Question: Use the information for Swanton Corp. in

> Instructions: Repeat E12-13, but now assume that the licence was granted in perpetuity and has an indefinite life, and that Dayton prepares financial statements in accordance with ASPE. Data from E12-13: At the end of 2017, Dayton Corporation owns a li

> Instructions: Repeat E12-13, but now assume that the licence was granted in perpetuity and has an indefinite life. Data from E12-13: At the end of 2017, Dayton Corporation owns a licence with a remaining life of 10 years and a carrying amount of $530,0

> Instructions: Repeat E12-13, but now assume that Dayton prepares financial statements in accordance with ASPE, and that the recoverable amount under ASPE (undiscounted future cash flows) is calculated to be $500,000 at the end of 2018. Data from E12-13:

> At the end of 2017, Dayton Corporation owns a licence with a remaining life of 10 years and a carrying amount of $530,000. Dayton expects undiscounted future cash flows from this licence to total $535,000. The licence’s fair value is $425,000 and disposa

> Refer to the annual financial statements of Brookfield Asset Management Inc. for its fiscal year ended December 31, 2014, found at the end of the book. Instructions: (a) Review Brookfield Asset Management Inc.’s balance sheet. Identify all financial inv

> Blue and White Town Taxi Incorporated applied for several taxi licences for its taxicab operations in the Town of Somerville and, on August 31, 2017, incurred costs of $12,500 in the application process. The outcome of applying for taxi licences in the t

> During 2017, Saskatchewan Enterprises Ltd., a private entity, incurred $4.7 million in costs to develop a new software product called Dover. Of this amount, $1.8 million was spent before establishing that the product was technologically and financially f

> Towers Inc. (TI) is a leader in delivering communications technology that powers global commerce and secures the world’s most critical information. Its shares trade on the Canadian and U.S. national stock exchanges. The company had been experiencing unpr

> Iskra Vremec and Colin McFee are experienced scuba divers who have spent many years in the salvage business. About a year ago, they decided to start their own company to recover damaged and sunken vessels and their cargoes off the east coast of Canada. T

> Shannonrock Racing Inc. (SR) is a promoter and sponsor of motor-sport activities. It is privately owned. The owner is looking to expand and has approached the local bank who has agreed to accept financial statements prepared in accordance with ASPE. The

> EMI Inc. is a public company that operates numerous movie theatres in Canada. Historically, it operated as a trust and its business model consisted of distributing all of its earnings to shareholders through dividends. As a result of tax changes two year

> Grappa Grapes Inc. (GGI) grows grapes and produces sparkling wines. The company is located in a very old area of town with easy access to fertile farmland that is excellent for growing grapes. It is owned by the Grappa family. The company has been in ope

> Fritz’s Furniture (FF) is a mid-sized owner-operated business that was started 25 years ago by Fred Fritz. The retail furniture business is cyclical, with business dropping off in times of economic downturn, as is the case currently. In order to encourag

> Standford Pharmaceuticals Inc. (SP) researches, develops, and produces over-the-counter drugs. During the year, it acquired 100% of the net assets of Jenstar Drugs Limited (JDL) for $200 million. The fair value of the identifiable assets at the time of t

> As a recent graduate and newly hired financial analyst for the local branch office of a national brokerage firm, you are excited to get your first assignment, allowing you to use your accounting expertise. Your supervisor provides you with updated data f

> Instructions: From SEDAR (www.sedar.com) or the company websites, access the financial statements of Loblaw Companies Limited for its year ended January 3, 2015, and Empire Company Limited for its year ended May 2, 2015. Review the financial statements a

> OG Limited (OG) is in the oil and gas business. It spends quite a bit of money each year exploring for new wells. Currently, it has several wells that are in the production phases. The company’s shares trade on the London Stock Exchange. OG is looking to

> Snow Spray Corp. (SSC) recently fi led for bankruptcy protection. The company manufactures downhill skis and reports under ASPE. With the increased popularity of such alternative winter sports as snowboarding and tubing, sales of skis are sagging. The co

> Dr. Gary Morrow, a former surgeon, is the president and owner of Morrow Medical (MM), a private Ontario company that focuses on the design and implementation of various medical and pharmaceutical products. With the recent success of various products put

> Tennessee Corp., reporting under ASPE, has provided the following information regarding its intangible assets: 1. A patent was purchased from Marvin Inc. for $1.2 million on January 1, 2016. Tennessee estimated the patent’s remaining useful life to be 10

