Questions from Intermediate Accounting

Q: Regina Corporation, which uses ASPE, manufactures replicators. On May

Regina Corporation, which uses ASPE, manufactures replicators. On May 29, 2017, it leased to Barnes Limited a replicator that cost $265,000 to manufacture and usually sells for $410,000. The lease agr...

Q: Chorus Aviation Inc. is a Canadian aviation holding company that provides

Chorus Aviation Inc. is a Canadian aviation holding company that provides, through Jazz Aviation LP, a “significant part of Air Canada’s domestic and trans border network.” Chorus indicates in Note 1...

Q: Use the information for Regina Corporation from BE20-16. Assume

Use the information for Regina Corporation from BE20-16. Assume instead that the residual value is not guaranteed. Prepare Regina’s May 29, 2017 journal entries. Data from BE20-16: Regina Corporatio...

Q: On January 1, 2017, Clark Inc. sold a piece

On January 1, 2017, Clark Inc. sold a piece of equipment to Daye Ltd. for $200,000, and immediately leased the equipment back. At the time, the equipment was carried on Clark’s books at a cost of $300...

Q: Palmer Corp. is evaluating the appropriate accounting for the following items

Palmer Corp. is evaluating the appropriate accounting for the following items under ASPE: 1. Management has decided to switch from the FIFO inventory cost formula to the weighted average cost formula...

Q: At the beginning of 2017, Armstead Corporation discovered that depreciation expense

At the beginning of 2017, Armstead Corporation discovered that depreciation expense in the years prior to 2017 was incorrectly calculated and recorded. For the years before 2017, total depreciation ex...

Q: ASPE does not permit the correction of an error to be accounted for

ASPE does not permit the correction of an error to be accounted for using partial retrospective restatement or prospective restatement. However, IAS 8 does allow partial retrospective restatement or e...

Q: Talbert, Inc. changed from the weighted average cost formula to

Talbert, Inc. changed from the weighted average cost formula to the FIFO cost formula in 2017. The increase in the prior year’s income before tax as a result of this change is $228,000. The tax rate i...

Q: Refer to the information for Rebek Corporation in E19-3.

Refer to the information for Rebek Corporation in E19-3. Instructions: (a) Prepare a pension work sheet: insert the January 1, 2017 balances and show the December 31, 2017 balances. (b) Prepare all j...

Q: Chang Limited is in the development phase of creating a new form

Chang Limited is in the development phase of creating a new form of medicine. In the past, the company has always capitalized development costs as long as the criteria under IFRS and ASPE were met. Ch...