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52.On January 1, James Corporation had 60,000 shares of common stock outstanding. On March 1, the company reacquired 12,000 shares, and it declared a 10% stock dividend on October 1. What is the denominator in the earnings per share calculation? a. 44,200 b. 40,800 c. 55,000 d. 60,000 53.On January 1, Buchanan Corporation had 50,000 shares of common stock.
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61.Which of the following is not a criterion that indicates a performance obligation is satisfied over time? a.The customer receives control of a delivered product which has an expected useful life of many years. b.The seller’s performance does not create an asset with an alternative use to the seller and the seller.
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149.List four componentsthat comprise a corporation’s contributed capital. 150.Corporate shareholderscan only lose the amount of their investment, in accordance with the concept of limited liability. State laws have established protection for a corporation's creditors with the concept of legal capital. ? Required: ?Explain how legal capital protects a corporation's creditors and discuss two different.
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11.Deductions that are allowed for income tax purposes but do not qualify as expenses under GAAP are permanent differences. a.True b.False 12.Temporary differences cause a company’s effective tax rate to be different from the enacted tax rate. a.True b.False 13.An operating loss must be carried back two years, starting with the earliest of the two years,.
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99.Under what conditions does a company recognize revenue over a period of time? 100.Describe the conditions when contract assets and contract liabilities are recognized and presented in financial statements. 101.Mary Streen is getting up to speed on the new guidance on revenue recognition. She is trying to understand the revenue recognition principle.
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136.A partial listing of accounts and ending balances for Carver, Inc., on December 31, 2016, is shown below: Investments in long-term notes receivable $ 40,000 Bonds payable 300,000 Temporary investment in equity securities available for sale 120,000 Premium on bonds payable 26,000 Common stock 180,000 Subscriptions receivable: common stock 120,000 Additional paid-in capital from preferred stock conversion 24,000 Retained earnings 650,000 Preferred stock 300,000 Long-term investment in equity securities.
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103.?IT Services Co. provides online technology support for consumers remotely via the Internet. For a flat fee, it will scan a customer’s personal computer (PC) for viruses, optimize the PC's performance, and solve any connectivity problems. When a customer calls to obtain the scan services, IT Services Co. describes the.
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134.Advance Medical Imaging, Inc. reacquired 2,000 shares of its $5 par common stock at $15 a share. The stock originally sold for $10 a share.Required: a. Prepare the journal entry to record the reacquisition under the (1) cost method (2) par value method b. Prepare the journal entry to record the reissuance of 500 shares at $18 a.
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85.Freesure Company manufactures and sells commercial refrigerators. It is currently running a promotion in which it pays a $500 rebate to any customer that purchases a refrigeration unit from one of its participating dealers. The rebate must be returned within 90 days of purchase. Given its historical experience and the.
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21.The Partial Billings account is a contra account of the Construction in Progress account. a.True b.False 22.Construction in Progress is an inventory account typically valued at on the balance sheet at net realizable value. a.True b.False 23.The FASB and the IASB jointly issued a comprehensive principles-based revenue recognitionModel entitled a.Revenue Recognition. b.Revenue from Contracts with Customers. c.Principles of Revenue.
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12.When a company is determining its dividend policy, the company must adhere to legal requirements. The legal requirements are determined by a. theFinancial Accounting Standards Board (FASB). b. thestate in which the company was incorporated. c. theSecurities and Exchange Commission (SEC). d. theFederal Trade Commission (FTC). 13.How will a company's retained earnings and total stockholders' equity be affected by.
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92.Major Corporation had 50,000 shares of common stock outstanding during 2016 with the following characteristics: Par value per share $10 Average market value per share 50 Market value per share on 12/31/2016 60 The company also has compensatory share options to purchase 5,000 shares of common stock at $40 a share during the year. The unrecognized compensation.
