All Related Questions of Financial Statements

Q: Presented below are a number of facts related to Weller, Inc

Presented below are a number of facts related to Weller, Inc. Assume that no mention of these facts was made in the financial statements and the related notes. Instructions Assume that you are...

Q: After the presentation of your report on the examination of the financial

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...

Q: Recently, your uncle, Carlos Beltran, who knows that you

Recently, your uncle, Carlos Beltran, who knows that you always have your eye out for a profitable investment, has discussed the possibility of your purchasing some corporate bonds. He suggests that y...

Q: Your aunt recently received the annual report for a company in which

Your aunt recently received the annual report for a company in which she has invested. The report notes that the statements have been prepared in accordance with IFRS. She has also heard that certain...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks...

Q: For each item below, indicate to which category of elements of

For each item below, indicate to which category of elements of financial statements it belongs. (a) Retained earnings (e) Depreciation (h) Dividends (b) Sales (f) Loss on sale of equipm...

Q: Identify which basic assumption of accounting is best described in each item

Identify which basic assumption of accounting is best described in each item below. (a) The economic activities of FedEx Corporation are divided into 12-month periods for the purpose of issuing ann...

Q: If the going concern assumption is not made in accounting, discuss

If the going concern assumption is not made in accounting, discuss the differences in the amounts shown in the financial statements for the following items. (a) Land. (b) Unamortized bond premiu...

Q: Presented below are four statements which you are to identify as true

Presented below are four statements which you are to identify as true or false. If false, explain why the statement is false. 1. The objective of financial statements emphasizes a stewardship appro...

Q: Answer the following multiple-choice questions.1. GAAP

Answer the following multiple-choice questions. 1. GAAP stands for: (a) Governmental auditing and accounting practices. (b) Generally accepted attest principles. (c) Government audit and a...

Q: Omar Morena has recently completed his first year of studying accounting.

Omar Morena has recently completed his first year of studying accounting. His instructor for next semester has indicated that the primary focus will be the area of financial accounting. Instruction...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks-an...

Q: In an examination of Arenes Corporation as of December 31, 2014

In an examination of Arenes Corporation as of December 31, 2014, you have learned that the following situations exist. No entries have been made in the accounting records for these items. 1. The co...

Q: The partner in charge of the Kappeler Corporation audit comes by your

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, 2014. B...

Q: Rainmaker Company prepares its financial statements in accordance with IFRS. In

Rainmaker Company prepares its financial statements in accordance with IFRS. In 2014, Rainmaker recorded the following revaluation adjustments related to its buildings and land: The Company’s...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marksand...

Q: Jurassic Park Co. prepares monthly financial statements from a worksheet.

Jurassic Park Co. prepares monthly financial statements from a worksheet. Selected portions of the January worksheet showed the following data. During February, no events occurred that affected...

Q: Discuss the appropriate treatment in the financial statements of each of the

Discuss the appropriate treatment in the financial statements of each of the following. (a) An amount of $113,000 realized in excess of the cash surrender value of an insurance policy on the life o...

Q: Indicate where the following items would ordinarily appear on the financial statements

Indicate where the following items would ordinarily appear on the financial statements of Boleyn, Inc. for the year 2014. (a) The service life of certain equipment was changed from 8 to 5 years. If...

Q: Willie Nelson, Jr., controller for Jenkins Corporation, is preparing

Willie Nelson, Jr., controller for Jenkins Corporation, is preparing the company’s financial statements at year-end. Currently, he is focusing on the income statement and determining the forma...

Q: Below is the income statement for a British company, Avon Rubber

Below is the income statement for a British company, Avon Rubber plc. Avon prepares its financial statements in accordance with IFRS. Avon Rubber plc Consolidated Income Statement for the Year End...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks...

Q: The financial statements of ConAgra Foods, Inc.’s 2012 annual

The financial statements of ConAgra Foods, Inc.’s 2012 annual report disclose the following information. Instructions Compute ConAgra’s(a) Inventory turnover and(b) The average days to...

Q: Garcia Home Improvement Company installs replacement siding, windows, and louvered

Garcia Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes in northern New Jersey and southern New York. The compa...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks-an...

Q: On April 15, 2015, fire damaged the office and warehouse

On April 15, 2015, fire damaged the office and warehouse of Stanislaw Corporation. The only accounting record saved was the general ledger, from which the trial balance below was prepared. The foll...

Q: Maddox Specialty Company, a division of Lost World Inc., manufactures

Maddox Specialty Company, a division of Lost World Inc., manufactures three models of gear shift components for bicycles that are sold to bicycle manufacturers, retailers, and catalog outlets. Since b...

Q: As of January 1, 2014, Aristotle Inc. installed the

As of January 1, 2014, Aristotle Inc. installed the retail method of accounting for its merchandise inventory. To prepare the store’s financial statements at June 30, 2014, you obtain the follow...

Q: Davenport Department Store converted from the conventional retail method to the LIFO

Davenport Department Store converted from the conventional retail method to the LIFO retail method on January 1, 2014, and is now considering converting to the dollar-value LIFO inventory method. Duri...

Q: LaTour Inc. is based in France and prepares its financial statements

LaTour Inc. is based in France and prepares its financial statements in accordance with IFRS. In 2014, it reported cost of goods sold of $578 million and average inventory of $154 million. Briefly dis...

Q: Garcia Home Improvement Company installs replacement siding, windows, and louvered

Garcia Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes in northern New Jersey and southern New York. The compa...

Q: The following three situations involve the capitalization of interest.Situation

The following three situations involve the capitalization of interest.Situation I: On January 1, 2014, Oksana Baiul, Inc. signed a fixed-price contract to have Builder Associates construct a major pla...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks-an...

Q: As the recently appointed auditor for William J. Bryan Corporation,

As the recently appointed auditor for William J. Bryan Corporation, you have been asked to examine selected accounts before the 6-month financial statements of June 30, 2014, are prepared. The contr...

Q: You are evaluating Woodlawn Racetrack for a potential loan. An examination

You are evaluating Woodlawn Racetrack for a potential loan. An examination of the notes to the financial statements indicates restricted cash at year-end amounts to $100,000. Explain how you would u...

Q: Recent financial statements of General Mills, Inc. report net sales

Recent financial statements of General Mills, Inc. report net sales of $12,442,000,000. Accounts receivable are $912,000,000 at the beginning of the year and $953,000,000 at the end of the year. Com...

Q: Moon Hardware is planning to factor some of its receivables.

Moon Hardware is planning to factor some of its receivables. The cash received will be used to pay for inventory purchases. The factor has indicated that it will require “recourse” on t...

Q: On October 1, 2014, Arden Farm Equipment Company sold a

On October 1, 2014, 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...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks...

Q: Presented below are transactions related to Tom Brokaw, Inc.

Presented below are transactions related to Tom Brokaw, Inc. May 10 Purchased goods billed at $15,000 subject to cash discount terms of 2/10, n/60. 11 Purchased goods billed at $13,200 subject to...

Q: Presented below are three independent situations. Answer the question at the

Presented below are three independent situations. Answer the question at the end of each situation. 1. During 2014, Salt-n-Pepa Inc. became involved in a tax dispute with the IRS. Salt-n-Pepa&rsquo...

Q: On November 24, 2014, 26 passengers on Windsor Airlines Flight

On November 24, 2014, 26 passengers on Windsor Airlines Flight No. 901 were injured upon landing when the plane skidded off the runway. Personal injury suits for damages totaling $9,000,000 were fil...

Q: The following amortization and interest schedule reflects the issuance of 10-

The following amortization and interest schedule reflects the issuance of 10-year bonds by Capulet Corporation on January 1, 2008, and the subsequent interest payments and charges. The company&rsquo...

Q: Presented on the next page are four independent situations.(

Presented on the next page are four independent situations. (a) On March 1, 2015, Wilke Co. issued at 103 plus accrued interest $4,000,000, 9% bonds. The bonds are dated January 1, 2015, and pay in...

Q: Presented below are three independent situations. (a) CeCe

Presented below are three independent situations. (a) CeCe Winans Corporation incurred the following costs in connection with the issuance of bonds: (1) Printing and engraving costs, $12,000; (2) lega...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks...

Q: Presented below are two different situations related to Mckee Corporation’s debt obligations

Presented below are two different situations related to Mckee Corporation’s debt obligations. Mckee’s next financial reporting date is December 31, 2014. The financial statements are aut...

Q: Kobayashi Corporation reports in the current liability section of its statement of

Kobayashi Corporation reports in the current liability section of its statement of financial position at December 31, 2014 (its year-end), short-term obligations of $15,000,000, which includes the c...

Q: On February 1, 2015, one of the huge storage tanks

On February 1, 2015, one of the huge storage tanks of Viking Manufacturing Company exploded. Windows in houses and other buildings within a one-mile radius of the explosion were severely damaged, an...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks...

Q: At January 1, 2014, Langley Company’s outstanding shares included the

At January 1, 2014, Langley Company’s outstanding shares included the following. 280,000 shares of $50 par value, 7% cumulative preferred stock 900,000 shares of $1 par value common stock Net income f...

Q: On January 1, 2014, Lennon Industries had stock outstanding as

On January 1, 2014, Lennon Industries had stock outstanding as follows. To acquire the net assets of three smaller companies, Lennon authorized the issuance of an additional 160,000 common shar...

Q: Melton Corporation is preparing the comparative financial statements for the annual report

Melton Corporation is preparing the comparative financial statements for the annual report to its shareholders for fiscal years ended May 31, 2014, and May 31, 2015. The income from operations for e...

Q: Agassi Corporation is preparing the comparative financial statements to be included in

Agassi Corporation is preparing the comparative financial statements to be included in the annual report to stockholders. Agassi employs a fiscal year ending May 31. Income from operations before i...

Q: Prior to 2014, Heberling Inc. excluded manufacturing overhead costs from

Prior to 2014, Heberling Inc. excluded manufacturing overhead costs from work in process and finished goods inventory. These costs have been expensed as incurred. In 2014, the company decided to chang...

Q: Taveras Co. decides at the beginning of 2014 to adopt the

Taveras Co. decides at the beginning of 2014 to adopt the FIFO method of inventory valuation. Taveras had used the LIFO method for financial reporting since its inception on January 1, 2012, and had m...

Q: Gordon Company started operations on January 1, 2009, and has

Gordon Company started operations on January 1, 2009, and has used the FIFO method of inventory valuation since its inception. In 2015, it decides to switch to the average-cost method. You are provide...

Q: Madrasah Corporation issued its financial statements for the year ended December 31

Madrasah Corporation issued its financial statements for the year ended December 31, 2014, on March 10, 2015. The following events took place early in 2015. (a) On January 10, 10,000 shares of $5 par...

Q: You have been engaged to review the financial statements of Gottschalk Corporation

You have been engaged to review the financial statements of Gottschalk Corporation. In the course of your examination, you conclude that the bookkeeper hired during the current year is not doing a goo...

Q: You have been engaged to review the financial statements of Gottschalk Corporation

You have been engaged to review the financial statements of Gottschalk Corporation. In the course of your examination, you conclude that the bookkeeper hired during the current year is not doing a goo...

Q: Koch Corporation is in the process of preparing its annual financial statements

Koch Corporation is in the process of preparing its annual financial statements for the fiscal year ended April 30, 2015. Because all of Koch’s shares are traded intrastate, the comp...

Q: Ace Inc. produces electronic components for sale to manufacturers of radios

Ace Inc. produces electronic components for sale to manufacturers of radios, television sets, and digital sound systems. In connection with her examination of Ace’s financial statements for the year e...

Q: Peter Henning Tool Company’s December 31 year-end financial statements contained

Peter Henning Tool Company’s December 31 year-end financial statements contained the following errors. An insurance premium of $66,000 was prepaid in 2014 covering the years 2014, 20...

Q: Presented below are three independent situations. Situation 1: A

Presented below are three independent situations. Situation 1: A company offers a one-year warranty for the product that it manufactures. A history of warranty claims has been compiled, and the probab...

Q: At December 31, 2014, Coburn Corp. has assets of

At December 31, 2014, Coburn Corp. has assets of $10,000,000, liabilities of $6,000,000, common stock of $2,000,000 (representing 2,000,000 shares of $1 par common stock), and retained earnings of $2,...

Q: The following information is available for Barkley Company at December 31,

The following information is available for Barkley Company at December 31, 2014, regarding its investments. Instructions (a) Prepare the adjusting entry (if any) for 2014, assuming the securities are...

Q: You are compiling the consolidated financial statements for Winsor Corporation International.

You are compiling the consolidated financial statements for Winsor Corporation International. The corporation’s accountant, Anthony Reese, has provided you with the segment informati...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks-and-Spencer...

Q: Your client, Cascade Company, is planning to invest some of

Your client, Cascade Company, is planning to invest some of its excess cash in 5-year revenue bonds issued by the county and in the shares of one of its suppliers, Teton Co. Teton’s shares trade on th...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marksand-Spencer-...

Q: How should consolidated financial statements be reported this year when statements of

How should consolidated financial statements be reported this year when statements of individual companies were presented last year?

Q: Discuss and illustrate how a correction of an error in previously issued

Discuss and illustrate how a correction of an error in previously issued financial statements should be handled.

Q: Presented below is an excerpt from the financial statements of H.

Presented below is an excerpt from the financial statements of H. J. Heinz Company. Segment and Geographic Data The company is engaged principally in one line of business—processed f...

Q: At January 1, 2014, Langley Company’s outstanding shares included the

At January 1, 2014, Langley Company’s outstanding shares included the following. 280,000 shares of $50 par value, 7% cumulative preferred stock 900,000 shares of $1 par value common stock Net income f...

Q: Lexington Co. has the following available-for-sale securities

Lexington Co. has the following available-for-sale securities outstanding on December 31, 2014 (its first year of operations). During 2015, Summerset Company stock was sold for $9,200, the difference...

Q: Monat Construction Company, Inc., entered into a firm fixed-

Monat Construction Company, Inc., entered into a firm fixed-price contract with Hyatt Clinic on July 1, 2014, to construct a four-story office building. At that time, Monat estimated that it would tak...

Q: Shapiro Inc. was incorporated in 2013 to operate as a computer

Shapiro Inc. was incorporated in 2013 to operate as a computer software service firm with an accounting fiscal year ending August 31. Shapiro’s primary product is a sophisticated onl...

Q: Holtzman Company is in the process of preparing its financial statements for

Holtzman Company is in the process of preparing its financial statements for 2014. Assume that no entries for depreciation have been recorded in 2014. The following information related to depreciation...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks-and-Spencer...

Q: Cutting Edge is a monthly magazine that has been on the market

Cutting Edge is a monthly magazine that has been on the market for 18 months. It currently has a circulation of 1.4 million copies. Negotiations are underway to obtain a bank loan in order to update t...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marksand-Spencer-...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks-and-Spencer...

Q: Midwest Health Club (MHC) offers one-year memberships.

Midwest Health Club (MHC) offers one-year memberships. Membership fees are due in full at the beginning of the individual membership period. As an incentive to new customers, MHC advertised that any c...

Q: The following statement is an excerpt from the FASB pronouncement related to

The following statement is an excerpt from the FASB pronouncement related to interim reporting. Interim financial information is essential to provide investors and others with timely information as to...

Q: What are interim reports? Why is a complete set of financial

What are interim reports? Why is a complete set of financial statements often not provided with interim data? What are the accounting problems related to the presentation of interim data?

Q: On January 1, 2014, Millay Inc. paid $700

On January 1, 2014, Millay Inc. paid $700,000 for 10,000 shares of Genso Company’s voting common stock, which was a 10% interest in Genso. At that date, the net assets of Genso totaled $6,000,000. The...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marksand-Spencer-...

Q: On January 1, 2014, Lennon Industries had stock outstanding as

On January 1, 2014, Lennon Industries had stock outstanding as follows. To acquire the net assets of three smaller companies, Lennon authorized the issuance of an additional 160,000 common shares. The...

Q: GAAP requires the statement of cash flows be presented when financial statements

GAAP requires the statement of cash flows be presented when financial statements are prepared. Instructions (a) Explain the purposes of the statement of cash flows. (b) List and describe the three cat...

Q: Baden Corporation entered into a lease agreement for 10 photocopy machines for

Baden Corporation entered into a lease agreement for 10 photocopy machines for its corporate headquarters. The lease agreement qualifies as an operating lease in all terms except there is a bargain-pu...

Q: Various types of accounting changes can affect the financial statements of a

Various types of accounting changes can affect the financial statements of a business enterprise differently. Assume that the following list describes changes that have a material effect on the financ...

Q: Snider Corporation, a publicly traded company, is preparing the interim

Snider Corporation, a publicly traded company, is preparing the interim financial data which it will issue to its shareholders at the end of the first quarter of the 2014–2015 fiscal...

Q: Whittier Construction Co. had followed the practice of expensing all materials

Whittier Construction Co. had followed the practice of expensing all materials assigned to a construction job without recognizing any salvage inventory. On December 31, 2014, it was determined that sa...

Q: Many business organizations have been concerned withproviding for the retirement of employees

Many business organizations have been concerned withproviding for the retirement of employees since the late 1800s. During recent decades, a marked increasein this concern has resulted in the establis...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marks-and-Spencer...

Q: As a certified public accountant, you have been contacted by Joe

As a certified public accountant, you have been contacted by Joe Davison, CEO of Sports-Pro Athletics, Inc., a manufacturer of a variety of athletic equipment. He has asked you how to account for the...

Q: Melton Corporation is preparing the comparative financial statements for the annual report

Melton Corporation is preparing the comparative financial statements for the annual report to its shareholders for fiscal years ended May 31, 2014, and May 31, 2015. The income from operations for eac...

Q: Swift Corp., a capital goods manufacturing business that started on January

Swift Corp., a capital goods manufacturing business that started on January 4, 2014, and operates on a calendar-year basis, uses the installment sales method of profit recognition in accounting for al...

Q: Agassi Corporation is preparing the comparative financial statements to be included in

Agassi Corporation is preparing the comparative financial statements to be included in the annual report to stockholders. Agassi employs a fiscal year ending May 31. Income from operations before inco...

Q: Snider Corporation, a publicly traded company, is preparing the interim

Snider Corporation, a publicly traded company, is preparing the interim financial data which it will issue to its stockholders and the Securities and Exchange Commission (SEC) at the end of the first...

Q: You are auditing the December 31, 2014, financial statements of

You are auditing the December 31, 2014, financial statements of Hockney, Inc., manufacturer of novelties and party favors. During your inspection of the company garage, you discovered that a used auto...

Q: In examining the costs of pension plans, Helen Kaufman, CPA

In examining the costs of pension plans, Helen Kaufman, CPA, encounters certain terms. The components of pension costs that the terms represent must be dealt with appropriately if generally accepted a...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/assets/downloads/Marks-and- Spencer...

Q: You have been assigned to examine the financial statements of Zarle Company

You have been assigned to examine the financial statements of Zarle Company for the year ended December 31, 2014. You discover the following situations. 1. Depreciation of $3,200 for 2014 on delivery...

Q: Davis Corporation is a medium-sized manufacturer of paperboard containers and

Davis Corporation is a medium-sized manufacturer of paperboard containers and boxes. The corporation sponsors a noncontributory, defined benefit pension plan that covers its 250 employees. Sid Cole ha...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://annualreport.marksandspencer.com/_assets/downloads/Marksand-Spencer-...

Q: Keystone Corporation’s financial statements for the year ended December 31, 2014

Keystone Corporation’s financial statements for the year ended December 31, 2014, were authorized for issue on March 10, 2015. The following events took place early in 2015. (a) On January 10, 10,000...

Q: In partnership with Jefferson County and the Mound City Visitor’s Bureau,

In partnership with Jefferson County and the Mound City Visitor’s Bureau, Mound City recently established a Native American Heritage Center and Museum, organized as a tax-exempt not-for-profit organiz...

Q: If you were trying to assess the financial health of a government

If you were trying to assess the financial health of a government administered pension plan, which financial statements or schedules would you review and why?

Q: The county collector of Lincoln County is responsible for collecting all property

The county collector of Lincoln County is responsible for collecting all property taxes levied by funds and governments within the boundaries of the county. To reimburse the county for estimated admin...

Q: What is the difference between a note to the financial statements and

What is the difference between a note to the financial statements and required supplementary information?

Q: The controller is considering whether a component unit should be presented in

The controller is considering whether a component unit should be presented in the financial statements as a discrete or a blended component unit. What should be considered in making the decision?

Q: Assuming that a government has governmental, proprietary, and fiduciary funds

Assuming that a government has governmental, proprietary, and fiduciary funds, identify the nine financial statements that must be prepared for the CAFR.

Q: Following are descriptions of several relationships between primary governments and other organizations

Following are descriptions of several relationships between primary governments and other organizations.* Required Using just the information provided, indicate whether you believe the primary govern...

Q: Choose the best answer. 1. Which of the following

Choose the best answer. 1. Which of the following fund type(s) uses the accrual basis of accounting? a. Special revenue. b. Internal service. c. Pension trust. d. Both b and c. 2. Which of the followi...

