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ADM 2342
2023 FALL SEMESTER
DGD #9
Question No. 1
Place an
“X” against, or insert a yellow highlight on, the
best answer for each of the following
five multiple-choice questions.
Only one answer will be accepted for each question. If more than
one choice is indicated, the question will not be marked.
Each question is worth 3 marks.
No
account will be taken of any supporting calculations written.
1.
Starburst Company began 2023 with capital assets of $172,000 and accumulated depreciation
of $66,000.
During 2023, capital assets were purchased for $81,000 and capital assets were
sold for proceeds of $78,000.
Depreciation expense for the year was $58,000.
On December
31, 2023, Starburst Company had capital assets of $155,000 and accumulated depreciation of
$102,000.
What was the gain or loss on disposal of capital assets during 2023?
a. $2,000 gain
b. $2,000 loss
c. $39,000 loss
d. $58,000 loss
e. None of the above
2.
Starfruit Company recently adopted the Revaluation Model to account for its only building
after acquisition. The following facts are presented at the time of the first revaluation:
Before Revaluation
Building
–
Carrying Value
320,000
Building
–
Accumulated Depreciation
80,000
Building
–
Fair Value
280,000
Because this is the first year that the Revaluation Model is being used by Starfruit Company,
the amount to be debited or credited to net income to record the revaluation would be:
a. $0
b. $40,000 debit
c. $40,000 credit
d. $200,000 credit
e. $200,000 debit
ADM 2342
2023 FALL SEMESTER
DGD #9
Question No. 1 (continued)
3.
Stardust Limited’s Statement of Financial Position
as at December 31, 2023 included an
asset classified as equipment with a cost of $77,000 and accumulated depreciation of
$26,000.
After performing its annual review for impairment, Stardust determined that the
equipment’s value in use is $43,000 and its fair value is $51,000.
Costs of disposal are
$6,000. Stardust follows IFRS.
If Stardust wanted to use the Rational Entity Impairment
Model, what is the amount of impairment to be recorded?
a. $8,000
b. $6,000
c. $3,000
d. $0
e. No impairment can be measured and recorded because the Rational Entity
Impairment Model is only used under ASPE.
4.
Starfish Company had acquired some machinery for $20,000 back in 2021.
On March 1,
2023, when the machine had a net book value of $13,000, Starfish exchanged the machine
for a more efficient machine owned by Rebhorn Company.
The new machine had a list
price of $29,000.
A trade-in allowance of $8,000 was agreed upon between both
companies. The fair value of the old machine was $4,000.
How much was the gain or loss
on the exchange for Starfish?
a. $9,000 loss
b. $13,000 gain
c. $9,000 gain
d. $13,000 loss
e. None of the above
5.
Stargaze Company was offered the following terms for the purchase of a new machine:
a
down payment of $6,000 on January 1, 2023 and semiannual payments of $6,000 starting
on June 30, 2023 for the next 3½ years. Alternatively, Stargaze Company could pay cash
for the machine and finance its acquisition using a loan from its local bank at an 8% annual
interest rate. At what amount (rounded to the nearest dollar) should the machine be
recorded on books of Stargaze Company on the acquisition date?
a. $31,737
b. $35,238
c. $35,453
d. $42,012
e. None of the above
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Concord Industries has equivalent units of 7100 for materials and for conversion costs. Total manufacturing costs are $124370. Total
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O $17.52.
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$12.82.
O $30.33
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Your grandfather has agreed to deposit a certain amount of money each year into an account paying 7.90 percent annually to help you
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A company pays its employees $5,600 every two weeks ($400/day). The current two-week pay period ends on December 26, 2024,
and employees are paid $5,600. The next two-week pay period ends on January 9, 2025, and employees will be paid $5,600.
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Sheridan Manufacturing Company expects the following sales in January, February, and March:
Cash
Credit
Sales
Sales
$50900
$250500
January
February
$45900
$240500
March
$85000
$325000
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after sale, 5% in the second month after sale, and 5% is expected to be uncollectible. How much cash will be collected from
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O $352150
O $364675
O $410000
O $279675
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Determine the following measures for 2018.
Round ratio values to one decimal place and dollar amounts to the nearest cent. For number of days' sales in receivables and number of
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Г
2,790,000
2.
Current ratio
4.1
3. Quick ratio
2.5
4.
Accounts receivable turnover
16
5. Days' sales in receivables
22.8
days
6.
Inventory turnover
7. Days sales in inventory
8. Debt ratio
days
%
9. Ratio of liabilities to stockholders' equity
10.
Ratio of fixed assets to long-term liabilities
11. Times interest earned
times
times
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Times preferred dividends earned
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A newspaper editor starts a retirement savings plan in which $225 per month is deposited at the beginning of each month into an account that earns an annual interest rate of 6.4% compounded monthly.
Find the value of this investment (in dollars) after 20 years. (Round your answer to the nearest cent.)
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logo design company purchases four new computers for $12,500. The company finances the cost of the computers for 3 years at an annual interest rate of 5.175% compounded monthly. Find the month
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Final: Part 2 (Problems) i
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QS 26-17 (Algo) X
Required 1 Required 2
4
At the beginning of the year, Custom Manufacturing set its predetermined overhead rate using the following estimates: overhead
costs, $1,080,000, and direct materials costs, $400,000.At year-end, the company reports that actual overhead costs for the year are
$1,088,900 and actual direct materials costs for the year are $400,000.
Actual overhead
Complete this question by entering your answers in the tabs below.
Required 3
1. Determine the predetermined overhead rate using estimated direct materials costs
2. Enter the actual overhead costs incurred and the amount of overhead cost applied to jobs during the year using…
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