Federated Fabrications leased a tooling machine on January 1,
2021, for a three-year period ending December...
Federated Fabrications leased a tooling machine on January 1,
2021, for a three-year period ending December 31, 2023. The lease
agreement specified annual payments of $32,000 beginning with the
first payment at the beginning of the lease, and each December 31
through 2022. The company had the option to purchase the machine on
December 30, 2023, for $41,000 when its fair value was expected to
be $56,000, a sufficient difference that exercise seems reasonably
certain. The machine's estimated useful life...
On January 1, 2021, Bronson Co., a calendar-year entity,
acquired 40% of Corbin Corp.’s common stock...
On January 1, 2021, Bronson Co., a calendar-year entity,
acquired 40% of Corbin Corp.’s common stock for $1 million. It did
not elect the fair value option for the investment. The purchase
price was equal to the carrying amount of 40% of Corbin's net
assets, which approximated their fair value. Corbin's earnings and
cash dividend payments for 2021 and 2022 were as follows:
2021
2022
Earnings
$300,000
$400,000
Dividends
$90,000
$120,000
On December 31, 2022, the balance in the investment...
On January 1, 2021, Wright Transport sold four school buses to
the Elmira School District. In...
On January 1, 2021, Wright Transport sold four school buses to
the Elmira School District. In exchange for the buses, Wright
received a note requiring payment of $522,000 by Elmira on December
31, 2023. The effective interest rate is 5%. (FV of $1, PV of $1,
FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate
factor(s) from the tables provided.):
Required: 1. How much sales revenue would Wright recognize on
January 1, 2021, for...
On January 1, 2021, Wright Transport sold four school buses to
the Elmira School District. In...
On January 1, 2021, Wright Transport sold four school buses to
the Elmira School District. In exchange for the buses, Wright
received a note requiring payment of $526,000 by Elmira on December
31, 2023. The effective interest rate is 7%. (FV of $1, PV of $1,
FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use
appropriate factor(s) from the tables provided.):
Required:
1. How much sales revenue would Wright
recognize on January 1, 2021, for...
On January 1, 2021, Wright Transport sold four school buses to
the Elmira School District. In...
On January 1, 2021, Wright Transport sold four school buses to
the Elmira School District. In exchange for the buses, Wright
received a note requiring payment of $523,000 by Elmira on December
31, 2023. The effective interest rate is 6%. (FV of $1, PV of $1,
FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use
appropriate factor(s) from the tables provided.):
Required:
1. How much sales revenue would Wright
recognize on January 1, 2021, for...
On January 1, 2021, the Montgomery Company agreed to purchase a
building by making six payments....
On January 1, 2021, the Montgomery Company agreed to purchase a
building by making six payments. The first three are to be $27,000
each, and will be paid on December 31, 2021, 2022, and 2023. The
last three are to be $42,000 each and will be paid on December 31,
2024, 2025, and 2026. Montgomery borrowed other money at a 10%
annual rate. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1
and PVAD...
FinanceCo lent $8.9 million to Corbin Construction on January 1,
2021, to construct a playground. Corbin...
FinanceCo lent $8.9 million to Corbin Construction on January 1,
2021, to construct a playground. Corbin signed a three-year, 4%
installment note to be paid in three equal payments at the end of
each year. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1
and PVAD of $1) (Use appropriate factor(s) from the tables
provided.)
Required:
1. Prepare the journal entry for FinanceCo’s
lending the funds on January 1, 2021.
2. Prepare an amortization...
Careweezy Autoparts leased an industrial press from Snap-On
Tools on January 1, 2021. The lease is...
Careweezy Autoparts leased an industrial press from Snap-On
Tools on January 1, 2021. The lease is for a 3-year period ending
December 31, 2023. Annual payments are $42,000 beginning with the
first payment on January 1, 2021, and each December 31 through
2022. NAPA has the option to purchase the industrial press on
December 30, 2023 for $51,000, and exercise of the option seems
reasonably certain. The machine's estimated useful life is 6 years
with no salvage value. The implicit...
Equipment was acquired on January 1, 2021, for $35,000 with an
estimated four-year life and $2,000...
Equipment was acquired on January 1, 2021, for $35,000 with an
estimated four-year life and $2,000 residual value. The company
uses straight-line depreciation. Record the gain or loss if the
equipment was sold on December 31, 2023, for $10,700.
On January 1, 2021, Cullumber Satellites issued $1,430,000,
10-year bonds. The bonds pay semi-annual interest on...
On January 1, 2021, Cullumber Satellites issued $1,430,000,
10-year bonds. The bonds pay semi-annual interest on July 1 and
January 1, and Cullumber has a December 31 year end. A partial bond
amortization schedule is presented below:
Semi-Annual
Interest Period
Interest
Payment
Interest
Expense
Amortization
Bond
Amortized Cost
Jan. 1, 2021
$1,328,381
July 1, 2021
$ [1]
$ [2]
$3,593
1,331,974
Jan. 1, 2022
42,900
46,619
3,719
1,335,693
July 1, 2022
42,900
46,749
[3]
1,339,542
Jan. 1, 2023
42,900
46,884...