Q: Choose the best answer. 1. Some governments have begun

Choose the best answer. 1. Some governments have begun to provide highly condensed financial information, budget summaries, and narrative descriptions, in addition to their traditional CAFR. This type...

Q: The City of Allenton has engaged you to examine its June 20

The City of Allenton has engaged you to examine its June 20, 2011, financial statements. You are the first CPA ever engaged by the city and you find that the city’s accounting staff...

Q: You have recently started working as the controller for a small county

You have recently started working as the controller for a small county. The county is preparing its financial statements for the comprehensive annual financial report and you have been given the follo...

Q: Following is the governmental activities pre-closing trial balance for the

Following is the governmental activities pre-closing trial balance for the Town of Freaz. Freaz is a relatively small town and, as a result, it has only governmental funds (i. e., it uses no proprieta...

Q: Describe how a taxpayer might assess the financial solvency and viability of

Describe how a taxpayer might assess the financial solvency and viability of a government using government-wide financial statements prepared according to generally accepted accounting principles.

Q: For the fiscal year 2007, the City and County of Denver

For the fiscal year 2007, the City and County of Denver, Colorado, had approximately $4.9 billion in bonded debt. You are a senior accountant in the controller’s office of the City and County of Denve...

Q: The government-wide financial statements for the City of Arborland for

The government-wide financial statements for the City of Arborland for a three-year period are presented on the following pages. Additional information follows: Population: Year 2011: 30,420, Year...

Q: For more than 100 years, the financial statements of the Town

For more than 100 years, the financial statements of the Town of Brookfield have consisted of a statement of cash receipts and a statement of cash disbursements prepared by the town treasurer for each...

Q: Locate a comprehensive annual financial report (CAFR) for a local

Locate a comprehensive annual financial report (CAFR) for a local government from some source on the Internet, perhaps the Web site of the governmental entity or the Governmental Accounting Standards...

Q: Write T if the corresponding statement is true. If the statement

Write T if the corresponding statement is true. If the statement is false, write F and state what changes should be made to make it a true statement. 1. Activities of a general purpose government that...

Q: Explain why governmental fund financial statements are insufficient for users seeking information

Explain why governmental fund financial statements are insufficient for users seeking information about operational accountability.

Q: Refer to Case 3–1 for instructions about how to obtain

Refer to Case 3–1 for instructions about how to obtain the CAFR for a city of your choice. Using that CAFR, go to the required supplementary information (RSI) section, immediately following the notes...

Q: If interim financial reporting to external parties is not required, why

If interim financial reporting to external parties is not required, why should a government bother to prepare interim financial statements and schedules? Give some examples of interim financial statem...

Q: In this case, local governments receive reimbursements from the state government’s

In this case, local governments receive reimbursements from the state government’s Department of Social Services Teen Assistance Program for expenditures incurred in conducting an array of locally adm...

Q: Why do governmental fund financial statements use a different basis of accounting

Why do governmental fund financial statements use a different basis of accounting and measurement focus than the Governmental Activities column of the government-wide financial statements? Also, which...

Q: In the current fiscal year, St. George County issued $

In the current fiscal year, St. George County issued $3,000,000 in general obligation term bonds for 102. The county is required to use any accrued interest or premiums for servicing the debt issue. a...

Q: Review each of the following cases that describe a public university and

Review each of the following cases that describe a public university and a foundation related to it (i.e., an institutionally related foundation). Explain whether the GASB criteria are met so that the...

Q: What are the required financial statements for (a) a

What are the required financial statements for (a) a not-for-profit health care entity and (b) a governmental health care entity reporting only business-type activities?

Q: Examine the financial statements for Oak Valley Hospital for the years ended

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Because management operates the business on a daily basis, they know more about the company's transactions and related assets, liabilities, and equity than the auditor. For example, it is extremely di...

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Distinguish between the existence and completeness balance-related audit objectives. State the effect on the financial statements (overstatement or understatement) of a violation of each in the audit...

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Q: Rene Ritter opened a small grocery and related-products convenience store

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Your client, Harper Company, has a contractual commitment as a part of a bond indenture to maintain a current ratio of 2.0. If the ratio falls below that level on the balance sheet date, the entire bo...

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Q: Consumers Union is a nonprofit organization that provides information and counsel on

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Planning is one of the most demanding and important aspects of an audit. A carefully planned audit increases auditor efficiency and provides greater assurance that the audit team addresses the critica...

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Each of the following situations involves a possible violation of the AICPA's Code of Professional Conduct. For each situation, state the applicable section of the rules of conduct and whether it is a...

Q: Each of the following situations involves possible violations of the AICPA's Code

Each of the following situations involves possible violations of the AICPA's Code of Professional Conduct. For each situation, state whether it is a violation of the Code. In those cases in which it i...

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In 2006, Arnold Diaz was a bright, upcoming audit manager in the South Florida office of a national public accounting firm. He was an excellent technician and a good "people person." Arnold also was a...

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The following questions concern the use of analytical procedures during an audit. Select the best response. a. Analytical procedures used in planning an audit should focus on identifying (1) Material...

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In the normal course of performing their responsibilities, auditors often conduct audits or reviews of the following: 1. Federal income tax returns of an officer of the corporation to determine whethe...

Q: The minutes of the board of directors of the Tetonic Metals Company

The minutes of the board of directors of the Tetonic Metals Company for the year ended December 31, 2011, were provided to you. Meeting of March 5, 2011 The meeting of the board of directors of Tetoni...

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Analytical procedures are an important part of the audit process and consist of the evaluation of financial information by the study of plausible relationships among financial and nonfinancial data. A...

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Your comparison of the gross margin percent for Jones Drugs for the years 2008 through 2011 indicates a significant decline. This is shown by the following information: A discussion with Marilyn Adams...

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Ray, the owner of a small company, asked Holmes, a CPA, to conduct an audit of the company's records. Ray told Holmes that an audit was to be completed in time to submit audited financial statements t...

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The ISAs allow an auditor to include either of the following phrases in the auditor's opinion paragraph: (1) "The financial statements present fairly in all material respects . . ." (2) "The financial...

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A careful reading of an unqualified report indicates several important phrases. Explain why each of the following phrases or clauses is used rather than the alternative provided: a. "The financial sta...

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For the following independent situations, assume that you are the audit partner on the engagement: 1. In the last 3 months of the current year, Oil Refining Company decided to change direction and go...

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Q: As a part of the audit of Ren Gold Manufacturing Company,

As a part of the audit of Ren Gold Manufacturing Company, a nonpublic company, management requests basic financial statements and separately, the same basic financial statements accompanied by additio...

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The following items were discovered during the December 31, 2011 audit of the financial statements of Westmoreland Corporation: 1. The company's financial statements did not include an accrual for bon...

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Q: What should auditors do if during a review of financial statements they

What should auditors do if during a review of financial statements they discover that applicable accounting standards are not being followed?

Q: What are the differences between the review reports for a private company

What are the differences between the review reports for a private company under SSARS and for the interim financial statements of a public company?

Q: Explain why a review of interim financial statements for a public company

Explain why a review of interim financial statements for a public company may provide a greater level of assurance than an SSARS review.

Q: Explain what is meant by prospective financial statements and distinguish between forecasts

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Evaluate the following comments about compiled financial statements: "When CPAs associate their name with compiled financial statements, their only responsibility is to the client and that is limited...

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Lucia Johnson, of Johnson and Lecy, CPAs, has completed the first-year audit of Tidwell Publishing Co., a publicly held company, for the year ended December 31, 2011. She is now working on a review of...

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The following audit procedures were planned by Linda King, CPA, in the audit of the acquisition and payment cycle for Cooley Products, Inc.: 1. Review the acquisitions journal for large and unusual tr...

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Establishing materiality and allocation of materiality to individual accounts requires considerable judgment. Access Microsoft’s 2009 financial statements at www.microsoft.com (use the “investor relat...

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Q: Describe which of the three categories of broad objectives for internal controls

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Q: Describe the concept of an integrated audit of the financial statements and

Describe the concept of an integrated audit of the financial statements and internal control required by PCAOB standards.

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Dodge, CPA, is auditing the financial statements of a manufacturing company with a significant amount of trade accounts receivable. Dodge is satisfied that the accounts are correctly summarized and cl...

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Q: Lew Pherson and Vera Collier are friends who are employed by different

Lew Pherson and Vera Collier are friends who are employed by different CPA firms. One day during lunch they are discussing the importance of internal control in determining the amount of audit evidenc...

Q: The following questions deal with tests of controls. Choose the best

The following questions deal with tests of controls. Choose the best response. a. Which of the following statements about tests of controls is most accurate? (1) Auditing procedures cannot concurrentl...

Q: What are the five types of tests auditors use to determine whether

What are the five types of tests auditors use to determine whether financial statements are fairly stated? Identify which tests are performed to reduce control risk and which tests are performed to re...

Q: Diane Smith, CPA, performed tests of controls and substantive tests

Diane Smith, CPA, performed tests of controls and substantive tests of transactions for sales for the month of March in an audit of the financial statements for the year ended December 31, 2011. Based...

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In evaluating the audit approach for McClain for the current year's audit, Sessions believed that a substantive approach was really only appropriate for the audits of small nonpublic companies. In his...

Q: The following questions deal with materiality. Choose the best response.

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Q: What is the purpose of tests of controls? Identify specific accounts

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Whitehead, CPA, is planning the audit of a newly obtained client, Henderson Energy Corporation, for the year ended December 31, 2011. Henderson Energy is regulated by the state utility commission and...

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In Part I of the case, you performed preliminary analytical procedures for Pinnacle. The purpose of Part II is to identify factors influencing risks and the relationship of risks to audit evidence. Du...

Q: The following are independent situations for which you will recommend an appropriate

The following are independent situations for which you will recommend an appropriate audit report on internal control over financial reporting as required by PCAOB auditing standards: 1. The auditor i...

Q: You are evaluating audit results for assets in the audit of Roberts

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Q: The most recent financial statements for Bradley, Inc., are shown

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Q: Consider the following abbreviated financial statements for Weston Enterprises:

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Financial statements can be a valuable tool for many interested parties in the performance of a company. Consider a public company in Alberta that drills oil and sells it to refineries in the United S...

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The integrated reporting initiative discussed in this chapter focuses on extending the disclosure of financial statements to include more information about a company and its objectives and performance...

Q: The following information is for Brittany, Inc. 1.

The following information is for Brittany, Inc. 1. To be more concise, the company decided that only net income should be reported on the income statement. Details on revenues, cost of goods sold, and...

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Fusters, Inc. issues audited financial statements to its creditors and is required to maintain certain covenants based on its debt to equity ratio and return on assets. In addition, management of Fust...

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Q: Obtain the 2011 financial statements of Teck Resources Limited from SEDAR (

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LD Driving Range Inc. was opened on March 1 by Phil Woods. The following selected events and transactions occurred during March: Woods uses the following accounts for his company: Cash; Prepaid Insur...

Q: To prepare financial statements for the month of March 2014. Mona

To prepare financial statements for the month of March 2014. Mona accumulated all the ledger balances from the business records and found the following: Mona reviewed the records and found the followi...

Q: Extensible business reporting language (XBRL) is a financial reporting system

Extensible business reporting language (XBRL) is a financial reporting system that allows a company to "tag" each piece of financial information as it is input into the company's books of account. Inf...

Q: Access the financial statements for EADS N .V. for its

Access the financial statements for EADS N .V. for its year ended December 31, 2011, from the company's website (www.eads.com). Instructions Answer the following questions with respect to EADS N.V. (...

Q: Gardi Inc. sold a unit of inventory to a buyer for

Gardi Inc. sold a unit of inventory to a buyer for $1,000 payable in one year. Gardi estimates that the interest rate for a similar financing arrangement would be 8%. The unit of inventory normally se...

Q: Storage Services Corporation recognizes revenue under the earnings approach. Explain how

Storage Services Corporation recognizes revenue under the earnings approach. Explain how uncertainty about collectability would affect revenue recognition if Storage prepares financial statements in a...

Q: Builder Corp. is constructing a warehouse that is expected to take

Builder Corp. is constructing a warehouse that is expected to take two years to complete. Builder prepares financial statements in accordance with IFRS. Explain how Builder should recognize revenue un...

Q: Granite Engineering Ltd. has entered into a contract beginning January 1

Granite Engineering Ltd. has entered into a contract beginning January 1, 2013, to build a bridge in Tuktoyuktuk Shores. It estimates that the bridge will cost $14.8 million and will take three years...

Q: Vaughan Construction Ltd. has entered into a contract beginning in February

Vaughan Construction Ltd. has entered into a contract beginning in February 2014 to build two warehouses for Atlantis Structures Ltd. The contract has a fixed price of $9.5 million. The following data...

Q: Cutting Edge is a monthly magazine that has been on the market

Cutting Edge is a monthly magazine that has been on the market for 18 months. It is owned by a private company and has a circulation of 1.4 million copies. Negotiations are underway to obtain a bank l...

Q: Nimble Health and Racquet Club (NHRC) is a public company

Nimble Health and Racquet Club (NHRC) is a public company that operates eight clubs in a large city and offers one-year memberships. The members may use any of the eight facilities but must reserve ra...

Q: Stock Car Auto Inc. (SCA) is a promoter and

Stock Car Auto Inc. (SCA) is a promoter and sponsor of motor-sport activities. Its shares trade on the Toronto Stock Exchange. The company owns two racing tracks where it hosts races (including those...

Q: Comminc Industries (CI) is a leader in delivering communications technology

Comminc Industries (CI) 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. nat...

Q: Treetop Pharmaceuticals (TP) researches, develops, and produces over

Treetop Pharmaceuticals (TP) researches, develops, and produces over- the-counter drugs. During the year, it acquired 100% of the net assets of Treeroot Drugs Limited (TDL) for $200 million. The fair...

Q: Mackenzie Construction Services Ltd. has entered into a contract to construct

Mackenzie Construction Services Ltd. has entered into a contract to construct an office building for Designers Corporation. Mackenzie prepares financial statements in accordance with IFRS. Explain how...

Q: Dave Scotland Inc. (DSI) sold inventory to a new

Dave Scotland Inc. (DSI) sold inventory to a new customer, Jamali Ltd., on December 20, 2014. Jamali was given a significant discount to entice it to switch from its regular supplier. Jamali asked DSI...

Q: Unique Construction Inc. entered into a firm fixed-price contract

Unique Construction Inc. entered into a firm fixed-price contract with A-One Clinic on July 1, 2014, to construct a multi-storey medical office. At that time, Unique Construction estimated that it wou...

Q: Daisy Construction Ltd. has entered into a contract beginning January 1

Daisy Construction Ltd. has entered into a contract beginning January 1, 2014, to build a parking complex. It has estimated that the complex will cost $8 million and will take three years to construct...

Q: In an examination of Wirjanto Corporation as at December 31, 2014

In an examination of Wirjanto Corporation as at December 31, 2014, you have learned about the following situations. No entries have been made in the accounting records for these items. 1. The corporat...

Q: Mills Corporation engaged in the following cash transactions during 2014:

Mills Corporation engaged in the following cash transactions during 2014: Mills prepares financial statements in accordance with IFRS. Calculate the net cash provided (used) by investing activities....

Q: Use the information from BE5- 14 for Mills Corporation.

Use the information from BE5- 14 for Mills Corporation. (a) Calculate the net cash provided (used) by financing activities, if dividends paid are treated as operating activities. (b) Explain how you...

Q: Mega Inc’s manufacturing division lost 5100,000 (net of tax

Mega Inc’s manufacturing division lost 5100,000 (net of tax) for the year ended December 31, 2014, and Mega estimates that it can sell the division at a loss of $200,000 (net of tax). The division qua...

Q: Midwest Beverage Company reported the following items in the most recent year

Midwest Beverage Company reported the following items in the most recent year: (a) Calculate net cash provided (used) by operating activities, the net change in cash during the year, and free cash fl...

Q: Chelsea Smith is the controller of Lincoln Corporation and is responsible for

Chelsea Smith is the controller of Lincoln Corporation and is responsible for the preparation of the year-end financial statements on December 31. Lincoln prepares financial statements in accordance w...

Q: It is February 2015 and Janix Corporation is preparing to issue financial

It is February 2015 and Janix Corporation is preparing to issue financial statements for the year ended December 31, 2014. To prepare financial statements and related disclosures that are faithfully r...

Q: The comparative statement of financial position of Marubeni Corporation for the fiscal

The comparative statement of financial position of Marubeni Corporation for the fiscal year ending December 31, 2014, follows: Net income of $37,000 was reported and dividends of $13,000 were paid in...

Q: In the late 1990s, CIBC helped Enron Corporation structure 34 "

In the late 1990s, CIBC helped Enron Corporation structure 34 "loans" that appeared in the financial statements as cash proceeds from sales of assets. Enron subsequently went bankrupt in 200 I and lef...

Q: The partner in charge of the Spencer Corporation audit comes by desk

The partner in charge of the Spencer Corporation audit comes by desk and leaves a letter he has started to the CEO and a copy of cash flows for the year ended December 31, 2014. Because he must leave...

Q: The financial statements for Maple Leaf Foods Inc. may be found

The financial statements for Maple Leaf Foods Inc. may be found on the company's website or at www.sedar.com. Instructions (a) Calculate the liquidity and coverage (solvency) ratios identified in App...

Q: Obtain the 2001 and 2011 annual reports for Goldcorp Inc. (

Obtain the 2001 and 2011 annual reports for Goldcorp Inc. (from SEDAR www.sedar.com). Read the material leading up to the financial statements and answer the following questions: (a) Explain how the c...

Q: The financial statements for Quebecor Inc. and Thomson Reuters Corporation may

The financial statements for Quebecor Inc. and Thomson Reuters Corporation may be found on SEDAR (www.sedar.com) or the companies' websites. Instructions (a) 'What business is Quebecor Inc. in? Is Th...

Q: The financial statements for Bombardier Inc. for the year ended December

The financial statements for Bombardier Inc. for the year ended December 31, 2011, can be found on the company’s; website or at www.sedar.com. Instructions (a) What form of presentation has the compa...

Q: Global Corporation prepares financial statements in accordance with ASPE. At January

Global Corporation prepares financial statements in accordance with ASPE. At January I, 2014, the company had retained earnings of $529,000. In 2014, net income was $1,646,000, and cash dividends of $...

Q: Use the information in BE4-14 to prepare a statement of

Use the information in BE4-14 to prepare a statement of retained earnings for Global Corporation, assuming that in 2014, Global discovered that it had overstated 2011 depreciation by $25,000 (net of t...

Q: At December 31, 2014, Tres Hombres Corporation had the following shares

At December 31, 2014, Tres Hombres Corporation had the following shares outstanding: 10% cumulative preferred shares, 107,500 shares outstanding $10,750,000 Common shares, 4,000,000 shares outstandin...

Q: The following is information for Gottlieb Corp. for the year ended

The following is information for Gottlieb Corp. for the year ended December 31, 2014: The effective tax rate is 25% on all items. Gottlieb prepares financial statements in accordance with IFRS, and ac...

Q: Plato Inc. prepares financial statements in accordance with IFRS and uses

Plato Inc. prepares financial statements in accordance with IFRS and uses the following headings on its statement of financial position: l. Current assets 2. Long-term investments 3. Property, plant...

Q: The shareholders' equity section of Emerson Corporation as at December 31, 2014

The shareholders' equity section of Emerson Corporation as at December 31, 2014, follows: Net income of$24 million for 2014 reflects a total effective tax rate of25%. Included in the net income figur...

Q: Pike Corporation, a clothing retailer, had income from operations (

Pike Corporation, a clothing retailer, had income from operations (before tax) of $375,000, and recorded the following before tax gains/ (losses) for the year ended December 31, 2014: Pike also had th...

Q: Assume that PAC Inc. decided to sell SBT, a subsidiary

Assume that PAC Inc. decided to sell SBT, a subsidiary, on September 30, 2014. There is a formal plan to dispose of the business component, and the sale qualifies for discontinued operations treatment...

Q: On October 5, 2014, Diamond in the Rough Recruiting Group

On October 5, 2014, Diamond in the Rough Recruiting Group Inc.'s board of directors decided to dispose of the Blue Division. A formal plan was approved. Diamond derives approximately 7 5% of its incom...

Q: Faz Corporation is a manufacturer of paints and specialty coatings. In

Faz Corporation is a manufacturer of paints and specialty coatings. In March 2014, Beck Inc. filed a lawsuit against Faz Corporation for alleged patent infringement, claiming $1.l million in damages....

Q: On January I, 2014, Caroline Lampron and Jenni Meno formed

On January I, 2014, Caroline Lampron and Jenni Meno formed a computer sales and service enterprise in Montreal by investing $90,000 cash. The new company, Razorback Sales and Service, has the followin...

Q: On November I, 2013, Campbell Corporation management decided to discontinue

On November I, 2013, Campbell Corporation management decided to discontinue operation of its Rocketeer Division and approved a formal plan to dispose of the division. Campbell is a successful corporat...

Q: Information for 2014 follows for Rolling Thunder Corp. /

Information for 2014 follows for Rolling Thunder Corp. Rolling Thunder decided to discontinue its entire wholesale division (a major line of business) and to keep its manufacturing division. On Septe...

