Homework Answers
| Completed Contract method | ||
| Pam Erickson Construction Company | ||
| Income statement (Partial) for years ended December 31 | ||
| 2017 | 2018 | |
| Income before tax | 590000 | 480000 |
| Tax @ 35% | -206500 | -168000 |
| Net Income | 383500 | 312000 |
| Percentage Completion method | ||
| Pam Erickson Construction Company | ||
| Income statement (Partial) for years ended December 31 | ||
| 2017 | 2018 | |
| Income before tax | 780000 | 700000 |
| Tax @ 35% | -273000 | -245000 |
| Net Income | 507000 | 455000 |
| Completed Contract method | ||
| Pam Erickson Construction Company | ||
| Income statement (Partial) for years ended December 31 | ||
| 2017 | 2018 | |
| Income before tax | 590000 | 480000 |
| Tax @ 35% | -206500 | -168000 |
| Net Income | 383500 | 312000 |
| Percentage Completion method | ||
| Pam Erickson Construction Company | ||
| Income statement (Partial) for years ended December 31 | ||
| 2017 | 2018 | |
| Income before tax | 780000 | 700000 |
| Tax @ 35% | -273000 | -245000 |
| Net Income | 507000 | 455000 |
| Pre-tax income from | Difference in income | ||||
| Percentage completion | Completed contract | Difference | Tax effect @35% | Income effect (Net of tax) | |
| 2017 | 780000 | 590000 | 190000 | 66500 | 123500 |
| 2018 | 700000 | 480000 | 220000 | 77000 | 143000 |
a.
| Prior period adjustment | 190000 | |
| To Taxes payable | 66500 | |
| To Retained Earnings | 123500 |
b.
| Pam Erickson Construction Company | ||
| Income statement (Partial) for years ended December 31 | ||
| 2018 | 2017 | |
| Income before tax | 700000 | 780000 |
| Tax @ 35% | -245000 | -273000 |
| Net Income | 455000 | 507000 |
c.
| Pam Erickson Construction Company | ||
| Retained Earnings statement for years ended | ||
| 2018 | 2017 | |
| Retained Earnings, January 1 as reported | 2123500 | 2000000 |
| Add: Net income as per change in method | 143000 | 123500 |
| Retained Earnings, December 31 | 2266500 | 2123500 |
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Using information related to E22-1 (page 1308), please: a. Prepare journal entry to record the change...
d. none UI ile dov. 23.During 2018, a construction company changed from the completed-contract method to...
d. none UI ile dov. 23.During 2018, a construction company changed from the completed-contract method to the percentage- of-completion method for accounting purposes but not for tax purposes. Gross profit figures under both methods for the past three years appear below: Completed-Contract Percentage-of-Completion $ 800,000 2016 $ 475,000 950,000 2017 625,000 2018 1.050,000 700.000 S1.800.000 $2.800.000 Assuming an income tax rate of 40% for all years, the effect of this accounting change on prior periods should be reported by a...
E22-4 (101) (Accounting Change) Gordon Company started operations on January 1, 2012, and has used the...
E22-4 (101) (Accounting Change) Gordon Company started operations on January 1, 2012, and has used the FIFO method of inventory valuation since its inception. In 2018, it decides to switch to the average cost method. You are provided with the following information Net Income Retained Earnings (Ending Balance) Under FIFO Under Average-Cost Under FIFO 2012 $100,000 $ 20,000 $100,000 70.000 65,000 160,000 2014 90.000 80,000 235,000 2015 120.000 130,000 340000 300.000 120,000 590,000 2017 305,000 310,000 780,000 2013 2016 Instructions...
Required 1 Prepare the journal entry to record the change in accounting principle. (If no entry...
Required 1
Prepare the journal entry to record the change in accounting
principle. (If no entry is required for a transaction/event, select
"No journal entry required" in the first account field. Enter your
answers in millions rounded to 1 decimal place (i.e., 5,500,000
should be entered as 5.5).)
Required 2
Determine the net income to be reported in the 2018–2017
comparative income statements. (Enter your answers in millions
rounded to 1 decimal place (i.e., 5,500,000 should be entered as
5.5).)...
