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Study Resources (Accounting)

Exercise 9 The balance sheet of the Tom, Dick, and Joe partnership on October 1, 2004 (the date of partnership dissolution) was as follows: Cash $ 3,000 Liabilities $ 9,000 Other assets 33,000 Loan from Tom 1,000 Loan to Dick 4,000 Tom, capital (20%) 3,000 Dick, capital (30%) 6,000 Joe, capital (50%) 21,000 Total assets $ 40,000 Total liab./equity $ 40,000 In October, other assets with a book value of $15,000 were sold for $17,000 in.
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Exercise 1 The profit and loss sharing agreement for the Capman, Philip, and Reiner partnership provides that Philip and Reiner receive salary allowances of $15,000 each, Philip receives a bonus of 10% of partnership net income, and all residual profit or loss be divided equally among the three partners. Required: Prepare a schedule.
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Exercise 7 For each of the following events or transactions, identify the fund or funds that will be affected. 1. A state government collects sales taxes on behalf of the state and for some of its counties and municipalities. 2. A printing shop was established to handle the printing needs of a county.
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Exercise 7 A summary balance sheet for the XYZ partnership on December 31, 2003 is shown below. Partners X, Y, and Z allocate profit and loss in their respective ratios of 4:5:7. The partnership agreed to pay partner Z $455,000 for his partnership interest upon his retirement from the partnership on.
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11.A partnership in liquidation has converted all assets into cash and paid all liabilities. If the partners’ capital accounts have credit balances, how are the final cash payments distributed? a.according to the balances in the partners’ capital accounts b.according to the partners’ residual profit and loss sharing ratios c.according to the partners’ profit.
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Multiple Choice Questions Use the following information for questions 1, 2 and 3. Willis and Rite share profits and losses equally. Willis and Rite receive salary allowances of $20,000 and $30,000, respectively, and both partners receive 10% interest on their average capital balances. Average capital balances are calculated at the beginning of.
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Multiple Choice Questions 1.A US parent makes a 1,000,000 krona ($108,250) loan to its Swedish subsidiary. The loan is denominated in US dollars and the functional currency of the subsidiary is the krona. This intercompany transaction is a foreign currency transaction of the: Subsidiary    Parent a.   Yes          No b.   Yes          Yes c.   No           Yes d.   No          .
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Exercise 7 Note to Instructor: This exam item is a continuation of Exercise 6 and proceeds forward with York’s second year of operations. York Corporation, a British subsidiary of Romero Corporation (a US company) was formed by Romero on January 1, 20X7 in exchange for all the subsidiary's common stock. York has.
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Exercise 2 The balance sheet of the Sam, Matt, and Coe partnership on January 1, 2004 (the date of partnership dissolution) was as follows: Cash $ 4,000 Liabilities $ 8,020 Other assets 26,000 Loan from Sam 1,000 Loan to Coe 2,000 Sam, capital (20%) 1,980 Matt, capital (40%) 9,000 Coe, capital (40%) 12,000 Total assets $ 32,000 Total liab./equity $ 32,000 In January, other assets with a book value of $16,000 were sold for $10,000 in.
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Exercise 5 Note to Instructor: This exam item is a continuation of Exercise 4 and proceeds forward with Yorkshire’s second year of operations. Yorkshire Corporation, a British subsidiary of Johnson Corporation (a US company) was formed by Johnson on January 1, 20X5 in exchange for all the subsidiary's common stock. Yorkshire has.
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Exercise 7 On November 1, 20X1, Crocker Corporation, a calendar-year US corporation, invested in a purely speculative contract to purchase 1 million yen on January 30, 20X2, from the Sumitomo Trading Company, a Japanese brokerage firm. Crocker agreed to purchase 1,000,000 yen from Sumitomo at a fixed price of $0.0100 per.
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Multiple Choice Questions Use the following information for questions 1, 2 and 3. On June 30, 2004, the Ritz, Sally, and Tracy partnership had the following fiscal year-end balance sheet: Cash $ 20,000 Accounts payable $ 35,000 Accounts receivable 30,000 Loan from Sally 25,000 Inventory 70,000 Ritz, capital (20%) 70,000 Plant assets-net 60,000 Sally, capital(30%) 50,000 Loan to Ritz 30,000 Tracy, capital(50%) 30,000 Total assets $ 210,000 Total liab./equity $ 210,000 The percentages shown are the residual profit and loss sharing.