Q: The ethical accountant is the manager and accountant for a small company

The ethical accountant is the manager and accountant for a small company that is privately owned by three individuals. He has always given the owners cash-based financial statements. The owners are no...

Q: The Canadian Securities Administrators (CSA), an umbrella group of Canadian

The Canadian Securities Administrators (CSA), an umbrella group of Canadian provincial securities commissions, accumulates and publishes all documents that public companies are required to file under...

Q: Lydia Trottier has prepared baked goods for sale since 1998. She

Lydia Trottier has prepared baked goods for sale since 1998. She started a baking business in her home and has been operating in a rented building with a storefront since 2003. Trottier incorporated t...

Q: The trial balance follows for McLean Corporation at December 3!, 2014

The trial balance follows for McLean Corporation at December 3!, 2014: A physical count of inventory on December 31 showed that there was $124,000 of inventory on hand. Instructions Prepare a single...

Q: Billy's Burgers (BB) is a franchisor that operates several corporate

Billy's Burgers (BB) is a franchisor that operates several corporate-owned restaurants as well as several franchised restaurants. The franchisees pay 3% of their sales revenues to BB in return for adv...

Q: Included in Cellin Limited’s December 31, 2014 trial balance are the

Included in Cellin Limited’s December 31, 2014 trial balance are the following accounts: Accounts Payable…………………………251,000 Obligations Under Capital Leases……$175,000 Discount on Bonds Payable………………$14...

Q: As a reviewer for the Ontario Securities Commission, you are in

As a reviewer for the Ontario Securities Commission, you are in the process of reviewing the financial statements of public companies. The following items have come to your attention: 1. A merchandisi...

Q: Before filing for bankruptcy protection, the company was able to buy

Before filing for bankruptcy protection, the company was able to buy a large shipment of snow tubes wholesale for a bargain price of $7 million from a supplier that was in financial trouble. The value...

Q: Bowearth Limited (BL) is in the lumber business. The

Bowearth Limited (BL) is in the lumber business. The company sells pulp and paper products as well as timber and lumber. It has over 500,000 hectares of timberland that it either owns or leases. The c...

Q: Canadian Tire Corporation, Limited is one of Canada's best-known

Canadian Tire Corporation, Limited is one of Canada's best-known retailers. The company operates 488 "hard-goods" retail stores through associate dealers, and a total of 385 corporate and franchise st...

Q: Instructions From SEDAR (www.sedar.com), or

Instructions From SEDAR (www.sedar.com), or the company websites, access the financial statements of Loblaw Companies Limited for its year ended December 31, 2011, and of Empire Company Limited for it...

Q: The financial statements of Trifolium Corporation for fiscal 2012 to fiscal 2014

The financial statements of Trifolium Corporation for fiscal 2012 to fiscal 2014 are as follows (in thousands): Instructions (a) Calculate Trifolium's (1) Inventory turnover and (2) Average days to...

Q: Iqbal Corporation uses the lower of FIFO cost and net realizable value

Iqbal Corporation uses the lower of FIFO cost and net realizable value method on an individual item basis, applying the direct method. The inventory at December 31, 2014, included product AG. Relevant...

Q: Transactions follow for Whitehall Limited: March 10 Purchased goods billed

Transactions follow for Whitehall Limited: March 10 Purchased goods billed at $25,000, terms 3/10, n/60. 11 Purchased goods billed at $26,575, terms 1115, n/30. 19 Paid invoice of March 10. 24 Purchas...

Q: The summary financial statements of KwikMart Ltd. on December 31,

The summary financial statements of KwikMart Ltd. on December 31, 2014, are as follows: The following errors were made by the inexperienced accountant on December 31, 2013, and were not corrected. l....

Q: Astro Languet established Languet Products Co. as a sole proprietorship on

Astro Languet established Languet Products Co. as a sole proprietorship on January 5, 2014. At the company's year end of December 31, 2014, the accounts had the following balances (in thousands): A c...

Q: Sube Specialty Corp., a division of FH Inc., manufactures three

Sube Specialty Corp., a division of FH Inc., manufactures three models of gearshift components for bicycles that are sold to bicycle manufacturers, retailers, and catalogue outlets. Since beginning op...

Q: Some of the transactions of Spandrel Corp. during August follow.

Some of the transactions of Spandrel Corp. during August follow. Spandrel uses the periodic inventory method. Instructions (a) Assuming that purchases are recorded at gross amounts and that discounts...

Q: Grappa Grapes Inc. (GGI) grows grapes and produces fine

Grappa Grapes Inc. (GGI) grows grapes and produces fine champagne. 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 ow...

Q: Access the annual financial statements of Andrew Peller Limited for the year

Access the annual financial statements of Andrew Peller Limited for the year ended March 31, 2012, on SEDAR (www.sedar.com), or the company's website (www.andrewpeller.com). Instructions Refer to the...

Q: From SEDAR (www.sedar.com), or the company

From SEDAR (www.sedar.com), or the company websites, access the financial statements of Loblaw Companies Limited for its year ended December 31, 2011, and of Empire Company Limited for its year ended...

Q: Stora Enso Oyj describes its business in its annual report as the

Stora Enso Oyj describes its business in its annual report as the "global rethinker of the biomaterials, paper, packaging and wood products industry." Instructions Access the financial statements of...

Q: The financial statements of Magnotta Winery Corporation report net sales of $

The financial statements of Magnotta Winery Corporation report net sales of $23,223,804 for its year ended January 31, 20ll. Accounts receivable are $616,797 at January 31, 2011, and $590,322 at Janua...

Q: The financial statements of BCE Inc. report net sales of $

The financial statements of BCE Inc. report net sales of $ 19,497 million for its year ended December 31, 2011, and $18,069 million for its year ended December 31, 2010. Accounts receivable (net) was...

Q: The Becker Milk Company Limited, a real estate and investment management

The Becker Milk Company Limited, a real estate and investment management company, reports the following information in its financial statements for the years ended April 30, 2011, 2010, and 2009: Not...

Q: At December 31, 2014, Ichor Ltd. has outstanding non

At December 31, 2014, Ichor Ltd. has outstanding non-cancellable purchase commitments for 45,500 litres of raw material at S3.25 per litre. The material will be used in Ichor's manufacturing process,...

Q: On October 1, 2014, Healy Farm Equipment Corp. sold

On October 1, 2014, Healy Farm Equipment Corp. sold a harvesting machine to Homestead industries. Instead of a cash payment, Homestead Industries gave Healy Farm Equipment a $150,000, two-year, 10% no...

Q: Chessman Corporation factors $600,000 of accounts receivable with Liquidity

Chessman Corporation factors $600,000 of accounts receivable with Liquidity Financing, Inc. on a with recourse basis. Liquidity Financing will collect the receivables. The receivable records are trans...

Q: Since 1996, Nike, Inc. has had endorsement contracts with

Since 1996, Nike, Inc. has had endorsement contracts with Tiger Woods and some of the world's best known athletes. For example, Nike has been able to gain the rights to use Tiger Woods's name in adver...

Q: As the recently appointed auditor for Daleara Corporation, you have been

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, 2014, are prepared. The controller for...

Q: In 2013, Aquaculture Incorporated applied for several commercial fishing licences for

In 2013, Aquaculture Incorporated applied for several commercial fishing licences for its commercial fishing vessels. The application was successful and on January 2, 2014, Aquaculture was granted 22...

Q: Six examples follow of purchased intangible assets. They are reported on

Six examples follow of purchased intangible assets. They are reported on the consolidated statement of financial position of Phelp Enterprises Limited and include information about their useful and le...

Q: In late July 2014, Mona Ltd., a private company,

In late July 2014, Mona Ltd., a private company, paid $2 million to acquire all of the net assets of Lubello Corp., which then became a division of Mona. Lubello reported the following statement of fi...

Q: Guiglano Inc. is a large, publicly held corporation. The

Guiglano Inc. is a large, publicly held corporation. The following are six selected expenditures that were made by the company during the current fiscal year ended April 30, 2014. The proper accountin...

Q: Gelato Corporation, a private entity reporting under ASPE, was incorporated

Gelato Corporation, a private entity reporting under ASPE, was incorporated on January 3, 2013. The corporation's financial statements for its first year of operations were not examined by a public ac...

Q: Biofuel Inc. (BI) is a private company that just

Biofuel Inc. (BI) is a private company that just started up this year. The company's owner, Sarah Biorini, created a process whereby carbon dioxide (CO2) emissions are converted into biofuel. Specific...

Q: On June 30, 2014, your client, Bearcat Limited,

On June 30, 2014, your client, Bearcat Limited, was granted two patents for plastic cartons that it had been producing and marketing profitably for the past three years. One patent covers the manufact...

Q: L'Oreal is the world's largest cosmetic company, with brands such as

L'Oreal is the world's largest cosmetic company, with brands such as its own name, Redken, Mayhelline, Lancome, and Ralph Lauren, just to name a few. Instructions Access L'Oreal’s annual financial...

Q: The following information is available about Kao Corp.'s investments at

The following information is available about Kao Corp.'s investments at December 31, 2014. This is the first year Kao has purchased securities for investment purposes. Assume that Kao Corp. follows I...

Q: On January 1, 2014, Mustafa Limited paid $537,

On January 1, 2014, Mustafa Limited paid $537,907.40 for 12% bonds with a maturity value of $500,000. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2014, and mature on...

Q: Perez Corp., a mining company, owns a significant mineral deposit

Perez Corp., a mining company, owns a significant mineral deposit in a northern territory. Included in the asset is a road system that was constructed to give company personnel access to the mineral d...

Q: In early January 2014, Chi Inc., a private enterprise that

In early January 2014, Chi Inc., a private enterprise that applies ASPE, purchased 40% of the common shares of Washi Corp. for $410,000. Chi was now able to exercise considerable influence in decision...

Q: Access the annual report for British Airways pic for the year ended

Access the annual report for British Airways pic for the year ended December 31, 2011, from the company's website. Use the notes to the financial statements to answer the following questions. Instruc...

Q: Castlegar Ltd. had the following investment portfolio at January 1,

Castlegar Ltd. had the following investment portfolio at January 1, 2014: During 2014, the following transactions took place: 1. On March 1, Josie Corp. paid a $2 per share dividend. 2. On April 30, C...

Q: On December 31, 2013, Nodd Corp. acquired an investment

On December 31, 2013, Nodd Corp. acquired an investment in GT Ltd. bonds with a nominal interest rate of I 0% (received each December 31) and the controller produced the following bond amortization sc...

Q: Octavia Corp. prepares financial statements annually on December 31, its

Octavia Corp. prepares financial statements annually on December 31, its fiscal year end. At December 31, 2014, the company has the account Investments in its general ledger that contains the followin...

Q: Green Thumb Landscaping Limited has determined that its lawn maintenance division is

Green Thumb Landscaping Limited has determined that its lawn maintenance division is a cash-generating unit under IFRS. The carrying an10unts of the division’s assets at December 31, 2014, are as foll...

Q: Harper Corporation has the following portfolio of investments at December 31,

Harper Corporation has the following portfolio of investments at December 31, 2014, that qualify and are accounted for using the fair value through other comprehensive income (FV-OIC) method: Early in...

Q: Minute Corp., a Canadian public corporation, reported the following on

Minute Corp., a Canadian public corporation, reported the following on its December 31, 2013 statement of financial position: $ Investment in Hysenaj Ltd. shares, at fai...

Q: MacAskill Corp. has the following portfolio of securities acquired for trading

MacAskill Corp. has the following portfolio of securities acquired for trading purposes and accounted for using the fair value through net income model at September 30, 2014, the end of the company~ t...

Q: The following information relates to the 2014 debt and equity invesm1ent transactions

The following information relates to the 2014 debt and equity invesm1ent transactions of Wildcat Ltd., a publicly accountable Canadian corporation. All of the investments were acquired for trading pur...

Q: Investment Company Limited (ICL) is a private company owned by

Investment Company Limited (ICL) is a private company owned by 10 doctors. The company's objective is to manage the doctors' investment portfolios. It actually began as an invesm1ent club 10 years ago...

Q: EMI Inc. is a public company that operates numerous movie theatres

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...

Q: Jax Taylor has the financial statements of an old established university,

Jax Taylor has the financial statements of an old established university, a manufacturing company, an insurance company, a real estate developer, a major retail enterprise, and a pension plan. (a) Ide...

Q: In 2014, Inventors Corp. spent $392,000 on

In 2014, Inventors Corp. spent $392,000 on a research project, hut by the end of 2014 it was impossible to determine whether any benefit would come from it. Inventors prepares financial statements in...

Q: Safe Ride Incorporated applied for several taxi licenses for its taxicab operations

Safe Ride Incorporated applied for several taxi licenses for its taxicab operations in the City of Waterford and, on August 31, 2014, incurred costs of$14,200 in the application process. The outcome o...

Q: At the end of 2014, Dayton Corporation owns a licence with

At the end of 2014, 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...

Q: Repeat E12-13, but now assume that Dayton prepares financial

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 $500,00...

Q: Repeat E12-13, but now assume that the licence was

Repeat E12-13, but now assume that the licence was granted in perpetuity and has an indefinite life. In exercise E12-13: At the end of 2014, Dayton Corporation owns a licence with a remaining life of...

Q: Repeat E12-13, but now assume that the licence was

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. In exercise E12-13 At the e...

Q: Use the information for Qilin Corp. given in BE11-11

Use the information for Qilin Corp. given in BE11-11. By the end of the following year, the machinery's fair value has increased to $490,000. In exercise Qilin Corp., a small company that follows ASP...

Q: Hambrecht Corp. is preparing its financial statements for the fiscal year

Hambrecht Corp. is preparing its financial statements for the fiscal year ending November 30, 2014. Certain specialized equipment was scrapped on January 1, 2015. At November 30, 2014, this equipment...

Q: Caley Inc. owns a building with a carrying amount of $

Caley Inc. owns a building with a carrying amount of $1.5 million, as of January 1, 2014. On that date, Caley's management determined that the buildings location is no longer suitable for the company'...

Q: Cella Corporation's statement of financial position shows property, plant, and

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,...

Q: On October 1, 2014, Ocean Airways Ltd. purchased a

On October 1, 2014, 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 of510 million each, an...

Q: Fran Song looked at the consolidated financial statements of Vixen Manufacturing Limited

Fran Song looked at the consolidated financial statements of Vixen Manufacturing Limited and shook her head. "I was asked to look at the accounting for Vixen's investments," she said, "but I can't fin...

Q: Chong Corp. purchased a machine on July 1, 2014,

Chong Corp. purchased a machine on July 1, 2014, for $30,000. Chong paid $200 in title fees and a legal fee of $100 related to the machine. In addition, Chong paid $500 of shipping charges for deliver...

Q: Gilles Corp. purchased a piece of equipment on February 1,

Gilles Corp. purchased a piece of equipment on February 1, 2014, for $100,000. The equipment has an estimated useful life of eight years with a residual value of $25,000, and an estimated physical lif...

Q: Consider the following independent situations for Kwok Corporation. Kwok applies ASPE

Consider the following independent situations for Kwok Corporation. Kwok applies ASPE. Situation 1: Kwok purchased equipment in 2007 for $120,000 and estimated a $12,000 residual value at the end of t...

Q: On April 1, 2014, Lombardi Corp. was awarded $

On April 1, 2014, Lombardi Corp. was awarded $460,000 cash as compensation for the forced sale of its land and building, which were directly in the path of a new highway. The land and building cost $6...

Q: Jiang Company Ltd. Purchases equipment on January 1, 2014,

Jiang Company Ltd. Purchases equipment on January 1, 2014, for $387,000 cash. The asset is expected to have a useful life of 12 years and a residual value of$39,000.Jiang prepares financial statements...

Q: Diderot Corp. acquired a property on September 15, 2014,

Diderot Corp. acquired a property on September 15, 2014, for $220,000, paying $3,000 in transfer taxes and a $1,500 real estate fee. Based on the provincial assessment information, 75% of the property...

Q: Gambit Corporation purchased a new plant asset on April 1, 2014

Gambit Corporation purchased a new plant asset on April 1, 2014, at a cost of $769,000. It was estimated to have a useful life of 20 years and a residual value of $300,000, and a physical life of 30 y...

Q: Refer to the annual financial statements of Shoppers Drug Mart for its

Refer to the annual financial statements of Shoppers Drug Mart for its fiscal year ended December 31, 2011, found in Appendix 5B. Instructions (a) Review Shoppers Drug Mart's balance sheet. Identify...

Q: On April30, 2014, Oceanarium Corporation ordered a new passenger ship

On April30, 2014, Oceanarium Corporation ordered a new passenger ship, which was delivered to the designated cruise port and available for use as of June 30, 2014. Overall, the cost of the ship was $9...

Q: Conan Logging and Lumber Company, a small private company that follows

Conan Logging and Lumber Company, a small private company that follows ASPE, owns 3,000 hectares of timberland on the north side of Mount Leno, which was purchased in 2002 at a cost of S550 per hectar...

Q: Refer to the 2011 financial statements and accompanying notes of Royal Bank

Refer to the 2011 financial statements and accompanying notes of Royal Bank of Canada (RBC) that are found on the company's website ('www.royalbank.ca) or www.sedar.com. Instructions (a) What percent...

Q: Club Loop Corporation (CL) is a large owner, operator

Club Loop Corporation (CL) is a large owner, operator, and developer of golf clubs and resorts. The company is privately owned by several wealthy individuals. During the current year, according to the...

Q: MA Hydro (MH) is a private company that owns and

MA Hydro (MH) is a private company that owns and operates all of Ontario~ electricity transmission systems. It is deciding whether it should follow IFRS or ASPE in the upcoming year. The company must...

Q: On March 31, Ramesh Corp. invests in a $1

On March 31, Ramesh Corp. invests in a $1,000, 6% bond to be held for short-term trading purposes, and accounts for this investment using the FV-NI method. The bond's fair value when acquired was $970...

Q: Two well-known company names in the transportation industry in Canada

Two well-known company names in the transportation industry in Canada are Canadian National Railway Company and Canadian Pacific Railway Limited. Go co either SEDAR (www.sedar.com) or to each company'...

Q: Lufthansa and Air Canada are both global airline companies. Lufthansa reports

Lufthansa and Air Canada are both global airline companies. Lufthansa reports under IFRS. Air Canada reported under pre-changeover Canadian GAAP until 2010 and now reports under IFRS. Access the finan...

Q: Usually a comparison assignment involves comparing two similar companies that are reporting

Usually a comparison assignment involves comparing two similar companies that are reporting under different GAAP. Ideally, it would be better to compare the same company's financial reports prepared o...

Q: Instructions Gain access to the 2011 financial statements of Potash Corporation

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Q: QT, Inc. and Elppa Computers, Inc. compete with

QT, Inc. and Elppa Computers, Inc. compete with each other in the personal computer market. QT assembles computers to customer orders, building and delivering a computer within four days of a customer...

Q: In teams, select a public company that interests you. Obtain

In teams, select a public company that interests you. Obtain the company’s most recent annual report on Form 10-K. The Form 10-K is a company’s annually required filing with the Securities and Exchang...

Q: The following data were taken from the financial statements of Hunter Inc

The following data were taken from the financial statements of Hunter Inc. for December 31 of two recent years: The income before income tax was $480,000 and $420,000 for the current and previous ye...

Q: The following selected data were taken from the financial statements of Vidahill

The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 20Y7, 20Y6, and 20Y5: The 20Y7 net income was $411,000, and the 20Y6 net income was $462,500. N...

Q: What is the central problem involved in consolidating the financial statements of

What is the central problem involved in consolidating the financial statements of a foreign subsidiary?

Q: Why are interviews in fraudulent financial statements and tax returns handled differently

Why are interviews in fraudulent financial statements and tax returns handled differently than interviews in other fraud examinations?

Q: The unadjusted trial balance of Good Times, Inc., at January

The unadjusted trial balance of Good Times, Inc., at January 31, 2012, does not balance. The list of accounts and their balances is given below. The trial balance needs to be prepared and adjusted bef...

Q: Refer to the consolidated financial statements of RadioShack Corporation in Appendix B

Refer to the consolidated financial statements of RadioShack Corporation in Appendix B. During 2010, the company had numerous accruals and deferrals. As a new member of RadioShack’s accounting staff ,...

Q: Refer to the RadioShack Corporation consolidated financial statements in Appendix B at

Refer to the RadioShack Corporation consolidated financial statements in Appendix B at the end of this book. Show amounts in millions and round to the nearest $1 million. 1. Three important pieces of...

Q: The notes are part of the financial statements. They give details

The notes are part of the financial statements. They give details that would clutter the statements. This case will help you learn to use a company’s inventory notes. Refer to Amazon.com, Inc.’s conso...

Q: On October 1, 2012, Lou Marks opened Eagle Restaurant,

On October 1, 2012, Lou Marks opened Eagle Restaurant, Inc. Marks is now at a crossroads. The October financial statements paint a glowing picture of the business, and Marks has asked you whether he s...

