Question: The following information is related to Dickinson

> On July 1, 2017, Moresan Company sold special-order merchandise on credit and received in return an interest-bearing note receivable from the customer. Moresan will receive interest at the prevailing rate for a note of this type. Both the principal and i

> How can earnings management affect the quality of earnings?

> What is a repurchase agreement (product financing) arrangement? How should a product repurchase agreement be reported in the financial statements?

> In what accounts should the following items be classified? a. Coins and currency. b. U.S. Treasury (government) bonds. c. Certificate of deposit (matures in 5 months). d. Cash in a bank that is in receivership. e. NSF check (returned with bank s

> On January 1, 2017, Bonanza Wholesalers Inc. adopted the dollar-value LIFO inventory method for income tax and external financial reporting purposes. However, Bonanza continued to use the FIFO inventory method for internal accounting and management purpo

> Norman’s Televisions produces television sets in three categories: portable, midsize, and flat-screen. On January 1, 2017, Norman adopted dollar-value LIFO and decided to use a single inventory pool. The company’s Janu

> The management of Tritt Company has asked its accounting department to describe the effect upon the company’s financial position and its income statements of accounting for inventories on the LIFO rather than the FIFO basis during 2017

> Dimitri Company, a manufacturer of small tools, provided the following information from its accounting records for the year ended December 31, 2017. Inventory at December 31, 2017 (based on physical count of goods in Dimitri’s plant,

> Richardson Company cans a variety of vegetable-type soups. Recently, the company decided to value its inventories using dollar-value LIFO pools. The clerk who accounts for inventories does not understand how to value the inventory pools using this new me

> Presented below is information related to Kaisson Corporation for the last 3 years. Instructions Compute the ending inventories under the dollar-value LIFO method for 2016, 2017, and 2018. The base period is January 1, 2016, and the beginning inventor

> The following independent situations relate to inventory accounting. 1. Kim Co. purchased goods with a list price of $175,000, subject to trade discounts of 20% and 10%, with no cash discounts allowable. How much should Kim Co. record as the cost of thes

> In light of the full disclosure principle, investors and creditors need to know the balances for assets, liabilities, and equity as well as the accounting policies adopted by management to measure the items reported in the balance sheet. Instructions

> Braddock Inc. had the following long-term receivable account balances at December 31, 2016. Note receivable from sale of division…………$1,500,000 Note receivable from officer…………………………. 400,000 Transactions during 2017 and other information relating to

> On December 31, 2017, Oakbrook Inc. rendered services to Beghun Corporation at an agreed price of $102,049, accepting $40,000 down and agreeing to accept the balance in four equal installments of $20,000 receivable each December 31. An assumed interest r

> On October 1, 2017, Arden Farm Equipment Company sold a pecan-harvesting machine to Valco Brothers Farm, Inc. In lieu of a cash payment Valco Brothers Farm gave Arden a 2-year, $120,000, 8% note (a realistic rate of interest for a note of this type). The

> The balance sheet of Starsky Company at December 31, 2016, includes the following. Transactions in 2017 include the following. 1. Accounts receivable of $138,000 were collected including accounts of $60,000 on which 2% sales discounts were allowed. 2

> Presented below is information related to the Accounts Receivable accounts of Gulistan Inc. during the current year 2017. 1. An aging schedule of the accounts receivable as of December 31, 2017, is as follows. 2. The Accounts Receivable control accoun

> From inception of operations to December 31, 2017, Fortner Corporation provided for uncollectible accounts receivable under the allowance method. The provisions are recorded, based on analyses of customers with different risk characteristics. Bad debts w

> The following are a series of unrelated situations. 1. Halen Company’s unadjusted trial balance at December 31, 2017, included the following accounts. Halen Company estimates its bad debt expense to be 7% of gross accounts receivable.

