Manny Company uses many kinds of machines in its operations. The following information relates to a machine that was acquired at the beginning of the current year: Cash paid for machine, including VAT of P96,000 Cost of transporting machine Labor cost of installation by expert fitter Labor cost of testing machine Insurance cost for the current year Cost of training for personnel who will use the machine Cost of safety rails and platform surrounding machine Cost of water device to keep machine cool Cost of adjustment to machine to make it operate more efficiently Estimated dismantling cost to be incurred as required by contract 896,000 30,000 50,000 40,000 15,000 25,000 60,000 80,000 75,000 65,000 What total amount should be capitalized as cost of the machine?
Q: Fred is considering three job offers in advertising. • A full-time position as a coordinator that…
A: Social Security Tax: 6.2% Medicare Tax: 1.45% Federal Income Tax: 15% Average Sales: $100,000…
Q: Sully Sports Cars Co. entered into a subscription contract with various investors. The terms were as…
A: Journal means the book of original entry where the entry is passed for the very first time after…
Q: The Maria Company estimated its factory overhead of the next period at P160,000. It is estimated…
A: In ABC costing method, overheads are allocated based on the activity or cost pool. Overhead cost…
Q: DIDAL Company owns a ranch which produces the livestock which it uses in its meat processing…
A: Current Liabilities are those dues and obligations which needs to be settled or being paid out by…
Q: Name the error which was made under the following circumstances: The purchase of the machinery on…
A: When machinery is purchased on credit . Machinery account is debited. It's wrongly debited to…
Q: osita Flores owns Rosita's Mexican Restaurant in Tempe, Arizona. Rosita's is an affordable…
A: Calculation of Number of checks May: Number of checks in May = Credit sales of May/ Average amount…
Q: Jackie owns a temporary employment agency that hires personnel to perform accounting services for…
A: Introduction: Businesses incur a variety of expenditures. An expense is a form of spending that…
Q: On July 1, 2021, Ghana Company signed an agreement to operate as a franchisee of Fast Foods, Inc.…
A: Given data, Initial franchise fee =P6,000,000 Down payment =P2,000,000 Balance =P6,000,000 -…
Q: Determine the company's break-even point in (1) number of lawns serviced per month and (2) sales…
A: Breakeven sales is that level of sales at which business is only covering its fixed costs and…
Q: est Company has nine employees. FICA Social Security taxes are 6.2% of the first $132,900 paid to…
A: Computation of each total for FICA Social Security taxes, FICA Medicare taxes, FUTA taxes, and SUTA…
Q: a. Income is the amount spent by the business for recruiting the most qualified staff b. Income is…
A: Introduction:- Income is the revenue a business obtain or gain from selling its goods and services.
Q: a. What is the net present value of the project? (Negative amount should be indi factor to 3…
A: Net Present Value It is the difference between the present value of the cash inflows and present…
Q: On 1/1/21, Elliott Company leased machinery with a fair value of $1,185,000 from Greene Corporation.…
A: Lease is an agreement between leaser and lessee in which leaser allows lessee to use her land…
Q: 3. JFINEX Corporation has a retained earnings of 2,100,000. The company reported an EBIT of 540,000…
A: Formula: Dividend payout ratio = ( Declared total dividends / Net income ) x 100
Q: Atlas Foods produces three supplemental food products simultaneously through a refining process…
A: The joint cost is the cost incurred to produce two or more products and the cost incurred is not…
Q: Compute the following ratios for 2022. (Round Debt to total assets ratio to 1 decimal place, e.g 1.8
A: Introduction:- Debt total asset ratio indicates total amount of debt of a company holds to finance…
Q: Mr. and Mrs. Bogdanovich want to buy a house that costs $585,000. They can only afford to pay $2200…
A: Down Payment: If a buyer is acquiring an expensive commodity or service, a down payment is a…
Q: Answer the question below based on the following scenario and table. Scenario: A US-based…
A: According to the given scenario, a multinational corporation located in the United States spends…
Q: A package holiday company is about to block book hotel rooms for the coming season. The number of…
A: Cost management is related to the activities of management for planning and controlling the business…
Q: What is the amount of inventory on March 31 using the moving average cost flow technique? During…
A: Moving Average Cost method of Inventory Valuation is a method of Perpetual System i.e. the unit cost…
Q: omplete the following: FLASH TRUCKING SERVICES INCOME STATEMENT DECEMBER 31, 2014 FLASH TRUCKING…
A: Financial statements are those statements which are prepared at the end of the period in order to…
Q: maximum profit u
A: Production level refers to the chances of an increase in the special requests of customers for a…
Q: P Company acquired 100% of S Company through an issue of 5,000,000 shares, par P10, to the…
A: In case one company overtake the assets and liabilities of another company , then accounting for…
Q: You are considering two job offers: Job 1 is a full-time position that pays $58,000 annually and Job…
A: Pretax earnings are a corporation's earnings after deducting all operational expenditures, including…
Q: what is accounting?explain it.
