Pharoah company has delivery equipment that costs $49,800 and has been depreciated $23,000. Prepare a tabulat summary to record the disposal under the following assumptions. A. Its was scrapped as having no value. It was scrapped as having no value. Decreases in assets, liablilitles, or stockholders' equilty require a negative slgn or parentheses. Increases in expenses and losses require a negative sign or parentheses. Increases in Accumulated Depreclation require a negative sign or parentheses. Decreases in Accumulated Depreclation are entered as postive amounts.
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- If machinery is depreciated @ 10%, What will the effects on financial statements Select one: a. It will b treated as a current asset only O b. It will be treated as an expense in income statement & subtracted from concerned assets in Balance Sheet It will be treated as an expense in income statement only O d. It will be subtracted from concerned asset onlyClassify each of the following accounting practices as conservative or aggressive. 1. Increase the allowance for uncollectible accounts. 2. When costs are rising, change from LIFO to FIFO. 3. Change from declining-balance to straight-line depreciation in the second year of an asset depreciated over 20 years.If a P2,500 adjustment for depreciation is omitted, which of the following financial statement errors will occur? a. profit will be understated c. expenses will be overstated b. assets will be understated d. owner's equity will be overstated
- Uno Company sold office equipment with a cost of $44,560 and accumulated depreciation of $40,255 for $6,120. Required a. What is the book value of the asset at the time of sale? b. What is the amount of gain or loss on the disposal? (Loss amount should be indicated with a minus sign.) c. How would the sale affect net income (increase, decrease, no effect) and by how much? d. How would the sale affect the amount of total assets shown on the balance sheet (increase, decrease, no effect) and by how much? e. How would the event affect the statement of cash flows (inflow, outflow, no effect) and in what section? a. Book value b. Gain (loss) on sale c. Net income would d. Total assets would by by e. Cash flow would by SectionO Net profit was calculated as being $10,200. It was later discovered that capital expenditure of $3,000 had been treated as revenue expenditure, and revenue receipts of $1,400 had been treated as capital receipts. What is the net profit after correcting this error?! Required information [The following information applies to the questions displayed below.] Turtle Creek Partnership had the following revenues, expenses, gains, losses, and distributions: Sales revenue Long-term capital gains Cost of goods sold Depreciation-MACRS Amortization of organization costs. Guaranteed payments to partners for general management Cash distributions to partners $ 65,500 $ 4,800 Ordinary income (loss) $ (22,100) $ (7,900) $ (1,240) $ (15,600) $ (3,600) a. Given these items, what is Turtle Creek's ordinary business income (loss) for the year?
- The accountant at Allied Client inadvertently recorded depreciation expense as $57,000 instead of $75,000. Which of the four primary financial statements (i.e., Income Statement, Statement of Changes in Equity, Balance Sheet, and Statement of Cash Flows) will be incorrect if this error is not corrected before the statements are issued?30) A loss on disposal of an asset would be reported: A) as a direct increase to the asset account on the balance sheet. B) in the Operating Expenses section of the income statement. C) as a direct decrease to the asset account on the balance sheet. D) in the Operating Revenues section of the income statement.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 12/31/2021 year-end financial statements for Company B: Income Statement Depreciation expense Balance Sheet Assets: Plant and equipment, at cost Less: Accumulated depreciation Net 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 $260,000 represents depreciable assets. Also, all of the depreciable assets have the same useful life and residual values are zero. Required: 1. In order to compare performance with Company A, estimate what B's depreciation expense would have been for 2021 if the double- declining-balance depreciation method had been used by Company B since acquisition of the depreciable assets. 2. If Company B decided to switch depreciation…
- Un Company sold office equipment with a cost of $42,880 and accumulated depreciation of $39,583 for $5,010. Required What is the book value of the asset at the time of sale? What is the amount of gain or loss on the disposal? How would the sale affect net income (increase, decrease, no effect) and by how much? How would the sale affect the amount of total assets shown on the balance sheet (increase, decrease, no effect) and by how much? How would the event affect the statement of cash flows (inflow, outflow, no effect) and in what section?State whether if the statement is TRUE or FALSE 1.Lower of cost and net realizable value gives the lowest valuation if applied to individual item of inventory. 2.Professional fee arising directly from the acquisition of property and equipment are recognized as expense immediately. 3.The asset is cash or cash equivalent to settle a liability for more than twelve months after the reporting period is classify as current assets. 4.An excess of equity over current assets is equal to liabilities. 5.An asset is not depreciated if the fair value exceed the carrying amount. 6.Exchange has a commercial substance when the exchange result in the difference in future cash flows. 7.LCNRV should always be equal to net realizable value. 8.The amount of writedown of inventory to net realizable value and all losses of inventory should be recognized ad operating expense in the period the writedown or loss occurs. 9.The cost of abnormal anounts of wated materials is not included in the cost of self…Depreciation for a prior period was incorrectly understated by $950,000. The error was discovered in the current year. what section of the income statement or retained earnings statement these items should be classified. Provide a brief rationale for your position.