Q: Infografix Corporation’s consolidated sales for 2012 were $26.6 billion

Infografix Corporation’s consolidated sales for 2012 were $26.6 billion, and expenses totaled $24.8 billion. Infografix operates worldwide and conducts 37% of its business outside the United States. D...

Q: This problem demonstrates the dramatic effect that consolidation accounting can have on

This problem demonstrates the dramatic effect that consolidation accounting can have on a company’s ratios. Spindler Motor Company (Spindler) owns 100% of Spindler Motor Credit Corpo...

Q: Assume that Goss has a subsidiary company based in Japan.

Assume that Goss has a subsidiary company based in Japan. Requirements 1. Translate into dollars the foreign-currency balance sheet of the Japanese subsidiary of Goss. ____________________________Yen...

Q: This problem demonstrates the dramatic effect that consolidation accounting can have on

This problem demonstrates the dramatic effect that consolidation accounting can have on a company’s ratios. Roto Motor Company (Roto) owns 100% of Roto Motor Credit Corporation (RMCC...

Q: On January 4, 2012, G.L. Brown Co

On January 4, 2012, G.L. Brown Co. paid $235,000 for a computer system. In addition to the basic purchase price, the company paid a setup fee of $1,100, $6,200 sales tax, and $37,200 for a special pla...

Q: Lily, Inc., sells electronics and appliances. The excerpts that

Lily, Inc., sells electronics and appliances. The excerpts that follow are adapted from Lily’s financial statements for 2012 and 2011. Requirements 1. How much was Lilyâ€...

Q: Assume that Mattson has a subsidiary company based in Japan.

Assume that Mattson has a subsidiary company based in Japan. Requirements 1. Translate into dollars the foreign-currency balance sheet of the Japanese subsidiary of Mattson. _________________________...

Q: The consolidated financial statements of Amazon.com, Inc. ,

The consolidated financial statements of Amazon.com, Inc. , are given in Appendix A at the end of this book. 1. Refer to Note 1—Description of Business and Accounting Policies, under Investments. Desc...

Q: This case is based on the consolidated financial statements of RadioShack Corporation

This case is based on the consolidated financial statements of RadioShack Corporation given in Appendix B at the end of this book. 1. Read Note 4: Acquisitions. Does RadioShack Corporation own any for...

Q: On January 7, 2012, J.B. Griffin Co

On January 7, 2012, J.B. Griffin Co. paid $240,000 for a computer system. In addition to the basic purchase price, the company paid a setup fee of $1,400, $6,500 sales tax, and $29,100 for a special p...

Q: Macy’s, Inc., is one the nation’s premier retailers, with

Macy’s, Inc., is one the nation’s premier retailers, with fiscal 2010 sales of $25 billion. The company operates about 810 Macy’s department store...

Q: Avril, Inc., sells electronics and appliances. The excerpts that

Avril, Inc., sells electronics and appliances. The excerpts that follow are adapted from Avril’s financial statements for 2012 and 2011. Requirements 1. How much was Avrilâ&#...

Q: Answer these questions about consolidation accounting: 1. Define “

Answer these questions about consolidation accounting: 1. Define “parent company.” Define “subsidiary company.” 2. How do consolidated financial statements differ from the financial statements of a si...

Q: Refer to Amazon.com, Inc.’s Consolidated Financial Statements

Refer to Amazon.com, Inc.’s Consolidated Financial Statements in Appendix A at the end of the book, and answer the following questions: 1. Refer to Note 1 and Note 3 of the Notes to Consolidated Finan...

Q: Refer to the RadioShack Corporation Consolidated Financial Statements in Appendix B at

Refer to the RadioShack Corporation Consolidated Financial Statements in Appendix B at the end of this book. This case leads you through an analysis of the activity in Radioshack’s long-term assets, a...

Q: You are meeting with executives of Cooper Cosmetics Corporation to arrange your

You are meeting with executives of Cooper Cosmetics Corporation to arrange your firm’s engagement to audit the corporation’s financial statements for the year ending December 31. One executive suggest...

Q: Dunder-Mifflin Inc. wanted to expand its manufacturing and sales

Dunder-Mifflin Inc. wanted to expand its manufacturing and sales facilities. The company applied for a loan from First Bank, presenting the prior-year audited financial statements and the forecast for...

Q: This question consists of a number of items pertaining to an auditor’s

This question consists of a number of items pertaining to an auditor’s risk analysis for a company. Your task is to tell how each item affects overall audit risk—that is, the probability of issuing an...

Q: Give an example of an error or fraud that would misstate financial

Give an example of an error or fraud that would misstate financial statements to affect the accounts as follows, taking each case independently. (Note: “Overstate” means the account has a higher value...

Q: Audit standards distinguish auditors’ responsibility for planning procedures for detecting noncompliance with

Audit standards distinguish auditors’ responsibility for planning procedures for detecting noncompliance with laws and regulations having a direct effect on financial statements versus planning proced...

Q: Horizontal analysis refers to changes of financial statement numbers and ratios across

Horizontal analysis refers to changes of financial statement numbers and ratios across two or more years. Vertical analysis refers to financial statement amounts expressed each year as proportions of...

Q: An audit strategy memorandum contains a. Specifications of auditing standards

An audit strategy memorandum contains a. Specifications of auditing standards relevant to the financial statements being audited. b. Specifications of procedures the auditors believe appropriate for t...

Q: Under the Private Securities Litigation Reform Act (the Act), independent

Under the Private Securities Litigation Reform Act (the Act), independent auditors are required to first a. Report in writing all instances of noncompliance with the Act to the client’s board of direc...

Q: A primary objective of analytical procedures used in the final review stage

A primary objective of analytical procedures used in the final review stage of an audit is to a. Identify account balances that represent specific risks relevant to the audit. b. Gather evidence from...

Q: Which of the following matters relating to an entity’s operations would an

Which of the following matters relating to an entity’s operations would an auditor most likely consider as an inherent risk factor in planning an audit? a. The entity’s fiscal year ends on June 30. b....

Q: Auditing standards do not require auditors of financial statements to a

Auditing standards do not require auditors of financial statements to a. Understand the nature of errors and frauds. b. Assess the risk of occurrence of errors and frauds. c. Design audits to provide...

Q: The auditors assessed risk of material misstatement at 0.50 and

The auditors assessed risk of material misstatement at 0.50 and said they wanted to achieve a 0.05 risk of failing to express a correct opinion on financial statements that were materially misstated....

Q: The president of Allpurpose Loan Company had a genuine dislike for external

The president of Allpurpose Loan Company had a genuine dislike for external auditors. Almost any conflict generated a towering rage. Consequently, the company changed auditors often. The firm of Wells...

Q: North, CPA, is planning an independent audit of the financial

North, CPA, is planning an independent audit of the financial statements of General Company. In determining the nature, timing, and extent of the audit procedures, North is considering General’s inter...

Q: You have accepted the engagement of auditing the financial statements of the

You have accepted the engagement of auditing the financial statements of the C. Reis Company, a small manufacturing firm that has been your client for several years. Because you were busy writing the...

Q: In each of the following, identify which of the elements of

In each of the following, identify which of the elements of the fundamental principles is most applicable. In addition, discuss what action(s) (if any) you believe auditors should take with respect to...

Q: Sorrell, CPA, is auditing the financial statements of Van Dyke

Sorrell, CPA, is auditing the financial statements of Van Dyke as of December 31, 2017. Sorrell’s substantive procedures and other tests indicated that Van Dyke’s f...

Q: Which of the following opinions would be issued if auditors believed that

Which of the following opinions would be issued if auditors believed that the entity’s financial statements were not presented in conformity with GAAP? a. Adverse opinion. b. Disclaimer of opinion. c....

Q: What options are available to the auditor for presenting reports on the

What options are available to the auditor for presenting reports on the entity’s financial statements and internal control over financial reporting?

Q: Indicate whether each of the following audit procedures is a test of

Indicate whether each of the following audit procedures is a test of controls, a substantive test, or a dual-purpose test. Next, indicate the financial statement assertion most closely related to each...

Q: An audit plan contains a. Specifications of audit standards relevant

An audit plan contains a. Specifications of audit standards relevant to the financial statements being audited. b. Specifications of procedures the auditors believe appropriate for the financial state...

Q: When auditing an investment in another company, an auditor most likely

When auditing an investment in another company, an auditor most likely would seek to conduct which audit procedure to help satisfy the valuation assertion? a. Inspect the stock certificates evidencing...

Q: Which of the following statements is not true with respect to the

Which of the following statements is not true with respect to the auditors’ report on internal control over financial reporting? a. The report will be dated as of the date of the financial statements....

Q: Ray, the owner of a small entity, asked Holmes,

Ray, the owner of a small entity, asked Holmes, CPA, to conduct an audit of the entity’s records. Ray told Holmes that the audit was to be completed in time to submit audited financial statements to a...

Q: Following is a list of various professional services. Identify each by

Following is a list of various professional services. Identify each by its apparent characteristics as audit engagement, attestation engagement, or assurance engagement. Because audits are a subset of...

Q: Your neighbor, Loot Starkin, invited you to lunch yesterday.

Your neighbor, Loot Starkin, invited you to lunch yesterday. Sure enough, it was no “free lunch” because Loot wanted to discuss the annual report of Dodge Corporation. He owns Dodge stock and just rec...

Q: Audits may be characterized as (a) financial statement audits,

Audits may be characterized as (a) financial statement audits, (b) compliance audits, (c) economy and efficiency audits, and (d) program results audits. The work can be done by independent (external)...

Q: You are engaged to examine the financial statements of Spillane Company for

You are engaged to examine the financial statements of Spillane Company for the year ended December 31. Assume that on November 1, Spillane borrowed $500,000 from Second National Bank to finance plant...

Q: It is always a good idea for auditors to begin an audit

It is always a good idea for auditors to begin an audit with the professional skepticism characterized by the assumption that a. A potential conflict of interest always exists between the auditor and...

Q: The primary difference between operational auditing and financial auditing is that in

The primary difference between operational auditing and financial auditing is that in operational auditing a. The operational auditor is not concerned with whether the audited activity is generating i...

Q: According to the AICPA, the purpose of an audit of financial

According to the AICPA, the purpose of an audit of financial statements is to a. Enhance the degree of confidence that intended users can place in the financial statements. b. Express an opinion on th...

Q: Bankers who are processing loan applications from companies seeking large loans will

Bankers who are processing loan applications from companies seeking large loans will probably ask for financial statements audited by an independent CPA because a. Financial statements are too complex...

Q: Independent auditors of financial statements perform audits that reduce a.

Independent auditors of financial statements perform audits that reduce a. Business risks faced by investors. b. Information risk faced by investors. c. Complexity of financial statements. d. Timeline...

Q: The risk to investors that a company’s financial statements may be materially

The risk to investors that a company’s financial statements may be materially misleading is called a. Client acceptance risk. b. Information risk. c. Moral hazard. d. Business risk.

Q: Which of the following topics is not addressed in the auditors’ report

Which of the following topics is not addressed in the auditors’ report for a public entity? a. Responsibilities of the auditor and management in the financial reporting process. b. Absolute assurance...

Q: Which of the following best describes the focus of the following engagements

Which of the following best describes the focus of the following engagements?

Q: Which of the following would be considered an assurance engagement?

Which of the following would be considered an assurance engagement? a. Giving an opinion on a prize promoter’s claims about the amount of sweepstakes prizes awarded in the past. b. Giving an opinion o...

Q: If the auditor believes that a misstatement is or might be intentional

If the auditor believes that a misstatement is or might be intentional and the effect on the financial statements could be material or cannot be readily determined, the auditor should do which of the...

Q: Taylor, a CPA, has been engaged to audit the financial

Taylor, a CPA, has been engaged to audit the financial statements of University Books, Incorporated. University Books maintains a large cash fund exclusively for the purpose of buying used books from...

Q: You are the in-charge auditor examining the financial statements of

You are the in-charge auditor examining the financial statements of the Gutzler Company for the year ended December 31. During late October, with the help of Gutzler’s controller, yo...

Q: You can use the computer-based Electronic Workpapers on the textbook

You can use the computer-based Electronic Workpapers on the textbook website to prepare the schedule of interbank transfers required in this problem. EverReady Corporation is in the home building and...

Q: L. King, CPA, is auditing the financial statements of

L. King, CPA, is auditing the financial statements of Cycle Company, a client that has receivables from customers arising from the sale of goods in the normal course of business. King is aware that th...

Q: This case is designed like the ones in the chapter. Your

This case is designed like the ones in the chapter. Your assignment is to write the “audit approach” portion of the case, organized around these sections: Objective. Express the objective in terms of...

Q: Embezzlement is a type of fraud that involves a. An

Embezzlement is a type of fraud that involves a. An employee’s misappropriating an employer’s money or property not entrusted to him or her. b. A manager’s falsification of financial statements for th...

Q: Sorenson Manufacturing Corporation was incorporated on January 3, 2016. The

Sorenson Manufacturing Corporation was incorporated on January 3, 2016. The corporation’s financial statements for its first year’s operations were not examined by...

Q: You are in charge of the audit of the financial statements of

You are in charge of the audit of the financial statements of Demot Corporation for the year ended December 31. The corporation has a policy of investing its surplus funds in marketable securities. It...

Q: The primary reason for preparing a reconciliation between interest-bearing obligations

The primary reason for preparing a reconciliation between interest-bearing obligations outstanding during the year and interest expense in the financial statements is to a. Evaluate internal control o...

Q: For each of the following independent events, indicate the (1

For each of the following independent events, indicate the (1) effect of the error or fraud on the financial statements and (2) what auditing procedures could have detected the misstatement resulting...

Q: Jones was engaged to examine the financial statements of Gamma Corporation for

Jones was engaged to examine the financial statements of Gamma Corporation for the year ended June 30. Having completed an examination of the investment securities, which of the following is the best...

Q: You have been engaged to audit the financial statements of Broadwall Corporation

You have been engaged to audit the financial statements of Broadwall Corporation for the year ended December 31, 2017. During the year, Broadwall obtained a long-term loan from a local bank pursuant t...

Q: Sammy Smith is the partner in charge of the audit of Blue

Sammy Smith is the partner in charge of the audit of Blue Distributing Corporation, a wholesaler that owns one warehouse containing 80 percent of its inventory. Smith is reviewing the audit documentat...

Q: You are a CPA engaged in an audit of the financial statements

You are a CPA engaged in an audit of the financial statements of Pate Corporation for the year ended December 31. The financial statements and records of Pate Corporation have not been audited by a CP...

Q: You have been engaged to audit the financial statements of Hardy Hardware

You have been engaged to audit the financial statements of Hardy Hardware Distributors Inc., as of December 31. In your review of the corporate nonfinancial records, you have found that Hardy Hardware...

Q: You are engaged in the audit of the financial statements of Bass

You are engaged in the audit of the financial statements of Bass Corporation for the year ended December 31 and you are about to begin an audit of the investment securities. Bass’s records indicate th...

Q: You are conducting an audit of the financial statements of a wholesale

You are conducting an audit of the financial statements of a wholesale cosmetics distributor with an inventory consisting of thousands of individual items. The distributor keeps its inventory in its o...

Q: You are in the final stages of your audit of the financial

You are in the final stages of your audit of the financial statements of Ozine Corporation for the year ended December 31, 2017, when the corporation’s president consults you. The president believes t...

Q: C. Marsh, CPA, is the independent auditor for Compufast

C. Marsh, CPA, is the independent auditor for Compufast Corporation, which sells personal computers, peripheral equipment (printers, data storage), and a wide variety of programs for business and game...

Q: A major objective of written representations is to a. Shift

A major objective of written representations is to a. Shift responsibility for financial statements from the management to auditors. b. Provide a substitute source of audit evidence for substantive pr...

Q: Which of the following normally occurs earliest in the audit examination?

Which of the following normally occurs earliest in the audit examination? a. Discovery of an omitted audit procedure. b. Dual dating the auditor’s report on the entity’s financial statements for subse...

Q: What is the auditors’ reporting responsibility for (a) other information

What is the auditors’ reporting responsibility for (a) other information accompanying the audited financial statements and (b) required supplementary information?

Q: If auditors wish to express a different opinion on prior years’ financial

If auditors wish to express a different opinion on prior years’ financial statements in the current report than in a previously issued report, how should their current report be modified?

Q: What reporting options are available if predecessor auditors examined prior years’ financial

What reporting options are available if predecessor auditors examined prior years’ financial statements presented in comparative form?

Q: Briefly describe the options and information provided by auditors when engaged to

Briefly describe the options and information provided by auditors when engaged to report on (a) summary financial statements and (b) supplementary information?

Q: Ambrose is auditing the financial statements of Mays (dated December 31

Ambrose is auditing the financial statements of Mays (dated December 31, 2017). The date of the auditor’s report is February 17, 2018, and the audit report release date is February 20, 2018. For which...

Q: Identify the reports that accompany the financial statements of public entities and

Identify the reports that accompany the financial statements of public entities and nonpublic entities.

Q: What alternatives are available to auditors for reporting on the financial statements

What alternatives are available to auditors for reporting on the financial statements and internal control over financial reporting in the audit of public entities?

Q: Hall accepted an engagement to audit the year 1 financial statements of

Hall accepted an engagement to audit the year 1 financial statements of XYZ Company. XYZ completed the preparation of the year 1 financial statements on February 13, year 2, and its auditors began the...

Q: Which of the following substantive procedures should auditors ordinarily perform regarding subsequent

Which of the following substantive procedures should auditors ordinarily perform regarding subsequent events? a. Compare the latest available interim financial statements with the financial statements...

Q: Which of the following substantive procedures would auditors most likely perform to

Which of the following substantive procedures would auditors most likely perform to obtain evidence about the occurrence of subsequent events? a. Recompute a sample of large-dollar transactions occurr...

Q: Hart, an assistant accountant with the firm of Better & Best

Hart, an assistant accountant with the firm of Better & Best, CPAs, is auditing the financial statements of Tech Consolidated Industries Inc. The firm’s audit plan calls for the preparation of written...

Q: During the audit of the annual financial statements of Amis Manufacturing Inc

During the audit of the annual financial statements of Amis Manufacturing Inc., the company’s president, Vance Molar, and Wanda Dweebins, the engagement partner, reviewed matters that were supposed to...

Q: Each of the following statements is a communication from management. Indicate

Each of the following statements is a communication from management. Indicate whether the inclusion of each statement in written representations is appropriate. Provide your rationale for any statemen...

Q: Classify each of the following issues according to whether they will be

Classify each of the following issues according to whether they will be (1) included in written representations in all audits, (2) included in written representations in audits of public entities (und...

Q: The firm of Cole & Cole, CPAs, is auditing the

The firm of Cole & Cole, CPAs, is auditing the financial statements of Consolidated Industries Co. for the year ended December 31, 2017. On March 6, 2018, C. R. Brown, Consolidated’s chief financial o...

Q: Faye Jaworski, CPA, is auditing the financial statements of Fulbright

Faye Jaworski, CPA, is auditing the financial statements of Fulbright Company. As she is nearing the audit completion date, Jaworski realizes that she needs to evaluate whether all material contingenc...

Q: Aaron Rivers, CPA, is auditing the financial statements of Charger

Aaron Rivers, CPA, is auditing the financial statements of Charger Company, a client for the past five years. During past audits of Charger, Rivers identified some immaterial misstatements (most of wh...

Q: Pat Colt is auditing the financial statements of Manning Company. The

Pat Colt is auditing the financial statements of Manning Company. The following is a summary of the uncorrected misstatements that Colt has identified during the past three years. These misstatements...

Q: The following subsequent event was disclosed in Dole Food Company’s 2009 annual

The following subsequent event was disclosed in Dole Food Company’s 2009 annual report: Note 24: Subsequent Event On February 27, 2010, a significant earthquake struck the country of Chile. Although...

Q: Michael Ewing is auditing the financial statements of Dallas Company for the

Michael Ewing is auditing the financial statements of Dallas Company for the year ended December 31, 2017. In concluding the process of gathering sufficient appropriate evidence, Ewing has asked to me...

Q: Crankwell Inc. is preparing its annual financial statements and annual report

Crankwell Inc. is preparing its annual financial statements and annual report to stockholders. Management wants to be sure that all of the necessary and proper disclosures have been incorporated into...

Q: You are in the process of completing the gathering of sufficient appropriate

You are in the process of completing the gathering of sufficient appropriate evidence for Top Stove Corporation, a company engaged in the manufacture and sale of kerosene space heaters. To date, there...

Q: In connection with your examination of the financial statements of Olars Manufacturing

In connection with your examination of the financial statements of Olars Manufacturing Corporation for the year ended December 31, your post balance-sheet substantive procedures disclosed the followin...

Q: On June 1, Sidney Faultless of A. J. Faultless

On June 1, Sidney Faultless of A. J. Faultless & Co., CPAs, noticed some disturbing information about the firm’s client, Hopkirk Company. A story in the local paper mentioned the indictment of Tony Ba...

Q: Jay Ralph completed the December 31, 2017, audit of Raider

Jay Ralph completed the December 31, 2017, audit of Raider Company on February 3, 2018; Raider’s financial statements and Ralph’s reports on Raider’s financial statements and internal control over fin...