> In 2017, Inventors Corp. spent $392,000 on a research project, but by the end of 2017 it was impossible to determine whether any benefit would come from it. Inventors prepares financial statements in accordance with IFRS. Instructions: (a) What account

> Oakville Corp. incurred the following costs during 2017 in connection with its research and development phase activities: Instructions: (a) Calculate the amount to be reported as research and development expense by Oakville on its income statement for

> In early January 2017, FJS Corporation applied for and received approval for a trade name, incurring legal costs of $52,500. In early January 2018, FJS incurred $28,200 in legal fees in a successful defense of its trade name. Instructions: (a) Managemen

> Institute Limited organized late in 2016 and set up a single account for all intangible assets. The following summary shows the entries in 2017 (all debits) that have been recorded in Intangible Assets since then: Instructions: (a) Prepare the necessar

> As the recently appointed auditor for Daleara Corporation, you have been asked to examine selected accounts before the six-month financial statements of June 30, 2017, are prepared. The controller for Daleara Corporation mentions that only one account is

> Selected information follows for Mount Olympus Corporation for three independent situations: 1. Mount Olympus purchased a patent from Bakhshi Co. for $1.8 million on January 1, 2015. The patent expires on January 1, 2025, and Mount Olympus is amortizing

> Access the annual financial statements of Andrew Peller Limited for the year ended March 31, 2015, on SEDAR (www.sedar.com) or the company’s website (www.andrewpeller.com). Instructions: Refer to these financial statements and the accompanying notes to

> Berrie Electric Inc. has the following amounts included in its general ledger at December 31, 2017: Instructions: (a) Based on the information provided, calculate the total amount for Berrie to report as intangible assets on its statement of financial

> Selected account information follows for Entertainment Inc. as at December 31, 2017. All the accounts have debit balances. Assume the company uses IFRS when preparing fi nancial statements. Instructions: (a) Identify which items should be classified as

> The following assets have been recognized as items of property, plant, and equipment: 1 . Head office boardroom table and executive chairs 2. Landfill site 3. Escalator in shopping mall 4. Forklift vehicles in a manufacturing plant 5. Stand-alone trainin

> Odyssey Ltd. purchased machinery on January 1, 2017, for $60,000. The machinery is estimated to have a residual value of $6,000 after a useful life of eight years. (a) Calculate the 2017 depreciation expense using the straight line method. (b) Calculate

> Azure Industries Ltd. acquired two copyrights during 2017. One copyright was on a textbook that was developed internally at a cost of $36,000. This textbook is estimated to have a useful life of three years from July 1, 2017, the date it was published. T

> E-Learning Educational Services Inc. incurred the following costs associated with its research facilities. Indicate whether these items are capitalized or expensed in the current year, assuming the company reports under ASPE. Where applicable, indicate h

> On October 1, 2017, Ocean Airways Ltd. purchased a new commercial aircraft for a total cost of $100 million. Included in the total cost are the aircraft’s two engines, at a cost of $10 million each, and the aircraft’s body, which costs $80 million. The e

> Cella Corporation’s statement of financial position shows property, plant, and equipment of $100,000. The notes to its financial statements state that the amount is represented by a cost of $600,000, accumulated depreciation of $300,000, and accumulated

> Extract Corporation, a publicly traded mining company, acquires a mine at a cost of $500,000. Capitalized development costs total $125,000. After the mine is depleted, $75,000 will be spent to restore the property, after which it can be sold for $157,500

> Andeo Corporation purchased a truck at the beginning of 2017 for $48,000. The truck is estimated to have a residual value of $3,000 and a useful life of 275,000 km. It was driven for 52,000 km in 2017 and 65,000 km in 2018. (a) Calculate depreciation exp

> Refer to the 2014 annual report of Canadian Tire Corporation, Limited, available at SEDAR (www.sedar.com) or the company’s website (www. canadiantire.ca). Note that the company provides a 10-year financial review at the end of its annual report. This sum

> se the information for Odyssey Ltd. in BE11-5. (a) Calculate the 2017 depreciation expense using the sum of-the-years’-digits method. (b) Calculate the 2017 depreciation expense using the sum-of-the-years’-digits method, but assuming the machinery was pu

> Use the information for Odyssey Ltd. in BE11-5. (a) Calculate the 2017 depreciation expense using the double declining-balance method. (b) Calculate the 2018 depreciation expense using the double-declining-balance method, but assuming the machinery was p

