Costs of hiring new employees Attorney's fees in connection with the organization of the company Improvements to leased offices prior to occupancy (10-year lease) Costs of pre-opening advertising 3,000 12,000 6,000 5,000
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Kling Company was organized in late 2019 and began operations On January 2, 2020. Prior to the start of operations, it incurred the following costs:
1. what amount should the compmy expense in 2019? In 2020?
2. Next Level What is the justification of the accounting treatment of these costs?
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- Worksheet Devlin Company has prepared the following partially completed worksheet for the year ended December 31, 2019: The following additional information is available: (a) salaries accrued but unpaid total 250; (b) the 80 heat and light bill for December has not been recorded or paid; (c) depreciation expense totals 810 on the buildings and equipment; (d) interest accrued on the note payable totals 380 (this will be paid when the note is repaid); (e) the company leases a portion of its floor space to KT Daniel Specialty Company for 50 per month, and KT Daniel has not yet paid its December rent; (f) interest accrued on the note receivable totals 80; (g) bad debts expense is 70; and (h) the income tax rate is 30% on current income and is payable in the first quarter of 2017. Required: 1. Complete the worksheet. (Round to the nearest dollar.) 2. Prepare the companys financial statements. 3. Prepare (a) adjusting and (b) closing entries in the general journal.Start-Up Costs Kling Company was organized in late 2019 and began operations on January 2, 2020. Prior to the start of operations, it incurred the following costs: Costs of hiring new employees $3,000 Attorney's fees in connection with the organization of the company 12,000 Improvements to leased offices prior to occupancy (10-year lease) 6,000 Costs of pre-opening advertising 5,000 1. What amount should the company expense in 2019? What amount should the company expense in 2020? 2. Next Level Kling Company was organized in late 2019 and began operations on January 2, 2020. Prior to the start of operations, it incurred costs to hire new employees, attorney fees in connection with the organization of the company, improvements to leased offices prior to occupancy (10-year lease), and costs related to pre-opening advertising. Start-up costs are:A company enters into a contract with a customer to build a building, with a performance bonus of $33,500 if the building is completed by September 30, 2021. The bonus is reduced by $5,000 each week that completion is delayed. The company commonly includes these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes: Completed by ProbabilitySeptember 30, 2021 70%October 7, 2021 15%October 14, 2021 10%October 21, 2021 5%The amount of revenue the company should recognize related to this bonus is $_______________.
- A construction company enters a long-term contract with a customer. The contract price is $2,500,000. Year 1 costs are $700,000, and it's estimated the project is 30% complete. Using the percentage-of-completion method, what profit is recognized in Year 1? A) $50,000 B) $210,000 C) $750,000 D) $1,800,000Start-Up Costs Kling Company was organized in late 2019 and began operations on January 2, 2020. Prior to the start of operations, it incurred the following costs: Costs of hiring new employees $3,000 Attorney's fees in connection with the organization of the company 12,000 Improvements to leased offices prior to occupancy (10-year lease) 6,000 Costs of pre-opening advertising 5,000 Required: 1. What amount should the company expense in 2019?$fill in the blank 1 What amount should the company expense in 2020?$ fill in the blank 2Start-Up Costs Kling Company was organized in late 2019 and began operations on January 2, 2020. Prior to the start of operations, it incurred the following costs: Costs of hiring new employees $3,000 Attorney's fees in connection with the organization of the company 12,000 Improvements to leased offices prior to occupancy (10-year lease) 6,000 Costs of pre-opening advertising 5,000 Required: 1. What amount should the company expense in 2019? 2. What amount should the company expense in 2020?
- C. An entity is committed to close a factory in 10 months and shall terminate the employment of all theremaining employees of the factory. Under the termination plan, an employee leaving before closure offactory shall receive on termination date a cash payment of P20,000. However, an employee that rendersservice until closure of the factory shall receive P60,000. There are 120 employees at the factory. The entityexpects 100 employees to leave before closure and 20 employees to render service until closure. REQUIRED:11. What amount should be recognized as short-term benefit?C. An entity is committed to close a factory in 10 months and shall terminate the employment of all theremaining employees of the factory. Under the termination plan, an employee leaving before closure offactory shall receive on termination date a cash payment of P20,000. However, an employee that rendersservice until closure of the factory shall receive P60,000. There are 120 employees at the factory. The entityexpects 100 employees to leave before closure and 20 employees to render service until closure. REQUIRED:10. What amount should be recognized as termination benefit?Marcellus acquired new premises at a cost of £500,000 on 1 January 20X1. Marcellus paid the following further costs during the year ended 31 December 20X1: Costs of initial adaptation 27,800; Legal costs relating to purchase 2,400; Monthly cleaning contract 19,200; Office furniture 13,000. What amount should appear as the cost of premises in the company's statement of financial position at 31 December 20X1?
- Computing Revenue and Gross Profit on Long-Term Construction Contract Supplier Corp. enters into a government contract during the year to provide computer equipment for $4,400,000. The contract consists of a single performance obligation to provide specified equipment in three years. Total costs estimated by Supplier Corp. for the contract are $3,080,000 . The equipment is highly specialized and has no alternative uses. As negotiated in the contract, any costs incurred by Supplier Corp. plus a specified profit margin will be paid to Supplier Corp. in the event of a contract cancellation. Actual costs incurred during the year were $1,408,000 including unexpected cost overruns of $176,000 due to labor inefficiencies.a. Would revenue be recognized over time or at a point in time for this contract?Answer b. Calculate (1) recognized revenue, (2) the gross profit, and (3) adjusted contract margin to be recorded during the year. 1. Recognized revenue Answer 2. Gross profit Answer…On January 1, Year 1, Crawford Construction Company enters into a contract with a customer to build an office complex for a fixed price of $36 million. Estimated costs to complete the project are $24 million. At the end of Year 1, costs incurred to date amount to $18 million. Using the cost-to-cost method, how much revenue should be recognized in Year 1? $24 million $27 million $36 million $0A company entered into a contract on 1 January 20X5 to build a factory. The total contract revenue was $2.8 million. At 31 December 20X5 the contract was certified as 35% complete. Costs incurred during the year were $740,000 and costs to complete are estimated at $1.4 million. $700,000 has been billed to the customer but not yet paid. What amount will be recognised as a contract asset or liability in respect of this contract in the statement of financial position as at 31 December 20X5? A $271,000 contract asset B $509,000 contract asset C $271,000 contract liability D $509,000 contract liability
