Intermediate Accounting
9th Edition
ISBN: 9781259722660
Author: J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 3, Problem 3.3P
• LO3–2, LO3–3
The following is a December 31, 2018, post-closing
Additional Information:
1. The investment account includes an investment in common stock of another corporation of $30,000 which management intends to hold for at least three years. The balance of these investments is intended to be sold in the coming year.
2. The land account includes land which cost $25,000 that the company has not used and is currently listed for sale.
3. The cash account includes $15,000 restricted in a fund to pay bonds payable that mature in 2021 and $23,000 restricted in a three-month Treasury bill.
4. The notes payable account consists of the following:
a. a $30,000 note due in six months
b. a $50,000 note due in six years
c. a $50,000 note due in five annual installments of $10,000 each, with the next installment due February 15, 2019
5. The $60,000 balance in
6. The common stock account represents 100,000 shares of no par value common stock issued and outstanding. The corporation has 500,000 shares authorized.
Required:
Prepare a classified balance sheet for the Almway Corporation at December 31, 2018.
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part C D
QUESTION 1.
You are a financial analyst reviewing the draft financial statements of Speedy Coaches Ltd with a view to purchasing the company and have been given the following information.
Income statements for the year ended 30 June
2021
2020
£'000
£'000
Revenue
32,800
29,459
Cost of sales
(17,855)
(15,840)
Gross profit
14,945
13,619
Operating expenses
(11,680)
(10,477)
Depreciation
(1,198)
(1,063)
Operating profit
2,067
2,079
Interest
(74)
(94)
Profit before taxation
1,993
1,985
Taxation
(634)
(601)
Profit for the year
1,359
1,384
Statements of financial position as at 30 June
2021
2020
£'000
£'000
ASSETS
Non-current assets
Property, plant and equipment
10,300
8,720
Current assets
Inventories
750
701
Trade receivables
597
436
Cash
407
279
1,754…
Q 2 (12 marks) Gideon Corp. is a reinsurance and financial services company. Gideonstrongly believes in evaluating the performance of its stand-alone divisions using financialmetrics such as ROI and residual income. For the year ended December 31, 2019, Gideon’sCFO received the following information about the performance of the property/casualtydivision:Sales Revenues $ 900 000Operating Income 225 000Total Assets 1 500 000Page 2 of 3Current Liabilities 300 000Debt (Interest rate: 5%) 400 000Common Equity (book value) 500 000For the purposes of divisional performance evaluation, Gideon defines investment as totalassets, and income as operating income (that is, income before interest and taxes). The firmpays a flat rate of 25% in taxes on its income.Required:1. What was the net income after taxes of the property/casualty division? (4 marks)2. What was the division’s ROI for the year? (4 marks)3. Based on Gideon’s required rate of return of 8%, what was the property/casualtydivision’s…
Q 39
Question 39
Arthur Company is a construction company. In January, the company purchased an equity investment for $73,500. At year end, the investment had a fair market value of $65,000, Arthur company’s adjusting entry should include a …
Select one:
a. Credit (decrease) to Equity Investments – Balance Sheet account.
b. Credit to Unrealized Loss Income – Income Statement
c. Debit to Loss on Sale of Equity Investment – Income Statement
d. Debit (increase) to Equity Investments – Balance Sheet
Chapter 3 Solutions
Intermediate Accounting
Ch. 3 - Prob. 3.1QCh. 3 - Prob. 3.2QCh. 3 - Define current assets and list the typical asset...Ch. 3 - Prob. 3.4QCh. 3 - Prob. 3.5QCh. 3 - Prob. 3.6QCh. 3 - Describe the common characteristics of assets...Ch. 3 - Prob. 3.8QCh. 3 - Prob. 3.9QCh. 3 - Define the terms paid-in-capital and retained...
Ch. 3 - Disclosure notes are an integral part of the...Ch. 3 - A summary of the companys significant accounting...Ch. 3 - Define a subsequent event.Ch. 3 - Prob. 3.14QCh. 3 - Prob. 3.15QCh. 3 - Prob. 3.16QCh. 3 - Prob. 3.17QCh. 3 - Show the calculation of the following solvency...Ch. 3 - Prob. 3.19QCh. 3 - Prob. 3.20QCh. 3 - (Based on Appendix 3) Segment reporting...Ch. 3 - Prob. 3.22QCh. 3 - Prob. 3.23QCh. 3 - Current versus long-term classification LO32,...Ch. 3 - Balance sheet classification LO32, LO33 The trial...Ch. 3 - Prob. 3.3BECh. 3 - Balance sheet classification LO32, LO33 Refer to...Ch. 3 - Balance sheet classification LO32, LO33 The...Ch. 3 - Balance sheet classification LO32, LO33 You have...Ch. 3 - Balance sheet preparation; missing elements LO32,...Ch. 3 - Financial statement disclosures LO34 For each of...Ch. 3 - Calculating ratios LO38 Refer to the trial...Ch. 3 - Prob. 3.10BECh. 3 - Calculating ratios; solving for unknowns LO38 The...Ch. 3 - Balance sheet; missing elements LO32, LO33, LO38...Ch. 3 - Balance sheet classification LO32, LO33 The...Ch. 3 - Balance sheet classification LO32, LO33 The...Ch. 3 - Balance sheet preparation LO32, LO33 The...Ch. 3 - Balance sheet preparation LO32, LO33 The...Ch. 3 - Balance sheet; Current versus long-term...Ch. 3 - Prob. 3.7ECh. 3 - Prob. 3.8ECh. 3 - Balance sheet preparation LO32, LO33 The...Ch. 3 - Financial statement disclosures LO34 The...Ch. 3 - Prob. 3.11ECh. 3 - Prob. 3.12ECh. 3 - Prob. 3.13ECh. 3 - FASB codification research LO32, LO34 Access the...Ch. 3 - Prob. 3.15ECh. 3 - Prob. 3.16ECh. 3 - Prob. 3.17ECh. 3 - Calculating ratios; solve for unknowns LO38 The...Ch. 3 - Prob. 3.19ECh. 3 - Effect of management decisions on ratios LO38...Ch. 3 - Prob. 3.21ECh. 3 - Prob. 3.22ECh. 3 - Balance sheet preparation LO32, LO33 Presented...Ch. 3 - Balance sheet preparation; missing elements LO32,...Ch. 3 - Balance sheet preparation LO32, LO33 The...Ch. 3 - Balance sheet preparation LO32, LO33 The...Ch. 3 - Balance sheet preparation LO32, LO33 The...Ch. 3 - Prob. 3.6PCh. 3 - Balance sheet preparation; errors LO32, LO33 The...Ch. 3 - Balance sheet; errors; missing amounts LO32, LO33...Ch. 3 - Balance sheet preparation LO32 , LO33 Presented...Ch. 3 - Prob. 3.10PCh. 3 - Communication Case 31 Current versus long-term...Ch. 3 - Analysis Case 32 Current versus long- term...Ch. 3 - Prob. 3.4BYPCh. 3 - Judgment Case 35 Balance sheet; errors LO32...Ch. 3 - Prob. 3.6BYPCh. 3 - Real World Case 37 Balance sheet and significant...Ch. 3 - Judgment Case 38 Post fiscal year-end e vents ...Ch. 3 - Prob. 3.9BYPCh. 3 - Prob. 3.10BYPCh. 3 - Prob. 3.11BYPCh. 3 - Analysis Case 314 Balance sheet information LO32...Ch. 3 - Prob. 3.15BYPCh. 3 - Ethics Case 316 Segment reporting Appendix 3 You...Ch. 3 - Prob. 1CCTC
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