For the month of July, Blackfly Ltd. experienced/recorded the following transactions• received a $6000 cash payment for work performed & billed the previous•month.replanted an area of northern Alberta forest for which it sent out an invoicetotaling $35000At the beginning of the month, the company had $2000 of trees in inventoryready for planting.During the month the company purchased $7000 tress for planting• at the end of the month it was left with trees still suitable for planting thatoriginally cost $2500.monthly expenses were: $1500 for office rent; $3500 in misc. expenses;• Amortization on the truck and office equipment was calculated to be $1500• The income tax rate is 10%.Total expenses for the month of July were$24500$13000

Total costs for the month of June :Cost of Goods sold = opening stock + purchases - Closing Stock…

Answered: For the month of July, Blackfly Ltd.…

Principles of Accounting Volume 1

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Chapter11: Long-term Assets

Section: Chapter Questions

Problem 2EB: Johnson, Incorporated had the following transactions during the year: Purchased a building for...

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Johnson, Incorporated had the following transactions during the year: Purchased a building for $5,000,000 using a mortgage for financing Paid $2,000 for ordinary repair on a piece of equipment Sold product on account to customers for $1,500,600 Purchased a copyright for $5,000 cash Paid $20,000 cash to add a storage shed in the corner of an existing building Paid $360,000 in monthly salaries Paid $25,000 for routine maintenance on equipment Paid $110,000 for major repairs If all transactions were recorded properly, what amount did Johnson capitalize for the year, and what amount did Johnson expense for the year?
Jada Company had the following transactions during the year: Purchased a machine for $500,000 using a long-term note to finance it Paid $500 for ordinary repair Purchased a patent for $45,000 cash Paid $200,000 cash for addition to an existing building Paid $60,000 for monthly salaries Paid $250 for routine maintenance on equipment Paid $10,000 for major repairs Depreciation expense recorded for the year is $25,000 If all transactions were recorded properly, what is the amount of increase to the Property, Plant, and Equipment section of Jadas balance sheet resulting from this years transactions? What amount did Jada report on the income statement for expenses for the year?
Godwin Co. owns three delivery trucks. Details for each truck at the end of the most recent year follow: At the beginning of the year, a hydraulic lift is added to Truck 1 at a cost of 4,500. The addition of the hydraulic lift will allow the company to deliver much larger objects than could previously be delivered. At the beginning of the year, the engine of Truck 2 is overhauled at a cost of 5,000. The engine overhaul will extend the trucks useful life by three years. Write a short memo to Godwins chief financial officer explaining the financial statement effects of the expenditures associated with Trucks 1 and 2.
Happy Timber, Inc. owns timberland that is used to supply firewood. The timberland was purchased for $480,000 of which $125,000 relates to the land itself, and it is expected to produce 1,000,000 total pieces of firewood over the next 5 years. If 75,000 pieces of firewood are cut and sold during the year, prepare the journal entries for the depletion and sale of the firewood. *Note: should have two iournal entries.
O’Connor Company ordered a machine on January 1 at a purchase price of $40,000. On the date of delivery, January 2, the company paid $10,000 on the machine and signed a long-term note payable for the balance. On January 3, it paid $350 for freight on the machine. On January 5, O’Connor paid cash for installation costs relating to the machine amounting to $2,400. On December 31 (the end of the accounting period), O’Connor recorded depreciation on the machine using the straight-line method with an estimated useful life of 10 years and an estimated residual value of $4,750. Required: Indicate the effects (accounts, amounts, and + for increase, − for decrease) of each transaction (on January 1, 2, 3, and 5) on the accounting equation. Compute the acquisition cost of the machine. Compute the depreciation expense to be reported for the first year. What should be the book value of the machine at the end of the second year?