E22-9 (し02.3) (Change in Estimate and Error; Financial Statements) Presented below are the comparative income and retained earnings statements for Denise Habbe Inc. for the years 2017 and 2018 2018...
E22-9 (し02.3) (Change in Estimate and Error; Financial Statements) Presented below are the comparative income and retained earnings statements for Denise Habbe Inc. for the years 2017 and 2018 2018 $340,000 200,000 140,000 88,000 $ 52,000 2017 $270,000 142,000 128,000 50,000 $78,000 $ 72,000 78,000 (25,000) $125,000 Sales Cost of sales Gross profit Expenses Net income Retained earnings (Jan. 1) Net income Dividends $125,000 52,000 (30,000) $147,000 Retained earnings (Dec. 31) The following additional information is provided 1. In 2018,...
At the beginning of 2018, a construction company that began operations in 2016 changed from the...
At the beginning of 2018, a construction company that began operations in 2016 changed from the completed-contract method to the percentage-of-completion method for accounting purposes but not for tax purposes. Gross profit figures under both methods for the past three years appear below: Completed-Contract Percentage-of-Completion 2016 $ 950,000 $ 1,800,000 2017 1,250,000 1,900,000 2018 1,400,000 2,100,000 Assuming an income tax rate of 30% for all years, the effect of this accounting change on prior periods should be reported by f...
inment NEX MY INSTRUCTOR FULL SCREEN PRINTER VERSION Exercise 22-1 Whispering Construction Company changed from the...
inment NEX MY INSTRUCTOR FULL SCREEN PRINTER VERSION Exercise 22-1 Whispering Construction Company changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction contracts during 2018. For tax purposes, the company employs the completed: contract method and will continue this approach in the future. (Hint: Adjust all tax consequences through the Deferred Tax Liability account.) The appropriate information related to this change is as follows. Pretax Income from: Percentage-of- Completed Completion Contract $761,000 $610,000 688,000 462,000 2017...
Blue Construction Company, which began operations in 2017, changed from the completed-contract to...
Blue Construction Company, which began operations in 2017,
changed from the completed-contract to the percentage-of-completion
method of accounting for long-term construction contracts during
2018. For tax purposes, the company employs the completed-contract
method and will continue this approach in the future. The
appropriate information related to this change is as
follows.
Pretax Income from
Percentage-of-Completion
Completed-Contract
Difference
2017
$966,000
$600,000
$366,000
2018
906,000
434,000
472,000
(a) Assuming that the tax rate is 35%, what is the
amount of net income...
Tamarisk Construction Company changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction...
Tamarisk Construction Company changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction contracts during 2018. For tax purposes, the company employs the completed-contract method and will continue this approach in the future. (Hint: Adjust all tax consequences through the Deferred Tax Liability account.) The appropriate information related to this change is as follows. Pretax Income from: Percentage-of-Completion Completed-Contract Difference 2017 $714,000 $647,000 $67,000 2018 642,000 512,000 130,000 (a) Assuming that the tax rate is 30%, what...
Question6. Long-term contract based on percentage of completion method (32 (4) Prepare journal entry to record...
Question6. Long-term contract based on percentage of completion method (32 (4) Prepare journal entry to record gross profit for 2017(6 points) (5) Show at end of 2017 and 2018, what are the balance af CIP ( points) points) lim's Construction Co. has a $85,000,000 contract to build a new football stadium The project began on January 1, 2016 with an expected completion date of October 31, 2018. The following table provides infomation gathered during the construction period. Jim uses the...
Please check my answers. 1. Prepare Journal Entry to record income tax expense, deferred taxes, and...
Please check my answers.
1. Prepare Journal Entry to record income tax expense, deferred taxes, and income taxes payable for 2018 2. Draft the income tax expense section of the Income Statement, beginning with Income before income taxes". . Write an analysis directed toward the team at Good Company describing what the numbers mean and how they relate to the business. Information: Good Company began operations in 2018 and has provided the following information: 1. Pretax financial income for 2018...
d. none UI ile dov. 23.During 2018, a construction company changed from the completed-contract method to the percentage- of-completion method for accounting purposes but not for tax purposes. Gross profit figures under both methods for the past three years appear below: Completed-Contract Percentage-of-Completion $ 800,000 2016 $ 475,000 950,000 2017 625,000 2018 1.050,000 700.000 S1.800.000 $2.800.000 Assuming an income tax rate of 40% for all years, the effect of this accounting change on prior periods should be reported by a...
