Questions from Intermediate Accounting

Q: Earnhart Corporation has outstanding 3,000,000 shares of common

Earnhart Corporation has outstanding 3,000,000 shares of common stock with a par value of $10 each. The balance in its Retained Earnings account at January 1, 2017, was $24,000,000, and it then had Pa...

Q: Penn Company was formed on July 1, 2015. It was

Penn Company was formed on July 1, 2015. It was authorized to issue 300,000 shares of $10 par value common stock and 100,000 shares of 8% $25 par value, cumulative and nonparticipating preferred stock...

Q: Clemson Company had the following stockholders’ equity as of January 1,

Clemson Company had the following stockholders’ equity as of January 1, 2017. Common stock, $5 par value, 20,000 shares issued………. $100,000 Paid-in capital in excess of par—common stock………………. 300,00...

Q: Mask Company has 30,000 shares of $10 par value

Mask Company has 30,000 shares of $10 par value common stock authorized and 20,000 shares issued and outstanding. On August 15, 2017, Mask purchased 1,000 shares of treasury stock for $18 per share. M...

Q: Hatch Company has two classes of capital stock outstanding: 8%,

Hatch Company has two classes of capital stock outstanding: 8%, $20 par preferred and $5 par common. At December 31, 2017, the following accounts were included in stockholders’ equity. Preferred Sto...

Q: Washington Company has the following stockholders’ equity accounts at December 31,

Washington Company has the following stockholders’ equity accounts at December 31, 2017. Common Stock ($100 par value, authorized 8,000 shares) …. $480,000 Retained Earnings………………………………………………………………2...

Q: The books of Conchita Corporation carried the following account balances as of

The books of Conchita Corporation carried the following account balances as of December 31, 2017. Cash…………………………………………………………………………………………. $ 195,000 Preferred Stock (6% cumulative, nonparticipating, $...

Q: The following is a summary of all relevant transactions of Vicario Corporation

The following is a summary of all relevant transactions of Vicario Corporation since it was organized in 2017. In 2017, 15,000 shares were authorized and 7,000 shares of common stock ($50 par value) w...

Q: Why are inventories valued at the lower-of-cost-

Why are inventories valued at the lower-of-cost-or-net realizable value (LCNRV)? What are the arguments against the use of the LCNRV method of valuing inventories?

Q: Mickelson Inc. owns land that it purchased on January 1,

Mickelson Inc. owns land that it purchased on January 1, 2000, for $450,000. At December 31, 2017, its current value is $770,000 as determined by appraisal. At what amount should Mickelson report this...