Wiley Plus Help

Question 1

Headland Enterprises owns the following assets at December 31, 2017.

What amount should be reported as cash?

Question 2

Riverbed Family Importers sold goods to Tung Decorators for $45,000 on November 1, 2017, accepting Tung’s $45,000, 6-month, 5% note.
Prepare Riverbed’s November 1 entry, December 31 annual adjusting entry, and May 1 entry for the collection of the note and interest. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Question 4

Windsor Company designated Jill Holland as petty cash custodian and established a petty cash fund of $370. The fund is reimbursed when the cash in the fund is at $14, which it is. Petty cash receipts indicate funds were disbursed for office supplies $95 and miscellaneous expense $258.
Prepare journal entries for the establishment of the fund and the reimbursement. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

B will be provided once answer to (a) is correct

Question 6

Sweet Company uses a periodic inventory system. For April, when the company sold 650 units, the following information is available.

Compute the April 30 inventory and the April cost of goods sold using the FIFO method.

Question 7

Concord Company uses a periodic inventory system. For April, when the company sold 550 units, the following information is available.

Compute the April 30 inventory and the April cost of goods sold using the LIFO method.

Question 9

A fire destroys all of the merchandise of Metlock Company on February 10, 2017. Presented below is information compiled up to the date of the fire.

What is the approximate inventory on February 10, 2017?

Question 10

Presented below is information related to Sheffield Inc.’s inventory, assuming Sheffield uses lower-of-LIFO cost-or-market.

Determine the following:
(a) The two limits to market value (i.e., the ceiling and the floor) that should be used in the lower-of-cost-or-market computation for skis.

(b) The cost amount that should be used in the lower-of-cost-or-market comparison of boots.

(c) The market amount that should be used to value parkas on the basis of the lower-of-cost-or-market.

Question 11

Splish Company began operations in 2017 and determined its ending inventory at cost and at LCNRV at December 31, 2017, and December 31, 2018. This information is presented below.

(a) Prepare the journal entries required at December 31, 2017, and December 31, 2018, assuming inventory is recorded at LCNRV and a perpetual inventory system using the cost-of-goods-sold method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

(b) Prepare journal entries required at December 31, 2017, and December 31, 2018, assuming inventory is recorded at cost and a perpetual system using the loss method. (Use Recovery of Loss Inventory account.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

(c) Which of the two methods above provides the higher net income in each year?

Question 12

Splish Inc. purchased land, building, and equipment from Laguna Corporation for a cash payment of $371,700. The estimated fair values of the assets are land $70,800, building $259,600, and equipment $94,400. At what amounts should each of the three assets be recorded? (Round intermediate percentage calculations to 5 decimal places e.g. 18.25124 and final answers to 0 decimal places, e.g. 5,275.)

Question 13

Bonita Corporation traded a used truck (cost $21,600, accumulated depreciation $19,440) for a small computer with a fair value of $3,564. Bonita also paid $540 in the transaction.
Prepare the journal entry to record the exchange. (The exchange has commercial substance.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Question 14

The expenditures and receipts below are related to land, land improvements, and buildings acquired for use in a business enterprise. The receipts are enclosed in parentheses.

Identify each item by letter and list the items in columnar form, using the headings shown below. All receipt amounts should be reported in parentheses. For any amounts entered in the Other Accounts column, also indicate the account title. (Enter receipt amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). If no entry is required in other accounts, select "No Entry" for the account titles.)

Question 15

Bonita Company purchased machinery for $157,500 on January 1, 2017. It is estimated that the machinery will have a useful life of 20 years, salvage value of $14,700, production of 80,600 units, and working hours of 39,300. During 2017, the company uses the machinery for 9,825 hours, and the machinery produces 8,060 units. Compute depreciation under the straight-line, units-of-output, working hours, sum-of-the-years’-digits, and double-declining-balance methods. (Round intermediate calculations to 5 decimal places, e.g. 1.56487 and final answers to 0 decimal places, e.g. 5,125.)

