Advanced Financial Accounting
12th Edition
ISBN: 9781259916977
Author: Christensen, Theodore E., COTTRELL, David M., Budd, Cassy
Publisher: Mcgraw-hill Education,
expand_more
expand_more
format_list_bulleted
Question
Chapter 13, Problem 13.3.10E
To determine
Introduction: Interim reporting is made in between the fiscal year. It is made before the completion of fiscal year in mostly public corporation for taking various decisions for the remaining period. Mostly quarterly and half yearly report is prepared.
To choose: The correct answer.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
3. On December 1, 2021, Violet Company committed to a plan to dispose of the assets of a business component. The disposal meets the requirements to be classified as discontinued operation. On that date, the entity estimated that the loss from the disposition of the assets would be P700,000 and the component’s operating income was P200,000. What amount of pretax loss should be reported for discontinued operation for 2021?
A. 900,000
B. 700,000
C. 200,000
D. 500,000
E. None of them
7. Karen Company purchased a varnishing machine for P3,000,000 on January 1, 2019. The entity received a government grant of P500,000 in respect of this asset. The accounting policy is to depreciate the asset over 4 years on a straight line basis and to treat the grant as deferred income. How much deferred income from the government grant will be presented in the statement of financial position for 2019?
Under IFRS 15, assuming the outcome of construction can be estimated reliably, what is the realized gross loss to be recognized by MDC for the year ended December 31, 20x22?
On July 1, 20x31, Torela Company, a construction company, entered into a contract to construct a commercial building for a customer on customer-owned land for promised consideration of P1,000,000 and a bonus of P200,000 if the building is completed within 24 months. An inception date, the entity expects total construction costs of P700,000 to complete the building. The entity accounts for the promised bundle of goods and services as a single performance obligation satisfied over time in accordance with paragraph IFRS 15 because the customer controls the building during construction. At contract inception, the entity cannot conclude that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur with respect to inclusion of bonus to contract price. Completion…
Chapter 13 Solutions
Advanced Financial Accounting
Ch. 13 - Prob. 13.1QCh. 13 - Prob. 13.2QCh. 13 - What are the three 10 percent significance tests...Ch. 13 - Prob. 13.4QCh. 13 - A company has 10 industry segments, of which the...Ch. 13 - Prob. 13.6QCh. 13 - Prob. 13.7QCh. 13 - Prob. 13.8QCh. 13 - Prob. 13.9QCh. 13 - Prob. 13.10Q
Ch. 13 - Prob. 13.11QCh. 13 - Prob. 13.12QCh. 13 - Prob. 13.13QCh. 13 - Prob. 13.14QCh. 13 - Maness Company made a change in accounting for its...Ch. 13 - Prob. 13.1CCh. 13 - Prob. 13.2CCh. 13 - Prob. 13.3CCh. 13 - Prob. 13.7CCh. 13 - Prob. 13.8CCh. 13 - Prob. 13.9CCh. 13 - Reportable Segments Data for the seven operating...Ch. 13 - Prob. 13.2.1ECh. 13 - Prob. 13.2.2ECh. 13 - Prob. 13.2.3ECh. 13 - Prob. 13.2.4ECh. 13 - Prob. 13.2.5ECh. 13 - Prob. 13.2.6ECh. 13 - Prob. 13.2.7ECh. 13 - Prob. 13.2.8ECh. 13 - Prob. 13.2.9ECh. 13 - Prob. 13.2.10ECh. 13 - Prob. 13.2.11ECh. 13 - Prob. 13.3.1ECh. 13 - Prob. 13.3.2ECh. 13 - Multiple-Choice Questions on Interim Reporting...Ch. 13 - Prob. 13.3.4ECh. 13 - Prob. 13.3.5ECh. 13 - Prob. 13.3.6ECh. 13 - Prob. 13.3.7ECh. 13 - Prob. 13.3.8ECh. 13 - Prob. 13.3.9ECh. 13 - Prob. 13.3.10ECh. 13 - LIFO Liquidation During July, Laesch Company,...Ch. 13 - Inventory Write-Down and Recovery Cub Company, a...Ch. 13 - MutiniedChoice Questions on Income Taxes at...Ch. 13 - Prob. 13.6.2ECh. 13 - Prob. 13.6.3ECh. 13 - MutiniedChoice Questions on Income Taxes at...Ch. 13 - Prob. 13.6.5ECh. 13 - Prob. 13.6.6ECh. 13 - Prob. 13.7ECh. 13 - Prob. 13.8ECh. 13 - Prob. 13.9ECh. 13 - Prob. 13.10ECh. 13 - Prob. 13.11ECh. 13 - Prob. 13.12ECh. 13 - Prob. 13.13PCh. 13 - Prob. 13.14PCh. 13 - Interim Income Statement Chris Inc. has...Ch. 13 - Prob. 13.17PCh. 13 - Prob. 13.20PCh. 13 - Matching Terms Match the items in the left-hand...