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82.Johnson Company has retained earnings balance of $550,000 at the end of 2016. During 2016 Johnson issued $200,000 of 10 year, 10% bonds. As part of the bond issue the each year $20,000 of retained earnings will be unavailable to pay dividends. Required: Show the proper reporting requirements for Johnson’s retained earnings.
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128.On January 1, 2016, Robertson Company created a fixed compensatory stock option plan for employees to acquire 18,000 shares of $3 par common stock for $22 a share. The options vest after four years of employment, and therefore, they cannot be exercised until January 1, 2020. On the grant date,.
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105.Revenue is recognized for accounting purposes when a performance obligation is satisfied. In some situations, revenue is recognized over time as the fair values of assets and liabilities change. In other situations, however, accountants have developed guidelines for recognizing revenue at the point of sale. ? Required: Explain and justify why revenue is.
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21.Which of the following is not a timing difference that would cause pretax financial accounting income to differ from taxable income? a.Investment revenue is recognized under the equity method for financial reporting purposes but in a later period as dividends are received for income tax purposes. b.Life insurance proceeds are received by.
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79.Consider each of the following scenarios for Bunsen Suppliers Company: The common practice of Bunsen Suppliers is to obtain a written sales agreement. When an Anson Store called on the phone with an urgent need, however, Bunsen orally agreed to deliver goods in exchange for $6,000, then immediately delivered these goods.
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88.The Orlando Company is involved in a three-year long-term contract. The following data relate to this contract: ? 2016 2017 2018 Total Contract price ? ? ? $160,000 Cost incurred each year $24,000 $24,000 $ 56,000 104,000 Cost incurred to date 24,000 48,000 104,000 ? Estimated cost to complete ? 96,000 ? 48,000 ? 0 ? Partial billings each year 12,000 48,000 100,000 ? Cash collected from billings ? 8,000 ? 52,000 ? 100,000 ? ? Required: Prepare the journal entries for each of the following assuming Orlando satisfies its performance obligation over time: 2017.
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71.A construction project is expected to take two-and-a-half years to complete. Partial Billings exceeds Construction in Progress. The two accounts are reported together on the balance sheet in the a.current assets section. b.long-term assets section. c.current liabilities section. d.long-term liabilities section. 72.A construction project is expected to take two-and-a-half years to complete. Partial Billings is.
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1.The core principle of revenue recognition is that a company should recognize revenue when it has been earned. a.True b.False 2.One type of revenue is the settlement of a liability that occurs as a result of a company’s primary operating activities. a.True b.False 3.The FASB provides a 4-step model for evaluating when a company should recognize.
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125.On January 1, 2016, Asquith Company adopts a performance-based stock option plan with a four-year vesting and service period, a $35 exercise price, and a $6 per option fair value. The plan grants a maximum of 2,000 shares of $5 par common stock to each of the company's 30 executives..
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11.There are two types of license: those that are distinct and those that are satisfied over a period of time. a.True b.False 12.A company that is considered to be an agent in a revenue-producing transaction will recognize revenue for the net amount of consideration received from the customer. a.True b.False 13.When a customer pays a seller.
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81.In July 2016, Sykick Software Company licenses its accounting software to RayHawk Corporation at a cost of $30,000 for two years and also enters into a contract to install the software for an additional $3,000. Trident sells the software license with or without installation. The accounting software is not modified.
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88.West, Inc. determined the following information concerning its common stock during 2016: January 1 80,000 shares outstanding April 1 Issued a 20% stock dividend July 1 Issued an additional 2,900 shares October 1 Issued a 2-for-1 stock split December 1 Reacquired 5,000 shares ? Required:What should West, Inc. use as the denominator for its basic earnings per share calculation for 2016? 89.On January.
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102.What three items rarely affect retained earnings? 103.Other Comprehensive Income or loss might include what four items? 104.Describe the two types of corporate capital structures. 105.What is the basic earnings per share calculation? What is the weighted average shares calculation? 106.What are the steps necessary to compute diluted earnings per share? .