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Exercise 4 Johnson Corporation, a US company, formed a British subsidiary on January 1, 20X5 by investing £450,000 in exchange for all the subsidiary’s no-par common stock. The British subsidiary, Yorkshire Corporation, purchased real property on April 1, 20X5 at a cost of £500,000, with £100,000 allocated to land and £400,000.
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Exercise 6 Note to Instructor: This exam item is similar to Exercise 4 except that the exchange rates have been changed and the temporal method is used instead of the current rate method. The Romero Corporation, a US corporation, formed a British subsidiary on January 1, 20X7 by investing £550,000 in exchange.
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Exercise 6 A cash distribution plan for the Matthews, Norell, and Reams partnership was as follows: Priority Creditors Matthews Norell Reams First $300,000 100% Next $80,000 70% 30% Next $70,000 3/7 4/7 Remainder 22% 34% 44% Required: If $550,000 of cash was distributed by the partnership, how much was received respectively by the priority creditors, Matthews, Norell, and Reams? Exercise 7 A cash distribution plan for the A, B, and C partnership.
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11.In a partnership where an interest allocation factor is used in determining the distribution of partnership income, what is the common treatment for a partner's drawings in calculating weighted capital? a.The drawings are considered withdrawals of capital that reduce the partner's average capital. b.If the drawings exceed the amount of agreed-upon.
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11.Which one of the following items does SFAS 131 require to be disclosed by geographic area? a.external revenues b.external and intersegment revenues c.profit or loss d.total assets 12.Which statement below describes the treatment given a change in accounting principles made during the third quarter? a.The cumulative effect is deferred until year-end before it is recognized. b.The.
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Exercise 5 Bob, Carl, Ted, and Al are partners who share profits and losses 30%, 20%, 35%, and 15%, respectively. The partnership will be liquidated gradually over several months beginning January 1, 2004. The partnership trial balance at December 31, 2003 is as follows: Debits Credits Cash $ 3,000 Accounts receivable 10,000 Inventory 25,000 Loan to Carl 4,000 Furniture 15,000 Equipment 18,000 Goodwill 10,000 Accounts payable $ 12,000 Note payable 30,000 Loan from Ted 6,000 Bob,.
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Exercise 1 On January 1, 20X2, Packman Corporation, a US company, acquired 100% of Henkel Corporation of Canada, paying an excess of 60,000 Canadian dollars over the book value of Henkel’s net assets. The excess was allocated to undervalued equipment with a three-year remaining useful life. Henkel’s functional currency is the.
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Exercise 2 Tuftym Company is in bankruptcy and is being liquidated  under the provisions of Chapter 7 of the bankruptcy code. The trustee has converted all assets into $60,000 cash and has prepared the following list of approved claims: Accounts payable, unsecured $ 15,000 Trustee’s fees and other costs of liquidation 8,000 Mortgage payable, secured by property.
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Exercise 3 The partnership of Paul, Sean, and Unser was dissolved, and by July 1, 2004, all assets had been converted into cash and all partnership liabilities were paid. The partnership balance sheet on July 1, 2004 (with partner residual profit and loss sharing percentages) was as follows: Cash $ 20,000 Unser, capital(30%) $   80,000 Paul, capital(40%) (40,000) Sean,.
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Exercise 9 Hurricane Corporation, a US company, owns 100% of Koala Corporation, an Australian company. Koala's equipment was acquired on the following dates (amounts are stated in Australian dollars): Jan. 01, 20X1 Purchased equipment for A$40,000 Jul. 01, 20X1 Purchased equipment for A$80,000 Jan. 01, 20X2 Purchased equipment for A$50,000 Jul. 01, 20X2 Sold equipment.
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11.The unmatured liability for general long-term debt is reported in the: a.long-term debt records. b.debt service fund. c.Both of the above report the data. d.None of the above report the data. 12.Capital improvement costs incurred for general government special assessments projects requires recognition in the: a.special revenue fund. b.general fund. c.capital projects fund. d.permanent fund. 13.The general fixed assets records.
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Exercise 9 On November 1, 20X1, RCA Corporation purchased 5,000 television sets for its merchandise inventory from Samsung, a South Korean firm, at a total quoted cost of 600,000,000 won (W). On this date, the spot rate for won was $1 = 750W. On the same day, RCA invested $900,000 cash.