A: A business needs quantitative record of its over financial performance and financial position in…
Q: Coral Seas Jewelry Company makes and sells costume jewelry. For the coming year, Coral Seas expects…
A: Working Note: Income tax expense = Income tax expense x tax rate = $4,140,000 x 40% = $1,656,000
Q: Determine the amount of cash received from customers for each of the three independent situations…
A: Cash Received from Customers = Sales Revenue + Accounts Receivable Decrease or Cash Received from…
Q: Fizer Pharmaceutical paid $86 million on January 2, 2021, for 6 million shares of Carne Cosmetics…
A: A Journal entry is a primary entry that records the financial transactions initially. The…
Q: the following Assumptions: Tangible Asset Value = 16,200,000 Required Return on Tangible Assets =…
A: We can also utilize the surplus earnings method to appraise a corporation. We must first assess the…
Q: What is the depreciation of the building for 2021?
A: Depreciation is the reduction in the value of asset due to its normal use and tear and wear. It is…
Q: 6. Some years pass and the value of your home has risen to $900,000. Your home equity is more than…
A: Home equity refers to the property portion which is owned truly and the lender has the interest in…
Q: OB. Large companies are the biggest contributors to the presidential eléclions IR the 88URly.
A: Tax incentive refers to a process of a country’s tax code that is designed to encourage economic…
Q: Cash Budget Khloe Company imports gift items from overseas and sells them to gift shops and…
A: Cash Budget is a summary of Cash Receipts and disbursements made during the period. In cash budget…
Q: In the beginning of the year Fiji Co. entered into a contract with a customer which specifies that…
A: Revenue recognition is the recording of income in the records. Revenue recognition is very crucial…
Q: pplier (industrial division, Advance Micro Incorporated, or Admiral Electric) should the commercial…
A: The transfer price is the price charged for goods or services when the good is transferred from one…
Q: Sweet Company’s outstanding stock consists of 1,800 shares of cumulative 5% preferred stock with a…
A: Formula: Annual Dividend to Preferred shareholders = No. of preferred share outstanding x Par value…
Q: 3. Question Content Area Cash Budget Khloe Company imports gift items from overseas and sells…
A: Budgeting - Budgeting is the process of estimating future operations based on past performance. %…
Q: At December 31, 2019 and 2018, New Corporation had outstanding 4,000 shares of P 100 par 12%…
A: Cumulative preference shareholders are paid dividend including the arrears before the payment of…
Q: On Jan 1, 20X1 ABC received a P1,200,000 3-year 10% note. Interest and principal is collectible on…
A: Maturity value of the Note = Face value of the Note + Interest on note where, Interest on note =…
Q: ABC Company provides extended service contracts on equipment sold through major retailers. The…
A: Warranty is a form of assurance being provided by the seller to the buyer that in case product will…
Q: You are considering two job offers: Job 1 is a full-time position that pays $58,000 annually and Job…
A: Gross Annual Income is calculated by deducting all the taxes from the pay received in the month.…
Q: Homer Corp. is considering the purchase of a new piece of equipment. The cost savings from the…
A: Formula: Annual Net cash flow = Annual income after-tax + Annual depreciation where, Annual…
Q: Masipag Company produces a product that undergoes three processes and the completed items at end of…
A: Equivalent number of units means units completed in the particular period or manufactured in the…
Q: The following information applies to the questions displayed below.] In preparation for developing…
A: The cash flow statement is prepared to record the cash flow from various activities including…
Q: A PEN Company uses a flexible budget system and prepared the following information for 2012:…
A: Overhead Controllable Variance occurs when there is a difference between budgeted overhead expenses…
Q: Prepare a complete statement of cash flows using the indirect method for the current year. (Amounts…
A: Cash flow statement (CFS) refers to a financial statement which shows the flows of cash and cash…
Q: Matchroom's investment appraisal committee have worked out the Net Cash flows in the working shown…
A: The discount rate required to make a project's net present value (NPV) zero is called the Internal…
Q: A history class is comprised of 8 female and 7 male students. If the instructor of the class rando…
A: In the Given Question We have 8 females and 7 male students Total = 8+7 = 15 We need to select 5…
Q: Question 1 What is the accounting treatment of the direct issue costs of shares of stocks? O Debit…
A: Ques 1 Direct issuance cost of shares of stock should be recorded as expense in the income…
Q: MORGAN Merchandising is preparing its Sales Budget for the 3rd Quarter of 2020 based on a budgeted…
A: Budgeted sales revenue means the estimate of sales revenue for a future period.
