Questions from Intermediate Accounting


Q: Bonata Inc. sells 1,400 common shares on a subscription

Bonata Inc. sells 1,400 common shares on a subscription basis at $65 per share on June 1 and accepts a 45% down payment. On December 1, Bonata collects the remaining 55% and issues the shares. Prepare...

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Q: On March 1, Kramers Inc. sells 1,000 common

On March 1, Kramers Inc. sells 1,000 common shares to its employees at $25 per share and lends the money to the employees to buy the new shares. The employees pay 50% of the price on the transaction d...

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Q: Platinum Corporation issued 4,000 of its common shares for $

Platinum Corporation issued 4,000 of its common shares for $66,000. The company also incurred $1,700 of costs associated with issuing the shares. Prepare a single combined journal entry to record the...

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Q: Higgins Inc. has 52,000 common shares outstanding. The

Higgins Inc. has 52,000 common shares outstanding. The shares have an average cost of $21 per share. On July 1, 2017, Higgins reacquired 800 shares at $56 per share and retired them. Assume no contrib...

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Q: Opsco Corp. provides the following information about its post-retirement

Opsco Corp. provides the following information about its post-retirement health care benefit plan for the year 2017: Current service cost…………………………………………………………………………$ 202,500 Contribution to the plan...

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Q: Spencer Limited has 50,000 common shares outstanding, with an

Spencer Limited has 50,000 common shares outstanding, with an average issue price per share of $8. On August 1, 2017, the company reacquired and cancelled 600 shares at $40 per share. There was contri...

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Q: Maple Leaf Foods Inc. is a Canadian company that produces food

Maple Leaf Foods Inc. is a Canadian company that produces food products such as prepared meats, ready-to-cook and ready-to-serve meals, and fresh pork and poultry. While most of Maple Leaf Foods’ busi...

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Q: Abourawes Services Inc. issued 1,000 $2 convertible preferred

Abourawes Services Inc. issued 1,000 $2 convertible preferred shares at $75 and 5,000 common shares at $25 each in 2016. Each preferred share is convertible into three common shares. On March 15, 2017...

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Q: Sometimes an entity issues financial instruments that require settlement using its own

Sometimes an entity issues financial instruments that require settlement using its own shares. Examples of these include purchased or written options to buy or sell its own shares, or forward contract...

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Q: During 2017, Genoa Limited issued retractable preferred shares. The shares

During 2017, Genoa Limited issued retractable preferred shares. The shares may be presented to the company by the holder for redemption after 2020. Explain how these should be presented in the financi...

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