Access the Bombardier Inc. financial statements for the year ended December 31, 2017, which can be found on SEDAR (www.sedar.com). Instructions a. The company had many different types of shares authorized, issued, and/or outstanding at the end of 2017. Prepare a chart that shows the following: name of share class, number of authorized shares, number of issued and outstanding shares, number of votes per share, and rights in terms of dividends. b. Why would a company structure its capital in this way? Is there a need for the various classes of shares? Why or why not? c. Calculate the book value per common share at December 31, 2017 and 2016. Compare these values with the closing share price at each year end. (Hint: Look at the Annual Information Form.) Comment briefly. d. For the common (Class A and B) shares, indicate whether the number of shares is increasing or decreasing and what caused the changes in them over the two-year period ended December 31, 2017. e. Indicate the amount of dividends declared in 2017. What amount of dividends was paid? f. For 2017 and 2016, calculate the rate of return on the common shareholders' equity of Bombardier's shareholders, the payout ratio, and the price earnings ratio based on the year-end closing share price. Comment on the amounts calculated and assess the validity of the results for the rate of return on common shareholders' equity given the underlying amounts. g. Examine the Capital Management note (Note 33). What are the company's strategy and objectives in managing its capital? How does it manage its capital, and what does it include in its definition of capital?
> Malouin Corp.'s income statement for the year ended December 31, 2020, had the following condensed information: There were no purchases or sales of trading (FV-NI) investments during 2020. Malouin's statement of financial position included the followin
> Golden Properties Corporation purchased a parcel of land in March 2019 for $1 million with the intent to construct a building on the property in the near future. At the time of purchase, Golden applied the cost model and measured and reported the land at
> Linden Corporation started operations on January 1, 2012, and has used the FIFO cost formula since its inception. In 2021, it decides to switch to the weighted average cost formula. You are provided with the following information. Instructions Answer
> Merrick Inc. follows IFRS and is adjusting and correcting its books at the end of 2020. In reviewing its records, the following information has been compiled: 1. In 2020, the depreciation method on plant assets should be changed from sum-of-the-years'-d
> Access the annual report of Canadian Tire Corporation for its year ended December 31, 2017, from the company's website or SEDAR (www.sedar.com). According to Note 1 to the financial statements, the company operates in three main segments: retail, a real
> Access the annual report, including the audited financial statements, of Thomson Reuters Corporation for the year ended December 31, 2017, from SEDAR (www.sedar.com) or from the company's website (www.thomsonreuters.com). Instructions a. What related-
> Oakridge Leasing Corporation signs an agreement on January 1, 2020, to lease equipment to LeBlanc Limited. Oakridge and LeBlanc follow ASPE. The following information relates to the agreement. 1. The term of the non-cancellable lease is five years, with
> On January 1, 2021, Xu Ltd., which uses IFRS 16, entered into an eight-year lease agreement for a conveyor machine. Annual lease payments are $28,500 at the beginning of each lease year, which ends December 31, and Xu made the first payment on January 1,
> Field Corp.'s controller was preparing the adjusting entries for the company's year ended December 31, 2020, when the V.P. Finance called him into her office. “Jean-Pierre,” she said, “I've been considering a couple of matters that may require different
> In 2019, Bergeron Construction Company Ltd. applied the completedcontract method of accounting for long-term construction contracts. However, in 2020, Bergeron discovered that the percentage-of-completion method should have been applied instead. For tax
> On January 1, 2016, Zui Corporation purchased a building and equipment that had the following useful lives, residual values, and costs: Building: 40-year estimated useful life, $50,000 residual value, $1,200,000 cost Equipment: 12-year estimated useful
> Oliver Inc. acquired the following assets in January 2017: The equipment was depreciated using the double-declining-balance method for the first three years for financial reporting purposes. In 2020, the company decided to change the method of calculati
> When the records of Hilda Corporation were reviewed at the close of 2020, the following errors were discovered. Instructions For each item, indicate by a check mark in the appropriate column whether the error resulted in an overstatement or understatem
> The before-tax income for Hawks Corp. for 2019 was $101,000; for 2020, it was $77,400. However, the accountant noted that the following errors had been made: 1. Sales for 2019 included $38,200 that had been received in cash during 2019, but for which th
> Bennett Corp., which began operations in January 2017, follows IFRS and is subject to a 30% income tax rate. In 2020, the following events took place: 1. The company switched from the zero-profit method to the percentage-of-completion method of accounti
> Neilson Tool Corporation's December 31 year-end financial statements contained the following errors: An insurance premium of $66,000 covering the years 2019, 2020, and 2021 was prepaid in 2019, with the entire amount charged to expense that year. In add
> Access the financial statements of Saskatoon-based Potash Corporation of Saskatchewan Inc. for its year ended December 31, 2017, from SEDAR (www.sedar.com). PotashCorp was a well-known Canadian global fertilizer and related industrial and feed producer.