E22-4 (101) (Accounting Change) Gordon Company started operations on January 1, 2012, and has used the FIFO method of inventory valuation since its inception. In 2018, it decides to switch to the average cost method. You are provided with the following information Net Income Retained Earnings (Ending Balance) Under FIFO Under Average-Cost Under FIFO 2012 $100,000 $ 20,000 $100,000 70.000 65,000 160,000 2014 90.000 80,000 235,000 2015 120.000 130,000 340000 300.000 120,000 590,000 2017 305,000 310,000 780,000 2013 2016 Instructions...
Required 1
Prepare the journal entry to record the change in accounting
principle. (If no entry is required for a transaction/event, select
"No journal entry required" in the first account field. Enter your
answers in millions rounded to 1 decimal place (i.e., 5,500,000
should be entered as 5.5).)
Required 2
Determine the net income to be reported in the 2018–2017
comparative income statements. (Enter your answers in millions
rounded to 1 decimal place (i.e., 5,500,000 should be entered as
5.5).)...
E22-9 (し02.3) (Change in Estimate and Error; Financial Statements) Presented below are the comparative income and retained earnings statements for Denise Habbe Inc. for the years 2017 and 2018 2018 $340,000 200,000 140,000 88,000 $ 52,000 2017 $270,000 142,000 128,000 50,000 $78,000 $ 72,000 78,000 (25,000) $125,000 Sales Cost of sales Gross profit Expenses Net income Retained earnings (Jan. 1) Net income Dividends $125,000 52,000 (30,000) $147,000 Retained earnings (Dec. 31) The following additional information is provided 1. In 2018,...
At the beginning of 2018, a construction company that began operations in 2016 changed from the completed-contract method to the percentage-of-completion method for accounting purposes but not for tax purposes. Gross profit figures under both methods for the past three years appear below: Completed-Contract Percentage-of-Completion 2016 $ 950,000 $ 1,800,000 2017 1,250,000 1,900,000 2018 1,400,000 2,100,000 Assuming an income tax rate of 30% for all years, the effect of this accounting change on prior periods should be reported by f...
inment NEX MY INSTRUCTOR FULL SCREEN PRINTER VERSION Exercise 22-1 Whispering Construction Company changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction contracts during 2018. For tax purposes, the company employs the completed: contract method and will continue this approach in the future. (Hint: Adjust all tax consequences through the Deferred Tax Liability account.) The appropriate information related to this change is as follows. Pretax Income from: Percentage-of- Completed Completion Contract $761,000 $610,000 688,000 462,000 2017...
Blue Construction Company, which began operations in 2017,
changed from the completed-contract to the percentage-of-completion
method of accounting for long-term construction contracts during
2018. For tax purposes, the company employs the completed-contract
method and will continue this approach in the future. The
appropriate information related to this change is as
follows.
Pretax Income from
Percentage-of-Completion
Completed-Contract
Difference
2017
$966,000
$600,000
$366,000
2018
906,000
434,000
472,000
(a) Assuming that the tax rate is 35%, what is the
amount of net income...
Question6. Long-term contract based on percentage of completion method (32 (4) Prepare journal entry to record gross profit for 2017(6 points) (5) Show at end of 2017 and 2018, what are the balance af CIP ( points) points) lim's Construction Co. has a $85,000,000 contract to build a new football stadium The project began on January 1, 2016 with an expected completion date of October 31, 2018. The following table provides infomation gathered during the construction period. Jim uses the...
Please check my answers.
1. Prepare Journal Entry to record income tax expense, deferred taxes, and income taxes payable for 2018 2. Draft the income tax expense section of the Income Statement, beginning with Income before income taxes". . Write an analysis directed toward the team at Good Company describing what the numbers mean and how they relate to the business. Information: Good Company began operations in 2018 and has provided the following information: 1. Pretax financial income for 2018...
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