> Gilles Corp. purchased a piece of equipment on February 1, 2017, for $100,000. The equipment has an estimated useful life of eight years, with a residual value of $25,000, and an estimated physical life of 10 years, with no salvage value. The equipment w

> Chong Corp. purchased a machine on July 1, 2017, for $30,000. Chong paid $200 in title fees and a legal fee of $100 related to the machine. In addition, Chong paid $500 in shipping charges for delivery, and paid $400 to a local contractor to build and wi

> Julip Corporation purchased a 25% interest in Krov Corporation on January 2, 2017, for $1,000. At that time, the carrying amount of Krov’s net assets was $3,600. Any excess of the cost of the investment over Julip’s share of Krov’s carrying amount can be

> Fong Limited purchased an asset at a cost of $45,000 on March 1, 2017. The asset has a useful life of seven years and an estimated residual value of $3,000. For tax purposes, the asset belongs in CCA Class 8, with a rate of 20%. Calculate the CCA for eac

> In its 2017 annual report, Winkler Limited reports beginning-of-the-year total assets of $1,923 million, end-of-the-year total assets of $2,487 million, total revenue of $2,687 million, and net income of $52 million. (a) Calculate Winkler’s asset turnove

> Use the information presented for Volumetrics Corporation in BE11-17, but assume that the machinery is sold for $5,200 instead of $13,500. Prepare journal entries to (a) update depreciation for 2019 and (b) record the sale. Data from BE11-17: Volumetri

> Volumetrics Corporation owns machinery that cost $20,000 when purchased on January 1, 2017. Depreciation has been recorded at a rate of $3,000 per year, resulting in a balance in accumulated depreciation of $6,000 at December 31, 2018. The machinery is s

> Caley Inc. owns a building with a carrying amount of $1.5 million, as at January 1, 2017. On that date, Caley’s management determined that the building’s location is no longer suitable for the company’s operations and decided to dispose of the building b

> Stora Enso Oyj described its business in its annual report as the “global re thinker of the biomaterials, paper, packaging and wood products industry.” Instructions: Access the financial statements in the financial report of Stora Enso Oyj for its year

> Greentree Properties Ltd. is a publicly listed company following IFRS. Assume that on December 31, 2017, the carrying amount of land on the statement of fi nancial position is $500,000. Management determines that the land’s value in use is $425,000 and t

> Hambrecht Corp. is preparing its financial statements for the fiscal year ending November 30, 2017. Certain specialized equipment was scrapped on January 1, 2018. At November 30, 2017, this equipment was being used in production by Hambrecht and had a ca

> Spencer Ltd. traded a used truck (cost $30,000, accumulated depreciation $27,000, fair value $2,000) for a new truck with a fair value of $33,000. Spencer also made a cash payment of $31,000. Prepare Spencer’s entry to record the exchange, and state any

> Wizard Corp., a private company, obtained land by issuing 2,000 of its common shares. The land was appraised at $85,000 by a reliable, independent valuator on the date of acquisition. Last year, Wizard sold 1,000 common shares at $41 per share. Prepare t

> Hamm Inc. purchased land, a building, and equipment from Spamela Corporation for a cash payment of $406,000. The assets’ estimated fair values are land $95,000, building $250,000, and equipment $110,000. At what amounts should each of the three assets be

> Martin Corporation purchased a truck by issuing an $80,000, 8% note to Equinox Inc. Interest is payable annually and the note is payable in four years. Prepare the journal entry to record the truck purchase.

> Chavez Corporation purchased a truck by issuing an $80,000, four-year, non–interest-bearing note to Equinox Inc. The market interest rate for obligations of this nature is 8%. Calculate the purchase price using any of the three methods (tables, fi nancia

> Parolin Limited purchased equipment for an invoice price of $40,000, terms 2/10, n/30. (a) Record the purchase of the equipment and the subsequent payment, assuming the payment was made within the discount period. (b) Repeat (a), but assume the company’s

> Northern Utilities Corporation incurred the following costs in constructing a new maintenance building during the fiscal period: (a) Direct labour costs incurred up to the point when the building is in a condition necessary for use as management intended

> Brookfield Asset Management Inc. (Brookfield), as described in Note 1 to its financial statements, is a “global alternative asset management company” that “owns and operates assets with a focus on property, renewable energy, infrastructure and private eq