Q: A. Griffin audited the financial statements of Dodger Magnificat Corporation for

A. Griffin audited the financial statements of Dodger Magnificat Corporation for the year ended December 31, 2017. She completed gathering sufficient appropriate evidence on January 30 and later learn...

Q: For each of the following independent situations, describe the most appropriate

For each of the following independent situations, describe the most appropriate course of action that the auditors should take. a. Drew Allison is conducting the audit of Anderson Inc. as of December...

Q: Omega Corporation is involved in a lawsuit brought by a competitor for

Omega Corporation is involved in a lawsuit brought by a competitor for patent infringement. The competitor is asking $14 million actual damages for lost profits and unspecified punitive damages. The l...

Q: Central City was involved in litigation brought by Mexican American Legal Defense

Central City was involved in litigation brought by Mexican American Legal Defense and Educational Fund (MALDEF) over the creation of single-member voting districts (which require candidates to receive...

Q: Assume that Stanford CPAs encountered the following issues during its various audit

Assume that Stanford CPAs encountered the following issues during its various audit engagements in 2017: 1. It conducted the audit of Luck, a new client this past year. Last year, Luck was audited by...

Q: For each of the following situations, indicate the type of opinion

For each of the following situations, indicate the type of opinion(s) that auditors could issue (more than one opinion may be appropriate in each circumstance). Unless otherwise noted, assume that no...

Q: On September 23, 2018, Betsy Ross drafted the following report

On September 23, 2018, Betsy Ross drafted the following report on Continental Corporation’s financial statements. Required: List and explain the deficiencies and omissions in the r...

Q: The board of directors of Cook Industries Inc. engaged Brown &

The board of directors of Cook Industries Inc. engaged Brown & Brown, CPAs, to audit the financial statements for the year ended December 31, 2017. Required: Identify the deficiencies in the fol...

Q: An assistant drafted the following auditors’ report at the completion of the

An assistant drafted the following auditors’ report at the completion of the audit of Cramdon Inc. on March 5, 2018. The partner in charge of the engagement has decided the opinion o...

Q: Following is Rex Wolf’s report on Bonair Corporation’s financial statements. Bonair

Following is Rex Wolf’s report on Bonair Corporation’s financial statements. Bonair publishes general-purpose financial statements for distribution to owners, credi...

Q: The following auditors’ report was drafted by Quinn Moore, a staff

The following auditors’ report was drafted by Quinn Moore, a staff auditor with Tyler & Tyler, CPAs, at the completion of the audit of the financial statements of Park Publishing...

Q: AOW has completed the audit of the financial statements of Musgrave Company

AOW has completed the audit of the financial statements of Musgrave Company for the year ended December 31, 2017, and is now preparing the report. AOW has audited Musgrave’s financial statements for s...

Q: AOW is the group auditor for the December 31, 2017,

AOW is the group auditor for the December 31, 2017, consolidated financial statements of Ferguson Company and subsidiaries. However, component auditors perform the work on certain subsidiaries for the...

Q: Gustav Humphreys (chair of the board) and Ingrid VanEns (

Gustav Humphreys (chair of the board) and Ingrid VanEns (vice president, finance) prepared the draft of the financial review section of the annual report. You are reviewing it for consistency with the...

Q: On January 1, Graham Company purchased land (the site of

On January 1, Graham Company purchased land (the site of a new building) for $100,000. Soon thereafter, the state highway department announced that a new feeder road would run next to the site. The ef...

Q: In December of the current year, Williams Company changed its method

In December of the current year, Williams Company changed its method of accounting for inventory and cost of goods sold from LIFO to FIFO. The account balances shown in the trial balance have already...

Q: The concepts of materiality and pervasiveness are important to auditors in examinations

The concepts of materiality and pervasiveness are important to auditors in examinations of financial statements and expressions of opinion on these statements. Required: How will materiality influenc...

Q: For each of the following departures from GAAP, indicate the type

For each of the following departures from GAAP, indicate the type of opinion that the auditors would issue as well as any modifications that would be made to the standard (unmodified) report. a. A dep...

Q: How is the auditors’ responsibility for expressing the opinion on financial statements

How is the auditors’ responsibility for expressing the opinion on financial statements disclosed in the standard (unmodified) report for a nonpublic company? a. Stated explicitly in the Auditor’s Resp...

Q: Company A hired Samson & Delilah, CPAs, to audit the

Company A hired Samson & Delilah, CPAs, to audit the financial statements of Company B and deliver the report to Megabank. Who is the client? a. Megabank. b. Samson & Delilah. c. Company A. d. Company...

Q: Which of the following is not included in the standard (unmodified

Which of the following is not included in the standard (unmodified) report on the financial statements? a. An identification of the financial statements that were audited. b. A general description of...

Q: If the auditors decide to present separate reports on the entity’s financial

If the auditors decide to present separate reports on the entity’s financial statements and internal control over financial reporting, which of the following should be modified to re...

Q: When financial statements are presented in comparative form and another firm audited

When financial statements are presented in comparative form and another firm audited the prior years’ financial statements (but the other firm’s report is not presented with the financial statements),...

Q: If the opinion issued on prior years’ financial statements is no longer

If the opinion issued on prior years’ financial statements is no longer appropriate and financial statements are presented in comparative form, the auditors’ current report should a. Not reference the...

Q: Situations in which auditors are unable to obtain sufficient appropriate evidence necessary

Situations in which auditors are unable to obtain sufficient appropriate evidence necessary to support their opinion on the entity’s financial statements are referred to as scope limitations. Require...

Q: Which of the following statements is not true with respect to the

Which of the following statements is not true with respect to the audit examinations and reports for public and nonpublic entities? a. Audit examinations for nonpublic entities are based on user deman...

Q: Following are four possible scenarios that reflect scope limitations encountered by J

Following are four possible scenarios that reflect scope limitations encountered by J. Bruce, CPA, during the audit of Weaver Inc. In all cases, assume that the ending balance in inventory is material...

Q: D. Brady has been engaged as the auditor of Patriot Company

D. Brady has been engaged as the auditor of Patriot Company and is currently planning the year-end physical inventory counts. Patriot is a retailer that holds significant inventories in its warehouses...

Q: Lando Corporation is a domestic company with two wholly owned subsidiaries.

Lando Corporation is a domestic company with two wholly owned subsidiaries. Michaels, CPA, has been engaged to audit the financial statements of the parent company and one of its subsidiaries and to s...

Q: Assume that the auditors encountered the following separate situations when deciding on

Assume that the auditors encountered the following separate situations when deciding on the report to issue for the current-year financial statements. 1. The auditors decided that sufficient appropri...

Q: R. Wolfe became the new auditor for Royal Corporation, succeeding

R. Wolfe became the new auditor for Royal Corporation, succeeding C. Mason, who audited the financial statements last year. Wolfe needs to report on Royal’s comparative financial statements and should...

Q: This and similar cases in succeeding chapters are based on the consolidated

This and similar cases in succeeding chapters are based on the consolidated financial statements of Amazon.com, Inc. As you work with Amazon.com, Inc., throughout this course, you will develop the abi...

Q: The following data come from the financial statements of The Big Wave

The following data come from the financial statements of The Big Wave Company for the year ended May 31, 2013 (in millions): Requirements 1. Prepare a cash flow statement for the year ended May 31,...

Q: Summarized versions of Nachos Corporation’s financial statements are given for two recent

Summarized versions of Nachos Corporation’s financial statements are given for two recent years. Requirement Determine the missing amounts denoted by the letters.

Q: The following data come from the financial statements of The Water Fun

The following data come from the financial statements of The Water Fun Company at the year ended May 31, 2013 (in millions). Requirements 1. Prepare a cash flow statement for the year ended May 31,...

Q: Summarized versions of Sanchez Corporation’s financial statements follow for two recent years

Summarized versions of Sanchez Corporation’s financial statements follow for two recent years. Requirement Complete Sanchez Corporation’s financial statements by...

Q: Assume Adams & Murray, theaccounting firm, advises Pappadeaux Seafood that

Assume Adams & Murray, theaccounting firm, advises Pappadeaux Seafood that its financial statements must be changed toconform to GAAP. At December 31, 2012, Pappadeaux’s accounts include the following...

Q: The comparative financial statements of True Beauty Pools, Inc., for

The comparative financial statements of True Beauty Pools, Inc., for 2013,2012, and 2011 included the following select data: Requirements 1. Compute these ratios for 2013 and 2012: a. Current ratio...

Q: The comparative financial statements of Lakeland Pools, Inc., for 2013

The comparative financial statements of Lakeland Pools, Inc., for 2013,2012, and 2011 included the following select data: Requirements 1. Compute these ratios for 2013 and 2012: a. Current ratio b....

Q: Refer to Amazon.com, Inc.’s Consolidated financial statements

Refer to Amazon.com, Inc.’s Consolidated financial statements in Appendix A at the end of this book. 1. Examine the account “marketable securities” in the consolidated balance sheet. a. What does this...

Q: This case is based on RadioShack Corporation’s consolidated balance sheets, consolidated

This case is based on RadioShack Corporation’s consolidated balance sheets, consolidated statements of income, and Note 2 of its financial statements (Significant Accounting Policies) in Appendix B at...

Q: Sophia Loren opened anItalian restaurant. Business has been good, and

Sophia Loren opened anItalian restaurant. Business has been good, and Loren is considering expanding the restaurant.Loren, who knows little accounting, produced the following financial statements for...

Q: Refer to Amazon.com, Inc.’s financial statements in

Refer to Amazon.com, Inc.’s financial statements in Appendix A at the end of the book. Assume that Amazon.com completedthe following selected transactions during 2010. a. Made company sales (revenue)...

Q: Refer to the RadioShack Corporation financial statements in Appendix B at the

Refer to the RadioShack Corporation financial statements in Appendix B at the end of the book. Suppose you are an investor consideringbuying RadioShack Corporation common stock. The following question...

Q: Refer to the Amazon.com, Inc., consolidated financial statements

Refer to the Amazon.com, Inc., consolidated financial statements in Appendix A at the end of this book. The cash and cash equivalents section of the Consolidated Balance Sheet shows a balance of $3,77...

Q: Refer to the RadioShack Corporation Consolidated Financial Statements in Appendix B at

Refer to the RadioShack Corporation Consolidated Financial Statements in Appendix B at the end of this book. 1. Focus on cash and cash equivalents. Why did cash change during 2010? The statement of ca...

Q: Sunnyvale Loan Company is in the consumer loan business. Sunnyvale borrows

Sunnyvale Loan Company is in the consumer loan business. Sunnyvale borrows from banks and loans out the money at higher interest rates. Sunnyvale’s bank requires Sunnyvale to submit quarterly financia...

Q: The risk that the auditors’ own testing procedures will lead to the

The risk that the auditors’ own testing procedures will lead to the decision that material misstatements do not exist in the financial statements when in fact such misstatements do exist is a. Audit r...

Q: What action(s) should be taken if analysis of pro

What action(s) should be taken if analysis of pro forma financial statements reveals positive trends? Negative trends?

Q: What is the difference between pro forma financial statements and a cash

What is the difference between pro forma financial statements and a cash budget? Explain why pro forma financial statements are not used to forecast cash needs.

Q: Coulson Company is in the process of refinancing some long-term

Coulson Company is in the process of refinancing some long-term debt. Its fiscal year ends on December 31, 2018, and its financial statements will be issued on March 15, 2019. Under current U.S. GAAP,...

Q: Fleener Company is in the process of refinancing some long-term

Fleener Company is in the process of refinancing some long-term debt. Its fiscal year ends on December 31, 2016, and its financial statements will be issued on March 15, 2019. Under current IFRS, how...

Q: Nestlé S.A., the largest food and beverage company in

Nestlé S.A., the largest food and beverage company in the world, prepares its financial statements according to International Financial Reporting Standards. Its financial statements include ordinary s...

Q: For financial reporting, a reporting entity can be a single company

For financial reporting, a reporting entity can be a single company, or it can be a group of companies that reports a single set of financial statements. When changes occur that cause the financial st...

Q: Refer to the situation described in BE 20–10. Assume

Refer to the situation described in BE 20–10. Assume the error was discovered in 2020, after the 2019 financial statements are issued. Ignoring income taxes, what journal entry will PKE use to correct...

Q: Listed below are several statements that relate to financial accounting and reporting

Listed below are several statements that relate to financial accounting and reporting. Identify the accounting concept that applies to each statement. 1. SiriusXM Radio Inc. files its annual and quart...

Q: If a company has accounts receivable from ordinary customers and from related

If a company has accounts receivable from ordinary customers and from related parties, can they combine those receivables in their financial statements under U.S. GAAP? Under IFRS?

Q: For each of the following situations, (1) indicate

For each of the following situations, (1) indicate whether you agree or disagree with the financial reporting practice employed and (2) state the accounting concept that is applied (if you agree), o...

Q: Air France–KLM (AF), a Franco-Dutch company

Air France–KLM (AF), a Franco-Dutch company, prepares its financial statements according to International Financial Reporting Standards. AF’s financial statements and disclosure notes for the year end...

Q: What role do a corporation’s audited financial statements play in determining its

What role do a corporation’s audited financial statements play in determining its taxable income?

Q: The financial statements for Nike, Inc., are presented in Appendix

The financial statements for Nike, Inc., are presented in Appendix D at the end of the text. What is the major source of financing for Nike?

Q: From the following list of steps in the accounting cycle, identify

From the following list of steps in the accounting cycle, identify what two steps are missing: a. Transactions are analyzed and recorded in the journal. b. Transactions are posted to the ledger. c. An...

Q: Indicate how prior period adjustments should be reported on the financial statements

Indicate how prior period adjustments should be reported on the financial statements presented only for the current period.

Q: The financial statements are interrelated. (a) What item

The financial statements are interrelated. (a) What item of financial or operating data appears on both the income statement and the statement of owner’s equity? (b) What item appears on both the bala...

Q: Accrued salaries owed to employees for October 30 and 31 are not

Accrued salaries owed to employees for October 30 and 31 are not considered in preparing the financial statements for the year ended October 31. Indicate which items will be erroneously stated, becaus...

Q: What four financial statements are contained in most annual reports?

What four financial statements are contained in most annual reports?

Q: Use the RadioShack Corporation consolidated financial statements in Appendix B at the

Use the RadioShack Corporation consolidated financial statements in Appendix B at the end of this book to address the following questions. 1. Perform a trend analysis of RadioShack Corporation’s net s...

Q: At December 31, 2000, Enron Corporation reported the following data

At December 31, 2000, Enron Corporation reported the following data (condensed in millions): Total assets ................................................... $65,503 Total liabilities ...................

Q: Refer to Amazon.com, Inc.’s consolidated financial statements

Refer to Amazon.com, Inc.’s consolidated financial statements in Appendix A at the end of this book. 1. Did accounts payable for Amazon.com, Inc., increase or decrease in 2010? Calculate accounts paya...

Q: Refer to RadioShack Corporation’s consolidated financial statements in Appendix B at the

Refer to RadioShack Corporation’s consolidated financial statements in Appendix B at the end of this book. These financial statements report a number of liabilities. 1. The current liability section o...

Q: Footnote 10 of Abercrombie and Fitch Co.’s financial statements for

Footnote 10 of Abercrombie and Fitch Co.’s financial statements for fiscal year 2010 (January 29, 2011) contains the following information: At January 29, 2011, the Company was committed to noncancela...

Q: Footnote 7 of AnnTaylor Stores Corp.’s financial statements for fiscal

Footnote 7 of AnnTaylor Stores Corp.’s financial statements for fiscal year 2010 contains the following information: 7. Commitments and Contingencies Operating Leases The Company occupies its retail s...

Q: The notes to the Giving Charities’ financial statements reported the following data

The notes to the Giving Charities’ financial statements reported the following data on December 31, Year 1 (end of the fiscal year): Giving Charities’ amortizes b...

Q: The accounting records of Brighton Foods, Inc., include the following

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Q: Use the consolidated financial statements and the data in Amazon.com

Use the consolidated financial statements and the data in Amazon.com, Inc.’s annual report (Appendix A at the end of the book) to evaluate the company’s comparative performance for 2010 versus 2009. U...

Q: The notes to the Thankful Charities financial statements reported the following data

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Q: The accounting records of Braintree Foods, Inc., include the following

The accounting records of Braintree Foods, Inc., include the following items at December 31, 2012: Requirements 1. Show how each relevant item would be reported on the Braintree Foods, Inc., classif...

Q: The annual report of Westminster Computer, Inc., included the following

The annual report of Westminster Computer, Inc., included the following: Management’s Annual Report on Internal Control over Financial Reporting The Company’s management is responsible for establishin...

Q: Suppose Dupree Cycles, Inc., reported a number of special items

Suppose Dupree Cycles, Inc., reported a number of special items on its income statement. The following data, listed in no particular order, came from Dupree’s financial statements (a...

Q: Suppose Whitney Cycles, Inc., reported a number of special items

Suppose Whitney Cycles, Inc., reported a number of special items on its income statement. The following data, listed in no particular order, came from Whitney’s financial statements...

Q: Mike Magid Toyota is an automobile dealership. Magid’s annual report includes

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Q: Motorvehicles of Philadelphia, Inc., reported the following financial statements for

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Q: Use the Motorvehicles of Philadelphia data in Short Exercise 12-9

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Q: Use the Motorvehicles of Philadelphia data in Short Exercise 12-9

Use the Motorvehicles of Philadelphia data in Short Exercise 12-9 to compute the following: (Enter all amounts in thousands.) a. Collections from customers b. Payments for inventory Data from Short E...

Q: Use the Motorvehicles of Philadelphia data in Short Exercise 12-9

Use the Motorvehicles of Philadelphia data in Short Exercise 12-9 to compute the following: (Enter all amounts in thousands). a. Payments to employees b. Payments of other expenses In Short Exercise...

Q: The financial statements of Ridgeview Employment Services, Inc., reported the

The financial statements of Ridgeview Employment Services, Inc., reported the following accounts (adapted, with dollar amounts in thousands except for par value): Prepare the stockholdersâ...

Q: Refer to the data in S10-8. Using only year

Refer to the data in S10-8. Using only year-end figures rather than averages, compute the following for Ridgeview Employment Services: a. Net income b. Total liabilities c. Total assets (use the accou...

Q: Refer to the RadioShack Corporation, consolidated financial statements in Appendix B

Refer to the RadioShack Corporation, consolidated financial statements in Appendix B at the end of this book. Focus on the year ended December 31, 2010. 1. What is RadioShack Corporation’s main source...

Q: Use the financial statements of Allstott, Inc., in Short Exercises

Use the financial statements of Allstott, Inc., in Short Exercises 13-6 and 13-7. 1. Compute the company’s debt ratio at December 31, 2012. 2. Compute the company’s...

Q: Use the financial statements of Allstott, Inc., in Short Exercises

Use the financial statements of Allstott, Inc., in Short Exercises 13-6 and 13-7 to compute these profitability measures for 2012. Show each computation. a. Rate of return on sales b. Asset turnover c...

Q: The financial statements of Family News, Inc., include the following

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Two companies with different economic-value-added (EVA®) profiles are Emerson Oil Pipeline Incorporated and Farmer Bank Limited. Adapted versions of the two companies’ fin...

Q: The financial statements of Alliance News, Inc., include the following

The financial statements of Alliance News, Inc., include the following items: Requirements 1. Compute the following ratios for 2012 and 2011: a. Current ratio b. Quick (acid test) ratio c. Inventory...

Q: Assume that you are a financial analyst. You are trying to

Assume that you are a financial analyst. You are trying to compare the financial statements of Caterpillar, Inc., with those of CNH Global , an international company that uses international financial...

Q: The following data (dollar amounts in millions) are taken from

The following data (dollar amounts in millions) are taken from the financial statements of Number 1 Industries, Inc.: Total liabilities.................................... $12,500 Total current assets...

Q: The following data (dollar amounts in millions) are from the

The following data (dollar amounts in millions) are from the financial statements of Valley Corporation: Average stockholders’ equity............................... $5,400 Interest e...

Q: Turnberry Golf Corporation’s long-term debt agreements make certain demands on

Turnberry Golf Corporation’s long-term debt agreements make certain demands on the business. For example, Turnberry may not purchase treasury stock in excess of the balance of retained earnings. Also,...

Q: POLA Corporation’s 2012 financial statements reported the following items, with 2011

POLA Corporation’s 2012 financial statements reported the following items, with 2011 figures given for comparison (adapted and in millions). Use the DuPont model to compute POLA&ac...

Q: Rodeo Drive, Inc., reported the following in its financial statements

Rodeo Drive, Inc., reported the following in its financial statements for the year ended May 31, 2012 (in thousands): Requirement 1. Determine the following cash receipts and payments for Rodeo Driv...

Q: This case is based on the RadioShack Corporation consolidated financial statements in

This case is based on the RadioShack Corporation consolidated financial statements in Appendix B at the end of this book. 1. Focus on the company’s Consolidated Statements of Income for the three year...

