Assume that Jarden Associates began the year with 75,000 outstanding shares and implemented a 7% stock dividend on January 1 of the current year. Jarden employees held 90,000 options that were granted on April 1. If exercised, there would be 18,000 incremental shares. On July 1, Jarden implemented a 3-for-1 stock split. Finally, on November 1, the company purchased 135,000 shares to be held in the treasury. Compute the denominator for basic and diluted earnings per share. Assume that the stock split also applies to the options.
> On January 1, 2018, Stark Incorporated issued $1,500,000 par value, 5%, 7-year bonds (i.e., there were 1,500 of $1,000 par value bonds in the issue). Interest is payable semiannually each January 1 and July 1 with the first interest payment due at the en
> Fredrick Wilson Company determined that one of its finite-life intangible assets is impaired. The asset’s net carrying value on the date of the impairment is $905,000. Fredrick Wilson does not use a separate accumulated amortization acc
> On December 31, an entity analyzed a finite life trademark with a net carrying value of $750,000 for impairment. The entity determined the following: Fair value (less costs to sell) $ 700,000 Present value of future cash flows 710,000 What is the impairm
> Sumrall Corporation owns machinery that was purchased 20 years ago. The machinery, which originally cost $2,000,000, has been depreciated using the straight-line method using a 40-year useful life and no salvage value and has a current carrying amount of
> Using the information provided in E15-5, prepare the journal entries to record the acquisition of the treasury stock assuming that it is immediately retired. Also, prepare the journal entries to record the loss and the dividend transactions as well as th
> On December 31, Star Corp. had a reporting unit that had a book value of $950,000, including goodwill of $130,000. As part of the company’s annual review of goodwill impairment, Star determined that the fair value of the reporting unit was $890,000. Star
> On December 31, an entity analyzed a finite life trademark with a net carrying value of $750,000 for impairment. The entity determined the following: Fair value $700,000 Undiscounted future cash flows $740,000 What is the impairment loss that will be rep
> SMC Research Associates reports the following intangible assets on its December 31 balance sheet: It does not use a separate accumulated amortization account for the intangible assets (i.e., it deducts the amount of amortization directly from the intang
> Derrick’s Domino Manufacturing Company learned that one of its cutting machines is obsolete. Although the company will continue to use this machinery in the future, management believes that an impairment write-down is required. The foll
> Use the same information from E12-1 except now assume the following cash-flow projections: Required: a. Compute the impairment loss for the current year, if any. b. Prepare the journal entry to record the impairment loss, if needed. Data from E12-1:
> Henne Optical Corporation reported the following information regarding long-term operating assets for its Lens Manufacturing Operations: Recent advances in technology have rendered the company’s lens manufacturing operations nearly obs
> Prepare the operating activities section of the statement of cash flows for Michael Hart Associates in E22-7 using the indirect method assuming that Michael Hart Associates reports under IFRS. Hart begins the operating activities section with operating i
> Prepare the cash flow statement under the direct format for Michael Hart Associates using the data provided in E22-7. Data from E22-7:
> West Fork Corporation issued $100,000 par value, 6%, 4-year bonds (i.e., there were 100 of $1,000 par value bonds in the issue). Interest is payable annually with the first interest payment made at the end of the period. West Fork paid $1,800 in underwri
> Michael Hart Associates closed its books for the current year. The firm provided the following comparative balance sheets and income statement. Additional Information: The company sold its indefinite-life intangible assets at their carrying value. Cash
> The following shareholders’ equity section was taken from the books of Aubry Corporation at the beginning of the current year: Required: a. Prepare the journal entries required to record each of the following events: â€&c
> Using the information provided in E22-5, prepare the cash flow statement for SuperView Company using the direct method. Provide all required disclosures.
> Super View Company’s comparative balance sheets and its current income statement follow. Additional Information : • SuperView did not sell any plant or intangible assets during the current year. It acquired equipment
> Sansa Accessories, Inc. reported the following comparative balance sheets and income statement for the current year. Sansa Accessories purchased new equipment for $948 and sold equipment with a net book value of $320. Both events were cash transactions.