> Weaver Limited is a company that distributes hard-to-find computer supplies, such as hardware parts and cables. It sells and ships products all over the world. Recently, the board of directors approved the plan and a budget for the company to design its

> Barnet Brothers Inc. purchased land and an old building with the intention of removing the old building and then constructing the company’s new corporate headquarters on the land. The land and old building were purchased for $570,000. Closing costs were

> TrueNorth Investment Properties Inc. and its subsidiaries have provided you with a list of the properties they own: (a) Land held by TrueNorth for undetermined future use (b) A vacant building owned by TrueNorth and to be leased out under an operating le

> Playtime Corporation purchased a new piece of equipment for production of a new children’s toy. According to market research tests, the toy is expected to be very popular among preschool-aged children. The equipment consists of the following significant

> Use the information for Valued Assets Inc. from BE10-18. On January 5, 2018, Valued sold the building for $325,000 cash. Prepare the journal entries to record the sale of the building after having used (a) the cost model, (b) the revaluation model using

> Valued Assets Inc., a publicly listed company, has a building with an initial cost of $400,000. At December 31, 2017, the date of revaluation, accumulated depreciation amounted to $110,000. The fair value of the building, by comparing it with transaction

> Lowell Corporation acquires a gold mine at a cost of $400,000. Development costs that were incurred total $100,000, including $12,300 of depreciation on movable equipment to construct mine shafts. Based on construction to date, the legal obligation to re

> Dubois Inc. received equipment as a donation. The equipment has a fair value of $55,000. Prepare the journal entry to record the receipt of the equipment under each of the following assumptions: (a) The equipment was donated by a shareholder. (b) The equ

> In early January, Swanton Corp. purchased a building to house its manufacturing operations in Moose Jaw for $470,000. The company agreed to lease the land that the building stood on for $14,000 per year from the industrial park owner, and the municipalit

> Use the information for Spencer Ltd. from BE10-12. The same used truck is being traded, but Spencer does not know the fair value of the new truck. Spencer did look up the value of its used truck and determined its fair value at the date of the trade is $

> Kongus Inc. traded a used truck (cost $23,000, accumulated depreciation $20,700) for another used truck with a fair value of $3,700. Kongus also paid $300 cash in the transaction. Prepare the journal entry to record the exchange, assuming the transaction

> From SEDAR (www.sedar.com), or the company websites, access the financial statements of Loblaw Companies Limited for its year ended January 3, 2015, and of Empire Company Limited for its year ended May 3, 2014. Review the financial statements and answer

> Caruso Airlines Incorporated is a privately owned commercial airline servicing short-haul routes in Western Canada. Caruso has operated successfully and profitably for five years. It is now considering expanding its fleet of 10 aircraft by adding 15 new

> Global Ltd. had beginning inventory of 50 units that cost $100 each. During September, the company purchased 200 units on account at $100 each, returned 6 units for credit, and sold 150 units at $200 each. (a) Journalize the September transactions, assum

> Tansley Ltd. took a physical inventory count on December 31 and determined that goods costing $4,000 were on hand. This amount included $1,000 of goods held on consignment for Woods Corporation. Not included in the physical count were $800 of goods purch

> Able Limited is a company that is involved in the wholesaling and retailing of automobile tires for foreign cars. Most of the inventory is imported, and it is valued on the company’s records at the actual inventory cost plus freight-in. (a) At year end,

> Saving Energy Inc. is a company that wants to buy coal deposits but does not want the financing for the purchase to be reported on its financial statements. The company therefore establishes a trust to acquire the coal deposits. The company agrees to buy

> Gamma Corp. invested in a three-year, $100 face value 6% bond, paying $105.55. At this price, the bond will yield a 4% return. Interest is payable annually. (a) Prepare a bond premium amortization table for Gamma Corp., assuming Gamma uses the effective

> Beta Corp. invested in a three-year, $100 face value 8% bond, paying $95.03. At this price, the bond will yield a 10% return. Interest is payable annually. (a) Prepare a bond discount amortization table for Beta Corp., assuming Beta uses the effective in

> Stowe Enterprises owns the following assets at December 31, 2017: If Stowe follows ASPE, what amount should be reported as cash and cash equivalents? Explain how your answer would differ if Stowe followed IFRS. Cash in bank savings account 56,200 1

> Delicious Foods Inc. reported inventory of $5,706 million at the end of its 2017 fiscal year and $5,310 million at the end of its 2016 fiscal year. It reported cost of goods sold of $35,350 million for the fiscal year 2017 and net sales of $54,365 millio