> On January 1, 2017, Botosan Company issued a $1,200,000, 5-year, zero-interestbearing note to National Organization Bank. The note was issued to yield 8% annual interest. Unfortunately, during 2018 Botosan fell into financial trouble due to increased com

> The cash account of Aguilar Co. showed a ledger balance of $3,969.85 on June 30, 2017. The bank statement as of that date showed a balance of $4,150. Upon comparing the statement with the cash records, the following facts were determined. 1. There were

> Bill Jovi is reviewing the cash accounting for Nottleman, Inc., a local mailing service. Jovi’s review will focus on the petty cash account and the bank reconciliation for the month ended May 31, 2017. He has collected the following inf

> Access the glossary (“Master Glossary”) to answer the following. a. What is the definition provided for inventory? b. What is a customer? c. Under what conditions is a distributor considered a customer? d. What is a product financing arrangement?

> Sandburg Company requires additional cash for its business. Sandburg has decided to use its accounts receivable to raise the additional cash and has asked you to determine the income statement effects of the following contemplated transactions. 1. On Ju

> Salen Company finances some of its current operations by assigning accounts receivable to a finance company. On July 1, 2017, it assigned, under guarantee, specific accounts amounting to $150,000. The finance company advanced to Salen 80% of the accounts

> James Kirk is a financial executive with McDowell Enterprises. Although James Kirk has not had any formal training in finance or accounting, he has a “good sense” for numbers and has helped the company grow from a very small company ($500,000 sales) to a

> Answer the following questions related to Dubois Inc. a. Dubois Inc. has $600,000 to invest. The company is trying to decide between two alternative uses of the funds. One alternative provides $80,000 at the end of each year for 12 years, and the other i

> At the end of 2017, Sawyer Company is conducting an impairment test and needs to develop a fair value estimate for machinery used in its manufacturing operations. Given the nature of Sawyer’s production process, the equipment is for spe

> Danny’s Lawn Equipment sells high-quality lawn mowers and offers a 3-year warranty on all new lawn mowers sold. In 2017, Danny sold $300,000 of new specialty mowers for golf greens for which Danny’s service department

> You have been hired as a benefit consultant by Jean Honore, the owner of Attic Angels. She wants to establish a retirement plan for herself and her three employees. Jean has provided the following information. The retirement plan is to be based upon annu

> Aero Inc. had the following balance sheet at December 31, 2016. During 2017, the following occurred. 1. Aero liquidated its available-for-sale debt investment portfolio at a loss of $5,000. 2. A tract of land was purchased for $38,000. 3. An additio

> Lansbury Inc. had the following balance sheet at December 31, 2016. During 2017, the following occurred. 1. Lansbury Inc. sold part of its debt investment portfolio for $15,000. This transaction resulted in a gain of $3,400 for the firm. The company c

> Presented below is the balance sheet of Sargent Corporation for the current year, 2017. The following information is presented. 1. The current assets section includes cash $150,000, accounts receivable $170,000 less $10,000 for allowance for doubtful

> In addition to the list of topics identified in footnote 1 on page 268, identify the specific Codification guidance related to the use of present value in goodwill impairment.

> The balance sheet of Kishwaukee Corporation as of December 31, 2017, is as follows. Note 1: Buildings are stated at cost, except for one building that was recorded at appraised value. The excess of appraisal value over cost was $570,000. Depreciation ha

> The adjusted trial balance of Eastwood Company and other related information for the year 2017 are presented as follows. Additional information: 1. The LIFO method of inventory value is used. 2. The cost and fair value of the long-term investments th

> Wade Corp. has 150,000 shares of common stock outstanding. In 2017, the company reports income from continuing operations before income tax of $1,210,000. Additional transactions not considered in the $1,210,000 are as follows. 1. In 2017, Wade Corp. so

> Cooke Company has a fiscal year ending on September 30. Selected data from the September 30 worksheet are presented below. Instructions a. Prepare a complete worksheet. b. Prepare a classified balance sheet. (Note: $10,000 of the mortgage payable is d

> On January 1, 2017, Norma Smith and Grant Wood formed a computer sales and service company in Soapsville, Arkansas, by investing $90,000 cash. The new company, Arkansas Sales and Service, has the following transactions during January. 1. Pays $6,000 in a

> Below is the Retained Earnings account for the year 2017 for Acadian Corp. Instructions a. Prepare a corrected retained earnings statement. Acadian Corp. normally sells investments of the type mentioned above. FIFO inventory was used in 2017 to comput