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Exercise 4 Itek Corporation owes Ames Finance Company $660,000 plus $43,000 of accrued interest. Itek has a cash flow shortage and arranges for an equity settlement of the loan with Ames by issuing 55,000 shares of its $10.00 par value common stock to Ames on April 1, 2004. Itek common stock.
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Exercise 3 Pearman Corporation, a US company, acquired a 30% interest in Sulzer Corporation of Switzerland on January 1, 20X3 for $3,300,000 when Sulzer’s stockholders’ equity in Swiss francs (SF) consisted of 7,000,000 SF Capital Stock and 3,000,000 SF Retained Earnings. The exchange rate for Swiss francs was $.66 on January.
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Exercise 1 Macco Corporation is liquidating under Chapter 7 of the Bankruptcy Act. The accounts of Macco at the  time of filing are summarized as follows: Book Value Estimated Realizable Value Cash $ 10,000 $ 10,000 Accounts receivable-net 60,000 50,000 Inventory 110,000 70,000 Equipment-net 70,000 70,000 Land 20,000 40,000 Building-net 200,000 150,000 Goodwill 42,000 $ 512,000 Accounts payable $ 120,000 Wages and salaries 30,000 Contributions due to pension plan 20,000 Taxes payable 80,000 Accrued interest payable (includes $10,000 from the mortgage payable and $2,000 from the note payable) 12,000 Note.
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Exercise 4 On November 1, 20X1, the Blondex Corporation, a US corporation, purchased an extruding machine from Sterling Corporation, a UK company. The purchase price was $10,000 and Blondex agreed to pay in pounds on February 1, 20X2. Both corporations are on a calendar year accounting period. Assume that the spot.
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Exercise 5 The following data relate to King Corporation’s industry segments. (King HQ represents the corporate headquarters). All other segments are geographical sales segments. Attribute Europe Russia China Japan King HQ External sales $ 35,000 $ 24,000 $ 33,000 $ 0 $ 0 Intersegment Sales 2,000 1,000 4,000 0 0 Expenses 27,000 18,000 29,000 5,000 12,000 Assets assigned 20,000 22,000 30,000 14,000 15,000 Income from Equity investee 5,000 Required: 1. Prepare a report which reconciles the reportable segment profits to total consolidated profits assuming that corporate expenses are not allocated to.
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Exercise 8 For each of the 12 accounts listed in the table below, select the correct exchange rate to use when either remeasuring or translating a foreign subsidiary for its US parent company. Codes C = Current exchange rate H = Historical exchange rate A = Average exchange rate US dollar is the functional currency The foreign currency is the functional currency 1. Cash 2. Marketable debt securities   carried at cost 3. Cash.
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Exercise 1 Al, Ed, Jo, and Lu are partners who share profits and losses 40%, 25%, 25%, and 10%, respectively. The partnership will be liquidated gradually over several months beginning January 1, 2004. The partnership trial balance at December 31, 2003 is as follows: Debits Credits Cash $ 3,000 Accounts receivable 19,000 Inventory 25,000 Loan to Jo 5,000 Furniture 15,000 Equipment 10,000 Goodwill 12,000 Accounts payable $ 14,000 Note payable 30,000 Loan from Al 5,000 Al,.
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Exercise 5 Required: Using the information from Exercise 4 above: Prepare a schedule to allocate income or loss to the partners assuming that the partnership incurs a net loss of $36,000. Prepare a journal entry to distribute the partnership's loss to the partners (assume that an Income Summary account is used by the.
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Exercise 3 The profit and loss sharing agreement for the Hein, Kontos, and Ribera partnership provides for a $10,000 salary allowance to Kontos. Residual profits and losses are allocated 5:3:2 to Hein, Kontos, and Ribera, respectively. In 2003, the partnership recorded $80,000 of net income that was properly allocated to the.
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Multiple Choice Questions 1.What test is applied to ensure that reported segments represent a significant portion of enterprise activity? a.The total external and intersegment revenues for the reportable segments is greater than 75% of the consolidated revenue. b.The total external and intersegment revenues for the reportable segments is greater than 75% of the.
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Multiple Choice Questions 1.The proceeds from a bond issuance for the building of a new public school should be recorded in the ______________ fund at the time the bonds are sold.  The fund balance increase is classified as ______________. a.capital projects, revenues b.general, revenues c.general, other financing sources d.capital projects, other financing sources 2.When a capital.
