labeled “Depreciation related to capitalized interest” relates to the depreciation of the interest that was capitalized as part of the cost of the asset. b. The first adjustment increases income because interest is not being expensed immediately but instead is capitalized as part of the cost of the asset to which it relates. The second adjustment decreases income because under Country A GAAP‚ the asset to which interest is capitalized has a larger cost and therefore a larger depreciation expense
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Chapter 1 Accounting in Action: CM Corporation (CMC) CM Corporation (CMC) was founded in 2000 by Eric Conner and Phil Martin. The company designs‚ installs‚ and services security systems for high-tech companies. The founders‚ who describe themselves as "entrepreneurial geeks‚" met in a computer lab when they were teenagers and found they had common interests in working on security systems for critical industries. In January 2012‚ CMC hired you as an accounting intern. Lately Conner and Martin
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Task 1 1. A roll forward is an important test in relation to year-end balance of gross PPE. It is necessary for the auditor to have assurance about the amount on the year-end 2011 balance sheet. However‚ a majority of the dollar amounts on the balance sheet should have been tested in the previous year. Roll forward allows the auditor to asses any activity since the last recording on the balance sheet. The mathematical accuracy is crucial because if the numbers are off‚ the auditor could be tested
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vendor. Cash flow reflects the cash that actually went out the door during a period. - Capital expenditures do not count against profit directly. A capital expenditure does not appear on the income statement when it occurs. It is only the depreciation that is charged against revenue over time which is based on the useful life of the item that was purchased. The cash flow reflects a different story as most items are paid for long before they may be fully depreciated on the profit and loss statement
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Profit Determination Prepared by John Hoggett and Clare Innes Measurement of Profit • Cash basis • Cash income received - Cash expenses paid – Revenues recorded when received – Expenses recorded when paid • Accrual basis • Profit = Income (incl. Revenues) - Expenses – Revenue is recognised when the anticipated inflow of economic benefit can be reliably measured – Expenses when the consumption of benefits can be reliably measured 2 Adjusting Entries • The need for adjusting entries-
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Friday is not compulsory for employees‚ only those who are willing to work on overtime rate‚ they do the job. The over time allowance re given t a rate of tk. Ten per hour for skilled workers and tk. Five for unskilled workers in the factory. Last month the workers have given notice in writing to the management (G.M. Production) and (GM HRM) to double their overtime allowance rates and to accept their request within a month. The reason for doubling their overtime rates as mentioned were many. Some
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Inventory 1. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows. Painting Cost 1/2 Beginning inventory Woods $21‚000 4/19 Purchase Sunset 21‚800 6/7 Purchase Earth 31‚200 12/16 Purchase Moon 4‚000 Woods and Moon were sold during the year for a total of $35‚000. Determine the firm’s a. Cost of goods sold.
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Table of Contents Background and Issues of Mount Pleasant Coffee Growers Cooperative Limited 2 Question 1 - Analytical Review Schedule of the farm and factory expenses 3 Question 2 - Audit Program for factory Wages and Administrative Salaries paid 7 Question 3 - Verification of the Coffee Industry Board Cess and the closing inventory of Coffee 13 Question 4 – Completing the Appropriation Account of Mount Pleasant 15 Question 5 - Presentation of simplistic financial Statements 16
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merchandise sold during the period. Inventory Systems 1. Perpetual System Features: * Used when there are few controllable items in the inventory. * Purchases increase Merchandise Inventory. * Freight costs‚ Purchase Returns and Allowances and Purchase Discounts are included in Merchandise Inventory. * Cost of goods sold is increased and Merchandise Inventory is decreased for each sale. - The perpetual inventory system provides a continuous record of Inventory and Cost of Goods
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ag‚a;es’g.;’gad;a’;ldg;gd;sal;‚ger’fa‚s.a;l‚gdlag‚dla‚g;ewlwetp;lq4pewql‚e;et‚q;g‚al‚gal;g‚dla;ew‚tqleg‚algm‚eksgtmaq;‚;’.E’S.AFD;Af?D/A>;T’‚;L‚EL;On January 1‚ 2010‚ Ameen Company purchased a building for $36 million. Ameen uses straight-line depreciation for financial statement reporting and MACRS for income tax reporting. At December 31‚ 2012‚ the carrying value of the building was $30 million and its tax basis was $20 million. At December 31‚ 2013‚ the carrying value of the building was $28 million
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