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95.What is the proper accounting for volume discounts on sales of products when there is uncertainty about whether the discounted volume level will be attained? 96.Provide two examples of variable consideration. What are the two approaches for estimating variable consideration and how does a company determine which approach should be used? 97.On.
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111.IFRS and GAAP are similar in regard to computing earnings per share components. However, the calculation of the impact from the exercise of options differs. ? Required: a. Describe the difference in treatment of unrecognized compensation cost relating to options in the calculation of EPS. b. Explain why the IFRS approach will systematically result in lower.
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94.During 2016, Stewart, Inc. had the following convertible securities outstanding: A. $220,000 of 10%, $100 par, cumulative preferred stock. Each share is convertible into 5 shares of common stock. B. $200,000 of 9.5% convertible bonds. Each $1,000 bond is convertible into 45 shares of common stock. C. $100,000 of 8% convertible bonds. Each $1,000 bond is.
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138.Given the following information for Jumping Johns Bounce Company: Bonds payable $150,000 Common stock 25,000 Premium on preferred stock 19,000 Long-term investments in equity securities held for sale 10,000 Preferred stock subscribed 32,000 Retained earnings 53,500 Premium on common stock 38,460 Common stock subscribed 2,800 Subscriptions receivable: preferred stock 17,000 Premium on bonds payable 4,000 Preferred stock 55,000 Temporary investments in equity securities held for sale 25,000 Subscriptions receivable: common stock 15,600   Required:Compute the total amount of.
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130.Baltimore Bike had outstanding 12,000 shares of $50 par callable preferred stock. The corporation called 35% of the shares (originally issued at $75 per share) at a call price of $80 per share. ? Required: ?Record the journal entry for the call of this preferred stock. 131.Several years ago, Walther, Inc. issued 12,000 shares.
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152.U.S. GAAP and IFRS utilize similar accounting for shareholders’ equity but there are some differences. ? Required: Explain the differences between U.S. GAAP and IFRS in their accounting for shareholders’ equity. 153.Current GAAP recommends that the fair value method be used to account for compensatory stock option plans. From a conceptual point of view,.
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42.Which of the following items would not be included in a basic earnings per share calculation? a. undeclared dividends on noncumulative preferred stock b. declared dividends on noncumulative preferred stock c. undeclared dividends on cumulative preferred stock d. declared dividends on cumulative preferred stock 43.On January 1, 2016, Wade Corporation had 24,000 shares of common stock outstanding. On April.
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86.Rutger was organized at the beginning of 2016. It had the following income items for the year ended December 31, 2016: Sales $10,000,000 Gain on sale of assets 250,000 Unrealized gain available for sale securities 140,000 Unrealized gain on trading securities 100,000 Cost of goods sold 5,000,000 Operating expenses 4,000,000 As a new company, Rutger issued 50,000 shares of $1 par common stock.
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96.Green Thumb, Inc. had 18,000 shares of common stock outstanding on January 1. An additional 6,000 shares were issued on May 1. The company also had 1,000 shares of 5.5%, $100 par, convertible preferred stock outstanding during the year. Each share is convertible into 8 shares of common stock. Net.
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1.The amount of incometax expense as determined by GAAP differs from amount determined under the Internal Revenue Code due to measurement and timing. a.True b.False 2.Permanent differences arise due to timing differences between the corporation’s pretax financial income and taxable income. a.True b.False 3.Atemporary difference will result in a deferred tax liability when future taxable income.
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1.When a property dividend is declared, fair value is determined on the ex-dividend date. a. True b. False 2.A small stock dividend is accounted for by transferring from retained earnings to contributed capital an amount equal to the par value of the additional shares issued. a. True b. False 3.A board of directors may decide to restrict retained earnings to.
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62.Smith Corporation had 30,000 shares of common stock outstanding during the year. In addition, there were compensatory share options to purchase 3,000 shares of common stock at $20 a share outstanding the entire year. The average market price for the common stock during the year was $36 a share. The.
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