Questions from Intermediate Accounting

Q: In its 2015 annual report, Gap Inc. reported inventory of

In its 2015 annual report, Gap Inc. reported inventory of $1,889 million on January 31, 2015, and $1,928 million on February 1, 2014, cost of goods sold of $10,146 million for 2015, and net sales of $...

Q: Francis Corporation purchased an asset at a cost of $50,

Francis Corporation purchased an asset at a cost of $50,000 on March 1, 2017. The asset has a useful life of 8 years and a salvage value of $4,000. For tax purposes, the MACRS class life is 5 years. C...

Q: Use the information for Lockard Company given in BE11-2.

Use the information for Lockard Company given in BE11-2. a. Compute 2017 depreciation expense using the sum-of-the-years’-digits method. b. Compute 2017 depreciation expense using the sum-of-the-yea...

Q: Ottawa Corporation owns machinery that cost $20,000 when purchased

Ottawa Corporation owns machinery that cost $20,000 when purchased on July 1, 2014. Depreciation has been recorded at a rate of $2,400 per year, resulting in a balance in accumulated depreciation of $...

Q: Use the information presented for Ottawa Corporation in BE10-14,

Use the information presented for Ottawa Corporation in BE10-14, but assume the machinery is sold for $5,200 instead of $10,500. Prepare journal entries to a. update depreciation for 2018 and b. rec...

Q: Use the information for Lockard Company given in BE11-2.

Use the information for Lockard Company given in BE11-2. a. Compute 2017 depreciation expense using the double-declining-balance method. b. Compute 2017 depreciation expense using the double-declini...

Q: Steele Corporation purchased a significant amount of raw materials inventory for a

Steele Corporation purchased a significant amount of raw materials inventory for a new product that it is manufacturing. Steele uses the lower-of-average-cost-or-net realizable value (LCNRV) rule for...

Q: Cominsky Company purchased a machine on July 1, 2018, for

Cominsky Company purchased a machine on July 1, 2018, for $28,000. Cominsky paid $200 in title fees and county property tax of $125 on the machine. In addition, Cominsky paid $500 shipping charges for...

Q: Holt Company purchased a computer for $8,000 on January

Holt Company purchased a computer for $8,000 on January 1, 2016. Straight-line depreciation is used, based on a 5-year life and a $1,000 salvage value. In 2018, the estimates are revised. Holt now fee...

Q: Taylor Swift Corporation purchases a patent from Salmon Company on January 1

Taylor Swift Corporation purchases a patent from Salmon Company on January 1, 2017, for $54,000. The patent has a remaining legal life of 16 years. Taylor Swift feels the patent will be useful for 10...