> Acerler Fixtures, Inc. reported the following comparative balance sheets and income statement for the current year. Acerler Fixtures purchased new equipment for $258 and sold equipment with a net book value of $45. Both events were cash transactions. It
> Use the information from E22-1 assuming that Hockey Apparel Providers, Inc. is an IFRS reporter. Compute cash flows from operating activities for the firm under the indirect reporting format assuming that Hockey reconciles income before taxes to operatin
> Using the information provided in E22-15, prepare Cuthbert’s current-year statement of cash flows under the direct reporting format. Data from E22-15:
> Cuthbert Cookware Distributors, Inc. is a wholesale distributor of brand-name cookware products. The company’s current-year comparative balance sheets and income statement follow. Additional information: • All dividen
> Using the information provided in E22-12, prepare the statement of cash flows for Ferragosto Services, Ltd. under the indirect method. Use operating income as the starting point. Assume that interest expense and dividends paid are financing activities an
> Using the information provided in E22-12, prepare the statement of cash flows for Ferragosto Services, Ltd. under the direct method. Data from E22-12:
> Using the information from BE14-11, determine the issue price of the bonds assuming that the market rate of interest is 6%, and prepare the journal entry to record the bond issue. Data From BE14-11: On January 1, Plum Company issued $800,000 par value,
> Using the information provided in E15-3, prepare the journal entry to record the acquisition of the new computer system assuming that the system is a standardized product with a current retail value of $1,470,000 Data from E15-3: Liberty Associates rece
> Ferragosto Services, Ltd. provided the following comparative balance sheets and income statement for the current year. Additional Information: • Ferragosto included the $24,150 loss on disposal of investments in selling, general, and a
> Complete the requirements of E22-10 using the direct method. Data from E22-10: Prepare the cash flow statement for Starland Corporation for the current year using the indirect method. Provide all required disclosures
> Starland Corporation provided the following comparative balance sheets and income statement. Additional Information: • Starland did not acquire any additional plant assets during the current year. • Starland sold equ
> Hockey Apparel Providers, Inc. provided the following information for the current year. Required: a. Compute cash flows from operating activities for Hockey Apparel Providers under the indirect reporting format. b. Compute cash flows from operating ac
> Tuscany Timber Company incorrectly recorded inventory in 2017. Rather than recording ending inventory as $2,200, Tuscany’s accounting manager entered $2,500. An inventory summary for 2017 and 2018 follows Required: a. Prepare an analy
> Lombardo Lumber Company incorrectly recorded inventory in 2017. Rather than recording ending inventory as $500, Lombardo’s accounting manager entered $560, overstating ending inventory by $60. An inventory summary for 2017 and 2018 as a
> Feinstein and Company completed an internal audit of its bookkeeping system that uncovered several errors. It discovered the errors on December 31 before the books were closed. a. A $45,000 payment for advertising was recorded as an asset in the account
> Hi-Lo Corporation elected to change its method of depreciation from the double-declining balance method to the straight-line method on January 1, of the current year. It acquired the equipment 2 years ago on January 1 for $300,000. The original estimated
> Corrnuto Equipment Manufacturers, Inc. (CEM) reported the net book value of a plant asset at $2,600,000 on January 1 of the current year. There is a $500,000 expected residual value, and the estimated useful life is 25 years. On January 1 of the current
> Winthur Stores began operations on January 1, 2014, and adopted the FIFO method of accounting for its inventory for book and tax purposes. In 2017, it is considering a change to the average-cost method basis for book purposes only. Winthur provided the f
> Liberty Associates recently hired Gervin Brothers to develop an online sales system for its consumer products division. The customized online system does not have a readily determinable market value. Gervin wanted to be paid in Liberty common shares. As
> On January 1, Plum Company issued $800,000 par value, 8%, 5-year bonds (i.e., there were 800 of $1,000 par value bonds in the issue). Interest is payable semiannually each January 1 and July 1 with the first interest payment due at the end of the period
> Arlen Technology Solutions, Inc. adopted the percentage-of-completion method when it began operations on January 1, 2016. The company elected to change to the completed-contract method on January 1, 2018, due to a change in the size of its computer netwo
> Greer Incorporated discovered the following errors on the books at the beginning of 2017: a. Maintenance expense on account was overstated by $20,000 in 2015 and understated by $30,000 in 2016. The payables for both years are still unpaid. b. Depreciatio
> Massi Pharmacies, Inc. started operations on January 1, 2014. The company initially used the average-cost method to value its inventory for both book and tax purposes. Effective January 1, 2018, Massi elected to change its inventory valuation method to t
> You are computing annual earnings per share and required disclosures for Tracy Fencing based on company-provided information. Net income is $4,500,000. The weighted-average number of shares is 2,700,000. The year-end balance of outstanding shares is also
> Assume that the $3,500,000 net income reported by Stewart Stamping in E20-4 includes a $780,000 loss from discontinued operations, net of tax. Required: a. Based on this information, compute basic and diluted earnings per share for the current year. b.
