Questions from Intermediate Accounting


Q: A partial statement of financial position of Blue water Ltd. on

A partial statement of financial position of Blue water Ltd. on December 31, 2019, showed the following property, plant, and equipment assets accounted for under the cost model (accumulated depreciati...

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Q: On January l, 2020, Algo Ltd. acquires a building

On January l, 2020, Algo Ltd. acquires a building at a cost of $230,000. The building is expected to have a 20-year life and no residual value. The asset is accounted for under the revaluation model,...

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Q: On January 1, 2020, the accounting records of Sasseville Ltee

On January 1, 2020, the accounting records of Sasseville Ltee included a debit balance of $15 million in the building account and of $12 million in the related accumulated depreciation account. The bu...

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Q: The following transactions occurred during 2020. Assume that depreciation of 10

The following transactions occurred during 2020. Assume that depreciation of 10% per year is charged on all machinery and 5% per year on buildings, on a straight-line basis, with no estimated residual...

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Q: On December 31, 2020, Omega Inc., a public company

On December 31, 2020, Omega Inc., a public company, borrowed $3 million at 12% payable annually to finance the construction of a new building. In 2021, the company made the following expenditures rela...

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Q: The following three situations involve the capitalization of borrowing costs for public

The following three situations involve the capitalization of borrowing costs for public companies following IFRS. Situation 1 On January 1, 2020, Oksana Inc. signed a fixed-price contract to have Buil...

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Q: In early February 2020, Huey Corp. began construction of an

In early February 2020, Huey Corp. began construction of an addition to its head office building that is expected to take 18 months to complete. The following 2020 expenditures relate to the addition:...

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Q: Native Inc. decided to purchase equipment from Central Ontario Industries on

Native Inc. decided to purchase equipment from Central Ontario Industries on January 2, 2020, to expand its production capacity to meet customers' demand for its product. Native issued a $900,000, fiv...

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Q: On September 1, 2020, Rupert Ltd. Purchased equipment for

On September 1, 2020, Rupert Ltd. Purchased equipment for $30,000 by signing a two-year note payable with a face value of $30,000 due on September 1, 2022. The going rate of interest for this level of...

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Q: Cannon Ltd. purchased an electric wax melter on April 30,

Cannon Ltd. purchased an electric wax melter on April 30, 2020, by trading in its old gas model and paying the balance in cash. The following data relate to the purchase: Instructions Assuming that...

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