Knowledge Booster
Similar questions
- lab Company’s accounting policy with respect to investment properties is to measure them at fair value at the end of each reporting period. One of its investment properties was measured at P8,000,000 on December 31, 2020.The property had been acquired on January 1, 2020 for a total of P7,600,000, made up of P6,900,000 paid to the vendor. P300,000 paid to the local authority as a property transfer tax and P400,000 paid to professional advisers. The useful life of the property is 40 years. What is the gain to be recognized in profit or loss for the year ended December 31, 2020 in respect of the investment property? * P400,000 P590,000 P700,000 P800,000 answer not givenarrow_forwardAs a result of differences between depreciation for financial reporting purposes and tax purposes, the financial reporting basis of Noor Co.’s sole depreciation asset, acquired in 20x1, exceeded its tax basis by P250,000 at December 31, 20x1. This difference will reverse in future years. The enacted tax rate is 30% for 20x1, and 40% for future years. Noor has no other temporary differences. In its December 31, 2001, balance sheet, how should Noor report the deferred tax effect of this difference - Asset (Liability)? a. 75,000 b. (100,000) c. 100,000 d. (75,000)arrow_forward11. On June 30, 2021, Line Company incurred a P100,000 net loss from disposal of a business segment. Also, on June 30, 2021, the entity paid P40,000 for property taxes assessed for 2021. What amount should be included in the determination of net income or loss for the six-month interim period ended June 30, 2021? CHOICES: P140,000 P120,000 P100,000 P90,000arrow_forward
- 1) On January 1, 2020, Harbor Company purchased land and building at a single cost of P20,000,000. On this date, it was determined that the land and building had a fair value of P18,000,000 and P7,000,000 respectively. The entity also incurred legal fees for purchase contract and recording ownership P200,000, and title guarantee insurance P100,000. The entity immediately demolished the building to make way for construction of a new building to be used as owner-occupied. The total contract price and other directly attributable cost to the building amounted to P15,000,000. The entity incurred demolition cost of P350,000. What is the initial cost of the land?arrow_forward3-On July 1, 2019, Captain Company paid $3,000,000 for all of the common stock of Bright Sunshine, Inc. Bright Sunshine’s identifiable net assets had a fair value of $2,850,000 at that date. After acquisition, Bright Sunshine was identified as a reporting unit and the goodwill from the acquisition was assigned to that reporting unit. Required: a. Compute the amount of goodwill, if any, from the acquisition.b. Over the remainder of the year, the new unit experienced significant operating losses, suggesting the need for testing of the goodwill for impairment. The fair value of the reporting unit was estimated to be $2,005,000 at December 31. Bright Sunshine's year-end balance sheet showed net assets of $2,100,000, including the goodwill. The fair value of the identifiable net assets of Bright Sunshine at year-end was $1,920,000. Prepare the required journal entry if you find that goodwill is impaired. Perform the pre-ASU 2017-04 quantitative two-step Goodwill impairment test and make the…arrow_forward2. On January 1, 2019, KRIS KRINGLE Company purchased a ₱600,000 machine, with a five-year useful life and no residual value. The machine was depreciated by an accelerated method for book and tax purposes. The carrying amount was ₱240,000 on December 31, 2020. On January 1, 2021, the entity changed to the straight-line method for financial reporting purposes. The income tax rate is 30%. On January 1, 2021, what amount should be reported as deferred tax liability as a result of the change? ₱ 36,000 ₱ - 0 - ₱ 72,000 ₱ 120,000arrow_forward
