not taxable the accountant reduced same amount from business income. Ø The company invested OMR 20,000 in equity share during this year. Ø Depreciation of a pre-fabricated building worth of OMR 80,000 was charged at 4%. Ø Salary OMR 8800 was paid for 11 months was included to arrive at the profit. Accountant did not report the outstanding salary. Ø The firm incurred a loss of OMR 24,600 in the year 2015 out of which OMR 20,800 has been written off so far. Ø Donation paid to an approved trust OMR 4,200 which is less than 3% of gross income. Ø Bad debts of previous years OMR 1,500 recovered in this…

The Kelly Services, Inc., and subsidiaries partial statement s of earnings from its annual report are presented below.   2020 2019 Revenues from services 4314.8 5517.3 Cost of services 3613.1 4539.7 Gross Profit 701.7 977.6 Selling and administrative expense 794.7 967.4 Asset impairments 53.1 80.5 Net earnings (loss) (164.1) (70.3)   Prepare a horizontal common size analysis, and comment on the trend.

For this question, please refer to the Fact Pattern below (Same fact pattern as previous question). Given the set of transactions above, what was Adjusted EBITDA in 2021?

The fact that generally accepted accounting principles allow companies flexibility in choosing between certain allocation methods can make it difficult for a financial analyst to compare periodic performance from firm to firm. Suppose you were a financial analyst trying to compare the performance of two companies. Company A uses the double-declining- balance depreciation method. Company B uses the straight-line method. You have the following information taken from the 12/31/2024 year-end financial statements for Company B: Income Statement Book Depreciation expense $ 5,000 Balance Sheet Assets: Print Plant and equipment, at cost Less: Accumulated depreciation Net $ 100,000 (20,000) Ferences $ 80,000 You also determine that all of the assets constituting the plant and equipment of Company B were acquired at the same time, and that all of the $100,000 represents depreciable assets. Also, all of the depreciable assets have the same useful life and residual values are zero. Required: 1. In…

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The following information is related to Nash Company for 2025. Retained earnings balance, January 1, 2025 Sales revenue Cost of goods sold Interest revenue Selling and administrative expenses Write-off of goodwill Income taxes for 2025 Gain on the sale of investments Loss due to flood damage. Loss on the disposition of the wholesale division (net of tax) Loss on operations of the wholesale division (net of tax) Dividends declared on common stock Dividends declared on preferred stock (a1) $901,600 23,000,000 14,720,000 Nash Company decided to discontinue its entire wholesale operations (considered a discontinued operation) and to retain its manufacturing operations. On September 15, Nash sold the wholesale operations to Rogers. Company. During 2025, there were 500,000 shares of common stock outstanding all year. + 64,400 4,324,000 754,400 1,144,480 101,200 358,800 404,800 82,800 230,000 73,600 Prepare a multiple-step income statement. (Round earnings per share to 2 decimal places, e.g.…

The income statement is incomplete but that is the format that is needed