Question: On January 1, 2012, Millay Inc. paid $

> Data for Andrews Inc. are presented in E23-13. In E23-13 Andrews Inc., a greeting card company, had the following statements prepared as of December 31, 2012. ANDREWS INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2012 Sales â€&brvb

> The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the accompanying notes to answer the following questions.

> At December 31, 2012, Grinkov Corporation had the following account balances. Installment Accounts Receivable, 2011 ………………………. $ 65,000 Installment Accounts Receivable, 2012 …………………….….. 110,000 Deferred Gross Profit, 2011 …………………………………………… 23,400 Deferr

> Use the information for Rode Inc. given in BE19-13. Assume that it is more likely than not that the entire net operating loss carryforward will not be realized in future years. Prepare all the journal entries necessary at the end of 2012. In BE19-13 Rod

> Distinguish between counterbalancing and noncounterbalancing errors. Give an example of each.

> Metheny Corporation’s lease arrangements qualify as sales-type leases at the time of entering into the transactions. How should the corporation recognize revenues and costs in these situations?

> The financial statements of Marks and Spencer plc Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.com/documents/publications/2010/Annual_Report_2010. Instructions Refer to

> The financial statements of Marks and Spencer plc (M&S) Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.com/documents/publications/2010/Annual_Report_2010. Instructions Ref

> Hollenbeck Foods Inc. sponsors a postretirement medical and dental benefit plan for its employees. The following balances relate to this plan on January 1, 2012. Plan assets ……………………………………………………………….……………..… $200,000 Expected postretirement benefit oblig

> In 2012, Steinrotter Construction Corp. began construction work under a 3-year contract. The contract price was $1,000,000. Steinrotter uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is b

> Bryant Construction Company began operations in 2011 and changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction contracts during 2012. For tax purposes, the company employs the completed contra

> On January 1, 2012, a machine was purchased for $900,000 by Floyd Co. The machine is expected to have an 8-year life with no salvage value. It is to be depreciated on a straight-line basis. The machine was leased to Crampton Inc. on January 1, 2012, at a

> The financial statements of P&G are provided in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the accompanying notes to answer the following questions. (

> At the end of 2012, Wasicsko Company has $180,000 of cumulative temporary differences that will result in reporting future taxable amounts as follows. 2013 ……………..……… $ 70,000 2014 ………………….……. 50,000 2015 ……………………….. 40,000 2016 ……………….………. 20,000 ………………

> Andrews Inc., a greeting card company, had the following statements prepared as of December 31, 2012. ANDREWS INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2012 Sales ………â€

> Lazaro Inc. sells goods on the installment basis and uses the installment-sales method. Due to a customer default, Lazaro repossessed merchandise that was originally sold for $800, resulting in a gross profit rate of 40%. At the time of repossession, the

> Rode Inc. incurred a net operating loss of $500,000 in 2012. Combined income for 2010 and 2011 was $350,000. The tax rate for all years is 40%. Rode elects the carryback option. Prepare the journal entries to record the benefits of the loss carryback and

> Explain how multiple-deliverable arrangements are measured and reported.

> “The financial statements of a company are management’s, not the accountant’s.” Discuss the implications of this statement.

> Simms Corp. controlled four domestic subsidiaries and one foreign subsidiary. Prior to the current year, Simms Corp. had excluded the foreign subsidiary from consolidation. During the current year, the foreign subsidiary was included in the financial sta

> Explain a multiple-deliverable arrangement. What is the major accounting issue related to these arrangements?

> Kleckner Company started operations in 2009, and although it has grown steadily, the company reported accumulated operating losses of $450,000 in its first four years in business. In the most recent year (2013), Kleckner appears to have turned the corner

> The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.com/documents/publications/2010/Annual_Report_2010. Instructions Refer to M&S’s financial statem

> The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements, accompanying notes, and management’s discussion and analysis

> In June 2012, the board of directors for McElroy Enterprises Inc. authorized the sale of $10,000,000 of corporate bonds. Jennifer Grayson, treasurer for McElroy Enterprises Inc., is concerned about the date when the bonds are issued. The company really n

> Larson Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2013, the following balances related to this plan. Plan assets (market-related value) ……………………………. $270,000 Projected benefit obligation ………………………………………… 340,000 Pensio

> On January 3, 2011, Martin Company purchased for $500,000 cash a 10% interest in Renner Corp. On that date, the net assets of Renner had a book value of $3,700,000. The excess of cost over the underlying equity in net assets is attributable to undervalue

> In 2011, Grishell Trucking Company negotiated and closed a long-term lease contract for newly constructed truck terminals and freight storage facilities. The buildings were erected to the company’s specifications on land owned by the co

> During 2012, Nilsen Company started a construction job with a contract price of $1,600,000. The job was completed in 2014. The following information is available. Instructions (a) Compute the amount of gross profit to be recognized each year, assuming

> Frederick Industries changed from the double-declining balance to the straight-line method in 2012 on all its plant assets. There was no change in the assets’ salvage values or useful lives. Plant assets, acquired on January 2, 2011, had an original cost

> On January 1, 2012, Secada Co. leased a building to Ryker Inc. The relevant information related to the lease is as follows. 1. The lease arrangement is for 10 years. 2. The leased building cost $3,600,000 and was purchased for cash on January 1, 2012. 3.