Q: Refer to the Amazon.com, Inc. , consolidated financial

Refer to the Amazon.com, Inc. , consolidated financial statements in Appendix A at the end of this book. 1. Amazon.com, Inc.’s consolidated statements of operations do not mention income from continui...

Q: This case is based on the consolidated financial statements of RadioShack Corporation

This case is based on the consolidated financial statements of RadioShack Corporation given in Appendix B at the end of this book. In particular, this case uses RadioShack Corporation’s consolidated s...

Q: California Company included the following items in its financial statements for 2012

California Company included the following items in its financial statements for 2012, the current year (amounts in millions): Requirements 1. Use DuPont analysis to compute Californiaâ€&#...

Q: Use the California Company data in Exercise E10-34A to show

Use the California Company data in Exercise E10-34A to show how the company reported cash flows from financing activities during 2012 (the current year). List items in descending order from largest to...

Q: In 2002, Enron Corporation fi led for Chapter 11 bankruptcy protection

In 2002, Enron Corporation fi led for Chapter 11 bankruptcy protection, shocking the business community: How could a company this large and this successful go bankrupt? This case explores the causes a...

Q: Easton Company included the following items in its financial statements for 2012

Easton Company included the following items in its financial statements for 2012, the current year (amounts in millions): Requirements 1. Use DuPont analysis to compute Easton’s re...

Q: Use the Easton data in Exercise E10-50B to show how

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Q: This case is based on a real situation. George Campbell paid

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Q: Amazon.com’s consolidated financial statements appear in Appendix A at the

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Q: The Manning Company has financial statements as shown below, which are

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Q: What conditions would help make a percent-of-sales forecast

What conditions would help make a percent-of-sales forecast almost as accurate as pro forma financial statements and cash budgets?

Q: On August 27, 2015, Celgene Corporation acquired all of the

On August 27, 2015, Celgene Corporation acquired all of the outstanding stock of Receptos, Inc., in exchange for $7.6 billion in cash. Referring to Celgene’s 2015 financial statements and its July 14,...

Q: How are intra-entity transfers reported in an investee’s separate financial

How are intra-entity transfers reported in an investee’s separate financial statements if the investor is using the equity method?

Q: Echo, Inc., purchased 10 percent of ProForm Corporation on January

Echo, Inc., purchased 10 percent of ProForm Corporation on January 1, 2017, for $345,000 and accounted for the investment using the fair-value method. Echo acquires an additional 15 percent of ProForm...

Q: On January 1, 2018, Pine Company owns 40 percent (

On January 1, 2018, Pine Company owns 40 percent (40,000 shares) of Seacrest, Inc., which it purchased several years ago for $182,000. Since the date of acquisition, the equity method has been properl...

Q: On January 1, 2017, Stream Company acquired 30 percent of

On January 1, 2017, Stream Company acquired 30 percent of the outstanding voting shares of Q-Video, Inc., for $770,000. Q-Video manufactures specialty cables for computer monitors. On that date, Q-Vid...

Q: What does the term consolidated financial statements mean?

What does the term consolidated financial statements mean?

Q: On May 1, Burns Corporation acquired 100 percent of the outstanding

On May 1, Burns Corporation acquired 100 percent of the outstanding ownership shares of Quigley Corporation in exchange for $710,000 cash. At the acquisition date, Quigley’s book and...

Q: Following are preacquisition financial balances for Padre Company and Sol Company as

Following are preacquisition financial balances for Padre Company and Sol Company as of December 31. Also included are fair values for Sol Company accounts. Parentheses indicate a credit balance. On...

Q: On June 30, 2017, Wisconsin, Inc., issued $

On June 30, 2017, Wisconsin, Inc., issued $300,000 in debt and 15,000 new shares of its $10 par value stock to Badger Company owners in exchange for all of the outstanding shares of that company. Wisc...

Q: Go to the SEC’s Edgar site at http://www.sec

Go to the SEC’s Edgar site at http://www.sec.gov/edgar.shtml and download the latest annual (“10-K”) report for the firm of your choice. Use the financial statements in the report to calculate the fir...

Q: Compare and contrast the use of pro forma financial statements in corporate

Compare and contrast the use of pro forma financial statements in corporate financial planning with their use in accounting.

Q: Suppose that the 2016 actual and 2017 projected financial statements for AFS

Suppose that the 2016 actual and 2017 projected financial statements for AFS are initially shown as follows. In these tables, sales are projected to rise by 14 percent in the coming year, and the comp...

Q: Suppose that the 2016 actual and 2017 projected financial statements for Comfy

Suppose that the 2016 actual and 2017 projected financial statements for Comfy Corners Catbeds are initially shown as follows. In these tables, sales are projected to rise by 22 percent in the coming...

Q: Listed below are the 2018 financial statements for Garners’ Platoon Mental Health

Listed below are the 2018 financial statements for Garners’ Platoon Mental Health Care, Inc. Spread the balance sheet and income statement. Calculate the financial ratios for the fir...

Q: Suppose that the 2016 actual and 2017 projected financial statements for your

Suppose that the 2016 actual and 2017 projected financial statements for your firm are initially shown as follows. In these tables, sales are projected to rise by 18 percent in the coming year, and th...

Q: Shown below are partial financial statements for Garners’ Platoon Mental Health Care

Shown below are partial financial statements for Garners’ Platoon Mental Health Care, Inc. Fill in the blanks on the four financial statements. Garners’ Platoon Me...

Q: On which of the four major financial statements (balance sheet,

On which of the four major financial statements (balance sheet, income statement, statement of cash flows, or statement of retained earnings) would you find the following items?

Q: Use the following financial statements for Garners’ Platoon Mental Health Care,

Use the following financial statements for Garners’ Platoon Mental Health Care, Inc., to calculate and interpret the Altman’s Z-score for this firm. / / /

Q: Use the following financial statements for Lake of Egypt Marina to calculate

Use the following financial statements for Lake of Egypt Marina to calculate and interpret the Altman’s Z-score for this firm as of 2018. / /

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.com/documents/publications/2010/Annual_Repo...

Q: Where in the financial statements is preferred stock normally reported?

Where in the financial statements is preferred stock normally reported?

Q: Earnhart Corporation has outstanding 3,000,000 shares of common

Earnhart Corporation has outstanding 3,000,000 shares of common stock of a par value of $10 each. The balance in its Retained Earnings account at January 1, 2012, was $24,000,000, and it then had Paid...

Q: The financial statements of P&G are presented in Appendix 5B

The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to these financial statements and the...

Q: Described below are certain transactions of Edwardson Corporation. The company uses

Described below are certain transactions of Edwardson Corporation. The company uses the periodic inventory system. 1. On February 2, the corporation purchased goods from Martin Company for $70,000 sub...

Q: In this simulation, you are asked to address questions related to

In this simulation, you are asked to address questions related to the accounting for current liabilities. Prepare responses to all parts.

Q: The following information is taken from the 2012 annual report of Bugant

The following information is taken from the 2012 annual report of Bugant, Inc. Bugant’s fiscal year ends December 31 of each year. Bugant’s December 31, 2012, balance sheet is as follows. Bugant, Inc....

Q: The financial statements of P&G are presented in Appendix 5B

The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to these financial statements and the...

Q: Listed below are selected transactions of Schultz Department Store for the current

Listed below are selected transactions of Schultz Department Store for the current year ending December 31. 1. On December 5, the store received $500 from the Jackson Players as a deposit to be return...

Q: Dumars Corporation reports in the current liability section of its balance sheet

Dumars Corporation reports in the current liability section of its balance sheet at December 31, 2012 (its year-end), short-term obligations of $15,000,000, which includes the current portion of 12% l...

Q: On February 1, 2013, one of the huge storage tanks

On February 1, 2013, one of the huge storage tanks of Viking Manufacturing Company exploded. Windows in houses and other buildings within a one-mile radius of the explosion were severely damaged, and...

Q: The following two independent situations involve loss contingencies. Part 1

The following two independent situations involve loss contingencies. Part 1 Benson Company sells two products, Grey and Yellow. Each carries a one-year warranty. 1. Product Grey—Product warranty costs...

Q: Presented below are two different situations related to Mckee Corporation debt obligations

Presented below are two different situations related to Mckee Corporation debt obligations. Mckee’s next financial reporting date is December 31, 2012. The financial statements are authorized for issu...

Q: On November 24, 2012, 26 passengers on Windsor Airlines Flight

On November 24, 2012, 26 passengers on Windsor Airlines Flight No. 901 were injured upon landing when the plane skidded off the runway. Personal injury suits for damages totaling $9,000,000 were filed...

Q: Kobayashi Corporation reports in the current liability section of its statement of

Kobayashi Corporation reports in the current liability section of its statement of financial position at December 31, 2012 (its year-end), short-term obligations of $15,000,000, which includes the cur...

Q: Polska Corporation, in preparation of its December 31, 2012,

Polska Corporation, in preparation of its December 31, 2012, financial statements, is attempting to determine the proper accounting treatment for each of the following situations. 1. As a result of un...

Q: Garison Music Emporium carries a wide variety of musical instruments, sound

Garison Music Emporium carries a wide variety of musical instruments, sound reproduction equipment, recorded music, and sheet music. Garison uses two sales promotion techniques—warranties and premiums...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.com/documents/publications/2010/Annual_Repo...

Q: Presented below are three independent situations. Answer the question at the

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Q: Vogue Company’s condensed financial statements provide the following information.

Vogue Company’s condensed financial statements provide the following information. Income Statement for the year ended 2012 Sales ……â&#...

Q: In this simulation, you are asked to address questions related to

In this simulation, you are asked to address questions related to the accounting for long-term liabilities. Prepare responses to all parts.

Q: Presented below are three independent situations. (a) Chinook

Presented below are three independent situations. (a) Chinook Corporation incurred the following costs in connection with the issuance of bonds: (1) Printing and engraving costs, $15,000; (2) Legal fe...

Q: The following amortization and interest schedule reflects the issuance of 10-

The following amortization and interest schedule reflects the issuance of 10-year bonds by Capulet Corporation on January 1, 2006, and the subsequent interest payments and charges. The companyâ&...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.com/documents/publications/2010/Annual_Repo...

Q: Presented below are four independent situations. (a) On

Presented below are four independent situations. (a) On March 1, 2013, Wilke Co. issued at 103 plus accrued interest $4,000,000, 9% bonds. The bonds are dated January 1, 2013, and pay interest semiann...

Q: The financial statements of P&G are presented in Appendix 5B

The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the...

Q: On January 1, 2012, Agassi Corporation had the following stockholders’

On January 1, 2012, Agassi Corporation had the following stockholders’ equity accounts. Common Stock ($10 par value, 60,000 shares issued and outstanding) ……….. $600,000 Paid-in Capital in Excess of P...

Q: The following information is taken from the 2012 annual report of Bugant

The following information is taken from the 2012 annual report of Bugant, Inc. Bugant’s fiscal year ends December 31 of each year. Bugant’s December 31, 2012, balance sheet is as follows. Bugant, Inc....

Q: In this simulation, you are asked to address questions related to

In this simulation, you are asked to address questions related to the accounting for long-term liabilities. Prepare responses to all parts.

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the book’s companion website or can be accessed at http://corporate.marksandspencer.com/documents/publications/2010/Annual_Repo...

Q: The financial statements of Marks and Spencer plc (M&S

The financial statements of Marks and Spencer plc (M&S) are available at the books’ companion website or can be accessed at http://corporate.marksandspencer.com/documents/publications/2010/Annual_Repo...

Q: Presented below are three independent situations. (a) Chinook

Presented below are three independent situations. (a) Chinook Corporation incurred the following costs in connection with the issuance of bonds: (1) Printing and engraving costs, $15,000; (2) Legal fe...

Q: The following amortization and interest schedule reflects the issuance of 10-

The following amortization and interest schedule reflects the issuance of 10-year bonds by Capulet Corporation on January 1, 2006, and the subsequent interest payments and charges. The companyâ&...

Q: Presented below are four independent situations. (a) On

Presented below are four independent situations. (a) On March 1, 2013, Wilke Co. issued at 103 plus accrued interest $4,000,000, 9% bonds. The bonds are dated January 1, 2013, and pay interest semiann...

Q: The financial statements of P&G are presented in Appendix 5B

The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the...

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On January 1, 2012, Agassi Corporation had the following stockholders’ equity accounts. Common Stock ($10 par value, 60,000 shares issued and outstanding) ……….. $600,000 Paid-in Capital in Excess of P...

Q: The financial statements of Marks and Spencer plc (M&S

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Q: In this simulation, you are asked to address questions related to

In this simulation, you are asked to address questions related to investments. Prepare responses to all parts.

Q: The financial statements of P&G are presented in Appendix 5B

The financial statements of P&G are presented in Appendix 5B or can be accessed at the book’s companion website, www.wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the...

Q: Described below are certain transactions of Edwardson Corporation. The company uses

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Q: The financial statements of P&G are presented in Appendix 5B

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Q: Listed below are selected transactions of Schultz Department Store for the current

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Dumars Corporation reports in the current liability section of its balance sheet at December 31, 2012 (its year-end), short-term obligations of $15,000,000, which includes the current portion of 12% l...

Q: Where in the financial statements is preferred stock normally reported?

Where in the financial statements is preferred stock normally reported?

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On February 1, 2013, one of the huge storage tanks of Viking Manufacturing Company exploded. Windows in houses and other buildings within a one-mile radius of the explosion were severely damaged, and...

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Q: Presented below are two different situations related to Mckee Corporation debt obligations

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Q: Kennedy Company has the following portfolio of available-for-sale

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Q: On November 24, 2012, 26 passengers on Windsor Airlines Flight

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Q: Kobayashi Corporation reports in the current liability section of its statement of

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Q: Polska Corporation, in preparation of its December 31, 2012,

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Q: The financial statements of Marks and Spencer plc (M&S

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Presented below are three independent situations. Answer the question at the end of each situation. 1. During 2012, Maverick Inc. became involved in a tax dispute with the IRS. Maverick’s attorneys ha...

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Q: The financial statements of Marks and Spencer plc Marks and Spencer plc

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Q: On January 1, 2012, Bailey Industries had stock outstanding as

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Q: At January 1, 2012, Cameron Company’s outstanding shares included the

At January 1, 2012, Cameron Company’s outstanding shares included the following. 280,000 shares of $50 par value, 7% cumulative preferred stock 800,000 shares of $1 par value common stock Net income f...

Q: Melton Corporation is preparing the comparative financial statements for the annual report

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Q: Agassi Corporation is preparing the comparative financial statements to be included in

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Q: The financial statements of P&G are presented in Appendix 5B

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Q: Kellogg Company in its 2004 Annual Report in Note 1—Accounting

Kellogg Company in its 2004 Annual Report in Note 1—Accounting Policies made the comment on page 962 about its accounting for employee stock options and other stock-based compensatio...

Q: Sepracor, Inc., a drug company, reported the following information

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Q: Earnhart Corporation has outstanding 3,000,000 shares of common

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Q: The financial statements of P&G are presented in Appendix 5B

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Q: On October 3, 2000, E-centives, incorporated in

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Q: Regents Corporation is a recently acquired U.S. manufacturing subsidiary

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Q: On December 15, MSC Corporation acquires its first foreign affiliate by

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Q: Kashmir Enterprises, an Indian carpet manufacturer, begins the calendar year

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Q: From a user’s perspective, what is the inherent problem in attempting

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Q: Sobrero Corporation, a Mexican affiliate of a major U.S

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Q: Revisit Sobrero Corporation in Exercise 1. In addition to the information

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Q: Now assume that Majikstan Enterprises is a foreign subsidiary of a U

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Q: Petro China Company Limited (Petro China) was established as a

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Q: Three solutions have been proposed for resolving the problems associated with filing

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Q: Exhibit 8-3 identifies current IASB standards and their respective titles

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Q: One of the accounting development patterns that was introduced in Chapter 2

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Q: Marissa Skye and Alexa Reichele, tire analysts for a global investment

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Q: How does the translation of foreign currency financial statements differ from the

How does the translation of foreign currency financial statements differ from the foreign currency translation process described in Chapter 6?

Q: Based on the balance sheet and income statement data contained in Exhibit

Based on the balance sheet and income statement data contained in Exhibit 9-5, and using the suggested worksheet format shown in Exhibit 9-20 or one of your own choosing, show how the statement of cas...

Q: Refer again to Exhibits 9-5 and 9-6.

Refer again to Exhibits 9-5 and 9-6. Show how you would modify the consolidated funds statement appearing in Exhibit 9-5 to enable an investor to get a better feel for the actual investing and financi...

Q: Read Appendix 9-1. Referring to Exhibit 9-14

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Q: The Volkswagen Group adopted International Accounting Standards (IAS, now International

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Q: As an analyst for a securities firm, you are aware that

As an analyst for a securities firm, you are aware that accounting practices differ around the world. Yet you wonder whether these differences really have any material effect on companies’ financial s...

Q: As an analyst for a securities firm, you are aware that

As an analyst for a securities firm, you are aware that accounting practices differ around the world. Yet you wonder whether these differences really have any material effect on companies’ financial s...

Q: What is the difference between consolidated and individual company financial statements?

What is the difference between consolidated and individual company financial statements? Why do some EU countries prohibit IFRS in individual company financial statements while others permit or requir...

Q: U.S. financial statements “present fairly,” while U

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The following describes Japanese accounting before the Big Bang: The preparation of consolidated financial statements is based on the Securities and Exchange Law. Individual-company accounts are the...

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Q: Mason Company has prepared consolidated financial statements for the current year and

Mason Company has prepared consolidated financial statements for the current year and is now gathering information in connection with the following five operating segments it has identified. Determin...

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Nuland International Corporation recently acquired 40 percent of Scott Trading Company and appropriately accounts for this investment under the equity method. Nuland’s corporate controller is in the p...

Q: The following information was extracted from quarterly reports for Wal-Mart

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Q: On April 1, 2017, Mendoza Company borrowed 500,000

On April 1, 2017, Mendoza Company borrowed 500,000 euros for one year at an interest rate of 5 percent per annum. Mendoza must make its first interest payment on the loan on October 1, 2017, and will...

Q: On September 30, 2017, Ericson Company negotiated a two-

On September 30, 2017, Ericson Company negotiated a two-year, 1,000,000 dudek loan from a foreign bank at an interest rate of 2 percent per year. It makes interest payments annually on September 30 an...

Q: Brandlin Company of Anaheim, California, sells parts to a foreign

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Q: Use the same facts as in Problem 31 except that Brandlin Company

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Q: On June 1, Alexander Corporation sold goods to a foreign customer

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Q: On June 1, Cairns Corporation purchased goods from a foreign supplier

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Q: On October 1, 2017, Sharp Company (based in Denver

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Q: On August 1, Ling-Harvey Corporation (a U.

On August 1, Ling-Harvey Corporation (a U.S.-based importer) placed an order to purchase merchandise from a foreign supplier at a price of 400,000 ringgits. Ling-Harvey will receive and make payment f...

Q: On June 1, Vandervelde Corporation (a U.S.-

On June 1, Vandervelde Corporation (a U.S.-based manufacturing firm) received an order to sell goods to a foreign customer at a price of 100,000 leks. Vandervelde will ship the goods and receive payme...

Q: Vino Veritas Company, a U.S.-based importer of

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Q: On February 1, 2017, Linber Company forecasted the purchase of

On February 1, 2017, Linber Company forecasted the purchase of component parts on May 1, 2017, at a price of 100,000 euros. On that date, Linber entered into a forward contract to purchase 100,000 eur...

Q: In translating the financial statements of a foreign subsidiary, why is

In translating the financial statements of a foreign subsidiary, why is the value assigned to retained earnings especially difficult to determine? How is this problem normally resolved?

Q: A translation adjustment must be calculated and disclosed when financial statements of

A translation adjustment must be calculated and disclosed when financial statements of a foreign subsidiary are translated into the parent’s reporting currency. How is this figure computed, and where...

Q: On December 18, 2017, Stephanie Corporation acquired 100 percent of

On December 18, 2017, Stephanie Corporation acquired 100 percent of a Swiss company for 4.0 million Swiss francs (CHF), which is indicative of book and fair value. At the acquisition date, the exchang...

Q: Millager Company is a U.S.-based multinational corporation with

Millager Company is a U.S.-based multinational corporation with the U.S. dollar (USD) as its reporting currency. To prepare consolidated financial statements for 2017, the company must translate the a...

Q: Which of the following historical reasons for accounting diversity could explain why

Which of the following historical reasons for accounting diversity could explain why accounting standards would be more detailed in some countries than in others? a. Different rates of inflation acros...

Q: Many companies make annual reports available on their corporate website, often

Many companies make annual reports available on their corporate website, often under an Investors tab. Annual reports also can be accessed through the SEC’s EDGAR system at www.sec.gov (under Filings,...

Q: Which of the following is not a potential problem caused by differences

Which of the following is not a potential problem caused by differences in financial reporting practices across countries? a. Consolidation of financial statements by firms with foreign operations is...

Q: Which of the following is not a reason for establishing international accounting

Which of the following is not a reason for establishing international accounting standards? a. Some countries do not have the resources to develop accounting standards on their own. b. Comparability o...