> The following account balances were included in the trial balance of Twain Corporation at June 30, 2017. The Retained Earnings account had a balance of $337,000 at July 1, 2016. There are 80,000 shares of common stock outstanding. Instructions a. Usi

> Vedula Advertising was founded by Murali Vedula in January 2015. On the next page are both the adjusted and unadjusted trial balances as of December 31, 2017. Instructions a. Journalize the annual adjusting entries that were made. b. Prepare an incom

> Rolling Hills Golf Inc. was organized on July 1, 2017. Quarterly financial statements are prepared. The unadjusted trial balance and adjusted trial balance on September 30 are shown below. Instructions a. Journalize the adjusting entries that were mad

> The following are the trial balance and the other information related to Yorkis Perez, a consulting engineer. 1. Fees received in advance from clients $6,000, which were recorded as revenue. 2. Services performed for clients that were not recorded by

> Access the glossary (“Master Glossary”) to answer the following. a. What is the definition of present value? b. Briefly describe the term “discount rate adjustment technique.”

> Presented below is a combined single-step income and retained earnings statement for Nerwin Company for 2017. Additional facts are as follows. 1. “Selling, general, and administrative expenses” for 2017 included a ch

> The trial balance of Bellemy Fashion Center contained the following accounts at November 30, the end of the company’s fiscal year. Adjustment data: 1. Supplies on hand totaled $1,500. 2. Depreciation is $15,000 on the equipment. 3.

> A review of the ledger of Baylor Company at December 31, 2017, produces the following data pertaining to the preparation of annual adjusting entries. 1. Salaries and Wages Payable $0. There are eight employees. Salaries and wages are paid every Friday f

> Answer each of these unrelated questions. a. On January 1, 2017, Fishbone Corporation sold a building that cost $250,000 and that had accumulated depreciation of $100,000 on the date of sale. Fishbone received as consideration a $240,000 non-interest-be

> The financial statements of M&S are presented in Appendix E. The company’s complete annual report, including the notes to the financial statements, is available online. Instructions Refer to M&S’s financial statements and the accompanying notes to answ

> The financial statements of M&S are presented in Appendix E. The company’s complete annual report, including the notes to the financial statements, is available online. Instructions Refer to M&S’s financial statements and the accompanying notes to answ

> Rainmaker Company prepares its financial statements in accordance with IFRS. In 2017, Rainmaker recorded the following revaluation adjustments related to its buildings and land: The company’s building increased in value by $200,000; its land declined by$

> The financial statements of M&S are presented in Appendix E. The company’s complete annual report, including the notes to the financial statements, is available online. Instructions Refer to M&S’s financial statements and the accompanying notes to answ

> Your client took accounting a number of years ago and was unaware of comprehensive income reporting. He is not convinced that any accounting standards exist for comprehensive income. Access the IFRS authoritative literature at the IASB website (http:/

> Enyart Company has a noncontrolling interest in a subsidiary. Enyart’s controller is unsure how to report losses in the subsidiary that exceed the value of Enyart’s interest in the subsidiary. Advise the controller.

> Presented below is information related to Viel Company at December 31, 2017, the end of its first year of operations. Sales revenue………………………………………………………...$310,000 Cost of goods sold……………………………………………………. 140,000 Selling and administrative expenses………………

> The financial statements of (M&S) are presented in Appendix E. The company's complete annual report, including the notes to the financial statements, is available online. Instructions Refer to M&S’s financial statements and the accompanying notes to an

> The financial statements of M&S are presented in Appendix E. The company’s complete annual report, including the notes to the financial statements, is available online. Instructions Refer to M&S’s financial statements and the accompanying notes to answ

> As a newly enrolled accounting major, you are anxious to better understand accounting institutions and sources of accounting literature. As a first step, you decide to explore the IASB’s The Conceptual Framework for Financial Reporting. Instructions: A

> As discussed in Chapter 1, the International Accounting Standards Board (IASB) develops accounting standards for many international companies. The IASB also has developed a conceptual framework to help guide the setting of accounting standards. While the

> What are some of the challenges to the IASB in developing a conceptual framework?