> Both ASPE and IFRS require disclosures about an enterprise’s investments that include the carrying amount of each type of investment by the accounting method used and the income, gains, or losses classified in a similar way. Identify the disclosure objec

> Soon after beginning the year-end audit work on March 10 for the 2017 year end at Arkin Corp., the auditor has the following conversation with the controller: Controller: The year ending March 31, 2017, should be our most profitable in history and, becau

> Beckett Corp. is facing a decision as to whether to purchase 40% of Kyla Corp.’s shares for $1.6 million cash, giving Beckett significant influence over the investee company, or 60% of Kyla’s shares for $2.4 million cash, making Kyla a subsidiary company

> Use the information from BE9-21, except that Julip Corporation is a private enterprise that applies ASPE. Prepare Julip’s 2017 entries to record all transactions and events related to its significant influence investment in Krov Corporation, assuming tha

> Poot Corporation purchased a 40% interest in Moss Inc. for $100. This investment gave Poot significant influence over Moss. During the year, Moss earned net income of $15 and paid dividends of $5. Assuming the purchase price was equal to 40% of Moss’s ne

> Indicate whether the following would be considered inventory for a public company like Ford Motor Corporation. If so, indicate the inventory category to which that item would belong. (a) Engines purchased to make the Ford F-150 (b) Nuts and bolts purchas

> Ramirez Company has an investment in 6%, 10-year bonds of Soto Company. The investment was originally purchased at par for $100 in 2016 and it is accounted for at amortized cost. Early in 2017, Ramirez recorded an impairment on the Soto investment due to

> Assume the same information as in BE9-17. Assume also that management feels that there has been a significant increase in the credit risk and that there is a 5% chance that the company will not collect 50% of the face value of the bond over its life. The

> Assume that Gush Inc. invests in a bond for $55,000. The bond was purchased at par and is accounted for using amortized cost. At year end, management has determined that there is no significant increase in credit risk, but that there is a 1% chance that

> Under the expected loss model, the entity must assess whether there has been a significant increase in credit risk. Explain what the impact is if the assessment results in a yes answer or a no answer.

> Aitocs Inc. sold used equipment with a cost of $15,000 and a carrying amount of $2,500 to Disc Corp. in exchange for a $5,000, three-year non–interest-bearing note receivable. Although no interest was specified, the market rate for a loan of that risk wo

> A review of the financial statements of private and publicly accountable enterprises may result in finding the following measurement approaches used for their non-strategic investments: (1) cost/amortized cost, (2) FV-NI (or FVTPL), (3) FV-OCI (with recy

> Canadian Tire Corporation, Limited is one of Canada’s best-known retailers. The company operates 493 “hard-goods” retail stores through associate dealers, 383 corporate and franchise stores under its subsidiary Mark’s Work Wear house, 297 independently o

> The following information relates to Cortez Corp. for 2017: net income of $672,683; unrealized loss of 20,830 related to investments accounted for at FV-OCI during the year; and accumulated other comprehensive income of $37,273 on January 1, 2017. Determ

> Early in its 2017 fiscal year (December 31 yearend), Hayes Company purchased 10,000 shares of Kenyon Corporation common shares for $26.18 per share, plus $1,800 in brokerage commissions. These securities were accounted for at FV-OCI (with no recycling),

> Angus Enterprises Ltd. reported cost of goods sold for 2017 of $2.5 million and retained earnings of $4.0 million at December 31, 2017. Angus later discovered that its ending inventories at December 31, 2016 and 2017, were overstated by $150,000 and $50,

> Best Corp., a public company using IFRS, signed a long-term non-cancellable purchase commitment with a major supplier to purchase raw materials at an annual cost of $1 million. At December 31, 2016, the raw materials to be purchased in 2017 have a market

> Bali Corp. has $10,000 in surplus funds to invest and is considering investing in either Company A or Company B. Company A promises to return the $10,000 original amount invested in three years’ time and pay a 2% annual return on the principal amount. Co

> Boyko Company received an order from Lister Inc. on May 15, 2017, valued at $3,800. Boyko shipped the goods to Lister on May 31, 2017, with terms f.o.b. shipping point, and credit terms 2/10, n/30. Assuming Boyko uses the gross method of recording sales,

> Highfliers Inc. is a public company that purchases airplanes for sale to others. However, until the airplanes are sold, the company charters and services them. What is the proper way to report these airplanes in the company’s financial statements?