College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
expand_more
expand_more
format_list_bulleted
Question
Chapter 21, Problem 6SEA
To determine
Journalize the appropriation of the
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
On October 2, 20-1, the board of directors of Foxworth Company appropriated $80,000 of retained earnings for the purpose of buying a new sailboat (used for entertaining clients). On July 15, 20-2, the sailboat was purchased and the board of directors decided that the appropriation was no longer needed.
Prepare journal entries for the appropriation on October 2, 20-1, and the subsequent return on July 15, 20-2.
Prepare the journal entry for the following transaction.
Apr. 15
Last year, Titan Corporation's board of directors appropriated $150,000 for the purchase of a new storage facility over a three-year period. This year's appropriation for $50,000 was made on this date.
If an amount box does not require an entry, leave it blank.
Interest During Construction
Matrix Inc. borrowed $1,000,000 at 8% to finance the construction of a new building for its own use. Construction began on January 1, 2019, and was completed on October 31, 2019. Expenditures related to this building were:
January 1
$252,000
(includes cost of purchasing land of $150,000)
May 1
310,000
July 1
420,000
October 31
276,000
In addition, Matrix had additional debt (unrelated to the construction) of $500,000 at 9% and $800,000 at 10%. All debt was outstanding for the entire year.
1. Compute the amount of interest capitalized related to the construction of the building.
2.If the expenditures are assumed to have been incurred evenly throughout the year:a. Compute weighted average accumulated expenditures
b. Compute the amount of interest capitalized on the building
Chapter 21 Solutions
College Accounting, Chapters 1-27
Ch. 21 - Income taxes are a unique expense of the corporate...Ch. 21 - Prob. 2TFCh. 21 - Prob. 3TFCh. 21 - Prob. 4TFCh. 21 - Prob. 5TFCh. 21 - Prob. 1MCCh. 21 - Prob. 2MCCh. 21 - Prob. 3MCCh. 21 - Prob. 4MCCh. 21 - Prob. 5MC
Ch. 21 - Prob. 1CECh. 21 - Prob. 2CECh. 21 - Teway Company declared and paid dividends in the...Ch. 21 - Prob. 4CECh. 21 - Prob. 5CECh. 21 - Prob. 1RQCh. 21 - Prob. 2RQCh. 21 - Prob. 3RQCh. 21 - Prob. 4RQCh. 21 - Prob. 5RQCh. 21 - Prob. 6RQCh. 21 - Prob. 7RQCh. 21 - Prob. 8RQCh. 21 - Prob. 9RQCh. 21 - Prob. 10RQCh. 21 - Prob. 11RQCh. 21 - CORPORATE INCOME TAX Stanton Company estimates...Ch. 21 - CLOSING INCOME SUMMARY AND DIVIDENDS TO RETAINED...Ch. 21 - Prob. 3SEACh. 21 - STOCK DIVIDENDS Kaufman Company currently has...Ch. 21 - STOCK SPLIT Goldstein Company has 100,000 shares...Ch. 21 - Prob. 6SEACh. 21 - STATEMENT OF RETAINED EARNINGS McGregor Company...Ch. 21 - Prob. 8SPACh. 21 - Prob. 9SPACh. 21 - Prob. 10SPACh. 21 - Prob. 11SPACh. 21 - Prob. 1SEBCh. 21 - CLOSING INCOME SUMMARY AND DIVIDENDS TO RETAINED...Ch. 21 - COMMON AND PREFERRED CASH DIVIDENDS Ramirez...Ch. 21 - STOCK DIVIDENDS Martinez Company currently has...Ch. 21 - Prob. 5SEBCh. 21 - Prob. 6SEBCh. 21 - Prob. 7SEBCh. 21 - Prob. 8SPBCh. 21 - CASH DIVIDENDS, STOCK DIVIDEND, AND STOCK SPLIT...Ch. 21 - Prob. 10SPBCh. 21 - Prob. 11SPBCh. 21 - Prob. 1MYWCh. 21 - Prob. 1ECCh. 21 - MASTRY PROBLEM On January 1, 20--, Dover Companys...Ch. 21 - CHALLENGE PROBLEM This problem challenges you to...
