Questions from Intermediate Accounting

Q: Reddy Industries has the following patents on its December 31, 2011

Reddy Industries has the following patents on its December 31, 2011, balance sheet. The following events occurred during the year ended December 31, 2012. 1. Research and development costs of $245,7...

Q: Fred Graf, owner of Graf Interiors, is negotiating for the

Fred Graf, owner of Graf Interiors, is negotiating for the purchase of Terrell Galleries. The balance sheet of Terrell is given in an abbreviated form below. Graf and Terrell agree that: 1. Land is...

Q: On July 1, 2012, Gissel Corporation purchased Mills Company by

On July 1, 2012, Gissel Corporation purchased Mills Company by paying $250,000 cash and issuing a $150,000 note payable. At July 1, 2012, the balance sheet of Mills Company was as follows. The recor...

Q: At a recent meeting of the accounting staff in your company,

At a recent meeting of the accounting staff in your company, the controller raised the issue of using present value techniques to conduct impairment tests for some of the company’s fixed assets. Some...

Q: Presented below is information related to copyrights owned by Botticelli Company at

Presented below is information related to copyrights owned by Botticelli Company at December 31, 2012. Cost ……………………………………………………… $8,600,000 Carrying amount …………………………………….. 4,300,000 Expected future...

Q: Presented below is net asset information related to the Mischa Division of

Presented below is net asset information related to the Mischa Division of Santana, Inc. MISCHA DIVISION NET ASSETS AS OF DECEMBER 31, 2012 (IN MILLIONS) Cash …………………………………………………………………….. $ 60 Accoun...

Q: Margaret Avery Company from time to time embarks on a research program

Margaret Avery Company from time to time embarks on a research program when a special project seems to offer possibilities. In 2011, the company expends $325,000 on a research project, but by the end...

Q: Martinez Company incurred the following costs during 2012 in connection with its

Martinez Company incurred the following costs during 2012 in connection with its research and development activities. Cost of equipment acquired that will have alternative uses in future R&D projects...

Q: Majoli Inc. has capitalized computer software costs of $3,

Majoli Inc. has capitalized computer software costs of $3,900,000 on its new “Trenton” software package. Revenues from 2012 (first year) sales are $2,000,000. Additional future revenues from “Trenton”...

Q: During 2012, Botosan Enterprises Inc. spent $5,000

During 2012, Botosan Enterprises Inc. spent $5,000,000 developing its new “Dover” software package. Of this amount, $2,600,000 was spent before technological feasibility was established for the produc...