2- Record the 40- income earned during period by Seida- 3- Record 2021.docx

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2. Record the 40% income earned during period by Seida. 3. Record 2021 amortization for trademark excess fair value. 4. Record dividend declaration from Seida. 5. Record collection of dividend from investee. Milani, Inc., acquired 10 percent of Seida Corporation on January 1, 2020, for $195 , 000 and appropriately accounted for the investment using the fair-value method. On January 1, 2021, Milani purchased an additional 30 percent of Seida for $600 , 000 which resulted in significant influence over Seida. On that date, the fair value of Seida's common stock was $2 , 000 , 000 in total. Seida's January 1, 2021, pook value equaled $1 , 850 , 000 , although land was undervalued by $130 , 000 . Any additional excess fair value over Seida's book value was attributable to a trademark with an eight-year remaining life. During 2021, Seida reported income of $332 , 000 and declared and paid dividends of $101 , 000 . Prepare the 2021 journal entries for Milani related to its investment in Seida. (If no entry is required for a transaction/event, select 'No journal entry required" in the first account field.) .

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On January 1, 2020, Fisher Corporation purchased 40 percent (90,000 shares) of the common stock of Bowden, Inc., for $974 , 000 in cash and began to use the equity method for the investment. The price paid represented a $60 , 000 payment in excess of the book value of Fisher's share of Bowden's underlying net assets. Fisher was willing to make this extra payment because of a recently developed potent held by Bowden with a 15-year remaining life. All other assets were considered appropriately valued on Bowden's books. Bowden deciares and pays a $92.000 cash dividend to its stockholders each year on September 15 . Bowden reported net income of $386 , 000 in 2020 and $344 , 000 in 2021 . Each income figure was earned evenly throughout its respective years. On July 1, 2021, Fisher soid 10 percent (22,500 shares) of Bowden's outstanding shares for $326 , 000 in cash. Although it sold this interest, Fisher maintained the ability to significantly influence Bowden's decision-making process. Prepare the journal entries for Fisher for the years of 2020 and 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Round your final answers to the nearest whole dollar.).

On January 1- 2020- Fisher Corporation purchased 40 percent (90-000 sh.pdf

Stewart29UReesa

1.1 It is the policy of Libra Ltd to retain 40% of the profit after tax. Was this policy adhered to for the financial year ended 31 December 2020? Motivate your answer. (5 marks) 1.2 Has management been efficient in the management of its accounts receivable? Use the relevant ratio to motivate your answer. 1.3 Did Libra Ltd take advantage of the credit terms offered by its trade creditors? Substantiate your answer. (4 marks) 1.4 Would the shareholders of Libra Ltd be satisfied with their return on investment? Why? (4 marks) 1.5 Suppose Libra Ltd purchases goods for R600 000. How much should it sell the goods for and still maintain the existing gross margin ratio? (4 marks) 1.6 Comment on the ability of the company to generate profits from all the capital it has employed. Support your answer with a suitable ratio. (4 marks) INFORMATION Libra Ltd commenced operations during January 2015. The company experienced profitability since the first year of existence and was able to pay out dividends to the shareholders over the years and retain some of the profit. The following are excerpts of the financial statements of Libra Ltd for 2020: LIBRA LTD STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2020 Sales (all credit) 7 000 000 Cost of sales (5 600 000) Gross profit 1 400 000 Operating expenses (800 000) Operating profit 600 000 Interest expense (150 000) Profit before tax 450 000 Company tax (135 000) Profit after tax 315 000 STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2020 Assets Non-current assets 700 000 Inventories 1 600 000 Accounts receivable/Debtors 800 000 Cash 100 000 3 200 000 Equity and liabilities Ordinary share capital 1 200 000 Retained earnings 500 000 Long-term loan (15%) 800 000 Accounts payable/Creditors 400 000 Dividends payable 100 000 Other current liabilities 200 000 3 200 000 NOTE: 1. Interim dividends paid during the year amounted to R114 200. 2. Inventories amounted to R1 800 000 on 31 December 2019. 3. Eight percent (80%) of all purchases of inventories is on credit. 4. Credit terms to debtors are 30 days and the creditors of Libra Ltd allow 90 days to settle accounts..