Question 16

Wildhorse Company owns equipment that cost $963,000 and has accumulated depreciation of $406,600. The expected future net cash flows from the use of the asset are expected to be $535,000. The fair value of the equipment is $428,000.
Prepare the journal entry, if any, to record the impairment loss. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Question 17

Swifty Corporation purchases a patent from Wildhorse Company on January 1, 2017, for $45,000. The patent has a remaining legal life of 16 years. Swifty feels the patent will be useful for 10 years. Assume that at January 1, 2019, the carrying amount of the patent on Swifty’s books is $36,000. In January, Swifty spends $38,400 successfully defending a patent suit. Swifty still feels the patent will be useful until the end of 2026.
Prepare the journal entries to record the $38,400 expenditure and 2019 amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Question 18

Monty Corporation purchased Johnson Company 3 years ago and at that time recorded goodwill of $350,000. The Johnson Division’s net assets, including the goodwill, have a carrying amount of $710,000. The fair value of the division is estimated to be $646,000 and the implied goodwill is $286,000.
Prepare Monty journal entry to record impairment of the goodwill. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Question 19

Joni Marin Inc. has the following amounts reported in its general ledger at the end of the current year.

(a)
On the basis of this information, compute the total amount to be reported by Marin for intangible assets on its balance sheet at year-end.

Question 20

Marin Company borrowed $31,200 on November 1, 2017, by signing a $31,200, 9%, 3-month note. Prepare Marin’s November 1, 2017, entry; the December 31, 2017, annual adjusting entry; and the February 1, 2018, entry. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Question 23

Novak Factory provides a 2-year warranty with one of its products which was first sold in 2017. Novak sold $1,073,800 of products subject to the warranty. Novak expects $133,420 of warranty costs over the next 2 years. In that year, Novak spent $76,060 servicing warranty claims. Prepare Novak’s journal entry to record the sales (ignore cost of goods sold) and the December 31 adjusting entry, assuming the expenditures are inventory costs. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Question 24

The Blossom Company issued $300,000 of 13% bonds on January 1, 2017. The bonds are due January 1, 2022, with interest payable each July 1 and January 1. The bonds were issued at 97.
Prepare the journal entries for (a) January 1, (b) July 1, and (c) December 31. Assume The Blossom Company records straight-line amortization semiannually. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548.)

Question 25

Skysong Corporation issued a 4-year, $50,000, 5% note to Greenbush Company on January 1, 2017, and received a computer that normally sells for $35,725. The note requires annual interest payments each December 31. The market rate of interest for a note of similar risk is 15%.
Prepare Skysong’s journal entries for (a) the January 1 issuance and (b) the December 31 interest. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Question 27

Headland Corporation manufactures replicators. On January 1, 2017, it leased to Althaus Company a replicator that had cost $99,400 to manufacture. The lease agreement covers the 5-year useful life of the replicator and requires 5 equal annual rentals of $44,500 payable each January 1, beginning January 1, 2017. An interest rate of 11% is implicit in the lease agreement. Collectibility of the rentals is reasonably assured, and there are no important uncertainties concerning costs.
Prepare Headland’s January 1, 2017, journal entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971.)
Click here to view factor tables

Question 29

On June 30, 2018, Carla Vista Co. sold equipment to an unaffiliated company for $2350000. The equipment had a book value of $1255000 and a remaining useful life of 10 years. That same day, Carla Vista leased back the equipment at $12700 per month for 5 years with no option to renew the lease or repurchase the equipment. Carla Vista’s rent expense for this equipment for the year ended December 31, 2018, should be

Question 30

Wildhorse, Inc. leased equipment from Tower Company under a 4-year lease requiring equal annual payments of $434152, with the first payment due at lease inception. The lease does not transfer ownership, nor is there a bargain purchase option. The equipment has a 4 year useful life and no salvage value. Wildhorse, Inc.’s incremental borrowing rate is 9% and the rate implicit in the lease (which is known by Wildhorse, Inc.) is 7%. Assuming that this lease is properly classified as a capital lease, what is the amount of principal reduction recorded when the second lease payment is made in Year 2?