> On December 31, 2017, Firth Company borrowed $62,092 from Paris Bank, signing a 5-year, $100,000 zero-interest-rate note. The note was issued to yield 10% interest. Unfortunately, during 2019, Firth began to experience financial difficulty. As a result,

> What organizations are the two key international players in the development of international accounting standards? Explain their role.

> The comparative balance sheets of Madrasah Corporation at the beginning and end of the year 2017 appear below. Net income of $44,000 was reported, and dividends of $33,000 were paid in 2017. New equipment was purchased and none was sold. Instructions

> Grant Wood Corporation’s balance sheet at the end of 2016 included the following items. The following information is available for 2017. 1. Net income was $55,000. 2. Equipment (cost $20,000 and accumulated depreciation $8,000) was

> On January 1, 2017, Richards Inc. had cash and common stock of $60,000. At that date, the company had no other asset, liability, or equity balances. On January 2, 2017, it purchased for cash $20,000 of debt securities that it classified as available-for-

> A comparative balance sheet for Shabbona Corporation is presented below. Additional information: 1. Net income for 2017 was $125,000. No gains or losses were recorded in 2017. 2. Cash dividends of $60,000 were declared and paid. 3. Bonds payable amo

> Presented below is a condensed version of the comparative balance sheets for Zubin Mehta Corporation for the last two years at December 31. Additional information: Investments were sold at a loss of $10,000; no equipment was sold; cash dividends paid w

> The comparative balance sheets of Constantine Cavamanlis Inc. at the beginning and the end of the year 2017 are as follows. Net income of $44,000 was reported, and dividends of $23,000 were paid in 2017. New equipment was purchased and none was sold.

> Presented below is the trial balance of Scott Butler Corporation at December 31, 2017. Instructions Prepare a balance sheet at December 31, 2017, for Scott Butler Corporation. (Ignore income taxes.) Debit Credit Cash $ 197,000 Sales Revenue $ 8,100

> Norma Smith is the controller of Baylor Corporation and is responsible for the preparation of the year-end financial statements. The following transactions occurred during the year. a. On December 20, 2017, a former employee filed a legal action against

> Presented below are a number of balance sheet accounts of Deep Blue Something, Inc. a. Debt Investments. b. Treasury Stock. c. Common Stock. d. Dividends Payable. e. Accumulated Depreciation—Equipment. f. Construction in Process. g. Petty Cash. h

> Presented below is information related to Ivan Calderon Corp. for the year 2017. Instructions a. Prepare a multiple-step income statement for 2017. Assume that 60,000 shares of common stock are outstanding for the entire year. b. Prepare a separate r

> Presented below are selected ledger accounts of Tucker Corporation as of December 31, 2017. Cash……………………………………………………………………………. $ 50,000 Administrative expenses………………………………………………..100,000 Selling expenses……………………………………………………………..80,000 Net sales……………………

> The accountant of Latifa Shoe Co. has piled the following information from the company’s records as a basis for an income statement for the year ended December 31, 2017. Rent revenue………………………………………………………………………. $ 29,000 Interest expense…………………………………………

> Presented below is information related to Viel Company at December 31, 2017, the end of its first year of operations. Sales revenue…………………………………………………………$310,000 Cost of goods sold……………………………………………………..140,000 Selling and administrative expenses……………………

> Using the information from BE4-9, prepare a retained earnings statement for the year ended December 31, 2017. Assume an error was discovered: land costing $80,000 (net of tax) was charged to maintenance and repairs expense in 2014. From BE 4-9: Portman

> Starr Co. had sales revenue of $540,000 in 2017. Other items recorded during the year were: Cost of goods sold………………………………………$330,000 Salaries and wages expense…………………………120,000 Income tax expense………………………………………25,000 Increase in value of company reputa

> Manitoba Soy Products (MSP) buys soy beans and processes them into other soy products. Each tonne of soy beans that MSP purchases for $300 can be converted for an additional $200 into 500 lbs of soy meal and 100 gallons of soy oil. A pound of soy meal ca