Tristar Production Company began operations on September 1, 2016. Listed below are a number of transactions that occurred during its first four months of operations. 1. On September 1, the company acquired five acres of land with a building that will be used as a warehouse. Tristar paid $100,000 in cash for the property. According to appraisals, the land had a fair value of $75,000 and the building had a fair value of $45,000. 2. On September 1, Tristar signed a $40,000 noninterest-bearing note to purchase equipment. The $40,000 payment is due on September 1, 2017. Assume that 8% is a reasonable interest rate. 3. On September 15, a truck was donated to the corporation. Similar trucks were selling for $2,500. 4. On September 18, the company paid its lawyer $3,000 for organizing the corporation. 5. On October 10, Tristar purchased equipment for cash. The purchase price was $15,000 and $500 in freight charges also were paid. 6. On December 2, Tristar acquired various items of office…
On October 1, Hot Springs Co., a water distiller, acquired new bottling equipment with a list price (fair market value) of $462,000. Hot Springs received a trade-in allowance of $96,000 on the old equipment of a similar type and paid cash of $366,000. The following information about the old equipment is obtained from the account in the equipment ledger: Cost, $336,000 accumulated depreciation on December 31, the end of the preceding fiscal year, $220,000; annual depreciation, $20,000. Assuming the exchange has commercial substance, journalize the entries to record: (a) the current depreciation of the old equipment to the date of trade-in and (b) the exchange transaction on October 1.
On July 1, Twin Pines Co., a water distiller, acquired new bottling equipment with a list price (fair market value) of $220,000. Twin Pines received a trade-in allowance (fair market value) of $45,000 on the old equipment of a similar type and paid cash of $175,000. The following information about the old equipment is obtained from the account in the equipment ledger: cost, $180,000; accumulated depreciation on December 31, the end of the preceding fiscal year, $120,000; annual depreciation, $12,000.Assuming that the exchange has commercial substance, journalize the entries to record (a) the current depreciation of the old equipment to the date of trade-in and (b) the exchange transaction on July 1.
Depreciation on the company’s wind turbine equipment for the year is $6,700. The Prepaid Insurance account for the solar panels had a $3,700 debit balance at December 31 before adjusting for the costs of any expired coverage. Analysis of prepaid insurance shows that $1,450 of unexpired insurance coverage remains at year-end. The company received $8,100 cash in advance for sustainability consulting work. As of December 31, one-third of the sustainability consulting work had been performed. As of December 31, $2,900 in wages expense for the organic produce workers has been incurred but not yet paid. As of December 31, the company has earned, but not yet recorded, $570 of interest revenue from investments in socially responsible bonds. The interest revenue is expected to be received on January 12. Required For each of the above separate cases, prepare the required December 31 year-end adjusting entries. Depreciation on the company’s wind turbine equipment for the year is $6,700. Prepaid…
ABC Company purchased a new printing machine on December 1 at an invoice price of P4,000,000 with terms 2/10, n/30. On December 15, Cabiao paid the required amount for the machine. The installation costs were P50,000 and the employees received training on how to use the machine, at a cost of P20,000. Before using the machine to print customers’ orders, a test was undertaken and the paper and ink cost P5,000. What amount should be capitalized as cost of the machine? A. 3,995,000 B. 3,970,000 C. 3,975,000 D. 4,075,000
On March 1, Bartholomew Company purchased a new stamping machine with a list price of $88,000. The company paid cash for the machine; therefore, it was allowed a 5% discount. Other costs associated with the machine were: transportation costs, $3100; sales tax paid, $6,720, installation costs, $1,900; routine maintenance during the first month of operation, $3,000. The cost recorded for the machine was:
The following information applies to the questions displayed below.] The following events apply to Gulf Seafood for the Year 1 fiscal year: The company started when it acquired $35,000 cash by issuing common stock. Purchased a new cooktop that cost $16,400 cash. Earned $17,300 in cash revenue. Paid $13,600 cash for salaries expense. Adjusted the records to reflect the use of the cooktop. Purchased on January 1, Year 1, the cooktop has an expected useful life of five years and an estimated salvage value of $2,900. Use straight-line depreciation. The adjusting entry was made as of December 31, Year 1.. Record the events in general journal format and post to T-accounts.

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