Question: The assets of Fonzarelli Corporation are presented
The assets of Fonzarelli Corporation are presented below (000s omitted). 
Instructions Indicate the deficiencies, if any, in the foregoing presentation of Fonzarelli Corporation’s assets.
Transcribed Image Text:
FONZARELLI CORPORATION BALANCE SHEET (PARTIAL) DECEMBER 31, 2017 Assets Current assets Cash Unclaimed payroll checks Debt investments (trading) (fair value $30,000) at cost Accounts receivable (less bad debt reserve) Inventory-at lower-of-cost (determined by the next-in, first-out method)-or-net realizable value $ 100,000 27,500 37,000 75,000 240,000 Total current assets 479,500 Tangible assets Land (less accumulated depreciation) Buildings and equipment Less: Accumulated depreciation 80,000 $800,000 250,000 550,000 630,000 Net tangible assets Long-term investments Stocks and bonds Treasury stock 100,000 70,000 170,000 Total long-term investments Other assets Discount on bonds payable Sinking fund 19,400 975,000 Total other assets 994,400 Total assets $2,273,900
> Two or more items are omitted in each of the following tabulations of income statement data. Fill in the amounts that are missing. 2016 2017 2018 Sales revenue $ ? $290,000 11,000 $410,000 Sales returns and allowances 13,000 347,000 32,000 ? Net sal
> Craig Company asks you to review its December 31, 2017, inventory values and prepare the necessary adjustments to the books. The following information is given to you. 1. Craig uses the periodic method of recording inventory. A physical count reveals $2
> Assume that in an annual audit of Harlowe Inc. at December 31, 2017, you find the following transactions near the closing date. 1. A special machine, fabricated to order for a customer, was finished and specifically segregated in the back part of the sh
> At December 31, 2016, Stacy McGill Corporation reported current assets of $370,000 and current liabilities of $200,000. The following items may have been recorded incorrectly. 1. Goods purchased costing $22,000 were shipped f.o.b. shipping point by a su
> Trout Company uses the LIFO method for financial reporting purposes but FIFO for internal reporting purposes. At January 1, 2017, the LIFO reserve has a credit balance of $1,300,000. At December 31, 2017, Trout’s internal reports indicated that the FIFO
> The following information relates to the Jimmy Johnson Company. Instructions Use the dollar-value LIFO method to compute the ending inventory for Johnson Company for 2013 through 2017. Ending Inventory (End-of-Year Prices) $ 70,000 90,300 95,120 1
> Presented below is information related to Dino Radja Company. Instructions Compute the ending inventory for Dino Radja Company for 2014 through 2019 using the dollar-value LIFO method. Ending Inventory (End-of-Year Prices) $ 80,000 115,500 108,000
> The dollar-value LIFO method was adopted by Enya Corp. on January 1, 2017. Its inventory on that date was $160,000. On December 31, 2017, the inventory at prices existing on that date amounted to $140,000. The price level at January 1, 2017, was 100, and
> Tori Amos Corporation began operations on December 1, 2016. The only inventory transaction in 2016 was the purchase of inventory on December 10, 2016, at a cost of $20 per unit. None of this inventory was sold in 2016. Relevant information is as follows.
> Johnny Football Shop began operations on January 2, 2017. The following stock record card for footballs was taken from the records at the end of the year. A physical inventory on December 31, 2017, reveals that 100 footballs were in stock. The bookkeepe
> You are the vice president of finance of Sandy Alomar Corporation, a retail company that prepared two different schedules of gross margin for the first quarter ended March 31, 2017. These schedules appear below. The computation of cost of goods sold in
> The following is a record of Pervis Ellison Company’s transactions for Boston Teapots for the month of May 2017. Instructions a. Assuming that perpetual inventories are not maintained and that a physical count at the end of the month
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> Jim Carrie Company shows a balance of $181,140 in the Accounts Receivable account on December 31, 2017. The balance consists of the following. Installment accounts due in 2018……………………………. $23,000 Installment accounts due after 2018…………………………. 34,000 Ove
> Using the information provided in BE4-2, prepare a condensed multiple-step income statement for Brisky Corporation. From BE 4-2: Brisky Corporation had net sales of $2,400,000 and interest revenue of $31,000 during 2017. Expenses for 2017 were cost of g
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> Logan Bruno Company has just received the August 31, 2017, bank statement, which is summarized below. The general ledger Cash account contained the following entries for the month of August. Deposits in transit at August 31 are $3,800, and checks out
> Use the information for Jones Company as presented in E7-20. Jones is planning to factor some accounts receivable at the end of the year. Accounts totaling $25,000 will be transferred to Credit Factors, Inc. with recourse. Credit Factors will retain 5% o
> Presented below is information for Jones Company. 1. Beginning-of-the-year Accounts Receivable balance was $15,000. 2. Net sales (all on account) for the year were $100,000. Jones does not offer cash discounts. 3. Collections on accounts receivable du