> A partial trial balance of Lindy Corporation at December 31, 2020, follows: Additional adjusting data: 1. A physical count of supplies on hand on December 31, 2020, totalled $3,400. Through an oversight, the Salaries and Wages Payable account was not c
> Refer to the information in E19.16 and assume Opsco Corp. applies IFRS. Instructions Complete a post-retirement work sheet for 2020, and prepare all required journal entries related to the plan made by Opsco in 2020. From E19.16: Opsco Corp. provides
> Tracy Ltd. purchased a piece of equipment on January 1, 2016, for $1.2 million. At that time, it was estimated that the machine would have a 15- year life and no residual value. On December 31, 2020, Tracy's controller found that the entry for depreciati
> For the past three years, Bonafacio Holdings Ltd. has held bonds as investments, which it accounted for using the amortized cost model. The bonds were purchased at a discount and are currently classified as Bond Investment at Amortized Cost. There have b
> Matta Leasing Limited, which has a fiscal year end of October 31 and follows IFRS 16, signs an agreement on January 1, 2020, to lease equipment to Irvine Limited. The following information relates to the agreement. 1. The term of the non-cancellable lea
> Kea Limited provides a defined contribution pension plan for its employees. The plan requires the company to deduct 5% of each employee's gross pay for each payroll period as the employee contribution. The company then contributes 7% of the gross pay for
> On January 1, 2020, Lavery Corp., which follows ASPE, leased equipment to Flynn Ltd., which follows IFRS 16. Both Lavery and Flynn have calendar year ends. The following information concerns this lease. 1. The term of the non-cancellable lease is six ye
> Cuomo Mining Corporation, a public company whose stock trades on the Toronto Stock Exchange, uses IFRS. The vice-president of finance has asked you, the assistant controller, to prepare the company’s current accounting of a lease. The lease was signed by
> Assume the same data as in E20.6 for LeBlanc Limited except that the $7,000 residual value is guaranteed. Instructions Answer the following, rounding all numbers to the nearest dollar. a. Calculate the PV of the future minimum lease payments using any o
> A lease agreement between Hebert Corporation and Russell Corporation is described in E20.3. Instructions Provide the following for Hebert Corporation, the lessor, rounding all numbers to the nearest cent. a. Discuss the nature of the lease. b. Calcu
> Refer to the financial statements and accompanying notes of Canadian Tire Corporation Limited, for its year ended December 31, 2017. The financial statements are available on SEDAR (www.sedar.com). Instructions a. What are the issued and authorized sh
> The following facts are for a non-cancellable lease agreement between Hebert Corporation and Russell Corporation, a lessee: The collectibility of the lease payments is reasonably predictable, and there are no important uncertainties about costs that hav
> The accounting income (loss) figures for Farah Corporation are as follows: Accounting income (loss) and taxable income (loss) were the same for all years involved. Assume a 30% tax rate for 2015 and 2016, and a 25% tax rate for the remaining years. In
> Alliance Inc. reports the following incomes (losses) for both book and tax purposes (assume the carryback provision is used where possible): The tax rates listed were all enacted by the beginning of 2017. Instructions a. Prepare the journal entries f
> At the end of 2019, Valerie Corporation reported a deferred tax liability of $41,000. At the end of 2020, the company had $241,000 of temporary differences related to property, plant, and equipment. Depreciation expense on this property, plant, and equip
> Adelphi Corp. in its first year of operations has the following differences between its carrying amounts and the tax bases of its assets and liabilities at the end of 2020. It is estimated that the warranty liability will be settled in 2021. The differe
> Rancour Ltd., which uses ASPE, recently expanded its operations into an adjoining municipality, and on March 30, 2020, it signed a 15-year lease with its Municipal Industrial Commission (MIC). The property has a total fair value of $450,000 on March 30,
> On September 15, 2020, Local Camping Limited, the lessee, entered into a 20-year lease with Sullivan Corp. to rent a parcel of land at a rate of $30,000 per year. Both Local and Sullivan use ASPE. The annual rental is due in advance each September 15, be
> Instructions Refer to the data and other information provided in E20.1, but now assume that Maleki’s fiscal year end is May 31. Prepare the journal entries on Maleki Corp.’s books to reflect the signing of the lease agreement and to record payments and
> Presented below are five independent situations. All the companies involved use ASPE, unless otherwise noted. 1. On December 31, 2020, Zarle Inc. sold equipment to Orfanakos Corp. and immediately leased it back for 10 years. The equipment’s selling pric
> On January 1, 2020, Hein Corporation sold equipment to Liquidity Finance Corp. for $720,000 and immediately leased the equipment back. Both Hein and Liquidity use ASPE. Other relevant information is as follows. 1. The equipment’s carrying value on Hein’
> The Bank of Montreal and Royal Bank of Canada financial statements for their years ended October 31, 2017, can be found on SEDAR (www.sedar.com). Instructions a. What is the average carrying amount of each company's common shares? Compare these values