1-1 It is the policy of Libra Ltd to retain 40- of the profit after ta.pdf

EricJQOMurrayo

PART C 1- Petra Corporation paid $500,000 for 80% of the outstanding voting common stock of Sizable Corporation on January 2, 2022 when the book value of Sizable's net assets was $460,000. The fair values of Sizable's identifiable net assets were equal to their book values except as indicated below. Book Fair Value Value Inventories (sold in 2022) $80,000 $112,000 Buildings-net (15-year life) 200,000 170,000 Note Payable (paid in 2022) 20,000 21,250 Sizable reported net income of $75,000 during 2022; dividends of $35,000 were declared and paid during the year. (10 Marks) Required: 1. Prepare a schedule to allocate the fair value/book value differential to the specific identifiable assets and liabilities. 2. Determine Petra's income from Sizable for 2022. 3. Determine the correct balance in the Investment in Sizable account as of December 31, 2022. 2- On December 31, 2021, Paladium International purchased 70% of the outstanding common stock of Sennex Chemical. Paladium paid $140,000 for the shares and determined that the fair value of all recorded Sennex assets and liabilities approximated their book values, with the exception of a customer list that was not recorded and had a fair value of $10,000, and an expected remaining useful life of 5 years. At the time of purchase, Sennex had stockholders' equity consisting of capital stock amounting to $20,000 and retained earnings amounting to $80,000. Any remaining excess fair value was attributed to goodwill. The separate financial statements at December 31, 2022 appear in the first two columns of the consolidation workpapers shown below. (10 Marks) Required: Complete the consolidation working papers for Paladium and Sennex for the year 2022. Paladium Sennex Eliminations Consolidated Debit Credit INCOME STATEMENT Sales 331,900 48,000 Income of Sennex 9,100 Cost of Sales (148,000) (25,000) Other Expenses (72,000) ( 8,000) Noncontrolling Interest Share Net income 121,000 15,000 Retained Earnings 1/1 846,000 80,000 Add:Net income 121,000 15,000 Less: Dividends (9,000) (4,000) Retained Earnings 12/31 958,000 91,000 BALANCE SHEET Cash 135,000 64,000 Accounts Receivable-net 227,000 160,000 Inventories 316,000 86,000 Land 80,000 40,000 Equipment and Buildings-net 469,000 230,000 Investment in Sennex 146,300 Customer List Goodwill TOTAL ASSETS 1,373,300 580,000 LIAB. & EQUITY Accounts payable 305,300 469,000 Capital Stock 110,000 20,000 Retained Earnings 958,000 91,000 1/1 Noncontrol. Interest 12/31 Noncontrol. Int. TOTAL LIAB. & EQUITY 1,373,300 580,000 Eliminations C onsolidated Paladium S ennex Debit Credit INCOME STATEMENT Sales 331,900 48,000 Income of Sennex 9,100 Cost of Sales (148,000) ( 25,000) Other Expenses (72,000) ( 8,000) Noncontrolling Interest Share Net income 121,000 15,000 Retained Earnings 1/1 846,000 80,000 Add:Net income 121,000 15,000 Less: Dividends (9,000) (4,000) Retained Earnings 12/31 958,000 91,000 BALANCE SHEET 135,000 64,000 Cash Accounts Receivable-net 227,000 160,000 Invento.

