The plant manager of a manufacturing firm suggested in a conference of the company's executives that accountants should speed up depreciation on the machinery in the finishing department because improvements were rapidly making those machines obsolete, and a depreciation fund big enough to cover their replacement is needed. Discuss the accounting concept of depreciation and the effect on a business concern of the depreciation recorded for plant assets, paying particular attention to the issues raised by the plant manager.
Q: Ski West, Incorporated, operates a downhill ski area near Lake Tahoe, California. An all-day adult…
A: As per dual concept of accounting, every transaction has a dual impact on the books of…
Q: Summary information for a company's accounts receivable is provided below. Accounts receivable…
A: Allowance for uncollectible accountsThe amount of accounts receivable that a business anticipates…
Q: Raleigh Company has the following products in its ending inventory. Compute the lower t or market…
A: Inventory Method -The Lower Of Cost Or Market Is An Inventory Costing Method That Values Inventory…
Q: Parent Corporation acquired an 80% interest in Sub Corporation for $380,000 on January 1, 20X4 when…
A: Goodwill is the excess of cost over the fair value of identifiable net assets acquired. In this…
Q: Leanne Alstead opened a law firm by investing €12,500 cash and office furniture valued at €7,600.…
A: The T account is a T-shaped account and it is a summary account showing all the transactions of an…
Q: b. Assume that Tom and Mason are in the 24% marginal tax bracket and the actual before-tax cost for…
A: Commuting expenses include the costs of driving a car or paying fees to commute by bus, trolley,…
Q: s of its produc Actual fixed costs of $44,000 exceeded budgeted fixed costs by $3,500. Prepare…
A: The flexible budget is prepared for actual production level on the basis of the standard rates. The…
Q: M4 Engineering has just hired a new controller, Joan Miller. During her first week on the job, Joan…
A: A budgeting strategy refers to a structured and planned approach used by individuals, businesses, or…
Q: On July 31, the end of the first month of operations, Rhys Company prepared the following income…
A: To prepare a variable costing income statement, we need to separate fixed and variable costs.…
Q: McNeil, inc manufactures and sells guitars. During June, McNeil started and completed the production…
A: FInancial statements are those statements which are prepared at the end of accounting period. The…
Q: In 2020, Lake would recognize realized gross profit of:
A: The cost recovery method is used by the company on the installment sales in which the primary focus…
Q: 0 to 30 31 to 60 61 to 90 Over 90 Instructions % Estimate of Uncollectable 1% 6% 7% 25% Amount…
A: Accounts receivables are those customer accounts to whom business has made credit sales on account…
Q: The following ordinary shares details relate to Mizuri company for the year ending 2019 Kshs. ‘000’…
A: EPS stands for earnings per share. The earnings per share is calculated as net income divided by the…
Q: Income Statements under Absorption Costing and Variable Costing Gallatin County Motors Inc.…
A: The income statement is one of the financial statements of the business that tells about the…
Q: Hedging a Forecasted Sale Transaction On December 10, 2023, Daisy Foods, a U.S. company, anticipates…
A: The spot rate, also known as the "spot exchange rate" or simply "exchange rate," is the current…
Q: The terms and conditions of employment with the SM Inc. include entitlement to share in the staff…
A: There is a legal obligation to allocate profits to the bonus pool. An allocation should be made at…
Q: On January 2, 2025, Abrams Falls Inc. issued $30 million 9% bonds due in 2045 at 102. With each…
A: An official accounting record known as a journal entry is used to document financial transactions in…
Q: axpayer had AGI of $60,000 in year 1. During the same year, the taxpayer incurred $10,000 in…
A: Medical expenses are one of the most common itemized deductions that taxpayers claim on their tax…
Q: questions displayed below] Charles has AGI of $47,000 and has made the following payments related to…
A: The amount of tax deducted from AGI is the sum of Country real estate tax on the land, and School…
Q: Baker is planning to issue 10 year bonds with a 7% coupon, interest to be paid semiannually. The…
A: Bonds refer to high-security debt instruments that enable an entity to raise funds and fulfil…
Q: On June 13, the board of directors of Siewert Inc. declared a 2-for-1 stock split on its 80 million,…
A: Journal entries are the primary reporting of the business transactions in the books of accounts.…
Q: Select ALL the possible causes of an unfavorable direct labor rate variance. Talk of concessions by…
A: The direct labor rate variance is a measure that compares the actual labor rate paid to workers with…
Q: Fact Pattern: Tiny Tykes Corporation had the following activity relating to its fixed and variable…
A: The Fixed Overhead Efficiency Variance, a part of variance analysis in cost accounting, calculates…
Q: Required Information [The following information applies to the questions displayed below.] Raphael…
A: Par Value is that per share value of the shares issued by the organization. Company issued shares at…