Q: When does the liquidation basis of accounting first have to be applied

When does the liquidation basis of accounting first have to be applied to financial statements of a liquidating entity to be viewed as in conformity with U.S. GAAP? a. When an involuntary bankruptcy p...

Q: What financial statements must be reported when the liquidation basis of accounting

What financial statements must be reported when the liquidation basis of accounting is being applied? a. Statement of activities and a statement of financial position. b. Income statement and balance...

Q: When is a firm required to consolidate the financial statements of a

When is a firm required to consolidate the financial statements of a VIE with its own financial statements?

Q: One company purchases the outstanding debt instruments of an affiliated company on

One company purchases the outstanding debt instruments of an affiliated company on the open market. This transaction creates a gain that is appropriately recognized in the consolidated financial state...

Q: A company must prepare IFRS financial statements for the first time on

A company must prepare IFRS financial statements for the first time on December 31, 2020. According to IFRS 1, what is the date of transition to IFRS for this company? a. January 1, 2018. b. January 1...

Q: What is the so-called Norwalk Agreement? a.

What is the so-called Norwalk Agreement? a. An agreement between the FASB and SEC to allow foreign companies to use IFRS in their filing of financial statements with the SEC. b. An agreement between t...

Q: How should material seasonal variations in revenue be reflected in interim financial

How should material seasonal variations in revenue be reflected in interim financial statements? a. The seasonal nature should be disclosed, and the interim report should be supplemented with a report...

Q: Which of the following items is not required to be reported in

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Q: Harrington Company was sued by an employee in late 2017. General

Harrington Company was sued by an employee in late 2017. General counsel concluded that there was an 80 percent probability that the company would lose the lawsuit. The range of possible loss is estim...

Q: Parnell Company acquired construction equipment on January 1, 2017, at

Parnell Company acquired construction equipment on January 1, 2017, at a cost of $78,400. The equipment was expected to have a useful life of six years and a residual value of $10,000 and is being dep...

Q: Trecek Corporation incurs research and development costs of $650,000

Trecek Corporation incurs research and development costs of $650,000 in 2017, 30 percent of which relate to development activities subsequent to IAS 36 criteria having been met that indicate an intang...

Q: Rawl Corporation sold a building to a bank at the beginning of

Rawl Corporation sold a building to a bank at the beginning of 2017 at a gain of $76,000 and immediately leased the building back for a period of four years. The lease is accounted for as an operating...

Q: Hirsch Company acquired equipment at the beginning of 2017 at a cost

Hirsch Company acquired equipment at the beginning of 2017 at a cost of $135,000. The equipment has a five-year life with no expected salvage value and is depreciated on a straight-line basis. At Dece...

Q: Charles Edward Company established a subsidiary in a foreign country on January

Charles Edward Company established a subsidiary in a foreign country on January 1, 2017, by investing FC 3,200,000 when the exchange rate was $0.50/FC. Charles Edward negotiated a bank loan of FC 3,00...

Q: On January 1, 2016, Parker, Inc., a U

On January 1, 2016, Parker, Inc., a U.S.-based firm, acquired 100 percent of Suffolk PLC located in Great Britain for consideration paid of 52,000,000 British pounds ($), which was equal to fair value...

Q: Under what circumstances might it be acceptable for a company preparing IFRS

Under what circumstances might it be acceptable for a company preparing IFRS financial statements to follow an accounting treatment developed by the FASB?

Q: On January 1, 2017, Mona, Inc., acquired 80

On January 1, 2017, Mona, Inc., acquired 80 percent of Lisa Company’s common stock as well as 60 percent of its preferred shares. Mona paid $65,000 in cash for the preferred stock, w...

Q: In following the liquidation basis of accounting, what financial statements must

In following the liquidation basis of accounting, what financial statements must be presented?

Q: Bolero Company holds 80 percent of the common stock of Rivera,

Bolero Company holds 80 percent of the common stock of Rivera, Inc., and 40 percent of this subsidiary’s convertible bonds. The following consolidated financial statements are for 20...

Q: What are the steps that a company must follow in preparing its

What are the steps that a company must follow in preparing its initial set of IFRS financial statements upon the company’s first-time adoption of IFRS?

Q: What is the difference between Regulation S–K and Regulation S

What is the difference between Regulation S–K and Regulation S–X? a. Regulation S–K establishes reporting requirements for companies in their initial issuance of securities whereas Regulation S–X is d...

Q: An investment analyst has been studying the long-term prospects of

An investment analyst has been studying the long-term prospects of Six Flags Entertainment Corporation and has asked for assistance. Go to www.sixflags.com and click on “Investors” at the top of the p...

Q: Read several of the following articles as well as any other published

Read several of the following articles as well as any other published pieces that describe the work of the accountant in bankruptcy cases: “Restructuring for a Positive Return,” CMA Management, Decemb...

Q: What financial statements are required for private not-for-profit

What financial statements are required for private not-for-profit colleges and universities?

Q: Visit the Websites and review the financial statements for KTM (KTM

Visit the Websites and review the financial statements for KTM (KTM.com) and Piaggio(piaggio.com). Each of these companies sells street vehicles like motorcycles or scooters in globalmarkets. Requi...

Q: Refer to financial statements of Polaris (Polaris.com) and

Refer to financial statements of Polaris (Polaris.com) and Arctic Cat (arcticcat.com) to answerthe following. Required1. Identify at least two activities at Polaris and at Arctic Cat that cause cos...

Q: Polaris’s financial statements and notes in Appendix A provide evidence of growth

Polaris’s financial statements and notes in Appendix A provide evidence of growth potentialin its sales. Required1. Identify at least two types of costs that will predictably increase as a percent...

Q: Go to the website www.napico.com and click on

Go to the website www.napico.com and click on “Partnership Financial Information—Click Here.”Then click on “2015 Annual Reports” to access the Form 10-K annual report for Real Estate AssociatesLimited...

Q: How do governmental funds report capital outlay in fund financial statements?

How do governmental funds report capital outlay in fund financial statements? How dogovernment-wide financial statements report capital expenditures?

Q: How has the dual system of financial statements impacted the financial reporting

How has the dual system of financial statements impacted the financial reporting of state and localgovernments?

Q: What are the basic financial statements that a state or local government

What are the basic financial statements that a state or local government now produces?

Q: What measurement focus is used in fund financial statements for governmental funds

What measurement focus is used in fund financial statements for governmental funds, and whatsystem is applied to determine the timing of revenue and expenditure recognition?

Q: Fund financial statements have separate columns for each activity. Which activities

Fund financial statements have separate columns for each activity. Which activities are reported inthis manner?

Q: The City of Gargery has a fiscal year ending December 31,

The City of Gargery has a fiscal year ending December 31, Year 5. If the city were to producefinancial statements right now, the following figures would be included: – Governmental activities: Assets...

Q: Indicate (i) how each of the following transactions impacts the

Indicate (i) how each of the following transactions impacts the fund balance of the general fund,and its classifications, for fund financial statements and (ii) what impact each transaction has on the...

Q: During 2017, the City of Coyote contracted to build a bus

During 2017, the City of Coyote contracted to build a bus stop for schoolchildren costing $10,000as a special assessments project for which it collected $10,000 from affected citizens. The governmenth...

Q: On December 30, 2017, the City of Coyote borrowed $

On December 30, 2017, the City of Coyote borrowed $20,000 for the general fund on a 60-day note.In that fund, both Cash and Other Financing Sources were recorded. In the general informationabove for t...

Q: An art display set up for the City of Coyote was recorded

An art display set up for the City of Coyote was recorded within the general fund and generatedrevenues of $9,000 but had expenditures of $45,000 ($15,000 in expenses and $30,000 to buy landfor the di...

Q: The City of Coyote mailed property tax bills for 2018 to its

The City of Coyote mailed property tax bills for 2018 to its citizens during August 2017. Paymentscould be made early to receive a discount. The levy becomes legally enforceable on February 15,2018. A...

Q: The City of Coyote mailed property tax bills for 2018 to its

The City of Coyote mailed property tax bills for 2018 to its citizens during August 2017. Paymentscould be made early to receive a discount. The levy becomes legally enforceable on February 15,2018. A...

Q: In 2017, the City of Coyote received a $320,

In 2017, the City of Coyote received a $320,000 cash grant from the state to reduce air pollution.Assume that although a special revenue fund could have been set up, the money remained in thegeneral f...

Q: During 2017, the City of Coyote’s General Fund received $10

During 2017, the City of Coyote’s General Fund received $10,000, which was recorded as a generalrevenue when it was actually a program revenue earned by its park program. a. What was the correct overa...

Q: A city orders a new computer for its general fund at an

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Q: Cash of $90,000 is transferred from a city’s general

Cash of $90,000 is transferred from a city’s general fund to start construction on a police station. Thecity issues a bond at its $1.8 million face value. The police station is built for $1.89 million...

Q: Government officials of Hampstead County ordered a computer near the end of

Government officials of Hampstead County ordered a computer near the end of the current fiscalyear for $6,400 for the police department. It did not arrive prior to the end of the year. At its finalmee...

Q: The City of Havisham has a fiscal year ending December 31,

The City of Havisham has a fiscal year ending December 31, Year 5. If the city were to producefinancial statements right now, the following figures would be included: – Governmental activities: Assets...

Q: Which of the following statements is correct about the reporting of governmental

Which of the following statements is correct about the reporting of governmental funds? a. Fund financial statements measure economic resources. b. Government-wide financial statements measure only cu...

Q: Which of the following statements is correct about the reporting of governmental

Which of the following statements is correct about the reporting of governmental funds? a. Fund financial statements measure revenues and expenditures based on modified accrualaccounting. b. Governmen...

Q: A city issues a 60-day tax anticipation note to fund

A city issues a 60-day tax anticipation note to fund operations until taxes have been collected. Whatrecording should it make? a. The liability should be reported in the government-wide financial stat...

Q: A city issues five-year bonds payable to finance construction of

A city issues five-year bonds payable to finance construction of a new school. What recordingshould be made? a. Report the liability in the government-wide financial statements; show an other financin...

Q: The City of Hampshore is currently preparing financial statements for the past

The City of Hampshore is currently preparing financial statements for the past fiscal year. The city manager is concerned because the city encountered some unusual transactions during the current fisc...

Q: Search the Internet for the official website of one or more state

Search the Internet for the official website of one or more state or local governments. After reviewingthis website, determine whether the latest comprehensive annual financial report (CAFR) is availa...

Q: Assume in question (9) that the city does not choose

Assume in question (9) that the city does not choose to report the painting on the government-wide financial statements as a capital asset. Must the city report a revenue for the gift? In question (9...

Q: What are the two fund financial statements for governmental funds? What

What are the two fund financial statements for governmental funds? What information does each normally present?

Q: What is the most common form for the financial statements prepared by

What is the most common form for the financial statements prepared by public colleges and universities?

Q: Officials for the city of Winfield have agreed to forgo real estate

Officials for the city of Winfield have agreed to forgo real estate taxes normally charged to Jamieson Corporation for the subsequent 10 years. In exchange, Jamieson has agreed to build a distribution...

Q: A landfill is scheduled to be filled to capacity gradually over a

A landfill is scheduled to be filled to capacity gradually over a 10-year period. However, at the end of the first year of operations, the landfill is only 7 percent filled. How much liability for clo...

Q: The City of VanStone operates a solid waste landfill. This facility

The City of VanStone operates a solid waste landfill. This facility is 11 percent full after the first year of operation and 24 percent after the second year. How much expense should be recognized on...

Q: A teacher working for the City of Lights will be provided with

A teacher working for the City of Lights will be provided with a defined benefit pension plan. The city sets up a pension trust fund to monitor the resources held for these future payments. How is the...

Q: The City of Pfeiffer starts the year of 2017 with the general

The City of Pfeiffer starts the year of 2017 with the general fund and an enterprise fund. The general fund has two activities: education and parks/recreation. For convenience, assume that the general...

Q: Use the information in problem 37 to prepare the 2017 fund financial

Use the information in problem 37 to prepare the 2017 fund financial statements for the governmental funds and the proprietary funds. A statement of cash flows is not required. Assume that “available”...

Q: For each of the following, indicate whether the statement is true

For each of the following, indicate whether the statement is true or false and include a brief explanationfor your answer. a. A pension trust fund appears in the government-wide financial statements b...

Q: On the first day of Year 4, the city receives a

On the first day of Year 4, the city receives a painting as a gift that qualifies as a work of art. It has a30-year life, is worth $15,000, and is being displayed at one of the local parks. The accoun...

Q: Assume that the one component unit had program revenues of $30

Assume that the one component unit had program revenues of $30,000 and expenses of $42,000and spent $10,000 for land during Year 4. However, it should have been handled as a blended componentunit, not...

Q: The city maintains a landfill that has been recorded during the current

The city maintains a landfill that has been recorded during the current year within its parks. The landfillgenerated program revenues of $4,000 in Year 4 and cash expenses of $15,000. It also paid $3,...

Q: On the first day of the year, the City of Wolfe

On the first day of the year, the City of Wolfe bought $20,000 of equipment with a 5-year life andno salvage value for its school system. It was capitalized but no other entries were ever made. Themac...

Q: A city has a solid waste landfill that was filled 12 percent

A city has a solid waste landfill that was filled 12 percent in Year 1 and 26 percent in Year 2. Duringthose periods, the government expected that total closure costs would be $2 million. As a result,...

Q: Use the same information as in problem 44 except that, by

Use the same information as in problem 44 except that, by the end of Year 3, the landfill is40 percent filled. The city now realizes that the total closure costs will be $3 million. Indicatewhether ea...

Q: A city receives a copy of its original charter from the year

A city receives a copy of its original charter from the year 1799 as a gift from a citizen. The documentwill be put under glass and displayed in the city hall for all to see. The fair value is estimat...

Q: City government officials are analyzing a complicated financial transaction. A GASB

City government officials are analyzing a complicated financial transaction. A GASB Implementation Guide seems to provide one reporting answer and a GASB Concepts Statement seems to provide a differen...

Q: The accountants for a city are attempting to determine the proper reporting

The accountants for a city are attempting to determine the proper reporting for a new transaction so that the financial statements are in conformity with generally accepted accounting principles. No a...

Q: The City of Lawrence opens a solid waste landfill in 2017 that

The City of Lawrence opens a solid waste landfill in 2017 that is at 54 percent of capacity on December 31, 2017. The city had initially anticipated closure costs of $2 million but later that year dec...

Q: The City of Columbus has approximately 2,000 employees. For

The City of Columbus has approximately 2,000 employees. For the past three decades, the city has provided its employees with a defined benefit pension plan. The plan contract calls for specific paymen...

Q: On January 1, 2017, a rich citizen of the Town

On January 1, 2017, a rich citizen of the Town of Ristoni donates a painting valued at $300,000 to be displayed to the public in a government building. Although this painting meets the three criteria...

Q: On January 1, 2017, the City of Graf pays $

On January 1, 2017, the City of Graf pays $60,000 for a work of art to display in the local library. The city will take appropriate measures to protect and preserve the piece. However, if the work is...

Q: Which of the following is true about the management’s discussion and analysis

Which of the following is true about the management’s discussion and analysis (MD&A)? a. It is an optional addition to the comprehensive annual financial report, but the GASB encourages its inclusion....

Q: Government-wide financial statements make a distinction between program revenues and

Government-wide financial statements make a distinction between program revenues and general revenues. How is that difference shown? a. Program revenues are offset against the expenses of a specific f...

Q: Which of the following is most likely to be true about the

Which of the following is most likely to be true about the financial reporting of a public college or university? a. It resembles the financial reporting of private colleges and universities. b. It wi...

Q: Go to www.phoenix.gov and do a search for

Go to www.phoenix.gov and do a search for the term “CAFR.” Those results should lead to the latestCAFR for the City of Phoenix, Arizona. The financial statements for a state and local government musti...

Q: Prior to the creation of government-wide financial statements, the

Prior to the creation of government-wide financial statements, the City of Loveland did not report thecost of its infrastructure assets. Now city officials are attempting to determine reported values...

Q: Assume that this entity is a private college that charged students $

Assume that this entity is a private college that charged students $600,000 but then provided $140,000 in financial aid. The $600,000 was reported as a revenue; the $140,000 was shown as an expense. B...

Q: During Year 1, the entity above received a gift of $

During Year 1, the entity above received a gift of $80,000. The donor specified that this money be invested in government bonds with the interest to be used to pay the salaries of the entity’s employe...

Q: At the beginning of Year 1, the entity above received $

At the beginning of Year 1, the entity above received $50,000 in cash as a gift with the stipulation that the money be used to buy a bus. The accountant made the appropriate entry at that time. On the...

Q: Assume that the entity is a charity that charges its “members

Assume that the entity is a charity that charges its “members” monthly dues totaling $100,000 per year (in both Year 1 and Year 2). However, the members get nothing for their dues. The organization ha...

Q: On January 1, Year 2, several supporters of the entity

On January 1, Year 2, several supporters of the entity above spent their own money to construct a garage for its vehicles that is worth $70,000. It should last for 10 years and will have no salvage va...

Q: On December 25 of Year 2, the entity above received a

On December 25 of Year 2, the entity above received a $40,000 cash gift. The donor specified that the entity hold the money for four months. If, at the end of four months, the donor still wished to do...

Q: Assume that Charity A and Charity B are alike in every way

Assume that Charity A and Charity B are alike in every way except as described below. Assume that each of these questions is independent from all other questions. a. Each charity suffers significant d...

Q: Go to the following URL for Georgetown University: http://financialaffairs

Go to the following URL for Georgetown University: http://financialaffairs.georgetown.edu/gta/statements.html. Click on the link for the most recent set of financial statements for the university. Loo...

Q: Go to the website of a private voluntary health and welfare entity

Go to the website of a private voluntary health and welfare entity such as United Cerebral Palsy (www.ucp.org), the American Heart Association (www.americanheart.org), or the American Cancer Society (...

Q: Go to the website of a private not-for-profit

Go to the website of a private not-for-profit college or university such as Duke (www.duke.edu), Vanderbilt (www.vanderbilt.edu), Notre Dame (www.nd.edu), or Georgetown (www.georgetown.edu) and locate...

Q: Go to the Buckeye Partners, L.P. website where

Go to the Buckeye Partners, L.P. website where forms filed with the SEC are available through the InvestorCenter. Find Buckeye’s recent annual financial statements in their 10–K report for the partner...

Q: What ratio is required by GAAP to be reported on the financial

What ratio is required by GAAP to be reported on the financial statements or in the notes to the statements? a. Return on equity ratio. b. Net profit margin ratio. c. Earnings per share ratio. d...

Q: Explain how the financial statements relate to each other.

Explain how the financial statements relate to each other.

Q: TangoCo is developing its annual financial statements for 2012. The following

TangoCo is developing its annual financial statements for 2012. The following amounts were correct at December 31, 2012: cash, $48,800; investment in stock of PIL Corporation (long-term), $36,400; sto...

Q: Refer to the financial statements of American Eagle Outfitters given in Appendix

Refer to the financial statements of American Eagle Outfitters given in Appendix B at the end of this book. At the bottom of each statement, the company warns readers to “Refer to Notes to Consolidate...

Q: Refer to the financial statements of Urban Outfitters given in Appendix C

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book. At the bottom of each statement, the company warns readers that “The accompanying notes are an integr...

Q: Refer to the financial statements of American Eagle Outfitters (Appendix B

Refer to the financial statements of American Eagle Outfitters (Appendix B) and Urban Outfitters (Appendix C) and the Industry Ratio Report (Appendix D) at the end of this book. Required: 1. Compute...

Q: The following amounts were selected from the annual financial statements for Genesis

The following amounts were selected from the annual financial statements for Genesis Corporation at December 31, 2012 (end of the third year of operations): From the 2012 income statement: Sales reve...

Q: Match each player with the related definition by entering the appropriate letter

Match each player with the related definition by entering the appropriate letter in the space provided.

Q: Following are the titles of various information releases. Match each definition

Following are the titles of various information releases. Match each definition with the related release by entering the appropriate letter in the space provided.

Q: Following are information items included in various financial reports. Match each

Following are information items included in various financial reports. Match each information item with the report(s) where it would most likely be found by entering the appropriate letter(s) in the s...

Q: Avalos Corporation is preparing its annual financial statements at December 31,

Avalos Corporation is preparing its annual financial statements at December 31, 2011. Listed here are the items on its statement of cash flows presented in alphabetical order. Parentheses indicate tha...

Q: Match each player with the related definition by entering the appropriate letter

Match each player with the related definition by entering the appropriate letter in the space provided.

Q: Match each financial statement with the items presented on it by entering

Match each financial statement with the items presented on it by entering the appropriate letter in the space provided.

Q: Saunders, Inc., recently reported the following December 31 amounts in

Saunders, Inc., recently reported the following December 31 amounts in its financial statements (dollars in thousands): Compute return on assets for the current year. What does this ratio measure?...

Q: Which of the following is not a normal function of a financial

Which of the following is not a normal function of a financial analyst? a. Issue earnings forecasts. b. Examine the records underlying the financial statements to certify their conformance with GAAP...

