A. The owner of Computer World‚ Heath is confused about the depreciation expense for building in the income statement and the carrying amount in the balance sheet‚ and would like you to explain the following to him: i) Why is depreciation expense recoded in the income statement for the building as Heath believes the building is worth more now than when he bought it five years ago? [3] In order to explain building depreciation we must separate land and building‚ ( a property valuer can
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ADM 2342X MID TERM EXAM Intermediate Financial Accounting 1 Spring/Summer 2014 SOLUTIONS Instructions: 1. This examination comprises 6 questions over 19 pages. The last two pages (pages 18 and 19) contain present value tables. Page 17 is a page for rough work. Answer all questions directly in this booklet. The booklet is not to be removed from the examination room. You may separate the pages but ensure that you put them back together in the correct sequence and that you staple them before
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AC505 Course Project Hints: The beginning cash balance for April‚ is the cash from March 31 in the Asset section of the balance sheet. In the merchandise purchases budget‚ in April‚ we need 50% of March purchases (that amount is also given to us 3/31 Accounts payable of $100‚000 on page 415). Therefore‚ Total cash disbursements for April is (50% x $316‚000 April purchases) + ($100‚000 remaining March purchases to be paid) = $258‚000. Class‚ Here are some hints. Lets start from the beginning:
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anti-cholesterol drug. This patent is an intangible fixed asset. | True | | False | Patents are intangible fixed assets. 3. A non-cash item is an expense charged against revenues that does not directly affect the cash flow. | True | | False | Accounting income differs from cash flow as it includes non-cash items such as depreciation. 4. Operating cash flow is the cash generated from a firm ’s normal business activities related to production and sales. | True | | False |
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Disclosure requirements for a change in principle. Indirect effect of an accounting change. Retrospective application impracticality. Reporting changes in accounting estimates. Change in principle vs. change in estimate. Accounting for change in depreciation method. Accounting for change in reporting entities. Example of a change in reporting entities. Accounting error vs. change in estimate. Accounting for corrections of errors. New principle created by FASB standard. Balance sheet errors. Definition
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Q1 - Internal Controls (lecture 3): 15 Marks. ------------------------------------------------- He said he will ask either a petty cash question or a bank reconciliation one but not both. The question will also probably test us on e-controls or cash control for cash receipts and cash payments. What is internal control? It is the organisational plan and all the related measures that an entity adopts to: * safeguard assets * encourage adherence to company policies * promote operational
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2010 2009 Current Assets: Cash $ 9‚000 $ ? Accounts Receivable 14‚000 18‚000 Inventory 23‚000 20‚000 Total Current Assets 46‚000 45‚000 Fixed Assets 73‚000 66‚000 Less: Accum. Depreciation (28‚000) (26‚000) TOTAL ASSETS $ 91‚000 $ 85‚000 Current Liabilities: Accounts Payable $ 11‚000 $ 6‚000 Wages Payable 3‚000 4‚000 Income Tax Payable 5‚000 4‚500 Total Current Liabilities 19‚000 14‚500 Long Term Bonds Payable 20‚000 23‚000 TOTAL
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recording process 3. Analyze and journalize transactions and post journal entries to the ledgers 4. Prepare and use a trial balance 1. Copyright © 2014 Pearson Education‚ Inc. Publishing as Prentice Hall. 3-2 Learning Objectives Close revenue and expense accounts and update retained earnings 6. Correct erroneous journal entries and describe how errors affect accounts 7. Explain how computers have transformed the processing of accounting data 5. Copyright © 2014 Pearson Education‚ Inc. Publishing
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000 Less: Depreciation 40‚000 Less: Wages 50‚000 Equals: Operating Income $410‚000 Less: Interest expense 400‚000 Accounting income before tax +$10‚000 b. Economic profits: Revenues $5‚000‚000 Less: Variable operating costs 4‚500‚000 Less: Opportunity value of Bowen’s income potential 30‚000 Less: Economic depreciation 60‚000 Equals: Economic profit before financial costs $410‚000 Less: Interest expense 400‚000
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$78‚000 2004 2003 Inventory $100‚000 $120‚000 Prepaid expenses $12‚000 $18‚000 Cash $ 198‚000 $102‚000 Plant assets $840‚000 $700‚000 Receivables 106‚000 78‚000 Accumulated depreciation $(300‚000) $(250‚000) Inventory 100‚000 120‚000 Patent $102‚000 $116‚000 Prepaid expenses 12‚000 18‚000 $1‚058‚000 $884‚000 Plant assets 840‚000 700‚000 Accounts payable $102‚000 $112‚000 Accumulated depreciation (300‚000) (250‚000) Accrued liabilities $40‚000 $28‚000
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