> Topher Company began the current year with 1,600,000 common shares outstanding. It also reported $800,000 par value, 2% convertible bonds outstanding all year. The bonds were issued at par and can be converted to 800,000 shares of common stock. Topher ma
> On January 1, Bright Star Inc. had 600,000 common shares outstanding. The company issued an additional 200,000 shares on March 1. Bright Star also issued $1,000,000 par value, 2% nonconvertible, noncumulative preferred stock on October 1 and declared div
> Use the same information in E20-4 except assume that the company issued $10,000,000, 2.5% convertible bonds on June 30 (i.e., $250,000 coupon interest annually), which are convertible into 325,000 shares of common stock. Based on this information, comput
> Stewart Stamping began the current year with 400,000 common shares outstanding and issued an additional 150,000 shares on September 1. The firm has $10,000,000, 2.5% convertible bonds outstanding for a full year (i.e., $250,000 coupon interest per year),
> On January 1, 2018, Queens Company reported the following stockholders’ equity: On January 4, the company purchased 10,000 shares of its own stock at $25 per share to be held as treasury stock. On June 30, the company declared a $2 per
> Using the information from BE14-9, determine the issue price of the bonds assuming that the market rate of interest is 4% Data from BE14-9: Jorge Corporation issued $100,000 par value, 6%, 4-year bonds (i.e., there were 100 of $1,000 par value bonds in
> Thomas Company began the year with 150,000 common shares outstanding. The firm issued an additional 75,000 shares on May 1 and 15,000 shares on November 1. In addition, Thomas implemented a 2-for-1 stock split on July 1. The firm’s year-end is December 3
> Refer to the income statement for Gamba Incorporated from E20-11, noting the following modifications: Required: a. Based on the information provided, compute basic and diluted earnings per share for the current year. Include all computations related to
> We present Gamba Incorporated’s current-year partial income statement: Gamba is subject to a 35% income tax rate. Required: a. Based on the information provided, compute basic and diluted earnings per share for the current year. Inclu
> Archangelo Company provided the following information for the current year. Net income is $8,112,600, and the company is subject to a 40% tax rate. For the entire year, there are 1,020,300 shares of outstanding common stock with an average market price o
> Start Stamping began the current year with 450,000 common shares outstanding. The firm has $1,150,000 par value, 3% nonconvertible, noncumulative preferred stock outstanding. The preferred shares were outstanding for a full year and the firm declared pre
> Crystal Glass Works, Ltd. provided you with the following information regarding its defined-benefit pension plan. Required: • Beginning plan assets at fair value (market-related value), $600,000 • Beginning projected benefit obligation (PBO), $558,00
> NR Enterprises, Inc., an IFRS reporter, granted stock appreciation rights to its key employees on January 2, 2018. These SARs allow the employees to receive cash at the end of the vesting period for the difference between the market price of the stock on
> NR Enterprises, Inc., an IFRS reporter, granted stock appreciation rights to its key employees on January 2, 2018. These SARs allow the employees to receive cash at the end of the vesting period for the difference between the market price of the stock on
> Saddle Corporation reported comprehensive income of $14,000 for the current year. It had unrealized losses on available-for-sale debt investment securities of $750 after tax and a foreign currency translation gain of $3,500 after tax. The beginning balan
> NR Enterprises, Inc. granted stock appreciation rights to its key employees on January 2, 2018. These SARs allow the employees to receive cash at the end of the vesting period for the difference between the market price of the stock on the exercise date
> eGear Company started a share appreciation plan on January 1, 2018, when it granted 200,000 rights to its executives. The vesting period is 2 years. The plan expires on January 1, 2020. The fair value of eGear’s SARs for the years ended
> Scudder Products, Inc. borrowed $600,000 by issuing a 6-month note on September 1 of the current fiscal year. The note is due on March 1 of the following fiscal year. The short-term note carries a 5% annual interest rate with interest due at maturity. Th
> Max Ferguson Cosmetics compensates its key employees by offering stock options as part of total compensation. On January 1 of the current year, Max Ferguson granted 10,000 options to acquire 10,000 shares of its $2 par value common stock at an exercise p
