Homework Answers
| a) | ||||
| 2018 - ($27,400 - $24,200) | $3,200 | |||
| 2019 - ($28,300 - $23,500) | $4,800 | |||
| 2020 - ($31,100 - $29,100) | $2,000 | |||
| $10,000 | ||||
| Account Titles and Explanation | Debit | Credit | ||
| Retained Earnings | $10,000 | |||
| Inventory | $10,000 | |||
| (To record the affect due to change in inventory method) | ||||
| 2021 | 2020 | 2019 | 2018 | |
| Net Income | $29,200 | $29,100 | $23,500 | $24,200 |
| b) | ||||
| 2018 - ($27,400 - $21,400) | $6,000 | |||
| 2019 - ($28,300 - $19,800) | $8,500 | |||
| 2020 - ($31,100 - $25,700) | $5,400 | |||
| $19,900 | ||||
| Account Titles and Explanation | Debit | Credit | ||
| Inventory | $19,900 | |||
| Retained Earnings | $19,900 | |||
| (To record the affect due to change in inventory method) | ||||
| 2021 | 2020 | 2019 | 2018 | |
| Net Income | $33,500 | $31,100 | $28,300 | $27,400 |
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*Exercise 22-07 Below is the net income of Carla Instrument Co., a private corporation, computed under...
Below is the net income of Cheyenne Instrument Co., a private corporation, computed under the three...
Below is the net income of Cheyenne Instrument Co., a private corporation, computed under the three inventory methods using a periodic system. FIFO 2018 2019 2020 2021 $26,200 27,100 27,900 31,800 Average Cost $22,900 22,100 25,900 27,400 LIFO $20,500 18,400 22,800 23,300 (Ignore tax considerations.) (a) Assume that in 2021 Cheyenne decided to change from the FIFO method to the average-cost method of pricing inventories. Prepare the journal entry necessary for the change that took place during 2021, and show...
Pharoah Company began operations on January 1, 2015, and uses the average-cost method of pricing ...
Pharoah Company began operations on January 1, 2015, and uses the average-cost method of pricing inventory. Management is contemplating a change in inventory methods for 2018. The following information is available for the years 2015–2017. Net Income Computed Using Average-Cost Method FIFO Method LIFO Method 2015 $15,990 $19,120 $12,040 2016 17,880 20,820 14,130 2017 20,090 24,750 16,970 (a) Prepare the journal entry necessary to record a change from the average cost method to the FIFO method in 2018. (Credit account...
Sage Company began operations on January 1, 2015, and uses the average-cost method of pricing inventory....
Sage Company began operations on January 1, 2015, and uses the
average-cost method of pricing inventory. Management is
contemplating a change in inventory methods for 2018. The following
information is available for the years 2015–2017.
Net Income Computed Using
Average-Cost Method
FIFO Method
LIFO Method
2015
$15,860
$18,810
$12,090
2016
18,010
20,800
14,140
2017
19,970
24,990
16,870
(a) Prepare the journal entry necessary to record
a change from the average cost method to the FIFO method in 2018.
(Credit account...
Vaughn Company began operations on January 1, 2015, and uses the average-cost method of pricing inventory....
Vaughn Company began operations on January 1, 2015, and uses the
average-cost method of pricing inventory. Management is
contemplating a change in inventory methods for 2018. The following
information is available for the years 2015–2017.
Net Income Computed Using
Average-Cost Method
FIFO Method
LIFO Method
2015
$15,900
$19,170
$12,110
2016
17,880
20,980
13,990
2017
20,180
25,060
17,120
(a) Prepare the journal entry necessary to record
a change from the average cost method to the FIFO method in 2018.
(Credit account...
At the end of 2019, Carla Company has $176,400 of cumulative temporary differences that will result...
At the end of 2019, Carla Company has $176,400 of cumulative temporary differences that will result in reporting the following future taxable amounts. 2020 $58,000 2021 49,400 2022 40,100 2023 28,900 $176,400 Tax rates enacted as of the beginning of 2018 are: 2018 and 2019 40 % 2020 and 2021 30 % 2022 and later 25 % Carla’s taxable income for 2019 is $306,100. Taxable income is expected in all future years. (a) Prepare the journal entry for Carla to...
Exercise 15-16 a-c Carla Vista Company issued $790,000, 9%, 10-year bonds on December 31, 2019, for...
Exercise 15-16 a-c Carla Vista Company issued $790,000, 9%, 10-year bonds on December 31, 2019, for $720,000. Interest is payable annually on December 31. Carla Vista Company uses the straight-line method to amortize bond premium or discount. Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31, 2019 SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare...
Carla Vista Copaid $11.600 to purchase equipment on January 1, 2021. Carla Vista Co has a...
Carla Vista Copaid $11.600 to purchase equipment on January 1, 2021. Carla Vista Co has a December 31 fiscal year end and uses straight-line depreciation. The company estimates the equipment will have a 4-year useful life. Prepare the journal entry to record the purchase of the equipment on January 1, 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for...
Type or paste question here On January 1, 2020, Carla Vista Company issued $395,500, 9%, 5-year...
