Recent Question

Huffman Corporation constructed a building 1. During self-construction of an asset by Samuelson Company, the following were among the costs incurred: Fixed overhead for the year $1,000,000 Portion of $1,000,000 fixed overhead that would be allocated to asset if it were normal production 40,000 Variable overhead attributable to self-construction 35,000 What amount of overhead should be included in the cost of the self-constructed ...

Other / Other 04 Apr 2016

Which of the following would be correct for Stanton to record 1. Dodson Company traded in a manual pressing machine for an automated pressing machine and gave $8,000 cash. The old machine cost $93,000 and had a net book value of $71,000. The old machine had a fair market value of $60,000. Which of the following is the correct journal entry to record the exchange? a. Equipment 68,000 Loss on Exchange 11,000 Accumulated Depreciati ...

Other / Other 04 Apr 2016

The gain to be recognized from the exchange 1. On January 2, 2010, Rapid Delivery Company traded in an old delivery truck for a newer model. The exchange lacked commercial substance. Data relative to the old and new trucks follow: Old Truck Original cost $24,000 Accumulated depreciation as of January 2, 2010 16,000 Average published retail value 7,000 New Truck List price $40,000 Cash price without trade-in 36,000 Cash paid with t ...

Other / Other 04 Apr 2016

Historical cost is the basis advocated for recording the acquisition The cost of land typically includes the purchase price and all of the following costs except a. grading, filling, draining, and clearing costs. b. street lights, sewers, and drainage systems cost. c. private driveways and parking lots. d. assumption of any liens or mortgages on the property. 2. If a corporation purchases a lot and building and subsequently tears ...

Other / Other 04 Apr 2016

Special assessments for local improvements such as street lights True or false: 1. Assets classified as Property, Plant, and Equipment can be either acquired for use in operations, or acquired for resale. 2. Assets classified as Property, Plant, and Equipment must be both long-term in nature and possess physical substance. 3. When land with an old building is purchased as a future building site, the cost of removing the old buildin ...

Other / Other 04 Apr 2016

An improvement, which extended the life Ex. 1—Donated assets. Cheng Company has recently decided to accept a proposal from the City of Bel Aire that publicly owned property with a large warehouse located on it will be donated to Cheng if Cheng will build a branch plant in Bel Aire. The appraised value of the property is $490,000 and of the warehouse is $980,000. Instructions Prepare the entry by Cheng for the receipt of the pr ...

Other / Other 04 Apr 2016

What were the weighted-average accumulated expenditures Use the following information for questions 1 through 4. On January 2, 2010, Indian River Groves began construction of a new citrus processing plant. The automated plant was finished and ready for use on September 30, 2011. Expenditures for the construction were as follows: January 2, 2010 $200,000 September 1, 2010 600,000 December 31, 2010 600,000 March 31, 2011 600, ...

Other / Other 04 Apr 2016

Sawyer Corporation experienced several transactions Ex. 1—Plant asset accounting. During 2010 and 2011, Sawyer Corporation experienced several transactions involving plant assets. A number of errors were made in recording some of these transactions. For each item listed below, indicate the effect of the error (if any) in the blanks provided by using the following codes: O = Overstate; U = Understate; NE = No Effect If no e ...

Other / Other 04 Apr 2016

Ecker Company purchased a new machine 1. Durler Company traded machinery with a book value of $180,000 and a fair value of $300,000. It received in exchange from Hoyle Company a machine with a fair value of $270,000 and cash of $30,000. Hoyle’s machine has a book value of $285,000. What amount of gain should Durler recognize on the exchange? a. $ -0- b. $12,000 c. $30,000 d. $120,000 2. Hoyle Company traded machinery with ...

Other / Other 04 Apr 2016

Companies account for the exchange of nonmonetary assets True or false: 1. When a company purchases land with the intention of developing it for a particular use, interest costs associated with those expenditures qualify for interest capitalization. 2. Assets purchased on long-term credit contracts should be recorded at the present value of the consideration exchanged. 3. Companies account for the exchange of nonmonetary assets o ...

Other / Other 04 Apr 2016