> Davidson Company compensates its key employees by offering stock options as part of total compensation. On January 1 of the current year, Davidson granted 80,000 options to acquire 80,000 shares of its $1 par value common stock at an exercise price of $3
> Max Ferguson Cosmetics compensates its key employees by offering stock options as part of total compensation. On January 1 of the current year, Max Ferguson granted 10,000 options to acquire 10,000 shares of its $2 par value common stock at anexercise pr
> Welsa Manufacturing, Inc. offers a noncontributory, defined-benefit pension plan to its employees. The average remaining service life of employees is 10 years. The company provides you with the following information for the year ended December 31, 2019:
> The following information relates to the defined benefit pension plan of Murry Corp. for the year ended December 31, 2019: There were no benefit payments for the year. Required: (Round all computations to the nearest dollar) a. Compute the total pen
> McDonald-Johnson Engineering Associates offers its employees a defined-benefit pension plan. The company asked you to assess the impact of the following events on its annual pension cost, the balance of accumulated other comprehensive income, and its net
> Desmond Group provided the following information related to its defined-benefit plan for the current year. Required: a. Compute the total pension cost for the current year. b. Determine the ending balances of the plan assets and the projected benefit
> Neddle Corporation reported net income of $176,000 for the current year. It had unrealized gains on available-for-sale debt investment securities of $5,000 after tax and a foreign currency translation loss of $8,000 after tax. The beginning balance of it
> Rory Storm Roofing and Siding, Inc. reported the following shareholders’ equity section as of the beginning of the current year Rory Storm also issued 823,000 shares of its $5 par value preferred stock. There is a 6% dividend rate on t
> Pavane Company recorded the original issuance of its $10 par value common shares as follows: Required: Provide the journal entries for the following transactions. a. Pavane bought 95,000 shares of common stock as treasury shares at $55. It used the co
> The stockholders’ equity section of Bellwood Brands’ 2017 balance sheet follows: During 2018, Bellwood completed the following transactions: • November 9: Purchased 200 shares of its own stock to be
> Repeat the requirements of E15-9 and assume that the shares are retired rather than held in the treasury Data from E15-9: Prepare the journal entries required to record the following share buyback transactions assuming that Samuel Company holds the sha
> Pergolesi Products, Inc. recently issued 5,000 shares of no-par common stock. The shares carry a $2 per share stated value. The market price of the shares on the date of issue was $35 per share. The company paid $12,000 in underwriting fees to issue the
> Romero Brothers Contracting reports a $1,200,000 biweekly payroll. Romero and its employees must pay Social Security (federal insurance contribution act (or FICA) taxes, and none of the employees has exceeded the wage base for FICA taxes or the minimum a
> Takedo Company issued $600,000 par value, 10-year, 5% bonds on February 1, 2018. The bonds are dated January 1, 2018, and pay interest quarterly each March 31, June 30, September 30, and December 31. The bonds are sold at par plus accrued interest becaus
> On January 1, 2018, Faxico, Inc. issued $4,500,000 par value, 8%, 5-year bonds. Interest is payable semiannually each January 1 and July 1 with the first interest payment due at the end of the period on July 1, 2018. The market rate of interest on the da
> On January 1, 2018, McMillan Corporation issued $100,000 par value, 5-year, zero-coupon bonds. The market rate of interest on the date of the bond issue was 6%. The company’s fiscal year ends on December 31. Required: a. Determine the issue price of t
> On January 1, 2018, the Landon Capital Partners issued $600,000 par value, 6%, 6-year bonds. Interest is payable semiannually each January 1 and July 1 with the first interest payment due at the end of the period on July 1, 2018. The market rate of inter
> On January 1, 2018, Mill Road Corporation issued $300,000 par value, 5%, 5-year bonds. Interest is payable semiannually each January 1 and July 1 with the first interest payment due at the end of the period on July 1, 2018. The market rate of interest on
> On March 31, 2018, Vine Company issued a $487,000, 2%, 3-year note payable when the market rate was 8%. Interest is due on each March 31, beginning March 31, 2019. The company’s fiscal year ends on December 31. Required: a. Prepare the journal entry t