Type or paste question here
On January 1, 2020, Carla Vista Company issued $395,500, 9%,
5-year bonds at face value. Interest is payable annually on January
1.
Prepare the journal entry to record the issuance of the bonds.
(Credit account titles are automatically indented when
amount is entered. Do not indent manually.)
Date
Account Titles and Explanation
Debit
Credit
Jan. 1, 2020
SHOW LIST OF ACCOUNTS
LINK TO TEXT
Prepare the journal entry to record the accrual of interest on...
On December 31, 2020, Carla Co. performed environmental consulting services for Hayduke Co. Hayduke was short...
On December 31, 2020, Carla Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Carla Co. agreed to accept a $318,100 zero-interest-bearing note due December 31, 2022, as payment in full. Hayduke is somewhat of a credit risk and typically borrows funds at a rate of 11%. Carla is much more creditworthy and has various lines of credit at 5% - Your answer is partially correct. Prepare the journal entry to record the transaction of...
At December 31, 2020, the available-for-sale debt portfolio for Carla, Inc. is as follows. Unrealized Gain...
At December 31, 2020, the available-for-sale debt portfolio for Carla, Inc. is as follows. Unrealized Gain (Loss) $(4,125) 2,475 4,125 B Security Cost Fair Value $28,875 $24,750 20,625 23,100 C 37,950 42,075 Total $87,450 $89,925 Previous fair value adjustment balance- Dr. Fair value adjustment-Dr. 2.475 660 $1,815 On January 20, 2021, Carla, Inc. sold security A for $24,915. The sale proceeds are net of brokerage fees. Prepare the adjusting entry at December 31, 2020, to report the portfolio at fair...
Below is the net income of Cheyenne Instrument Co., a private corporation, computed under the three inventory methods using a periodic system. FIFO 2018 2019 2020 2021 $26,200 27,100 27,900 31,800 Average Cost $22,900 22,100 25,900 27,400 LIFO $20,500 18,400 22,800 23,300 (Ignore tax considerations.) (a) Assume that in 2021 Cheyenne decided to change from the FIFO method to the average-cost method of pricing inventories. Prepare the journal entry necessary for the change that took place during 2021, and show...
Sage Company began operations on January 1, 2015, and uses the
average-cost method of pricing inventory. Management is
contemplating a change in inventory methods for 2018. The following
information is available for the years 2015–2017.
Net Income Computed Using
Average-Cost Method
FIFO Method
LIFO Method
2015
$15,860
$18,810
$12,090
2016
18,010
20,800
14,140
2017
19,970
24,990
16,870
(a) Prepare the journal entry necessary to record
a change from the average cost method to the FIFO method in 2018.
(Credit account...
Vaughn Company began operations on January 1, 2015, and uses the
average-cost method of pricing inventory. Management is
contemplating a change in inventory methods for 2018. The following
information is available for the years 2015–2017.
Net Income Computed Using
Average-Cost Method
FIFO Method
LIFO Method
2015
$15,900
$19,170
$12,110
2016
17,880
20,980
13,990
2017
20,180
25,060
17,120
(a) Prepare the journal entry necessary to record
a change from the average cost method to the FIFO method in 2018.
(Credit account...
Exercise 15-16 a-c Carla Vista Company issued $790,000, 9%, 10-year bonds on December 31, 2019, for $720,000. Interest is payable annually on December 31. Carla Vista Company uses the straight-line method to amortize bond premium or discount. Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31, 2019 SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare...
Carla Vista Copaid $11.600 to purchase equipment on January 1, 2021. Carla Vista Co has a December 31 fiscal year end and uses straight-line depreciation. The company estimates the equipment will have a 4-year useful life. Prepare the journal entry to record the purchase of the equipment on January 1, 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for...
Type or paste question here
On January 1, 2020, Carla Vista Company issued $395,500, 9%,
5-year bonds at face value. Interest is payable annually on January
1.
Prepare the journal entry to record the issuance of the bonds.
(Credit account titles are automatically indented when
amount is entered. Do not indent manually.)
Date
Account Titles and Explanation
Debit
Credit
Jan. 1, 2020
SHOW LIST OF ACCOUNTS
LINK TO TEXT
Prepare the journal entry to record the accrual of interest on...
On December 31, 2020, Carla Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Carla Co. agreed to accept a $318,100 zero-interest-bearing note due December 31, 2022, as payment in full. Hayduke is somewhat of a credit risk and typically borrows funds at a rate of 11%. Carla is much more creditworthy and has various lines of credit at 5% - Your answer is partially correct. Prepare the journal entry to record the transaction of...
At December 31, 2020, the available-for-sale debt portfolio for Carla, Inc. is as follows. Unrealized Gain (Loss) $(4,125) 2,475 4,125 B Security Cost Fair Value $28,875 $24,750 20,625 23,100 C 37,950 42,075 Total $87,450 $89,925 Previous fair value adjustment balance- Dr. Fair value adjustment-Dr. 2.475 660 $1,815 On January 20, 2021, Carla, Inc. sold security A for $24,915. The sale proceeds are net of brokerage fees. Prepare the adjusting entry at December 31, 2020, to report the portfolio at fair...
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