> The following facts relate to McKane Corporation. 1. Deferred tax liability, January 1, 2012, $60,000. 2. Deferred tax asset, January 1, 2012, $20,000. 3. Taxable income for 2012, $115,000. 4. Cumulative temporary difference at December 31, 2012, giving

> Data for Fairchild Company are presented in E23-11. In E23-11 Condensed financial data of Fairchild Company for 2012 and 2011 are presented below. FAIRCHILD COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2012 Sales …&acir

> Gordeeva Corporation began selling goods on the installment basis on January 1, 2012. During 2012, Gordeeva had installment sales of $150,000; cash collections of $54,000; cost of installment sales of $102,000. Prepare the company’s entries to record ins

> The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the accompanying notes to answer the following questions.

> Oliver Corporation has owned stock of Conrad Corporation since 2009. At December 31, 2012, its balances related to this investment were: Equity Investments …………………………………………… $185,000 Fair Value Adjustment (AFS)……………………….…… 34,000 Dr. Unrealized Holding G

> On January 1, 2012, Irwin Animation sold a truck to Peete Finance for $33,000 and immediately leased it back. The truck was carried on Irwin’s books at $28,000. The term of the lease is 5 years, and title transfers to Irwin at lease-end. The lease requir

> Conlin Corporation had the following tax information. In 2013, Conlin suffered a net operating loss of $480,000, which it elected to carry back. The 2013 enacted tax rate is 29%. Prepare Conlin’s entry to record the effect of the loss

> An article in the financial press entitled “Important Information in Annual Reports This Year” noted that annual reports include a management’s discussion and analysis section. What would this section contain?

> How is it determined whether deferred tax amounts are considered to be “related” to specific asset or liability amounts?

> Collinsworth Co. reported sales on an accrual basis of $100,000. If accounts receivable increased $30,000, and the allowance for doubtful accounts increased $9,000 after a write-off of $2,000, compute cash sales.

> Callaway Corp. has a deferred tax asset account with a balance of $150,000 at the end of 2012 due to a single cumulative temporary difference of $375,000. At the end of 2013, this same temporary difference has increased to a cumulative amount of $500,000

> The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.Com/documents/publications/2010/Annual_Report_2010. Instructions Refer to M&S’s financial statem

> A lease agreement between Lennox Leasing Company and Gill Company is described in IFRS21-10. Refer to the data in IFRS21-10 and do the following for the lessor. (Round all numbers to the nearest cent.) In IFRS21-10 The following facts pertain to a non-c

> Jack Kelly Company has grown rapidly since its founding in 2002. To instill loyalty in its employees, Kelly is contemplating establishment of a defined benefit plan. Kelly knows that lenders and potential investors will pay close attention to the impact

> The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the accompanying notes to answer the following questions.

> Nancy Tercek, the financial vice president, and Margaret Lilly, the controller, of Romine Manufacturing Company are reviewing the financial ratios of the company for the years 2012 and 2013. The financial vice president notes that the profit margin on sa

> The following summarized information relates to the installment-sales activity of Phillips Stores, Inc. for the year 2012. Installment sales during 2012 ………………………………………. $500,000 Cost of goods sold on installment basis ……………………………. 350,000 Collections f

> The following data relate to the operation of Kramer Co.’s pension plan in 2013. The pension worksheet for 2012 is provided in P20-10. Service cost …………&aci

> Assume the same data as in P21-10 with National Airlines Co. having an incremental borrowing rate of 10%. In P21-10 George Company manufactures a check-in kiosk with an estimated economic life of 12 years and leases it to National Airlines for a period

> On December 31, 2012, Grando Company sells production equipment to Fargo Inc. for $50,000. Grando includes a 1-year warranty service with the sale of all its equipment. The customer receives and pays for the equipment on December 31, 2012. Grando estimat

> Thurber Co. purchased equipment for $710,000 which was estimated to have a useful life of 10 years with a salvage value of $10,000 at the end of that time. Depreciation has been entered for 7 years on a straight-line basis. In 2013, it is determined that

> Grady Leasing Company signs an agreement on January 1, 2012, to lease equipment to Azure Company. The following information relates to this agreement. 1. The term of the noncancelable lease is 5 years with no renewal option. The equipment has an estimate

> Henning Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2012 in which no benefits were paid. 1. The actuarial present value of future benefits earned by employees for

> At December 31, 2012, Cascade Company had a net deferred tax liability of $450,000. An explanation of the items that compose this balance is as follows. Temporary Differences _________________Resulting Balances in Deferred Taxes 1. Excess of tax depreci

> The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the accompanying notes to answer the following questions.