Q: You were engaged in the audit of Pelton Company as of December 31, 2021. The company is on a…
A: These are the journal entries that are required to be prepared by a company to prepare its…
Q: Barbara Altidore invested $10,000 at 7% annual interest, and left the money invested without…
A: Time value of money is one of useful concept being used in finance. It says that a sum of amount…
Q: Benton Company (BC), a calendar year entity, has one owner, who is in the 37% Federal income tax…
A: A proprietorship, often known as a sole proprietorship, is a type of business organization where a…
Q: On January 1, 20X1, Novak, Inc., enters into an interest rate swap and agrees to receive fixed and…
A: An agreement between two parties for financial exchange, of cash flows or liabilities from two…
Q: Prepare journal entries for the following wages and accruals of Bages Limited. Employees earned…
A: Payroll expenses refer to the amount of expenses a firm has to incur for the salary and wages of the…
Q: Pritchett Company reported the following year-end data: $ 20,500 7,100 12,700 Cash Short-term…
A: Current Ratio: The Current Ratio is a financial metric used to assess a company's short-term…
Q: 00 The Mighty Music Company produces and sells a desktop speaker for $170. The company has the…
A: Unit level costs are incurred on each additional unit produced in company. This is also known as…
Q: The standard costs and actual costs for factory overhead for the manufacture of 2,800 units of…
A: The fixed overhead volume variance refers to the difference between the amount of money that was…
Q: (4: On Sep.1, 2010 Bros Company purchased 10000 of Handle production Ins., %9 bonds face value 100 $…
A: A bond is a type of fixed-income security that simulates a loan from an investor to a borrower…
Q: Excavator Ltd had two areas of interest, Site A and Site B. The following costs were incurred to…
A: The cost that is incurred in the exploration of the process and the cost that is related to the…
Q: On January 1, 2023, Sandhill Ltd. acquires a building at a cost of $280,000. The building is…
A: According to the question given, we need to prepare the journal entries of the company.Journal…
Q: If a firm has retained earnings of $3.7 million, a common shares account of $5.7 million, and…
A: The stock dividend can be defined as a payment of dividends by issuing additional shares of common…
Q: Mo Burrow owns a 25% interest in Bengal LLC. On December 31, 2021, Mo Burrow's basis in the LLC is…
A: It is the increase or decrease in the value of an asset at a given date or time in comparison to its…
Q: Carmen is a retailer of scrapbooking products. The sales forecast for the coming months is: April…
A: Cash payments and cash receipts in budgeting means the estimated cash to be paid or received by the…
Q: The Tacurong Company has the following business income and expenses in year 2020: Gross Income…
A: An individual or entity's income from holding shares or stocks of a firm that pays dividends is…
Q: Presented below is information related to Dino Radja Company. Date December 31, 2022 December 31,…
A: LIFO stands for Last In First Out. The ending inventory is sold out and newer inventory is left in…
Q: Calculate the Dollar Market Share for BMW and Lexus for each year shown below: 2009 2010 Annual Car…
A: Market share is the percentage of sales or revenue that a company or brand generates in a particular…
Q: the following financial statements Assets Cash STREAMLINE INCORPORATED Comparative Balance Sheets…
A: One of the three crucial financial statements that firms employ to provide customers with a complete…
Q: Prepare an acquisition-date consolidated balance sheet for Casey Corporation and its subsidiary…
A: Consolidated Balance sheet: Consolidated balance sheet refers to the balance sheet prepared from the…
Q: Sulzer Sdn Bhd has the following information for the year ending 31 December 2021. RM 213,500…
A: Cash flow statement is the financial statement that records all the cash inflow and cash outflow…
Q: Problem 6-4A (Algo) Report inventory using lower of cost and net realizable value (LO6-6) a local…
A: Under inventory valuation we value inventory as cost or net realisable value which ever is lower.…
Q: The Kwok Company's inventory balance on December 31, 2016, was $245,000 (based on a 12/31/16…
A: For FOB shipping terms, the goods belong to buyer as soon as goods are shipped by the supplier.For…
Q: Richard is the
A: Reciprocal method The reciprocal method is the most accurate method compared to other cost…
Q: During Heaton Company's first two years of operations, it reported absorption costing net operating…
A: Using variable costing, only variable manufacturing costs are treated as product cost. The fixed…
Q: Accounts Receivable Analysis The following data are taken from the financial statements of Sigmon…
A: The account receivables turnover is calculated as net sales divided by the average account…
Q: (R) The balance sheet elimination for an intercompany profit in land involves the deduction of the…
A: The Balance sheet, also known as the statement of financial position, is one of the three primary…
Please provide with the relevant website for your content, such as Investopedia, and accounting tools.com, to answer this question. I need to see where recourse comes from.
