Questions from Intermediate Accounting

Q: R. Wilson Corporation commenced operations in early 2017. The corporation

R. Wilson Corporation commenced operations in early 2017. The corporation incurred $60,000 of costs such as fees to underwriters, legal fees, state fees, and promotional expenditures during its format...

Q: Treasure Land Corporation incurred the following costs in 2017. Cost

Treasure Land Corporation incurred the following costs in 2017. Cost of laboratory research aimed at discovery of new knowledge …………. $120,000 Cost of testing in search for product alternatives ……………...

Q: Indicate whether the following items are capitalized or expensed in the current

Indicate whether the following items are capitalized or expensed in the current year. a. Purchase cost of a patent from a competitor. b. Research and development costs. c. Organizational costs. d....

Q: Stephan Curry, Inc., spent $68,000 in attorney

Stephan Curry, Inc., spent $68,000 in attorney fees while developing the trade name of its new product, the Mean Bean Machine. Prepare the journal entries to record the $68,000 expenditure and the fir...

Q: Gershwin Corporation obtained a franchise from Sonic Hedgehog Inc. for a

Gershwin Corporation obtained a franchise from Sonic Hedgehog Inc. for a cash payment of $120,000 on April 1, 2017. The franchise grants Gershwin the right to sell certain products and services for a...

Q: On September 1, 2017, Winans Corporation acquired Aumont Enterprises for

On September 1, 2017, Winans Corporation acquired Aumont Enterprises for a cash payment of $700,000. At the time of purchase, Aumont’s balance sheet showed assets of $620,000, liabilities of $200,000,...

Q: Vania Magazine Company started construction of a warehouse building for its own

Vania Magazine Company started construction of a warehouse building for its own use at an estimated cost of $5,000,000 on January 1, 2016, and completed the building on December 31, 2016. During the c...

Q: Nieland Industries had one patent recorded on its books as of January

Nieland Industries had one patent recorded on its books as of January 1, 2017. This patent had a book value of $288,000 and a remaining useful life of 8 years. During 2017, Nieland incurred research a...

Q: Scorcese Inc. is involved in a lawsuit at December 31,

Scorcese Inc. is involved in a lawsuit at December 31, 2017. a. Prepare the December 31 entry assuming it is probable that Scorcese will be liable for $900,000 as a result of this suit. b. Prepare t...

Q: Calaf’s Drillers erects and places into service an off-shore oil

Calaf’s Drillers erects and places into service an off-shore oil platform on January 1, 2018, at a cost of $10,000,000. Calaf is legally required to dismantle and remove the platform at the end of its...