> Wong Inc., the lessee entered into two leases on July 1, 2020 with Pomerleau Corp. Both companies are public corporations following IFRS. The leases are for a large auger and a jackhammer that will be used on a construction site, and both parties would p
> Zdon Inc. reports accounting income of $105,000 for 2020, its first year of operations. The following items cause taxable income to be different than income reported on the financial statements. 1. Capital cost allowance (on the tax return) is greater t
> Castle Leasing Corporation, which uses IFRS 16, signs a lease agreement on January 1, 2020, to lease electronic equipment to Wai Corporation, which also uses IFRS 16. The term of the non-cancellable lease is two years and payments are required at the end
> The following information concerns Saverio Corp.'s defined benefit pension plan. On January 1, 2020, the company amended its pension plan, which resulted in a reduction in prior service benefits for current employees. The present value of the reduced be
> On September 1, 2020, Wong Corporation, which uses ASPE, signed a five-year, non-cancellable lease for a piece of equipment. The terms of the lease called for Wong to make annual payments of $13,668 at the beginning of each lease year, starting September
> You are a senior auditor auditing the December 31, 2020 financial statements of Hoang Inc., a manufacturer of novelties and party favours and a user of ASPE. During your inspection of the company garage, you discovered that a 2019 Shirk automobile is par
> The following defined benefit pension data of Dahl Corp. apply to the year 2020 The company applies ASPE and has made an accounting policy choice to base its actuarial valuation of the DBO on the funding basis. Instructions a. Prepare a continuity sc
> Refer to the information in E19.7 about Berstler Limited's defined benefit pension plan. Instructions a. Prepare a 2020 pension work sheet with supplementary schedules of calculations. b. Prepare the journal entries at December 31, 2020, to record pe
> Berstler Limited sponsors a defined benefit pension plan, and follows ASPE. The corporation's actuary provides the following information about the plan (in thousands of dollars): Instructions a. Calculate the actual return on the plan assets in 2020.
> Qui Importers provides the following pension plan information: Instructions Calculate the actual return on the plan assets for 2020. Fair value of pension plan assets, January 1, 2020 Fair value of pension plan assets, December 31, 2020 $1,438,750
> Hang Technologies Inc. held a portfolio of shares and bonds that it accounted for using the fair value through other comprehensive income model at December 31, 2020. This was the first year that Hang had purchased investments. In part due to Hang's inexp
> Refer to the information for Rebek Corporation in E19.3. Instructions a. Prepare a pension work sheet: insert the January 1, 2020 balances and show the December 31, 2020 balances. b. Prepare all journal entries. c. What is the amount of the plan's s
> Rebek Corporation provides the following information about its defined benefit pension plan for the year 2020: Rebek follows IFRS. Instructions Prepare a continuity schedule for 2020 for the defined benefit obligation. a. Prepare a continuity schedu
> Yen Inc.'s only temporary difference at the beginning and end of 2020 is caused by a $4.8-million deferred gain for tax purposes on an instalment sale of a plant asset. The related receivable (only one half of which is classified as a current asset) is d
> Josit Ltd. initiated a one-person pension plan in January 2012 that promises the employee a pension on retirement according to the following formula: pension benefit = 2.5% of final salary per year of service after the plan initiation. The employee began
> On January 1, 2020, Roper Inc. agrees to buy 3 kg of gold at $40,000 per kilogram from Golden Corp on April 1, 2020, but does not intend to take delivery of the gold. On the day that the contract was entered into, the fair value of this forward contract
> Mila Enterprises Ltd. provides the following information about its defined benefit pension plan: Instructions a. Calculate the January 1, 2020 balances for the pension-related accounts if Mila follows IFRS. b. Prepare the required disclosures that wou
> The following is partial information related to Siri Ltd.'s non-pension, post-retirement health-care benefit plan at December 31, 2020: Instructions a. Prepare a schedule reconciling, to the extent possible, the plan surplus or deficit with the asset/li
> Opsco Corp. provides the following information about its post-retirement health-care benefit plan for the year 2020: Instructions a. Assuming Opsco follows IFRS, calculate the post-retirement benefit expense for 2020, and prepare all required journal e
> Rosek Inc. provides the following information related to its post-retirement health-care benefits for the year 2020: Rosek Inc. follows IFRS. Instructions a. Calculate the post-retirement benefit expense for 2020. b. Calculate the post-retirement be
> Access the annual financial statements of Empire Company Limited for its year ended May 6, 2017, at www.sedar.com or the company's website. Instructions Review Empire Company Limited's consolidated financial statements and provide answers to the follo
> MFI Holdings Inc. follows IFRS and applies the FV-OCI model with recycling and has adopted the option to show dividends received as operating activities. MFI's SFP contained the following comparative data at December 31: At December 31, 2020, the follow
> Neilson Corp. reported $245,000 of net income for 2020. In preparing the statement of cash flows, the accountant noted several items that might affect cash flows from operating activities. 1. During 2020, Neilson reported a sale of equipment for $7,000.