The plant manager of a manufacturing firm suggested in a conference of the company's executives that accountants should speed up
Step by step
Solved in 3 steps
- The plant manager of a manufacturing firm suggested in a conference of the company’s executives that accountants should speed up depreciation on the machinery in the finishing department because improvements were rapidly making those machines obsolete, and a depreciation fund big enough to cover their replacement is needed. Discuss the accounting concept of depreciation and the effect on a business concern of the depreciation recorded for plant assets, paying particular attention to the issues raised by the plant manager.Jade Ltd is now considering how to obtain a computer software. The director of Jade Ltd has noticed that over the last 20 years, many companies have spent a great deal of money internally developing new intangible assets, such as software. You have been asked by the director to provide your advice on the accounting treatments of the two possibilities below: (i) Employ its own programmers to write software that the company will use (ii) Purchase computer software externally, including packages for payroll and general ledger. Required: In accordance with IAS 38 / AASB 138 Intangible Assets, discuss whether internally developed intangible assets should be recognised, and explain the differ in the accounting treatments for the two possible options.Suppose that you have been given a summer job as an intern at Issac Aircams, a company that manufacturessophisticated spy cameras for remote-controlled military reconnaissance aircraft. The company, which isprivately owned, has approached a bank for a loan to help it finance its growth. The bank requires financialstatements before approving such a loan. You have been asked to help prepare the financial statements andwere given the following list of costs:1. Depreciation on salespersons’ cars.2. Rent on equipment used in the factory.3. Lubricants used for machine maintenance.4. Salaries of personnel who work in the finished goods warehouse.5. Soap and paper towels used by factory workers at the end of a shift.6. Factory supervisors’ salaries.7. Heat, water, and power consumed in the factory.8. Materials used for boxing products for shipment overseas. (Units are not normally boxed.)9. Advertising costs.10. Workers’ compensation insurance for factory employees.11. Depreciation on chairs…
- Suppose that Demont has been given a summer job as an intern at Isaac Aircams, a company that manufactures sophisticated spy cameras for remote-controlled military reconnaissance aircraft. The company, which is privately owned, has approached a bank for a loan to help it finance its growth. The bank requires financial statements before approving such a loan. Classify each cost listed below as either product costs or period costs for the purpose of preparing the financial statements for the bank. Costs Product Cost/Period Cost 1. Depreciated on salesperson's cars 2. Rent on equipment used in the factory 3. Lubricants used for machine maintenance 4. Salaries of personnel who work in the finished goods warehouse 5. Soap and paper towels used by factory workers at the end of a shiftSuppose that you have been given a summer job as an intern at Issac Aircams, a company that man- ufactures sophisticated spy cameras for remote-controlled military reconnaissance aircraft. The company, which is privately owned, has approached a bank for a loan to help it finance its growth. The bank requires financial statements before approving such a loan. You have been asked to help prepare the financial statements and were given the following list of costs: Depreciation on salespersons’ cars. Rent on equipment used in the factory. Lubricants used for machine maintenance. Salaries of personnel who work in the finished goods warehouse. Soap and paper towels used by factory workers at the end of a shift. Factory supervisors’ salaries. Heat, water, and power consumed in the factory. Materials used for boxing products for shipment overseas. (Units are not normally boxed.) Advertising costs. Workers’ compensation insurance for factory employees. Depreciation on…Suppose that Demont has been given a summer job as an intern at Isaac Aircams, a company that manufactures sophisticated spy cameras for remote-controlled military reconnaissance aircraft. The company, which is privately owned, has approached a bank for a loan to help it finance its growth. The bank requires financial statements before approving such a loan. Classify each cost listed below as either product costs or period costs for the purpose of preparing the financial statements for the bank. Cost Product Cost/Period Cost1. Depreciation on chairs and tables in the factory lunchroom 2. The wages of the receptionist in the administrative offices 3. Cost of leasing the corporate jet used by the company's executives 4. The cost of renting rooms at a Florida resort for the annual sales conference 5. The cost of packaging the company's product
