truck and an overhead pulley system‚ in this year’s capital budget. The projects are independent. The cash outlay for the truck is $17‚100 and that for the pulley system is $22‚430. The firm’s cost of capital is 14%. After-tax cash flows‚ including depreciation‚ are as follows: Year | Truck | Pulley | 1 | $5‚100 | $7‚500 | 2 | 5‚100 | 7‚500 | 3 | 5‚100 | 7‚500 | 4 | 5‚100 | 7‚500 | 5 | 5‚100 | 7‚500
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Corporation ………… $1‚000‚000.00 IFRS adjustments: Add: Reversal of inventory cost written down to replacement cost….. 10‚000.00 Less: Additional depreciation of building after 2011 revaluation…….. (25‚000.00) Impairment loss on intangible assets…………… (5‚000.00) Add: Deferred research and development costs…….. 80‚000.00
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stock lowers the stock outstanding‚ it is subtracted from Stockholders’ Equity so that the stockholders’ net equity is for outstanding shares only. Treasury stock is‚ in essence‚ a reduction in paid-in capital. 3-36: Which depreciation method will result in the most depreciation over the life of an asset? Irrespective of the
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statements In 1984 they changed the depreciation method from accelerated methods to the straight-line for financial reporting purposes. This change included a adjustment of the residual values on certain machinery and equipment. They also included the products purchased from Kobe Steel‚ LTD and sold by them in their net sales. Moreover‚ they also included the financial statements of some foreign subsidiaries. 2. What is the effect of the depreciation accounting method change on the reported
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13. The interest on a $4‚000‚ 6%‚ 60-day note receivable is $40. 14. The maturity value of a $2‚000‚ 6%‚ 60-day note receivable dated February 10th is $2‚020 15. A disadvantage of the corporate form of business is government regulation.. 16. James Corporation issued 2‚000 shares of $5 par value common stock for $20 per share. The entry to record this transaction includes a credit to Paid-in Capital in Excess of Par for $30‚000.
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by this period will be linearly amortized value of the building ($ 32‚000: 10 years = $ 3200) in the form of remission of fixed assets‚ which then will be transferred to the account of depreciation as shown in Figure 2. |Remission of fixed assets ( annualy ) |Depreciation ( annualy ) | | | | |Dt |Ct |years
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Week Three Exercise Assignment 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
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is expected to be used for 80‚000 working hours during its 8-year life. Instructions: Compute depreciation using the following methods in the year indicated. (a) Straight-line for 2012 and 2013‚ assuming a December 31 year-end. (b) Declining-balance using double the straight-line rate for 2012 and 2013. (c) Units-of-activity for 2012‚ assuming machine usage was 2‚900 hours. (Round depreciation per unit to the nearest cent.) A) 15‚000 1 / 8= .125 128‚000-8‚000=120‚000 120‚000 x .125=
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Chapter 2 Worldwide accounting diversity Chapter Outline I. Considerable differences exist across countries in the accounting treatment of many items. These differences can result in significantly different amounts being reported in the financial statements prepared by companies using different GAAP. II. A variety of factors influence a country’s accounting system. A. Legal system – in code law countries‚ accounting rules tend to be legislated; common law countries tend to have
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Manufacturing Expense | | 350000 | | | | Cash | | 350000 | 12/31 | PPE | | 150000 | | | | Cash | | 150000 | 12/31 | Interest Expense | | 750 | | | | Cash | | 750 | 12/31 | Depreciation Expense | | 10625 | | | | Accum. Depreciation | | 10625 | | To record depreciation expense for Jul-Dec((150‚000+62‚500 -0)/10)*1/2 years | 12/31 | COGS | | 195000 | | | | Cash | | 195000 | 12/31 | Patent Amortization | | 25000 | | | | Accum. Amortization | | 25000
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