> Access the glossary (“Master Glossary”) to answer the following. (a) What is a bargain-purchase option? (b) What is the definition of “incremental borrowing rate”? (c) What is the definition of “estimated residual value”? (d) What is an unguaranteed

> Condensed financial data of Fairchild Company for 2012 and 2011 are presented below. FAIRCHILD COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2012 Sales …………&acir

> Archer Construction Company began work on a $420,000 construction contract in 2012. During 2012, Archer incurred costs of $278,000, billed its customer for $215,000, and collected $175,000. At December 31, 2012, the estimated future costs to complete the

> Simmons Corporation owns stock of Armstrong, Inc. Prior to 2012, the investment was accounted for using the equity method. In early 2012, Simmons sold part of its investment in Armstrong, and began using the fair value method. In 2012, Armstrong earned n

> At December 31, 2012, Fell Corporation had a deferred tax liability of $680,000, resulting from future taxable amounts of $2,000,000 and an enacted tax rate of 34%. In May 2013, a new income tax act is signed into law that raises the tax rate to 40% for

> Parsons Inc. wishes to change from the completed-contract to the percentage-of-completion method for financial reporting purposes. The auditor indicates that a change would be permitted only if it is to a preferable method. What difficulties develop in a

> At December 31, 2012, Cascade Company had a net deferred tax liability of $450,000. An explanation of the items that compose this balance is as follows. Temporary Differences in Deferred Taxes _________________Resulting Balances 1. Excess of tax depreci

> The financial statements of Marks and Spencer plc Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http:/corporate.marksandspencer.com/documents/publications/2010/Annual_Report_2010. Instructions Refer to M

> The following facts pertain to a non-cancelable lease agreement between Lennox Leasing Company and Gill Company, a lessee. (Round all numbers to the nearest cent.) Inception date: May 1, 2012 Annual lease payment due at the beginning of each year, beginn

> Linda Berstler Company sponsors a defined benefit pension plan. The corporation’s actuary provides the following information about the plan. The average remaining service life per employee is 20 years. The average time to vesting past

> Kramer Co. has prepared the following pension worksheet. Unfortunately, several entries in the worksheet are not decipherable. The company has asked your assistance in completing the worksheet and completing the accounting tasks related to the pension pl

> Peterson Industries has three operating divisions— Farber Mining, Glesen Paperbacks, and Enyart Protection Devices. Each division maintains its own accounting system and method of revenue recognition. Farber Mining Farber Mining specializes in the extrac

> You have been asked by a client to review the records of Roberts Company, a small manufacturer of precision tools and machines. Your client is interested in buying the business, and arrangements have been made for you to review the accounting records. Yo

> George Company manufactures a check-in kiosk with an estimated economic life of 12 years and leases it to National Airlines for a period of 10 years. The normal selling price of the equipment is $278,072, and its unguaranteed residual value at the end of

> Appliance Center is an experienced home appliance dealer. Appliance Center also offers a number of services together with the home appliances that it sells. Assume that Appliance Center sells ovens on a standalone basis. Appliance Center also sells insta

> On January 1, 2008, McElroy Company purchased a building and equipment that have the following useful lives, salvage values, and costs. Building, 40-year estimated useful life, $50,000 salvage value, $1,200,000 cost Equipment, 12-year estimated useful li

> Fieval Leasing Company signs an agreement on January 1, 2012, to lease equipment to Reid Company. The following information relates to this agreement. 1. The term of the noncancelable lease is 6 years with no renewal option. The equipment has an estimate

> Webb Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2012, the following balances relate to this plan. Plan assets …………………………………………….. $480,000 Projected benefit obligation ……………………….. 600,000 Pension asset/liability ………………

> Lanier Corporation has pretax financial income (or loss) equal to taxable income (or loss) from 2005 through 2013 as follows. Pretax financial income (loss) and taxable income (loss) were the same for all years since Lanier has been in business. Assume

> Following are selected balance sheet accounts of Sander Bros. Corp. at December 31, 2012 and 2011, and the increases or decreases in each account from 2011 to 2012. Also presented is selected income statement information for the year ended December 31, 2

> Guillen, Inc. began work on a $7,000,000 contract in 2012 to construct an office building. Guillen uses the completed-contract method. At December 31, 2012, the balances in certain accounts were Construction in Process $1,715,000; Accounts Receivable $24

> Palmer Co. is evaluating the appropriate accounting for the following items. 1. Management has decided to switch from the FIFO inventory valuation method to the LIFO inventory valuation method for all inventories. 2. When the year-end physical inventory

> Koch Corporation is in the process of preparing its annual financial statements for the fiscal year ended April 30, 2013. Because all of Koch’s shares are traded intrastate, the company does not have to file any reports with the Securities and Exchange C

> Clydesdale Corporation has a cumulative temporary difference related to depreciation of $580,000 at December 31, 2012. This difference will reverse as follows: 2013, $42,000; 2014, $244,000; and 2015, $294,000. Enacted tax rates are 34% for 2013 and 2014

> Explain a principal-agent relationship and its significance to revenue recognition.