- 11. The following differences enter into the reconciliation of financial income and taxable income of Abbott Company for the year ended December 31, 2021, its first year of operations. The enacted income tax rate is 30% for all years. Pretax accounting income - P700,000 Excess tax depreciation - (320,000) Litigation accrual - 70,000 Unearned rent revenue deferred on the books but appropriately recognized in taxable income - 50,000 Interest received on government obligations - (20,000) Taxable income - P480,000 1.Excess tax depreciation will reverse equally over a four-year period, 2022-2025. 2.It is estimated that the litigation liability will be paid in 2025. 3.Rent revenue will be recognized during the last year of the lease, 2025. 4.Interest received on government obligations is expected to be P20,000 each year until their maturity at the end of 2025. Deferred tax asset for the year ended 2021 isarrow_forwardOn October 1, 2021, Loving Company approved a formal plan to sell a businesssegment. The sale will occur on April 1, 2022. The segment’s revenue andexpenses for 2021 were P30,000,000 and P32,000,000, respectively. OnDecember 31, 2021, the carrying amount of the assets of the segment wasP10,000,000 and the fair value less costs of disposal was P9,600,000. Theincome tax rate is 25%. What amount should be reported as income/(loss) fromdiscontinued operation for 2021?arrow_forward9. On January 1, 2005, Paragon Company paid P6,000,000 to acquire a new barge. In the belief that it was entitled to a refund of purchase taxes on the acquisition of the barge, the entity claimed and was refunded P600,000 by the local government. However, in late 2011 the entity repaid the refund when it became apparent that it had made an error in making the claim to the local government as it had not been entitled to the refund of purchase taxes on acquisition of the barge. The useful life of the barge is 15 years from the date of acquisition. The residual value of the barge is NIL. In 2011, the period over which the barge is expected to be economically usable increased from 15 to 26 years. However, the entity expects to dispose of its barge after using it for 20 years from the date of acquisition. On December 31, 2011, the entity assessed the residual value of the barge at P800,000. What is the carrying amount of the barge on December 31, 2011? a. 3,600,000 b. 3,400,000…arrow_forward
- Munoz Corp.'s books showed pretax financial income of $3,600,000 for the year ended December 31, 2021. In the computation of federal income taxes, the following data were considered: Gain on an involuntary conversion $1,560,000 (Munoz has elected to replace the property within the statutory period using total proceeds.) Depreciation deducted for tax purposes in excess of depreciation deducted for book purposes 240,000 Federal estimated tax payments, 2021 200,000 Enacted federal tax rate, 2021 20%What amount should Munoz report as its current federal income tax liability on its December 31, 2021 balance sheet? $208,000 $360,000 $408,000 $160,000arrow_forwardSubject :- Account At the end of 2024, its first year of operations, Blossom Company prepared a reconciliation between pretax financial income and taxable income as follows: Pretax financial income $2,890,000 Estimated litigation expense 3890000 Extra depreciation for taxes (5892000) Taxable income $888,000 The estimated litigation expense of $3890000 will be deductible in 2025 when it is expected to be paid. Use of the depreciable assets will result in taxable amounts of $1964000 in each of the next 3 years. The income tax rate is 20% for all years. The deferred tax asset at the end of 2024 to be recognized isarrow_forwardSubject : Accounting Bre-X Inc.'s only temporary difference at the beginning and end of 2022 is caused by a $1.5-million deferred gain for tax purposes on an installment sale of a plant asset. The related receivable (only one half of which is classified as a current asset) is due in equal instalments in 2023 and 2024. The related deferred tax liability at the beginning of the year is $300,000. In Quarter three (3) of 2022, a new tax rate of 24% is enacted into law and is scheduled to become effective for 2024. Taxable income is expected in all future years. Required: a. Determine the amount to be reported as a deferred tax liability at the end of 2022. Indicate its proper classification(s) if Bre-X Inc. uses ASPE guidelines. b. Indicate the classification of the Deferred Tax Asset or Deferred Tax Liability account if Bre-X Inc. uses IFRS guidelines. c. Prepare the journal entry (if any) that is necessary to adjust the deferred tax liability when the new tax rate is enacted into law.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:9780357109731
Author:Hoffman
Publisher:CENGAGE LEARNING - CONSIGNMENT