Step by step
Solved in 2 steps
- Ronson recently purchased a new boat to help ship product overseas. The following information is related to that purchase: purchase price $4,500,000 cost to bring boat to production facility $15,000 yearly insurance cost $12,000 pays annual maintenance cost of $22,000 received a 10% discount on sales price Determine the acquisition cost of the boat and record the journal entry needed.Santa Rosa recently purchased a new boat to help ship product overseas. The following information is related to that purchase: Purchase price $4,500,000 Cost to bring boat to production facility $25,000 Yearly insurance cost $25,000 Annual maintenance cost of $30,000 Received 8% discount on sales price Determine the acquisition cost of the boat, and record the journal entry needed.Self-Construction Olson Machine Company manufactures small and large milling machines. Selling prices of these machines range from 35,000 to 200,000. During the 5-month period from August 1, 2019, through December 31, 2019, Olson manufactured a milling machine for its own use. This machine was built as part of the regular production activities. The project required a large amount of time front planning and supervisory personnel, as well as that of some of the companys officers, because it was a more sophisticated type of machine than the regular production models. Throughout the 5-month period, Olson charged all costs directly associated with the construction of the machine to a special account entitled Asset Construction Account. An analysis of the charges to this account as of December 31, 2019, follows: Olson allocates factory overhead to normal production as a percent of direct labor dollars as follows: Olson uses a flat rate of 40% of direct labor dollars to allocate general and administrative overhead. During the machine testing period, a cutter head malfunctioned and did extensive damage to the machine table and one cutter housing. This damage was not anticipated and was the result of an error in the assembly operation. Although no additional raw materials were needed to make the machine operational after the accident, the following labor for rework was required: Olson has included all these labor charges in the asset construction account. In addition, it included in the account the repairs and maintenance charges of 1,340 that it incurred as a result of the malfunction. Required: 1. Compute, consistent with GAAP and common practice, the amount that Olson should capitalize for the milling machine as of December 31, 2019, when it declares the machine operational. 2. Next Level Identify the costs you included in Requirement 1 for which there are acceptable alternative procedures. Describe the alternative procedure(s) in each case.
- Tutor Corp. uses different kinds of machines in its manufacturing process. The following information relates to the acquisition of machines that it has recorded in 2021.· Cash paid for equipment- P250,000· Cost of transporting machine - insurance and transport- P9,000· Labor cost of installation by expert fitter- P15,000· Labor cost of testing equipment- P12,000· Insurance cost for 2021- P4,500· Cost of training for personnel who will use the machine- P7,500· Cost of safety rails and platforms surrounding machine- P18,000· Cost of water devices to keep machine cool- P24,000· Cost of adjustments to machine during 2021 to make it operate more efficiently- P22,500 What is the cost of the machine?Angel Corp. uses different kinds of machines in its manufacturing process. The following information relates to the acquisition of machines that it has recorded in 2021.· Cash paid for equipment- P250,000· Cost of transporting machine - insurance and transport- P9,000· Labor cost of installation by expert fitter- P15,000· Labor cost of testing equipment- P12,000· Insurance cost for 2021- P4,500· Cost of training for personnel who will use the machine- P7,500· Cost of safety rails and platforms surrounding machine- P18,000· Cost of water devices to keep machine cool- P24,000· Cost of adjustments to machine during 2021 to make it operate more efficiently- P22,500 What is the cost of the machine? A. 358,000 B. 328,000 C. 350,500 D. 380,500BolaBola uses different kinds of machines in its manufacturing process. The following information relates to the acquisition of machines that it has recorded in 2020.· Cash paid for equipment- P250,000· Cost of transporting machine - insurance and transport- P9,000· Labor cost of installation by expert fitter- P15,000· Labor cost of testing equipment- P12,000· Insurance cost for 2020- P4,500· Cost of training for personnel who will use the machine- P7,500· Cost of safety rails and platforms surrounding machine- P18,000· Cost of water devices to keep machine cool- P24,000· Cost of adjustments to machine during 2020 to make it operate more efficiently- P22,500 What is the cost of the machine?