> Broussard Company reported net income of $3.5 million in 2012. Depreciation for the year was $520,000; accounts receivable increased $500,000; and accounts payable increased $300,000. Compute net cash flow from operating activities using the indirect met

> Identify the five components that comprise pension expense. Briefly explain the nature of each component.

> The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.Com/documents/publications/2010/Annual_ Report_2010. Instructions Refer to M&S’s financial state

> Youngman Corporation has temporary differences at December 31, 2012, that result in the following deferred taxes. Deferred tax asset …………….. $24,000 Deferred tax liability ………….. $69,000 Indicate how these balances would be presented in Youngman’s Decem

> Buhl Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2012, the following balances relate to this plan. Plan assets …………………………………………………….. $480,000 Defined benefit obligation ……………………………….... 625,000 Pension asset/liability

> Brecker Company leases an automobile with a fair value of $10,906 from Emporia Motors, Inc., on the following terms: 1. Non-cancelable term of 50 months. 2. Rental of $250 per month (at end of each month). (The present value at 1% per month is $9,800.) 3

> Hobbs Co. has the following defined benefit pension plan balances on January 1, 2012. Projected benefit obligation ………………â€

> Dingel Corporation has contracted with you to prepare a statement of cash flows. The controller has provided the following information. Additional data related to 2012 are as follows. 1. Equipment that had cost $11,000 and was 30% depreciated at time o

> The following statement was prepared by Maloney Corporation’s accountant. MALONEY CORPORATION STATEMENT OF SOURCES AND APPLICATION OF CASH FOR THE YEAR ENDED SEPTEMBER 30, 2012 Sources of cash Net income ………………………………………………………………………………………………………. $111,000

> Lowell Corporation has used the accrual basis of accounting for several years. A review of the records, however, indicates that some expenses and revenues have been handled on a cash basis because of errors made by an inexperienced bookkeeper. Income sta

> Shapiro Inc. was incorporated in 2011 to operate as a computer software service firm with an accounting fiscal year ending August 31. Shapiro’s primary product is a sophisticated online inventory-control system; its customers pay a fixed fee plus a usage

> Wise Company began operations at the beginning of 2013. The following information pertains to this company. 1. Pretax financial income for 2013 is $100,000. 2. The tax rate enacted for 2013 and future years is 40%. 3. Differences between the 2013 income

> On May 3, 2012, Eisler Company consigned 80 freezers, costing $500 each, to Remmers Company. The cost of shipping the freezers amounted to $840 and was paid by Eisler Company. On December 30, 2012, a report was received from the consignee, indicating tha

> Tarkington Co. purchased a machine on January 1, 2009, for $440,000. At that time it was estimated that the machine would have a 10-year life and no salvage value. On December 31, 2012, the firm’s accountant found that the entry for depreciation expense

> A lease agreement between Lennox Leasing Company and Gill Company is described in E21-8. In E21-8 The following facts pertain to a noncancelable lease agreement between Lennox Leasing Company and Gill Company, a lessee. Inception date: ……………………………………………

> The pretax financial income (or loss) figures for Synergetics Company are as follows. 2008 …………………….. $160,000 2009 ………………………. 250,000 2010 ………………………… 90,000 2011 ……………………… (160,000) 2012 ……………………. (350,000) 2013 ………………………. 120,000 2014 ………………………. 100,00

> Waubansee Corp. uses the direct method to prepare its statement of cash flows. Relevant balances for Waubansee at December 31, 2012 and 2011, are as follows. Additional information: 1. Waubansee purchased $5,000 in equipment during 2012. 2. Waubansee a

> Use the information from BE18-7, but assume Turner uses the completed-contract method. Prepare the company’s 2012 journal entries. In BE18-7 Turner, Inc. began work on a $7,000,000 contract in 2012 to construct an office building. During 2012, Turner, I

> Norton Co. had the following amounts related to its pension plan in 2012. Actuarial liability loss for 2012 ………………………………………………………………….. $28,000 Unexpected asset gain for 2012 ……………………………………………………………….…. 18,000 Accumulated other comprehensive income (G/L)