- The CEO of the Baker Inc, wants to implement a new accounting system, to improve work flow through the company’s sales, cash receipts, accounts payable, and cash disbursement procedures. The CEO is, however, concerned about the potential disruption that the implementation will have on operations. In an announcement letter to Baker’s employees, the CEO stated that: “I have contracted Flybynight Consulting Group to do the needs analysis, system selection, and design work. The programming and implementation will be performed in-house using existing IT department staff. The development process will be unobtrusive to user departments because Flybynight knows what needs to be done. They will work independently, in the background, and will not disrupt departmental and internal audit work flow with time consuming interviews, surveys, and questionnaires. This promises to be an efficient process that will produce a system that will be appreciated by all users.” Required: Draft a memo from George…Suppose that you have been given a summer job as an intern at Issac Aircams, a company that manufactures sophisticated spy cameras for remote-controlled military reconnaissance aircraft. The company, which is privately owned, has approached a bank for a loan to help finance its growth. The bank requires financial statements before approving the loan. Required: Classify each cost listed below as either a product cost or a period cost for the purpose of preparing financial statements for the bank. Costs Product Cost / Period Cost 1. Depreciation on salespersons’ cars. 2. Rent on equipment used in the factory. 3. Lubricants used for machine maintenance. 4. Salaries of personnel who work in the finished goods warehouse. 5. Soap and paper towels used by factory workers at the end of a shift. 6. Factory supervisors’ salaries. 7. Heat, water, and power consumed in the factory. 8. Materials used for boxing products for shipment overseas. (Units are…Consider yourself the financial controller of Alpha. The managing director, who is not an accountant, has recently attended a seminar and has raised the following questions for you concerning issues discussed at the seminar:The notes to the financial statements say that plant and equipment is held under the ‘cost model’. However, property which is owner occupied is revalued annually to fair value. Changes in fair value are sometimes reported in profit or loss but usually in ‘other comprehensive income’. Please explain how all these treatments comply with relevant reporting standards. The manager director also added “I wonder how the revaluation model can affect the information relevancy and reliability”
- Consider yourself the financial controller of Alpha. The managing director, who is not an accountant, has recently attended a seminar and has raised the following questions for you concerning issues discussed at the seminar: The notes to the financial statements say that plant and equipment is held under the ‘cost model’. However, property which is owner occupied is revalued annually to fair value. Changes in fair value are sometimes reported in profit or loss but usually in ‘other comprehensive income’. Please explain how all these treatments comply with relevant reporting standards. The manager director also added “I wonder how the revaluation model can affect the information relevancy and reliability”. Required: Provide answers to the queries raised. You should justify your answers with reference to relevant IFRS Standards and academic literature.Consider yourself the financial controller of Alpha. The managing director, who is not an accountant, has recently attended a seminar and has raised the following questions for you concerning issues discussed at the seminar: The notes to the financial statements say that plant and equipment is held under the ‘cost model’. However, property which is owner occupied is revalued annually to fair value. Changes in fair value are sometimes reported in profit or loss but usually in ‘other comprehensive income’. Please explain how all these treatments comply with relevant reporting standards. The manager director also added “I wonder how the revaluation model can affect the information relevancy and reliability”.Matt Holmes recently joined Klax Company as a staff accountant in the controller’s office. Klax Company provides warehousing services for companies in several midwestern cities. The location in Dubuque, Iowa, has not been performing well due to increased competition and the loss of several customers that have recently gone out of business. Matt’s department manager suspects that the plant and equipment may be impaired and wonders whether those assets should be written down. Given the company’s prior success, this issue has never arisen in the past, and Matt has been asked to conduct some research on this issue. Instructions If your school has a subscription to the FASB Codification, log in and prepare responses to the following. Provide Codification references for your responses. a. What is the authoritative guidance for asset impairments? Briefly discuss the scope of the standard (i.e., explain the types of transactions to which the standard applies). b. Give several examples of…