Q: Following are the concepts of accounting covered in Chapters 2 through 5

Following are the concepts of accounting covered in Chapters 2 through 5. Match each transaction or definition with its related concept by entering the appropriate letter in the space provided. Use on...

Q: Exquisite Jewelers is developing its annual financial statements for 2012. The

Exquisite Jewelers is developing its annual financial statements for 2012. The following amounts were correct at December 31, 2012: cash, $58,000; accounts receivable, $71,000; merchandise inventory,...

Q: Jordan Sales Company (organized as a corporation on April 1,

Jordan Sales Company (organized as a corporation on April 1, 2011) has completed the accounting cycle for the second year, ended March 31, 2013. Jordan also has completed a correct trial balance as fo...

Q: Refer to the financial statements of Urban Outfitters given in Appendix C

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book. Required: 1. How much cash and cash equivalents does the company report at the end of the current ye...

Q: Refer to the financial statements of American Eagle Outfitters (Appendix B

Refer to the financial statements of American Eagle Outfitters (Appendix B) and Urban Outfitters (Appendix C) and the Industry Ratio Report (Appendix D) at the end of this book. Required: 1. Compute...

Q: Refer to the financial statements of American Eagle Outfitters given in Appendix

Refer to the financial statements of American Eagle Outfitters given in Appendix B at the end of this book. Required: 1. What does the company include in its category of cash and cash equivalents? Ho...

Q: A recent annual report for Target contained the following information (dollars

A recent annual report for Target contained the following information (dollars in thousands) at the end of its fiscal year: A footnote to the financial statements disclosed that uncollectible accoun...

Q: This period a company collects $100 cash on an account receivable

This period a company collects $100 cash on an account receivable from a customer for a sale last period. How would the receipt of cash impact the following two financial statements this period? Inco...

Q: Refer to the financial statements of Urban Outfitters given in Appendix C

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book. Required: 1. The company uses lower of cost or market to account for its inventory. At the end of t...

Q: Refer to the financial statements of American Eagle Outfitters (Appendix B

Refer to the financial statements of American Eagle Outfitters (Appendix B) and Urban Outfitters (Appendix C) and the Industry Ratio Report (Appendix D) at the end of this book. Required: 1. Compute...

Q: Refer to the financial statements of American Eagle Outfitters given in Appendix

Refer to the financial statements of American Eagle Outfitters given in Appendix B at the end of this book. Required: 1. How much inventory does the company hold at the end of the most recent year?...

Q: Jones Company is preparing the annual financial statements dated December 31,

Jones Company is preparing the annual financial statements dated December 31, 2012. Ending inventory information about the five major items stocked for regular sale follows: Required: Compute the v...

Q: Parson Company was formed on January 1, 2012, and is

Parson Company was formed on January 1, 2012, and is preparing the annual financial statements dated December 31, 2012. Ending inventory information about the four major items stocked for regular sale...

Q: Several years ago, the financial statements of Gibson Greeting Cards,

Several years ago, the financial statements of Gibson Greeting Cards, now part of American Greetings, contained the following note: On July 1, the Company announced that it had determined that the in...

Q: Harvey Company prepared its annual financial statements dated December 31, 2011

Harvey Company prepared its annual financial statements dated December 31, 2011. The company applies the FIFO inventory costing method; however, the company neglected to apply LCM to the ending invent...

Q: Brianna Webb, a connoisseur of fine chocolate, opened Bri’s Sweets

Brianna Webb, a connoisseur of fine chocolate, opened Bri’s Sweets in Collegetown on February 1, 2011. The shop specializes in a selection of gourmet chocolate candies and a line of...

Q: Refer to the financial statements of American Eagle Outfitters in Appendix B

Refer to the financial statements of American Eagle Outfitters in Appendix B at the end of this book. Required: For each question, answer it and indicate where you located the information to answer...

Q: Refer to the financial statements of Urban Outfitters given in Appendix C

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book. Required: For each question, answer it and indicate where you located the information to answer the...

Q: Refer to the financial statements of American Eagle Outfitters (Appendix B

Refer to the financial statements of American Eagle Outfitters (Appendix B) and Urban Outfitters (Appendix C) and the Industry Ratio Report (Appendix D) at the end of this book. Required: 1. Compute...

Q: You are a financial analyst charged with evaluating the asset efficiency of

You are a financial analyst charged with evaluating the asset efficiency of companies in the hotel industry. Recent financial statements for Marriott include the following note: 8. Property and Equip...

Q: Cain Company operates in both the beverage and entertainment industries. In

Cain Company operates in both the beverage and entertainment industries. In June 2006, Cain purchased Good Time, Inc., which produces and distributes motion picture, television, and home video product...

Q: Complete the requirements for each of the following independent cases:

Complete the requirements for each of the following independent cases: Case A. Dr Pepper Snapple Group, Inc., is a leading integrated brand owner, bottler, and distributor of nonalcoholic beverages i...

Q: Refer to the financial statements of American Eagle Outfitters in Appendix B

Refer to the financial statements of American Eagle Outfitters in Appendix B at the end of this book. Required: 1. Is the company a corporation, a partnership, or a sole proprietorship? How do you kn...

Q: Refer to the financial statements of Urban Outfitters given in Appendix C

Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book. Required: 1. What is the amount of accrued compensation at the end of the most recent reporting year...

Q: Refer to the financial statements of American Eagle (Appendix B)

Refer to the financial statements of American Eagle (Appendix B) and Urban Outfitters (Appendix C) and the Industry Ratio Report (Appendix D) at the end of this book. Required: 1. Compute the quick r...

Q: Refer to the financial statements of American Eagle given in Appendix B

Refer to the financial statements of American Eagle given in Appendix B at the end of this book. Required: 1. What is the amount of accrued compensation and payroll taxes at the end of the most recen...

Q: Refer to the financial statements of Urban Outfitters in Appendix C at

Refer to the financial statements of Urban Outfitters in Appendix C at the end of this book. Required: 1. Use the company’s balance sheet to determine the amounts in the accounting equation (A = L...

Q: A company is facing a class-action lawsuit in the upcoming

A company is facing a class-action lawsuit in the upcoming year. It is possible, but not probable, that the company will have to pay a settlement of approximately $2,000,000. How would this fact be re...

Q: Refer to the financial statements of American Eagle Outfitters in Appendix B

Refer to the financial statements of American Eagle Outfitters in Appendix B, Urban Outfitters in Appendix C, and the Industry Ratio Report in Appendix D at the end of this book. Required: 1. Compute...

Q: Alpine Stables, Inc., was established in Denver, Colorado,

Alpine Stables, Inc., was established in Denver, Colorado, on April 1, 2011. The company provides stables, care for animals, and grounds for riding and showing horses. You have been hired as the new a...

Q: Refer to the financial statements of American Eagle Outfitters in Appendix B

Refer to the financial statements of American Eagle Outfitters in Appendix B at the end of the book. Required: 1. State the amount of the largest expense on the income statement for the year ended J...

Q: Refer to the financial statements of Urban Outfitters in Appendix C at

Refer to the financial statements of Urban Outfitters in Appendix C at the end of the book. Required: 1. What is the company’s revenue recognition policy? 2. Assuming that $50 million of cost of sale...

Q: Refer to the financial statements of American Eagle Outfitters in Appendix B

Refer to the financial statements of American Eagle Outfitters in Appendix B, Urban Outfitters in Appendix C, and the Industry Ratio Report in Appendix D at the end of this book. Required: 1. By wha...

Q: Refer to the financial statements of American Eagle Outfitters in Appendix B

Refer to the financial statements of American Eagle Outfitters in Appendix B at the end of this book. Required: 1. How much cash did the company pay for income taxes in its 2008 fiscal year (for the...

Q: Refer to the financial statements of Urban Outfitters in Appendix C at

Refer to the financial statements of Urban Outfitters in Appendix C at the end of this book. Required: 1. How much is in the Prepaid Expenses and Other Current Assets account at the end of the most r...

Q: Refer to the financial statements of American Eagle Outfitters in Appendix B

Refer to the financial statements of American Eagle Outfitters in Appendix B, Urban Outfitters in Appendix C, and the Industry Ratio Report in Appendix D at the end of this book. Required: 1. What wa...

Q: Stoscheck Moving Corporation has been in operation since January 1, 2012

Stoscheck Moving Corporation has been in operation since January 1, 2012. It is now December 31, 2012, the end of the annual accounting period. The company has not done well financially during the fir...

Q: Carey Land Company, a closely held corporation, invests in commercial

Carey Land Company, a closely held corporation, invests in commercial rental properties. Carey’s annual accounting period ends on December 31. At the end of each year, numerous adjusting entries must...

Q: Crystal Mullinex owns and operates Crystal’s Day Spa and Salon, Inc

Crystal Mullinex owns and operates Crystal’s Day Spa and Salon, Inc. She has decided to sell the business and retire. She has had discussions with a representative from a regional ch...

Q: On December 31, 2011, Yates Company prepared an income statement

On December 31, 2011, Yates Company prepared an income statement and balance sheet and failed to take into account four adjusting entries. The income statement, prepared on this incorrect basis, refle...

Q: Financial statements often serve as a starting point in formulating budgets.

Financial statements often serve as a starting point in formulating budgets. Review Polaris’sfinancial statements to determine its cash paid for acquisitions of property and equipment in the current...

Q: Analysis of flexible budgets and standard costs emphasizes the importance of a

Analysis of flexible budgets and standard costs emphasizes the importance of a similar unit ofmeasure for meaningful comparisons and evaluations. When Polariscompiles its financial reports in complia...

Q: The usefulness of budgets, variances, and related analyses often depends

The usefulness of budgets, variances, and related analyses often depends on the accuracy ofmanagement’s estimates of future sales activity. Required1. Identify and record the prior three years’ sal...

Q: Austin Acoustics recorded the following transactions during October: a

Austin Acoustics recorded the following transactions during October: a. Received $2,500 cash from customer for three months of service beginning October 1 and ending December 31. The company recorded...

Q: Griffin Fishing Charters has collected the following data for the December 31

Griffin Fishing Charters has collected the following data for the December 31 adjustingentries: a. The company received its electric bill on December 31 for $375 but will not pay it until January 5....

Q: Harrison Fishing Charters has collected the following data for the December 31

Harrison Fishing Charters has collected the following data for the December 31 adjusting entries: a. The company received its electric bill on December 31 for $375 but will not pay it until January 5...

Q: The tobacco companies have paid billions because of smoking-related illnesses

The tobacco companies have paid billions because of smoking-related illnesses. In particular, Philip Morris, a leading cigarette manufacturer, paid more than $3,000,000,000 in settlement payments in o...

Q: iHeartMedia, Inc. in their annual report for the year ending

iHeartMedia, Inc. in their annual report for the year ending December 31, 2015, state that the plant assets reported on its balance sheet includes the following: Plant Asset …………………………………………………………………...

Q: What document are financial statements prepared from?

What document are financial statements prepared from?

Q: Why are financial statements prepared in a specific order? What is

Why are financial statements prepared in a specific order? What is that order?

Q: This and similar cases in later chapters focus on the financial statements

This and similar cases in later chapters focus on the financial statements of a real company—Target Corporation, a discount merchandiser that sells a wide assortment of general merchandise and food. T...

Q: Estella Osage publishes an online travel magazine. In need of cash

Estella Osage publishes an online travel magazine. In need of cash, the business applies for a loan with National Bank. The bank requires borrowers to submit financial statements. With little knowledg...

Q: Picture Perfect Photography works weddings and prom-type parties. The

Picture Perfect Photography works weddings and prom-type parties. The balance of retained earnings was $16,000 at December 31, 2017. At December 31, 2018, the business’s accounting r...

Q: Pretty Pictures works weddings and prom-type parties. The balance

Pretty Pictures works weddings and prom-type parties. The balance of Retained Earnings was $20,000 at December 31, 2017. At December 31, 2018, the business’s accounting records show...

Q: Suppose you are starting a business, Wholly Shirts, to imprint

Suppose you are starting a business, Wholly Shirts, to imprint logos on T-shirts. In organizing the business and setting up its accounting records, you take your information to a CPA to prepare financ...

Q: Michael McNamee is the proprietor of a property management company, Apartment

Michael McNamee is the proprietor of a property management company, Apartment Exchange, near the campus of Pensacola State College. The Business has cash of $8,000 and furniture that cost $9,000 and h...

Q: Refer to Polaris’s financial statements in Appendix A to answer the following

Refer to Polaris’s financial statements in Appendix A to answer the following. 1. Is Polaris’s statement of cash flows prepared under the direct method or the indirect method? How do you know? 2. For...

Q: Refer to Arctic Cat’s financial statements in Appendix A to compute its

Refer to Arctic Cat’s financial statements in Appendix A to compute its equity ratio as of March 31, 2011, and March 31, 2010.

Q: Refer to Piaggio’s financial statements in Appendix A. Compute its debt

Refer to Piaggio’s financial statements in Appendix A. Compute its debt ratio as of December 31, 2011, and December 31, 2010.

Q: Use KTM’s financial statements in Appendix A to compute its return on

Use KTM’s financial statements in Appendix A to compute its return on total assets for fiscal yearended December 31, 2011.

Q: Nintendo Company, Ltd., reports the following financial information as of

Nintendo Company, Ltd., reports the following financial information as of, or for the year ended, March 31, 2011. Nintendo reports its financial statements in both Japanese yen and U.S. dollars as sho...

Q: Selected comparative financial statements of Korbin Company follow. /

Selected comparative financial statements of Korbin Company follow. Required1. Compute each year’s current ratio. (Round ratio amounts to one decimal.) 2. Express the income state...

Q: Selected comparative financial statements of Haroun Company follow. /

Selected comparative financial statements of Haroun Company follow. Required1. Compute trend percents for all components of both statements using 2008 as the base year. (Round percents to one decim...

Q: Selected year-end financial statements of Cabot Corporation follow. (

Selected year-end financial statements of Cabot Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2012, were inventory, $48,900; total assets, $189,400; com...

Q: Summary information from the financial statements of two companies competing in the

Summary information from the financial statements of two companies competing in the same industry follows. Required1. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) ac...

Q: Selected comparative financial statements of Tripoly Company follow. /

Selected comparative financial statements of Tripoly Company follow. Required1. Compute trend percents for all components of both statements using 2008 as the base year. (Round percents to one deci...

Q: Selected year-end financial statements of Overton Corporation follow. (

Selected year-end financial statements of Overton Corporation follow. (All sales were on credit; selected balance sheet amounts at December 31, 2012, were inventory, $17,400; total assets, $94,900; co...

Q: Summary information from the financial statements of two companies competing in the

Summary information from the financial statements of two companies competing in the same industry follows. Required1. For both companies compute the (a) current ratio, (b) acid-test ratio, (c) ac...

Q: Refer to Forten Company’s financial statements and related information in Problem 12

Refer to Forten Company’s financial statements and related information in Problem 12-1A. RequiredPrepare a complete statement of cash flows; report its operating activities according...

Q: Use the following financial statements and additional information to (1

Use the following financial statements and additional information to (1) prepare a statement of cash flows for the year ended December 31, 2014, using the indirect method, and (2) analyze and briefl...

Q: Your friend, Diana Wood, recently completed the second year of

Your friend, Diana Wood, recently completed the second year of her business and just received annual financial statements from her accountant. Wood finds the income statement and balancesheet informa...

Q: Refer to Golden Corporation’s financial statements and related information in Problem 12

Refer to Golden Corporation’s financial statements and related information in Problem 12-4A. RequiredPrepare a complete statement of cash flows; report its cash flows from operating...

Q: What is the difference between comparative financial statements and common-size

What is the difference between comparative financial statements and common-size comparative statements?

Q: Refer to Gazelle Corporation’s financial statements and related information in Problem 12

Refer to Gazelle Corporation’s financial statements and related information in Problem 12-1B. RequiredPrepare a complete statement of cash flows; report its operating activities acco...

Q: Refer to Polaris’s financial statements in Appendix A. Compute its profit

Refer to Polaris’s financial statements in Appendix A. Compute its profit margin for the years ended December 31, 2011, and December 31, 2010.

Q: Refer to the information in Exercise 12-10. Using the

Refer to the information in Exercise 12-10. Using the direct method, prepare the statement of cash flows for the year ended June 30, 2013. In Exercise 12-10 The following financial statements and add...

Q: Refer to Satu Company’s financial statements and related information in Problem 12

Refer to Satu Company’s financial statements and related information in Problem 12-4B. RequiredPrepare a complete statement of cash flows; report its cash flows from operating activ...

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Q: Refer to the financial statements of American Eagle Outfitters given in Appendix

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Q: Audio House , Inc., is developing its annual financial statements at

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Q: Refer to the financial statements of Urban Outfitters given in Appendix C

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Q: Refer to the financial statements of American Eagle Outfitters given in Appendix

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Q: HiDef Films , Inc., is developing its annual financial statements at

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BG Wholesalers is developing its annual financial statements at December 31, 2013. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and inco...

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Q: Refer to the financial statements of Urban Outfitters given in Appendix C

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Q: Refer to the financial statements of American Eagle Outfitters given in Appendix

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Q: Pam Corporation acquired an 80 percent interest in Sun Corporation on January

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Q: The balance sheets of Pam and Sun Corporations, an 80 percent

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Pop Corporation, which owns an 80 percent interest in Son Corporation, purchases $100,000 of Son’s 8 percent bonds at 106 on July 2, 2016. The bonds pay interest on January 1 and Jul...

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Q: On December 31, 2016, the separate-company financial statements

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Who are the primary users for which consolidated financial statements are intended?

Q: Comparative consolidated financial statements for Pam Corporation and its 90 percent–

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Q: Pop Corporation acquired a 70 percent interest in Son Corporation on January

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Q: Comparative consolidated financial statements for Pam Corporation and its 80 percent–

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Q: Pam Corporation acquired a 70 percent interest in Sun Corporation’s outstanding voting

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Q: Can the method used by a parent company in accounting for its

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Q: Pam Corporation acquired an 85 percent interest in Sun Corporation on August

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Q: Pam Corporation acquired 80 percent of Sun Corporation’s common stock on January

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Q: Pop Corporation acquired 80 percent of Son Corporation’s common stock on January

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Q: Pop Corporation acquired a 90 percent interest in Son Corporation at book

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Q: Pop Corporation acquired an 80 percent interest in Son Corporation for $

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Q: Pam Corporation acquired 100 percent of Sun Corporation’s outstanding voting common stock

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Q: Pop Corporation acquired a 75 percent interest in Son Corporation for $

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Q: Pam Corporation purchased a 90 percent interest in Sun Corporation on December

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Q: Pop Corporation acquired 100 percent of Son Corporation’s outstanding voting common stock

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Q: Should the consolidated financial statements include the subsidiary’s retained earnings at the

Should the consolidated financial statements include the subsidiary’s retained earnings at the acquisition date?

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Q: Is the amount of intercompany profit to be eliminated from consolidated financial

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Q: Pam Corporation acquired all the outstanding stock of Sun Corporation on April

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Q: Separate company financial statements for Pop Corporation and its subsidiary, Son

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Q: Pam Corporation acquired a 70 percent interest in Sun Corporation’s outstanding voting

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Q: On January 1, 2009, Pam Corporation acquired 60 percent of

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Q: Comparative consolidated financial statements for Pop Corporation and its subsidiary, Son

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Q: A reader of Gigantic Company’s consolidated financial statements received from another source

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Q: Select the correct answer for each of the following questions.

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Q: Consolidated financial statements are typically prepared when one company has a controlling

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Q: Select the correct answer for each of the following questions.

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Q: Select the correct answer for each of the following questions.

Select the correct answer for each of the following questions. 1. What is the theoretically preferred method of presenting a noncontrolling interest in a consolidated balance sheet? a. As a separate i...

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Q: Are consolidated financial statements likely to be more useful to the owners

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Q: Are consolidated financial statements likely to be more useful to the creditors

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Q: How would the decision to dispose of a segment of operations using

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Amazing Chemical Corporation’s president had always wanted his own yacht and crew and concluded that Amazing Chemical should diversify its investments by purchasing an existing boatyard and repair fac...

Q: 1. The classification of noncontrolling interest share as an expense and

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Q: Use the information and assumptions from Problem P 11-9 for

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Q: Pop Corporation paid $1,190,000 cash for 70

Pop Corporation paid $1,190,000 cash for 70 percent of the outstanding voting stock of Son Corporation on January 2, 2017, when Son Corporation’s stockholders’ equi...

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At December 31, 2016, when the fair values of Sun Corporation’s net assets were equal to their book values of $2,400,000, Pam Corporation acquired an 80 percent interest in Sun for $...

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Comparative financial statements for Pen Corporation and its subsidiaries, Sir and Tip Corporations, for the year ended December 31, 2016, are as follows (in thousands): ADDITIONAL INFORMATION: 1. P...

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The financial statements for Daniels’ Custom Haircuts for the month of October follow. Required Solve for the missing information.

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The comparative financial statements of O’Doherty’s Irish Grille for 2016, 2015, and 2014 include the following selected data:
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What two personal financial statements are most important to personal financial planning?

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