> Broad Street Company borrows $975,050 by issuing an 8%, 7-year note on January 1, 2018. Broad Street must make payments of principal and interest every 6 months beginning June 30, 2018. The note will be fully paid at maturity on December 31, 2024. The co
> On January 1, 2018, Sohape Corporation issued $100,000 par value, 5-year bonds with a 3% stated interest rate. Interest is paid annually each December 31. The market rate of interest on the date of the bond issue was 2.5%. The amortization table for the
> On January 1, 2018, McMillan Corporation issued $86,000 par value, 6-year bonds with a 0% stated interest rate. The discount on the bonds is amortized annually each December 31. The market rate of interest on the date of the bond issue was 3.25%. Fair va
> EA&Y, Inc. borrowed $350,000 on January 1, 2018, with a 6% interest rate. It will make a payment of $101,007 annually (beginning December 31, 2018) until the note is paid off on December 31, 2021. The company’s fiscal year ends on December 31. The paymen
> Michael and Sons, Ltd. sells lawn and garden products for home use. The company offers an assurance-type warranty that covers all repair costs, including parts and labor, for 1 year after the date of sale of lawn tractors. Michael also sells a service-ty
> DHC Associates issued 2,100 of its $1,000, 8%, 5-year par value bonds. There are no bond issue costs. Interest is paid annually. The market rate on the date of issue was 9%. The market price of DHC common shares on the date that the bonds are issued is $
> Randolph Company issued 4,500 of its $1,000 par value bonds for $1,440, providing total cash proceeds of $6,480,000. There are no bond issue costs. The market price of Randolph’s common shares on the date that the bonds were issued was $40 per share. The
> Use the information from E14-16 and assume that all bonds convert after 3 years. The carrying value of the bonds at the conversion date is $913,000. Prepare the journal entry at conversion Data from E14-16: Marly, Inc., issues 1,000 of 6-year, 3% conver
> Marly, Inc., issues 1,000 of 6-year, 3% convertible bonds at par of $1,000. Each $1,000 bond converts into 10 shares of no-par value common stock at the option of the bondholder beginning 3 years after the date of issue. There were no bond issue costs. T
> Using the information provided in E14-13, complete the following requirements assuming that Mobile Technology reports under IFRS. Required: a. Determine the present value of bond cash flows. b. Prepare the amortization table for the bond issue assuming
> Using the information provided in E14-13, complete the following requirements assuming that the effective rate of interest for convertible bonds is 4% on the date of issue. Required: a. Determine the issue price of the debt. b. Prepare the amortizatio
> On January 1, 2018, Mobile Technology, Incorporated issued $850,000 of $1,000 par value, 6%, 6-year bonds. Interest is payable semiannually each January 1 and July 1 with the first interest payment due at the end of the period on July 1, 2018. The market
> On January 1, 2018, Faxico, Inc. issued $4,500,000 par value 8%, 5-year bonds. Interest is payable semiannually on January 1 and July 1 with the first interest payment on July 1, 2018. The market rate of interest on the date of the bond issue was 10%. Fa
> Teter Company issued $700,000 par value, 5-year, 3% bonds on November 30, 2018. The bonds are dated July 1, 2018, and pay interest semiannually on June 30 and December 31. The bonds are sold at $723,807, including accrued interest, because they are sold
> Briscoe Company issued $700,000 par value, 5-year, 4% bonds on April 30, 2018. The bonds are dated January 1, 2018, and pay interest semiannually on June 30 and December 31. The bonds are sold at $703,455, including accrued interest, because they are sol
> Using the information provided in BE13-16, prepare the journal entries necessary to record the assurance-type warranty in the year of the sale and the actual repairs incurred during the following year assuming that Landau uses the accrual basis. Data fr
> Gardiner Manufacturing, Inc. borrowed $950,000 by issuing an 8-month note on July 1 of the current year. The note is due on March 1 of the following fiscal year. The short-term note carries a 6% annual interest rate with interest due at maturity. The com
> Using the same information from E13-8, assume that Fireen’s reports under IFRS. Required: a. Explain how the lawsuit should be reported under IFRS. b. Prepare any journal entries required. Data from E13-8: In January 2018, a customer filed a lawsuit