> Gao Limited, a publicly traded company, uses IFRS and had the following events and transactions occur in its fiscal year ended October 31, 2020. Although no dates are given, the events described are in chronological order. 1. Gao Limited repurchased com
> Ashley Limited, which follows IFRS, chooses to classify interest and dividends received as well as interest paid as operating activities and dividends paid as financing activities. Ashley had the following information available at the end of 2020: Not
> Comparative SFP accounts of Jensen Limited, which follows IFRS, appear below: Data from Jensen's 2020 income statement follow: Additional information: 1. Equipment that cost $10,000 and was 40% depreciated was sold in 2020. 2. Cash dividends were dec
> Laflamme Inc. follows IFRS and has adopted the policy of classifying interest paid as operating activities and dividends paid as financing activities. Comparative SFP accounts of Laflamme Inc., and its statement of income for the year ended December 31,
> The following is Mann Corp.'s comparative SFP at December 31, 2020 and 2019, with a column showing the increase (decrease) from 2019 to 2020: Additional information: 1. On December 31, 2019, Mann acquired 25% of Bligh Corp.'s common shares for $266,000
> Davis Inc. is a privately held company that uses ASPE. Davis had the following information available at March 31, 2020: Davis Inc.'s partial list of comparative account balances as at March 31, 2020 and 2019, is as follows: Additional information: 1.
> Sharma Corporation has decided that, in preparing its 2020 financial statements under IFRS, two changes should be made from the methods used in prior years: 1. Depreciation. Sharma has used the tax basis (CCA) method of calculating depreciation for fina
> On December 31, 2020, before the books were closed, management and the accountant at Flanagan Inc. made the following determinations about three depreciable assets. 1. Depreciable asset A (building) was purchased on January 2, 2017. It originally cost $
> Conduit Corporation has 45 current employees: 5 managers and 40 non-managers. The average wage paid is $250 per day for non-managers. The company has just finished negotiating a new employee contract with the non-managers that would see this increase by
> The founder, president, and major shareholder of Dewitt Corp. recently sold his controlling interest in the company to a national distributor in the same line of business. The change in ownership was effective June 30, 2020, halfway through Dewitt's curr
> You are the auditor of Maglite Services Inc., a privately owned full-service cleaning company following ASPE. It is undergoing its first audit for the period ended September 30, 2020. The bank has requested that Maglite have its statements audited this y
> As at December 31, 2020, Kendrick Corporation is having its financial statements audited for the first time ever. The auditor has found the following items that might have an effect on previous years. 1. Kendrick purchased equipment on January 2, 2017,
> Refer to the information in P20.3. Instructions a. Prepare the journal entries that Situ would make on January 1, 2020, and the adjusting journal entries at December 31, 2020, to record the annual interest income from the lease arrangement, assuming t
> Leader Enterprises Ltd. follows IFRS and has provided the following information: 1. In 2019, Leader was sued in a patent infringement suit, and in 2020, Leader lost the court case. Leader must now pay a competitor $50,000 to settle the suit. No previous
> You have just been hired as the new controller of SWT Services Inc., and on the top of the stack of papers on your new desk is a bundle of draft contracts with a note attached. The note says, “Please help me to understand which of these leases would be b
> On May 5, 2021, you were hired by Gavin Inc., a closely held company that follows ASPE, as a staff member of its newly created internal auditing department. While reviewing the company's records for 2019 and 2020, you discover that no adjustments have ye
> You have been assigned to examine the financial statements of Picard Corporation for the year ended December 31, 2020, as prepared following IFRS. Picard uses a periodic inventory system. You discover the following situations: 1. The physical inventory
> It is December 2020 and Wagner Inc. recently hired a new accountant, Jodie Larson. Although Wagner is a private company, it follows IFRS. As part of her preparation of the 2020 financial statements for Wagner Inc., Jodie has proposed the following accoun
> Both the management of Kimmel Instrument Corporation, a small company that follows IFRS, and its independent auditors recently concluded that the company's results of operations will be reliable and more relevant in future years if Kimmel changes its met