> The Vapor Company produces two products, turpentine and methanol (wood alcohol), by a joint process. Joint costs amount to $144,000 per batch of output. Each batch totals 40,000 litres: 25% methanol and 75% turpentine. Both products are processed further

> Roundtree Chocolates manufactures and distributes chocolate products. It purchases cocoa beans and processes them into two intermediate products: â–  Chocolate powder liquor base. â–  Milk chocolate liquor base. These two

> Quality Chicken is computing the ending inventory values for its July 31, 2015, statement of financial position. Ending inventory amounts on July 31 are 15 kilograms of breasts, 4 kilograms of wings, 6 kilograms of thighs, 5 kilograms of bones, and 2 kil

> A number of terms are listed below: byproduct …………………….constant gross margin percentage estimated net realizable value …………………….joint products main product ………………………………………..physical measure products …………………………………………sales value at splitoff scrap ……………………

> Consider E-books again. The controller of E-books reads a widely used textbook that states “The reciprocal method is conceptually the most defensible.” He seeks your assistance. Required: 1. Describe the key features of the reciprocal method. 2. Allocat

> E-books, an online book retailer, has two operating divisions— corporate sales and consumer sales—and two support divisions—human resources and information systems. Each sales division conducts mercha

> Three restaurants in a downtown area of a large city have decided to share a valet service and parking lot for their customers. The cost of the service and lot is $10,000 per month. The owners of the restaurants need to decide how to divide the $10,000 c

> The Bow River Company has prepared division overhead budgets for budgeted-volume levels before allocations as follows: Management has decided that the most appropriate in ventory costs are achieved by using individual division overhead rates. These rat

> Refer to the data given in Exercise 14-20. Required: 1. Allocate the two support divisions’ costs to the two operating divisions using the reciprocal method. 2. Compare and explain differences in requirement 1 with those in requirement

> Explain the main conceptual issue under variable and absorption costing regarding the proper timing for the release of fixed manufacturing overhead as expense.

> Phoenix Partners provides management consulting services to government and corporate clients. Phoenix has two support divisions— administrative services (AS) and information systems (IS)—and two operating divisions&aci

> Chocolat Inc. decides to examine the effect of using the dual-rate method for allocating truck costs to each round trip. At the start of 2015, the budgeted costs were: Variable cost per round trip ……â€&

> Chocolat Inc. is a producer of premium chocolate based in Owen Sound. The company has a separate division for each of its two products: dark chocolate and milk chocolate. Chocolat purchases ingredients from Toronto for its dark chocolate division and fro

> The Saskatchewan power plant that services all manufacturing divisions of Sask Engineering has a budget for the coming year. This budget has been expressed in the following monthly terms: The expected monthly costs for operating the power plant during

> Dave Meltzer went to Lake Tahoe for his annual winter vacation. Unfortunately, he broke his ankle severely while skiing and had to spend two days at the Tahoe General Hospital. Meltzer’s insurance company received a $4,800 bill for his two-day stay. One

> A number of terms are listed below: Required: Select the terms from the above list to complete the following sentences. Target pricing is a policy well suited to a highly competitive environment where the corporation is a ___________ because customers

> Refer to Exercise 13-27. Required: 1. Calculate Lakeside’s operating income in both 2015 and 2016. 2. Calculate the growth, price-recovery, and productivity components that explain the change in operating income from 2015 to 2016. 3. C

> Lakeside T-Shirt Company sells a variety of T-shirts. Lakeside presents the following data for its first two years of operations, 2015 and 2016. For simplicity, assume that all purchasing and selling costs are included in the average cost per T-shirt and

> Refer to the Snyder Corporation information in Exercise 13-23. Required: 1. Where possible, calculate the amount and cost of unused capacity for (a) software implementation support and (b) software development at the beginning of 2016, based on units of

> Suppose that during 2016 the market for implementing sales management software increased by 5%, and that Snyder experiences a 1% decline in prices. Assume that any further decreases in selling prices and increases in market share are strategic choices by

> Why is the term direct costing a misnomer for variable costing?