Knowledge Booster
Similar questions
- Interest During Construction Matrix Inc. borrowed $1,000,000 at 8% to finance the construction of a new building for its own use. Construction began on January 1, 2019, and was completed on October 31, 2019. Expenditures related to this building were: January 1 $252,000 (includes cost of purchasing land of $150,000) May 1 310,000 July 1 450,000 October 31 280,000 In addition, Matrix had additional debt (unrelated to the construction) of $500,000 at 9% and $800,000 at 10%. All debt was outstanding for the entire year. Required: Compute the amount of interest capitalized related to the construction of the building. $ If the expenditures are assumed to have been incurred evenly throughout the year:Compute weighted average accumulated expenditures $ Compute the amount of interest capitalized on the building $arrow_forwardConcord Corporation is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $6490000 on March 1, $5270000 on June 1, and $8250000 on December 31. Concord Corporation borrowed $3180000 on January 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 3-year, $6350000 note payable and an 11%, 4-year, $11950000 note payable.What is the weighted-average interest rate used for interest capitalization purposes? 10.85% 10.50% 11.00% 10.65%arrow_forwardInterest During Construction Matrix Inc. borrowed $1,000,000 at 8% to finance the construction of a new building for its own use. Construction began on January 1, 2019, and was completed on October 31, 2019. Expenditures related to this building were: January 1 $252,000 (includes cost of purchasing land of $150,000) May 1 320,000 July 1 450,000 October 31 275,000 In addition, Matrix had additional debt (unrelated to the construction) of $500,000 at 9% and $800,000 at 10%. All debt was outstanding for the entire year. Required: Compute the amount of interest capitalized related to the construction of the building. $fill in the blank If the expenditures are assumed to have been incurred evenly throughout the year:Compute weighted average accumulated expenditures $fill in the blank Compute the amount of interest capitalized on the building $fill in the blankarrow_forward
- Prepare the journal entry for the following transaction. Apr. 15 Last year, Titan Corporation's board of directors appropriated $150,000 for the purchase of a new storage facility over a three-year period. This year's appropriation for $50,000 was made on this date. arrow_forwardSheffield Corp. is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $6470000 on March 1, $5340000 on June 1, and $7950000 on December 31. Sheffield Corp. borrowed $3250000 on January 1 on a 5-year, 10% note to help finance construction of the building. In addition, the company had outstanding all year a 8%, 3-year, $6450000 note payable and an 9%, 4-year, $12350000 note payable. What is the weighted-average interest rate used for interest capitalization purposesarrow_forwardOn January 1, 20--, MacMillan Company's retained earnings accounts had the following balances: Appropriated for warehouse $ 80,000 Unappropriated retained earnings 600,000 $ 680,000 During the year ended December 31, 20--, MacMillan completed the following selected transactions: Mar. 16 MacMillan’s board of directors appropriated $75,000 for acquisition of new computers. Nov. 5 Purchased a new warehouse for $80,000, paying cash for the total amount. 5 The board of directors returned the amount of retained earnings set aside for the warehouse to unappropriated retained earnings. 12 Declared a cash dividend of $0.65 per share on common stock to shareholders of record on December 8, payable on December 19. Currently, 30,000 shares of common stock are outstanding. Dec. 19 Paid the cash dividends.arrow_forward
- Bonita Industries is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $6440000 on March 1, $5260000 on June 1, and $8850000 on December 31. Bonita Industries borrowed $3190000 on January 1 on a 5-year, 11% note to help finance construction of the building. In addition, the company had outstanding all year a 9%, 3-year, $6440000 note payable and an 10%, 4-year, $12650000 note payable.What are the weighted-average accumulated expenditures? $9860000 $20550000 $8435000 $11700000arrow_forwardCox Construction, a company in its 10th year of business, purchased a piece of equipment on April 1, year 9, for 20,000. Cox has used it for business purposes since the initial purchase date. The company depreciated the equipment using the MACRS half-year table for 5-year assets. For tax purposes, what is the amount of accumulated depreciation expense for the equipment as of December 31, year 10? a. 6,000 b. 10,400 c. 11,600 d. 12,800arrow_forwardStock transaction for corporate expansion Pulsar Optics produces medical lasers for use in hospitals. The accounts and their balances appear in the ledger of Pulsar Optics on April 30 of the current year as follows: At the annual stockholders meeting on August 5, the board of directors presented a plan for modernizing and expanding plant operations at a cost of approximately 9,000,000. The plan provided (a) that the corporation borrow 1,500,000, (b) that 20,000 shares of the unissued preferred stock be issued through an underwriter, and (c) that a building, valued at 4,150,000, and the land on which it is located, valued at 800,000, be acquired in accordance with preliminary negotiations by the issuance of 300,000 shares of common stock. The plan was approved by the stockholders and accomplished by the following transactions: Instructions Journalize the entries to record the October transactions.arrow_forward
- On January 01, 2021 Commission on Audit purchased an item of equipment for P550,000. The purchase price was funded by raising a loan of P 605,000 (including 5,000 loan raising fees). The loan is secured against the equipment. In January 2021, COA incurred costs of P 20,000 in transporting the equipment to the entity’s site and P 100,000 in installing the equipment at the site. At the end of the equipment’s 5-year useful life the entity is required to dismantle the equipment and restore the land upon which the factory is built. The present value of the cost of dismantling the equipment and restoring the environment is estimated to be P100,000. COA’s engineer incurred material cost, P55,000 and labor cost, P65,000 in modifying the equipment so that it can produce the government forms needed by Management. The equipment was ready for use on March 01, 2021. However, because of low initial production levels the entity incurred a loss of P23,000 on operating the equipment during March.…arrow_forwardEntity A publishes quarterly interim financial reports. Entity A’s annual depreciation for items of PPE is P120,000. At the end of the first quarter, Entity A’s inventories have a cost of P600,000 and a net realizable value of P510,000. Entity A expects that the total employee bonuses (13th month pay) that will be paid at year-end will amount to P60,000. How much is the total amount of expense to be recognized from the items described above in Entity A’s first quarter statement of profit or loss?arrow_forwardPROBLEM 4 An entity grants 100 cash share appreciation rights (SARs) to each of its 500 employees, on conditions that the employees remain in its employ for the next three years. During Year 1, 35 employees leave. The entity estimates that a further 60 will leave during Years 2 and 3. During Year 2, 40 employees leave and the entity estimates that a further 25 will leave during Year 3. During Year 3, 22 employees leave. At the end of Year 3, 150 employees exercise their SARs, another 140 exercise their SARs at the end of Year 4 and the remaining 113 employees exercise their SARs at the end of Year 5. The entity estimates the fair value of the SARs at the end of each year in which a liability exists as shown below. At the end of Year 3, all SARs held by the remaining employees vest. The intrinsic values of the SARs at the date of exercise, which equal the cash paid out) at the end of Years 3, 4 and 5 are also shown below. Year Fair Value Intrinsic Value 1 P 14.40 2…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- College Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENTFinancial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
College Accounting, Chapters 1-27
Accounting
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:Cengage Learning,
Individual Income Taxes
Accounting
ISBN:9780357109731
Author:Hoffman
Publisher:CENGAGE LEARNING - CONSIGNMENT
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,