Intermediate Accounting

Transcription

1 Intermediate Accounting Final Exam Review Question Sheet 1 1. In 21 the following transactions took place by Time Ltd. Sales on credit $426,582 Accounts written off 1,95 Accounts previously written off but recovered 43 Cash collected on account 48,97 During 29 Time Ltd reported accounts receivable as $62,4 with a credit balance in AFDA for $2,63 in the statement of financial position. Time Ltd sells its goods on account. The following aging schedule is provided for the year 21 with the accounts receivable and percentages that are projected to be uncollectable. Accounts Projected % Accounts Receivable 1-2 months 8% $6,5 3-6 months 25% 3, months 6% 1,2 More than 1 year due 1% 1,38 Required a. Journalize the entries for the year 21 (including the Bad debt expense for the year) b. Calculate the net accounts receivable that will be reported in the statement of financial position for the year The records for AJ s Retail store were provided for the following year 213. Gross Sales $38, Sales Returns 2,8 Markup Cancellations 5,1 Markups 7,81 Markdowns 5, Purchases: At retail 3, At cost 218, Purchase Returns: Retail 5,8 At cost 4,1 Beginning_Inventory At Retail 1, At cost 49, Freight on Purchases 9,85 Markdown Cancellations 4 28 Prepared By: Charanjit Singh

2 Intermediate Accounting 1 Final Exam Review Question Sheet Required: Estimate the valuation of ending inventory using the retail sales method and calculate cost of goods sold (for at cost) 3. GT Ltd has $55,82 of outstanding accounts receivable. GT Ltd decided to transfer its outstanding accounts receivable to a financial institution at a discount rate of 7.3%. GT Ltd estimated that 15% of the account receivable will be uncollectable and are expected to be bad. A 7.3% financing fee is applied to the net balance of accounts receivable. Required Record the transfer of accounts receivable (assume the transaction was classified as without recourse) 4. SKY Company invested into FVTPL investments. On Dec Sky Company purchased 3, common shares at $22 from Porters Company and 1,2 preferred shares at $25 from Comets Company. The following transactions occurred in 211 and 212 the annual reporting end for SKY Company is Dec 31 5t a. The quoted fair values on Dec 31 st 211 were Porters Company at $26 and Comets Company $22. b. On May 15t 2O12SKY company received dividends from Porters company at $3.5 and Comets company at $2.82 c. On August 31 5t 212 SKY company sold 35 Porters common shares at $28. Commissions fee totaled $2 Required: Provide all appropriate journal entries for the year 211 and Spenser Ltd had purchased shares from different corporations for the year 213. The following are the related transactions during the year: a. Purchased 12, preferred shares from the ABC Ltd at $45 per share plus a 3.5% brokerage fee. b. Purchased 8, common shares from Dave Ltd at $18 per share plus a 3.5% brokerage fee c. Cash dividends were received from ABC Ltd at $8 per share. d. During the year Spenser Ltd sold 3, of its Dave Ltd shares for $25 per share. Required: Commission fee totalled $1,1 a. Prepare journal entries for Spenser using the above information, were investment in shares are classified as fair value through other comprehensive income (FVTOCI). b. Record the reclassification adjustment (gain or loss) in (d) if FVTOCI with recycling and without recycling Prepared By: Charanjit Singh

3 6. On April 4th, 21, Lake Excavating Services purchased a trencher for $5,. The machine Question Sheet Final Exam Review Intermediate Accounting 1 Prepared By: Charanjit Singh The following amounts were given Capital Assets(net) 41, 52, Bonds Payable 1, 1, old machine had cost $33, with accumulated depreciation of $11,. The newer The fair value for the old machine was estimated to be $2, Liabilities 85, 85, Patents 138, b. ABC Ltd has decided to trade in their old heavy duty machinery for a newer version. The tuck will be used for the same general functions as the old truck, but it is hoped that it was paid along with the exchange Accounts Receivable $7, $7, mode) has a price of $37,; a trade in allowance of $15, was given by the seller. exchanged for a smaller truck. The smaller truck had a fair value of $25,4. The smaller Inventories 84, 128, Book Value Fair Market Value a. Automotive equipment, a large truck with original cost of $5,8, 5% depreciated was 8. Required: Prepare journal entries for the following unrelated assumptions will be more efficient. The larger used truck has a fair value of $23, and $2,cas 9. Parent Corporation purchased all of the assets and abilities of Sub Corporation for $8,, Prepare a schedule showing the allocations of impairment to the assets and calculate their adjusted CV. Prepare an impairment journal entry for the CGU Required the NRV of the CGU is $15, where the NRV for building is $6,1. Mir s management team had done an impairment test on the asset group and determined that Land 8, Building 7, Assets Carrying Value Equipment $4,4 7. Mir s company has the following assets as a CGU. Required: Calculate the depreciation expense for the year 212 was expected to have a five year life and a salvage value of $5,. In early January of 212, it was decided that the machine would last a total of 7 years and have a new salvage value of $14,375. This company uses double declining method for depreciating to the nearest month.

4 Required: What would be amount of goodwill inherited and prepare the initial entry of December 31st and uses the company uses the revaluation model to calculate the carrying value Required: Required: acquisition Accumulated depreciation 13, residual value of $15,. The fair value of the building at December 31st 213 was estimated to of the asset residual value. The company planned to use the asset in the future. It was estimated that the remaining useful life of this building would be for 5 years with no 215 be $19, and $16, as at December 31st 216. The corporation fiscal year end is 1. AK Corporation purchased a building that cost $22, on January 211. AK uses the straight 11. The following information was provided or the building owned by ABC Ltd for December 31st Question Sheet Final Exam Review Intermediate Accounting Expected future net cash flow (discounted, value in use) 58, Expected future net cash flow (undiscounted) 59, Cost of the asset 8, Fair Value $65, 1 line method to calculate depreciation. The building purchased has a useful life of 2 year with a Prepared By: Charanjit Singh depreciation for December 31 method of depreciation 5t 216. Assume ABC follows ASPE and uses straight line a. Prepare the journal entry to record any impairment for December 31 st 215 and record the b. Prepare journal entries for the year ended December 3l 216 a. Prepare journal entries for the year ended December 31 st 213

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