> Access the financial statements of Air Canada and WestJet Airlines Ltd. for their years ended December 31, 2017, through SEDAR (www.sedar.com) or the companies' websites. Review the financial statements, including the notes, and then answer the following
> Nadeau Company, a small company following ASPE, is adjusting and correcting its books at the end of 2020. In reviewing its records, it compiles the following information. 1. Nadeau has failed to accrue sales commissions payable at the end of each of the
> The following facts pertain to a non-cancellable lease agreement between Woodhouse Leasing Corporation and McKee Electronics Ltd., a lessee, for a computer system: The collectibility of the lease payments is reasonably predictable, and there are no impo
> Your employer, Wagner Inc., is a large Canadian public company that uses IFRS 16. You have collected the following information about a lease for a fleet of trucks used by Wagner to transport completed products to warehouses across the country. The trucks
> Ramey Corporation is a diversified public company with nationwide interests in commercial real estate development, banking, copper mining, and metal fabrication. The company has offices and operating locations in major cities throughout Canada. With corp
> Synergetics Inc. leased a new crane to Gumo Construction Inc. under a six-year, non-cancellable contract starting February 1, 2020. The lease terms require payments of $21,500 each February 1, starting February 1, 2020. Synergetics will pay insurance and
> LePage Manufacturing Ltd. agrees to lease equipment to Labonté Ltée. on July 15, 2020. LePage follows ASPE and Labonté is a public company following IFRS 16. The following information relates to the lease agreement. 1. The lease term is seven years, wit
> On January 1, 2020, Hunter Ltd. entered into an agreement to lease a truck from Situ Ltd. Both Hunter and Situ use IFRS 16. The details of the agreement are as follows: Additional information: 1. There are no abnormal risks associated with the collecti
> Lanier Dairy Ltd. leases its milk cooling equipment from Green Finance Corporation. Both companies use IFRS 16. The lease has the following terms. 1. The lease is dated May 30, 2020, with a lease term of eight years. It is non-cancellable and requires e
> Gaming Inc. issued a debenture bond to Karamoutz Bank to finance new technology it developed. The debenture was for $500,000, issued at face value, with a 10-year term and interest payable at 10%. Gaming Inc.'s new technology proved not to be technically
> Under the temporary difference approach, the tax rates used for deferred tax calculations are those enacted at the balance sheet date, and affect how the reversal will be treated for tax purposes. Instructions For each of the following situations, dis
> The consolidated financial statements of Deutsche Lufthansa AG for the year ended December 31, 2017, are available in the company's 2017 annual report on the www.lufthansagroup.com website. Instructions a. What is included in the current liabilities f
> Shikkiah Corp. (which is a private enterprise) tries to attract the most knowledgeable and creative employees it can find. To help accomplish this, the company offers a special group of technology employees the right to a fully paid sabbatical leave afte
> Dubois Steel Corporation, as lessee, signed a lease agreement for equipment for five years, beginning January 31, 2020. Annual rental payments of $41,000 are to be made at the beginning of each lease year (January 31). The insurance and repairs and maint
> Lee Industries Inc. and Lor Inc. enter into an agreement that requires Lor Inc. to build three dieselelectric engines to Lee’s specifications. Both Lee and Lor follow ASPE and have calendar year ends. Upon completion of the engines, Lee has agreed to lea
> At the end of the December 31, 2019 fiscal year, Yin Trucking Corporation, which follows IFRS 16, negotiated and closed a long-term lease contract for newly constructed truck terminals and freight storage facilities. The buildings were erected to the com
> Assume the same information as in P20.9. Instructions Answer the following questions, rounding all numbers to the nearest dollar. a. Assuming that Woodhouse Leasing Corporation’s accounting period ends on September 30, answer the fo
> Assume the same information as in P20.9. Instructions Follow the instructions assuming that McKee Electronics follows IFRS 16. From P20.9: The following facts pertain to a non-cancellable lease agreement between Woodhouse Leasing Corporation and McKe
> Interior Design Inc. (ID) is a privately owned business that provides interior decorating options for consumers. ID follows ASPE. The software that it purchased six years ago to present clients with designs that are unique to their offices is no longer s