> Presented below are a number of independent situations. Instructions For each individual situation, determine the amount that should be reported as cash. If the item(s) is not reported as cash, explain the rationale. 1. Checking account balance $925,0
> Beyoncé Corporation factors $175,000 of accounts receivable with Kathleen Battle Financing, Inc. on a with recourse basis. Kathleen Battle Financing will collect the receivables. The receivables records are transferred to Kathleen Battle Financing on Aug
> The trial balance before adjustment for Phil Collins Company shows the following balances. Instructions Using the data above, give the journal entries required to record each of the following cases. (Each situation is independent.) 1. To obtain additi
> On December 31, 2015, Ed Abbey Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Abbey Co. agreed to accept a $200,000 zero-interest-bearing note due December 31, 2017, as payment in full. Hayduke is somewhat
> On July 1, 2017, Agincourt Inc. made two sales. 1. It sold land having a fair value of $700,000 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,101,460. The land is carried on Agincourt’s books at a cost of $590,0
> Stacy Corporation had income from operations of $7,200,000. In addition, it suffered an unusual and infrequent pretax loss of $770,000 from a volcano eruption, interest revenue of $17,000, and a write-down on buildings of $53,000. The corporation’s tax r
> The chief accountant for Dickinson Corporation provides you with the following list of accounts receivable written off in the current year. Dickinson follows the policy of debiting Bad Debt Expense as accounts are written off. The chief accountant main
> Clarence Weatherspoon, a super salesman contemplating retirement on his fifty-fifth birthday, decides to create a fund on an 8% basis that will enable him to withdraw $20,000 per year on June 30, beginning in 2021 and continuing through 2024. To develop
> Presented below are three unrelated situations. a. Dwayne Wade Company recently signed a lease for a new office building, for a lease period of 10 years. Under the lease agreement, a security deposit of $12,000 is made, with the deposit to be returned a
> Using the appropriate interest table, answer the following questions. (Each case is independent of the others). a. What is the future value of 20 periodic payments of $4,000 each made at the beginning of each period and compounded at 8%? b. What is the
> Ricky Fowler borrowed $70,000 on March 1, 2015. This amount plus accrued interest at 6% compounded semiannually is to be repaid March 1, 2025. To retire this debt, Ricky plans to contribute to a debt retirement fund five equal amounts starting on March 1
> Nerwin, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1, 2017.
> Hincapie Inc. manufactures cycling equipment. Recently, the vice president of operations of the company has requested construction of a new plant to meet the increasing demand for the company’s bikes. After a careful evaluation of the request, the board
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> The partner in charge of the Kappeler Corporation audit comes by your desk and leaves a letter he has started to the CEO and a copy of the cash flow statement for the year ended December 31, 2017. Because he must leave on an emergency, he asks you to fin
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> The following financial statement was prepared by employees of Walters Corporation. Instructions Identify and discuss the weaknesses in classification and disclosure in the single-step income statement above. You should explain why these treatments ar
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> One of the more closely watched ratios by investors is the price/earnings (P/E) ratio. By dividing price per share by earnings per share, analysts get insight into the value the market attaches to a company’s earnings. More specifically, a high P/E ratio
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> Microsoft is the leading developer of software in the world. To continue to be successful Microsoft must generate new products, which requires significant amounts of cash. The following is the current asset and current liability information from Microsof
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> After the presentation of your report on the examination of the financial statements to the board of directors of Piper Publishing Company, one of the new directors expresses surprise that the income statement assumes that an equal proportion of the reve
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> Becker Ltd. is planning to adopt IFRS and prepare its first IFRS financial statements at December 31, 2018. What is the date of Becker’s opening balance sheet, assuming one year of comparative information? What periods will be covered in Becker’s first I
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> JFK Corp. factors $300,000 of accounts receivable with LBJ Finance Corporation on a without recourse basis on July 1, 2017. The receivables records are transferred to LBJ Finance, which will receive the collections. LBJ Finance assesses a finance charge
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> Bobek Inc. has recently reported steadily increasing income. The company reported income of $20,000 in 2014, $25,000 in 2015, and $30,000 in 2016. A number of market analysts have recommended that investors buy the stock because they expect the steady gr
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