PART C 1- Petra Corporation paid $500-000 for 80- of the outstanding.pdf

reachaakar

Questiong The following items are considered in the preparation of financial statements for Forde ine. for the year ended December 31,2020 . 1. The company is currently investignting whether a foreign drvision paid bribes to goverumental officials in the Bahamas in order to obtain a sales contract with the govemment. The company is working with the SEC to resolve the matter. 2. A loan to a 5% shareholder was made on June 30,2020 , for $10 , 000 . Interest is due annually beginning one year from the origination of the loan. 3. Short-term investments are valued at Level 1 in the fair value hierarchy for $40 , 550 . The total net unrealized gain (affecting net income) related to the investments is $1 , 500 . 4. Depreciation is determined on a straight-line basis for buildings and leasehold improvements over 2 to 40 years. 5. On February 1, 2021, the company declared a quarterly cash dividend of $0.40 per share, payable on March 15, 2021, for shareholders of record on March 10, 2021. 6. Equipment is measured at the fair value of $27 , 000 on a nonrecurring basis using significant unobservable inputs (Level 3). The total related impairment loss is $3 , 000 . 7. Land was sold to the company president at a price significantly under its appraised value. 8. All highly liquid investments with an original maturity of 90 days or less are considered to be cash equivalents. Requirements: a. For each of the items listed above, complete the following table. For the note disclosure category, choose from the following items: (1) summary of significant accounting policies, (2) fair value measurement, (3) related party transactions, (4) subsequent events, (5) errors, fraud, and illegal acts. For each item, indicate whether we would expect to potentially see an item affected on the face of the balance sheet and/or on the face of the income statement. b. For the note disclosure category, what treatment is required to present financial statements in accordance with the applicable financial reporting framework? .

Questiong The following items are considered in the preparation of fin.docx

lmarie40

Excel Storage Corporation You are an accountant working at Kyle & Co. Jeff Reynolds, a partner in your firm, leaves you the following voicemail message: The scheduling manager tells me you have some time available. We have recently been advised that management of Excel Storage Corporation (ESC) has received an offer from Edge Capital Partners to sell 100% of all issued and outstanding common shares. I have a meeting with management in two weeks regarding this issue, and I havent had much time to think about this engagement. I have prepared some background information on the company for you to review, including background information on the client (Exhibit I), the companys most recent internal financial statements (Exhibit II), and the proposed share purchase agreement (Exhibit III). I also met with ESC management earlier this month and made some notes from that meeting (Exhibit IV). They should all be in your inbox by now. Exhibit I Background Information Excel Storage Corporation (ESC) duplicates, DVDs, MP3s, and all forms of electronic files from master copies provided by its clients. The company started operations in 2000 in the basement of the home of part-owner, Amanda Biden. Sales increased quickly, and within one year of starting operations the company moved into a rented space in downtown Toronto. The market that ESC currently serves is mainly large companies that require training programs, corporate messages, and so on. The company is owned equally by Amanda Biden, Phil Mills, and Beth Iskiw. Amanda started the venture and has always managed the sales function. In order to keep the company growing, she brought in Phil and Beth as equal shareholders. Phil and Beth each paid $30,000 for one-third of Amandas shares. Phil is a good administrator and handles the accounting functions for the company. Amandas skills are mainly in sales. Beth looks after the production end and stays abreast of changes in technology. ESC has an October 31 fiscal year end. Exhibit II Internal Financial Statements Statement of Financial Position Exhibit II continued Statement of Income Exhibit II continued Notes to the Financial Statements Capital assets Future income tax asset A future tax asset has been recorded for noncapital losses carry forward. The losses were incurred during a bad year in fiscal 2018. ESC expects strong future profits to be able to generate taxable income to fully utilize the tax losses. The owners decided not to use the tax losses in the 2020 or 2019 fiscal years because they expect their marginal tax rate to increase significantly in the near future due to significant growth in income. Bank loan A small business bank loan and line of credit for $200,000 (presently unused) are secured by a general security agreement, a registered general assignment of book debts, and chattel mortgages on duplication equipment. Principal repayments on the small business loan are due as follows during the years ended October 31: Interest on the small busi.

