solve question c, please Presented below are four different transactions related to materiality. Explain whether you would classify these transactions as material.c. Manion Corp. expenses all capital equipment under $10,000 on the basis that it is immaterial. The company has followed this practice for a number of years.

Most of the companies and the auditors has made the rule that any item which is under 5% of net…

Answered: Presented below are four different…

Principles of Accounting Volume 1

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ISBN:9781947172685

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Chapter11: Long-term Assets

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Problem 2EA: Jada Company had the following transactions during the year: Purchased a machine for $500,000 using...

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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 extraordinary repairs If all transactions were recorded properly, what amount did Jada capitalize for the year, and what amount did Jada 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?
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 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 extraordinary repairs Depreciation expense recorded for the year is $15,000. If all transactions were recorded properly, what is the amount of increase to the Property, Plant, and Equipment section of Johnsons balance sheet resulting from this years transactions? What amount did Johnson report on the income statement for expenses for the year?
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?
For each of the following transactions, state whether the cost would be capitalized (C) or recorded as an expense (E). A. Purchased a machine, $100,000; gave long-term note B. Paid $600 for ordinary repairs C. Purchased a patent for $45,300 cash D. Paid $200,000 cash for addition to old building E. Paid $20,000 for monthly salaries F. Paid $250 for routine maintenance G. Paid $16,000 for major repairs
Ross Company is a C corporation providing property management services. Ross has used the cash method since inception because its gross receipts did not exceed $26,000,000. This year its average annual gross receipts for the prior three years crossed the $26,000,000 mark, requiring Ross to change from the cash method to the accrual method (per § 448). At the end of its prior year, Ross had accounts receivable of $850,000 and accounts payable of $540,000. a.Compute and explain the adjustment to taxable income that Ross must make due to the change in accounting method. b.When must Ross include this adjustment in its income?
Jada Company had the below transactions during the year. If all transactions were recorded properly, what amount did Jada capitalize for the year, and what amount did Jada expense for 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 extraordinary repairs
Jada Company had the following transactions during the year. If all transactions were recorded properly, determine whether each transaction is capitalized or expensed. Choose: capitalized or expensed for 1-10. 1. Purchased a machine for $500,000 using a long-term note to finance it. [ Select ]["expensed", "capitalized"] 2. Paid $500 for ordinary repair. [ Select ]["expensed", "capitalized"] 3. Purchased a patent for $45,000 cash. [ Select ]["expensed", "capitalized"] 4. Paid $200,000 cash for addition to an existing building. [ Select ]["expensed", "capitalized"] 5. Paid $60,000 for monthly salaries. [ Select ]["expensed", "capitalized"] 6. Paid $2,500 for routine maintenance on equipment. [ Select ]["expensed", "capitalized"] 7. Paid $10,000 for extraordinary repairs. [ Select ]["expensed", "capitalized"] 8. Paid shipping of $1,000 to get the machine to the business. [ Select ]["expensed", "capitalized"] 9. Paid installation fees for the machine of…
For each of the following situations, state whether you agree or disagree with the financial reporting practiceemployed, and briefly explain the reason for your answer.1. The controller of the Dumars Corporation increased the carrying value of land from its original cost of$2 million to its recently appraised value of $3.5 million.2. The president of Vosburgh Industries asked the company controller to charge miscellaneous expense for thepurchase of an automobile to be used solely for personal use.3. At the end of its 2018 fiscal year, Dower, Inc., received an order from a customer for $45,350. The merchandise will ship early in 2019. Because the sale was made to a long-time customer, the controller recorded thesale in 2018.4. At the beginning of its 2018 fiscal year, Rossi Imports paid $48,000 for a two-year lease on warehouse space.Rossi recorded the expenditure as an asset to be expensed equally over the two-year period of the lease.
Compute for total assets if the owner's initial contribution for opening a business is P150,000. Three months later, he made an additional investment of P200,000. During the 2nd quarter of the fiscal year, the business spent P100,000 to buy equipment for the business. Within the normal operations of the business, total revenues amounted to P500,000. The business did not incur any present obligations.
Given the following situation, Please classify into Current assets, Non-current assets, current liability and non-current liability - Inventories £6,000 was purchased on credit. and £5,000 was purchased for cash- Bank Loan of £1,000 full amount paid back during the year - The owners withdraw capital in the form of cash £10,000 - trade payables total £10,000 -And total wage of year is £20000 was paid in cash, but the end of year business found out £2000 of the wage for the last month not be paid
. Discuss the appropriate treatment in the financial statements of each of the following. a. Gain on sale of investment securities. b. A profit-sharing bonus to employees computed as a percentage of net income. c. Additional depreciation on factory machinery because of an error in computing depreciation for the previous year. d. Rent received from subletting a portion of the office space. e. A patent infringement suit, brought 2 years ago against the company by another company, was settled this year by a cash payment of $725,000. f. A reduction in the Allowance for Doubtful Accounts balance because the account appears to be considerably in excess of the probable loss from uncollectible receivables.

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Presented below are four different transactions related to materiality. Explain whether you would classify these transactions as material. c. Manion Corp. expenses all capital equipment under $10,000 on the basis that it is immaterial. The company has followed this practice for a number of years.