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Exercise 5 List the financial statements and/or schedules required to be presented for each of the following funds and entities as well as the required basis of accounting. 1.Debt Service Fund 2.Permanent Fund 3.Pension Trust Fund 4.Internal Service Fund Exercise 6 List the financial statements and/or schedules required to be presented for each of the following funds.
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Exercise 7 Cronklin Corporation is preparing its first quarterly interim report. It is subject to a corporate income tax rate of 20% on the first $50,000 of taxable income and 35% on taxable income above $50,000. Its estimated pretax accounting income for 2004, by quarter, is: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 2004 Total Estimated Income $ 50,000 $ 110,000 $ 95,000 $ 80,000 $ 335,000 Cronklin expects to earn and.
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Exercise 9 River Corporation is being liquidated under Chapter 7 of the Bankruptcy Act. The trustee has determined that the unsecured claims will receive $.50 on the dollar. Denon Corporation holds a $100,000 mortgage note receivable from River that is secured by marketable securities with a $75,000 book value and an.
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11.Bankruptcy courts are federal courts separate but adjunct to: a.the US Claims Court. b.the US Tax Court. c.the US Appellate courts. d.the US Districts courts. 12.Bankruptcy court judges are appointed by: a.the President of the United States. b.the United States Attorney General. c.the Chief Justice of the Supreme court. d.the federal appeals court judges that have appellate control over.
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Exercise 7 James Corporation is being liquidated under Chapter 7 of the Bankruptcy Act. The trustee has determined that the unsecured claims will receive $.30 on the dollar. Crown Corporation holds a $70,000 mortgage note receivable from James that is secured by equipment with a $35,000 book value and a $14,000.
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Exercise 5 On November 1, 20X1, Florex Corporation, a US corporation, purchased from Chico Corporation, a Mexican company, some machinery that cost 1,000,000 pesos. The invoice was payable in pesos on January 30, 20X2. To hedge against rapid changes in the peso, Florex entered into a forward exchange contract on November.
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Exercise 9 Brownstone Corporation is preparing its interim financial statements for the third quarter of calendar 2003. The following information was gathered for the third quarter: 1. Credit sales for the quarter $2,000,000 2. Cash sales for the quarter 500,000 3. Inventories, July 1 (FIFO cost method) 250,000 4. Cash purchases of inventory during the quarter 400,000 5. Inventory purchases made on account for the.
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Exercise 6 On November 1, 20X1, Florex Corporation, a US corporation, purchased from Chico Corporation, a Mexican company, some machinery that cost 1,000,000 pesos. The invoice was payable in pesos on January 30, 20X2. To hedge against rapid changes in the peso, Florex entered into a forward exchange contract on November.
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Exercise 1 The accountant for Biltmore Corporation has assigned most of the company’s assets to its three segments as follows: Motion pictures $ 1,900,000 Communications 3,000,000 Publishing 400,000 Total $ 5,300,000 The unassigned assets consist of $800,000 of unallocated goodwill and $300,000 of assets attached to the corporate headquarters. For internal decision-making purposes, goodwill is not assigned to the segments and the.
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Multiple Choice Questions 1.If a government is the recipient of a pass-through grant, but has no administrative or financial involvement in the program, the pass-through grant is accounted for in a(n): a.trust fund. b.agency fund. c.general fund. d.enterprise fund. 2.A nonrecurring and nonroutine transfer of equity between funds, such as an initial capital contribution from.
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Multiple Choice Questions 1.When the bankruptcy court grants an order for relief: a.creditors may not seek payment for their claims directly from the debtor corporation. b.the reorganization plan was accepted by creditors having at least one-half of the total number of claims and the claims represent at least two-thirds of the total amount.
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Exercise 1 a.Borrowed $10,000 by issuing a three-month note. b.Paid $2,000 for equipment. c.Services for $250 were billed and collected. d.Issued general obligation bonds, par value of $5,000, at 101 (101% of par value) to finance construction of a building. e.Incurred and paid construction costs of $2,500 on the building. Required: Analyze the above transactions by using.
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11.A comprehensive annual financial report has the following three  major sections: a.introductory, financial, and management's discussion and analysis. b.introductory, financial, and statistical. c.transmittal, financial, and statistical. d.transmittal, financial, and management's discussion and analysis. 12. Which of the following is accounted for in governmental funds? a.general government short-term liabilities b.general government long-term liabilities c.Both of the above are included. d.None.
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