Excel Storage Corporation You are an accountant working at.pdf

adcomp1

Wilco Corporation has the following account balances at December 31, 2012. Common stock, $5 par value $555,600 Treasury stock 90,720 Retained earnings 2,426,200 Paid-in capital in excess of par—common stock 1,321,900 Prepare Wilco’s December 31, 2012, stockholders’ equity section. (For preferred stock, common stock and treasury stock enter the account name only and do not provide the descriptive information provided in the question.) WILCO CORPORATION Stockholders’ Equity December 31, 2012 $ : $ Sprinkle Inc. has outstanding 10,050 shares of $10 par value common stock. On July 1, 2012, Sprinkle reacquired 107 shares at $89 per share. On September 1, Sprinkle reissued 61 shares at $90 per share. On November 1, Sprinkle reissued 46 shares at $85 per share. Prepare Sprinkle’s journal entries to record these transactions using the cost method. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit 7/1/12 9/1/12 11/1/12 Graves Mining Company declared, on April 20, a dividend of $519,800, on its $5 par common stock, payable on June 1. Of this amount, $133,700 is a return of capital. Prepare the April 20 and June 1 entries for Graves. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Apr. 20 June 1 Apr. 20 Retained Earnings = ($519,800 – $133,700) = $386,100 Abernathy Corporation was organized on January 1, 2012. It is authorized to issue 10,290 shares of 8%, $65 par value preferred stock, and 544,000 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year. Jan. 10 Issued 80,330 shares of common stock for cash at $6 per share. Mar. 1 Issued 5,670 shares of preferred stock for cash at $113 per share. Apr. 1 Issued 24,730 shares of common stock for land. The asking price of the land was $90,540; the fair value of the land was $80,330. May 1 Issued 80,330 shares of common stock for cash at $9 per share. Aug. 1 Issued 10,290 shares of common stock to attorneys in payment of their bill of $50,620 for services rendered in helping the company organize. Sept. 1 Issued 10,290 shares of common stock for cash at $11 per share. Nov. 1 Issued 1,940 shares of preferred stock for cash at $115 per share. Prepare the journal entries to record the above transactions. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 10 M.

Wilco Corporation has the following account balances at December 3.docx

alanfhall8953

Multiple-choice questions. Select the best one that answers the question. Show your procedure and calculations. Partial credits will be given if you procedure is correct, but answers are not. Each question is 3 points. Total: 78 points. Chapter 1 1. Angelo uses the equity method to account for its investment in Fischer on January 1. On the date of acquisition, Fischer’s land and buildings were undervalued on its balance sheet. During the year following the acquisition, how do these excesses of fair values over book values affect Angelo's Equity Income from Fischer? a. Building, Decrease; Land, No Effect b. Building, Decrease; Land, Decrease c. Building, Increase; Land, Increase d. Building, Increase; Land, No Effect 2. On January 2, 2020, Campbell, Inc. purchased a 20% interest in Renner Corp. for $2,000,000 cash. During 2020, Renner's net income was $2,500,000 and it paid dividends of $750,000. Equity Investment balance should Campbell report at December 31, 2020? a. $2,500,000 b. $ 500,000 c. $2,350,000 d. $2,150,000 3. On December 31, 2020, Park Inc. paid $500,000 for all of the common stock of Smith Corp. On that date, Smith had assets and liabilities with book values of $400,000 and $100,000; and fair values of $450,000 and $125,000, respectively. What amount of goodwill will be reported on the December 31, 2020 balance sheet? a. $ 50,000 b. $100,000 c. $200,000 d. $175,000 4. Francis, Inc. acquired 40% of Park's voting stock on January 1, 2020 for $420,000. During 2020, Park earned $120,000 and paid dividends of $60,000. During 2021, Park earned $160,000 and paid dividends of $50,000 on April 1 and $40,000 on December 1. On July 1, 2021, Francis sold half of its stock in Park for $275,000 cash. The Equity Investment balance at December 31, 2020 is: a. $420,000 b. $444,000 c. $408,000 d. $492,000 5. On January 1, 2020, Cracker Co. purchased 40% of Dallas Corp.'s common stock at book value of net assets. The balance in Cracker's Equity Investment account was $820,000 at December 31, 2020. Dallas reported net income of $500,000 for the year ended December 31, 2020, and paid dividends totaling $150,000 during 2020. How much did Cracker pay for its 40% interest in Dallas? a. $680,000 b. $500,000 c. $560,000 d. $760,000 Chapter 2 The following three Questions are based on the following set of facts. Lucky’s Company acquires Waterview, Inc., by issuing 40,000 shares of $1 par common stock with a market price of $25 per share on the acquisition date and paying $125,000 cash. The assets and liabilities on Waterview’s balance sheet were valued at fair values except equipment that was undervalued by $300,000. There was also an unrecorded patent valued at $40,000, as well as an unrecorded trademark valued at $75,000. In addition, the agreement provided for additional consideration, valued at $60,000, if certain earnings targets were met. The pre-acquisition balance she ...

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roushhsiu

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