- Tumeng Co. acquired a piece of equipment for 1,000,000 and incurred the following additional costs: Brokers Commission 50,000 Freight cost 35,000 Freight Insurance 5,000 Installation costs 250,000 Calibration and testing costs 20,000 Training cost of the machine operators 15,000 General and administrative costs 6,000 The samples generated from testing the equipment were sold for 2,000. Requirements: Compute for the initial cost of the equipmentOn 1 June 20X1, Galaxy Co. purchased a new machine for use in its factory. The directors have capitalised the purchase price but are unsure how to treat the following related costs. 350,000 was spent on testing whether the machine was functioning properly. During the testing period (June — October 20X1), samples were produced and sold for a total of 75,000. 400,000 was also spent on training existing employees how to operate the new machine. The machine is being used to manufacture a new product, Product C and 1 million was spent on advertising this new product. Testing was completed and commercial production of Product C commenced on 31 October 20X1. Required: Advise Galaxy on how the above transactions should be dealt with in its financial statements for the year ended 31 December 20X1.At the beginning of the year, Grillo Industries bought three used machines from Freeman Incorporated. The machines immediately were overhauled, were installed, and started operating. Because the machines were different, each was recorded separately in the accounts. Machine A Machine B Machine C Cost of the asset $ 10,800 $ 40,000 $ 23,800 Installation costs 950 3,900 3,000 Renovation costs prior to use 750 3,500 4,000 Repairs after production began 700 900 2,500 By the end of the first year, each machine had been operating 8,000 hours. Required: Compute the cost of each machine. Prepare the journal entry to record depreciation expense at the end of year 1, assuming the following: Estimates Machine Life Residual Value Depreciation Method A 5 years $ 2,800 Straight-line B 20,000 hours 2,400 Units-of-production C 10 years 1,600 Double-declining-balance
- A company purchased a special purpose machine on August 1st of the previous year. It was installed and ready to run on January 1st of the current year. The following costs were incurred in the purchase and installation of the machine: Invoice price $1,200,000 Freight costs 6,000 Installation costs 64,000 Electrical and power connections 32,000 Repairs to correct damage during uncrating 12,000 Costs to adjust machine to appropriate specifications 56,000 Costs of spare parts for future use 108,000 Sales tax 70,500 Cost of…Assume a (hypothetical) company, Troff erini S. A., incurred the following expendituresto purchase a towel and tissue roll machine: €10,900 purchase price including taxes,€200 for delivery of the machine, €300 for installation and testing of the machine,and €100 to train staff on maintaining the machine. In addition, the company paid aconstruction team €350 to reinforce the factory floor and ceiling joists to accommodatethe machine’s weight. Th e company also paid €1,500 to repair the factory roof (a repairexpected to extend the useful life of the factory by five years) and €1,000 to have theexterior of the factory and adjoining offices repainted for maintenance reasons. Th erepainting neither extends the life of factory and offices nor improves their usability.1. Which of these expenditures will be capitalized and which will be expensed?2. How will the treatment of these expenditures aff ect the company’s financialstatements?At the beginning of the year, Grillo Industries bought three used machines from Freeman Incorporated. The machines immediately were overhauled, were installed, and started operating. Because the machines were different, each was recorded separately in the accounts. Machine A Machine B Machine C Cost of the asset $10,600 $39,800 $23,600 Installation costs 850 3,700 2,800 Renovation costs prior to use 650 3,300 3,800 Repairs after production began 500 700 2,300 By the end of the first year, each machine had been operating 8,000 hours. Required: Compute the cost of each machine. Prepare the journal entry to record depreciation expense at the end of year 1, assuming the following: Estimates…