Questions from Intermediate Accounting

Q: Aykroyd Inc. has sponsored a noncontributory, defined benefit pension plan

Aykroyd Inc. has sponsored a noncontributory, defined benefit pension plan for its employees since 1989. Prior to 2012, cumulative net pension expense recognized equaled cumulative contributions to th...

Q: On March 1, 2012, Pechstein Construction Company contracted to construct

On March 1, 2012, Pechstein Construction Company contracted to construct a factory building for Fabrik Manufacturing Inc. for a total contract price of $8,400,000. The building was completed by Octobe...

Q: Vickie Plato, accounting clerk in the personnel office of Streisand Corp

Vickie Plato, accounting clerk in the personnel office of Streisand Corp., has begun to compute pension expense for 2014 but is not sure whether or not she should include the amortization of unrecogni...

Q: Brockman Guitar Company is in the business of manufacturing top-quality

Brockman Guitar Company is in the business of manufacturing top-quality, steel-string folk guitars. In recent years, the company has experienced working capital problems resulting from the procurement...

Q: Maria Rodriquez and Lynette Kingston are discussing accounting for income taxes.

Maria Rodriquez and Lynette Kingston are discussing accounting for income taxes. They are currently studying a schedule of taxable and deductible amounts that will arise in the future as a result of e...

Q: Your firm has been engaged to examine the financial statements of AlmadenCorporation

Your firm has been engaged to examine the financial statements of AlmadenCorporation for the year 2012. The bookkeeper who maintains the financial records has prepared all the unaudited financial stat...

Q: Joblonsky Inc. has recently hired a new independent auditor, Karen

Joblonsky Inc. has recently hired a new independent auditor, Karen Ogleby, who says she wants “to get everything straightened out.” Consequently, she has proposed the following accounting changes in c...

Q: Turner, Inc. began work on a $7,000

Turner, Inc. began work on a $7,000,000 contract in 2012 to construct an office building. During 2012, Turner, Inc. incurred costs of $1,700,000, billed its customers for $1,200,000, and collected $96...

Q: Villa Company has experienced tough competition, leading it to seek concessions

Villa Company has experienced tough competition, leading it to seek concessions from its employees in the company’s pension plan. In exchange for promises to avoid layoffs and wage cuts, the employees...

Q: At December 31, 2012, Hillyard Corporation has a deferred tax

At December 31, 2012, Hillyard Corporation has a deferred tax asset of $200,000. After a careful review of all available evidence, it is determined that it is probable that $60,000 of this deferred ta...