Question 1: Buttercup Corporation issued 250 portions of $ 11 par value common stock for $ 4. 125. Fix Buttercup’ journal entry.
Question 2: Wilco Corporation has the undermentioned history balances at December 31. 2012. Common stock. $ 5 par value $ 511. 670
Treasury stock 95. 260
Retained net incomes 2. 400. 840
Paid-in capital in surplus of par 1. 320. 150
Prepare Wilco’s December 31. 2012. stockholders’ equity subdivision
Question 3: Woolford Inc. declared a hard currency dividend of $ 1. 38 per portion on its 2. 22 million outstanding portions. The dividend was declared on August 1. payable on September 9 to all shareholders of record on August 15. Fix the diary entries necessary on those three day of the months.
Question 4: The outstanding capital stock of Pennington Corporation consists of 3. 100 portions of $ 109 par value. 6 % preferable. and 5. 700 portions of $ 52 par value common. Assuming that the company has retained net incomes of $ 83. 000. all of which is to be paid out in dividends. and that preferable dividends were non paid during the 2 old ages predating the current twelvemonth. province how much each category of stock should have under each of the undermentioned conditions.
Question 5: Martinez Company’s leger shows the undermentioned balances on December 31. 2012. 5 % Preferred stock- $ 10 par value. outstanding 22. 480 portions $ 224. 800 Common stock- $ 100 par value. outstanding 33. 720 portions 3. 372. 000 Retained net incomes 708. 120
Assuming that the managers decide to declare entire dividends in the sum of $ 298. 984. determine how much each category of stock should have under each of the conditions stated below. One year’s dividends are in arrears on the preferable stock.
Question 6: On January 1. 2012. Barwood Corporation granted 5. 040 options to executives. Each option entitles the holder to buy one portion of Barwood’s $ 5 par value common stock at $ 50 per portion at any clip during the following 5 old ages. The market monetary value of the stock is $ 72 per portion on the day of the month of grant. The just value of the options at the grant day of the month is $ 154. 000. The period of benefit is 2 old ages. Prepare Barwood’s journal entries for January 1. 2012. and December 31. 2012 and 2013.
Question 7: Rockland Corporation earned net income of $ 340. 800 in 2012 and had 100. 000 portions of common stock outstanding throughout the twelvemonth. Besides outstanding all twelvemonth was $ 908. 800 of 10 % bonds. which are exchangeable into 18. 176 portions of common. Rockland’s revenue enhancement rate is 40 per centum. Compute Rockland’s 2012 diluted net incomes per portion.
Question 8: DiCenta Corporation reported net income of $ 250. 000 in 2012 and had 50. 000 portions of common stock outstanding throughout the twelvemonth. Besides outstanding all twelvemonth were 5. 410 portions of cumulative preferable stock. each exchangeable into 2 portions of common. The preferable stock pays an one-year dividend of $ 5 per portion. DiCenta’ revenue enhancement rate is 40 % . Compute DiCenta’ 2012 diluted net incomes per portion.
Question 9: Ferraro. Inc. established a stock grasp rights ( SAR ) plan on January 1. 2012. which entitles executives to have hard currency at the day of the month of exercising for the difference between the market monetary value of the stock and the pre-established monetary value of $ 24 on 5. 050 SARs. The needed service period is 2 old ages. The just value of the SAR’s are determined to be $ 6 on December 31. 2012. and $ 13 on December 31. 2013.
Question 10: Hillsborough Co. has an available-for-sale investing in the bonds of Schuyler with a carrying ( and carnival ) value of $ 88. 020. Hillsborough determined that due to hapless economic chances for Schuyler. the bonds have decreased in value to $ 57. 020. It is determined that this loss in value is other-than impermanent. Fix the journal entry. if any. to enter the decrease in value.
Question 11: Capriati Corporation made the undermentioned hard currency purchases of securities during 2012. which is the first twelvemonth in which Arantxa invested in securities. 1. On January 15. purchased 11. 700 portions of Gonzalez Company’s common stock at $ 43. 55 per portion plus committee $ 2. 574. 2. On April 1. purchased 6. 500 portions of Belmont Co. ’s common stock at $ 67. 60 per portion plus committee $ 4. 381. 3. On September 10. purchased 9. 100 portions of Thep Co. ’s preferred stock at $ 34. 45 per portion plus committee $ 6. 383. On May 20. 2012. Capriati sold 3. 900 portions of Gonzalez Company’s common stock at a market monetary value of $ 45. 50 per portion less securities firm committees. revenue enhancements. and fees of $ 3. 705. The year-end carnival values per portion were: Gonzalez $ 39. 00. Belmont $ 71. 50. and Thep $ 36. 40. In add-on. the main comptroller of Capriati told you that Capriati Corporation plans to keep these securities for the long term but may sell them in order to gain net incomes from grasp in monetary values.
Question 12: ( Journal Entries for Fair Value and Equity Methods ) Presented below are two independent state of affairss.
Prepare all necessary diary entries in 2012 for each state of affairs.
Situation 1
Hatcher Cosmetics acquired 10 % of the 207. 400 portions of common stock of Ramirez Fashion at a entire cost of $ 15 per portion on March 18. 2012. On June 30. Ramirez declared and paid a $ 80. 200 hard currency dividend. On December 31. Ramirez reported net income of $ 123. 500 for the twelvemonth. At December 31. the market monetary value of Ramirez Fashion was $ 18 per portion. The securities are classified as available-for-sale.
Situation 2
Holmes. Inc. obtained important influence over Nadal Corporation by purchasing 25 % of Nadal’s 30. 800 outstanding portions of common stock at a entire cost of $ 9 per portion on January 1. 2012. On June 15. Nadal declared and paid a hard currency dividend of $ 43. 800. On December 31. Nadal reported a net income of $ 90. 500 for the twelvemonth. Question 13: ( Equity Method ) Gator Co. invested $ 1. 380. 000 in Demo Co. for 25 % of its outstanding stock. Demo Co. pays out 40 % of net income in dividends each twelvemonth. Use the information in the undermentioned T-account for the investing in Demo to reply the undermentioned inquiries. Question 14: ( Fair Value and Equity Method Compared ) . Gregory Inc. acquired 20 % of the outstanding common stock of Handerson Inc. on December 31. 2012. The purchase monetary value was $ 1. 320. 000 for 50. 000 portions.
Handerson Inc. declared and paid an $ 0. 87 per portion hard currency dividend on June 30 and on December 31. 2013. Handerson reported net income of $ 741. 000 for 2013. The just value of Handerson’s stock was $ 32 per portion at December 31. 2013. Question 15: ( Name Option ) . On January 2. 2012. Jones Company purchases a call option for $ 450 on Merchant common stock. The call option gives Jones the option to purchase 1. 000 portions of Merchant at a work stoppage monetary value of $ 50 per portion. The market monetary value of a Merchant portion is $ 50 on January 2. 2012 ( the intrinsic value is hence $ 0 ) . On March 31. 2012. the market monetary value for Merchant stock is $ 60 per portion. and the clip value of the option is $ 200. Question 16: In 2012. Amirante Corporation had pretax fiscal income of $ 207. 000 and nonexempt income of $ 166. 400.
The difference is due to the usage of different depreciation methods for revenue enhancement and accounting intents. The effectual revenue enhancement rate is 40 % . Calculate the sum to be reported as income revenue enhancements collectible at December 31. 2012. Question 17: At December 31. 2012. Fell Corporation had a deferred revenue enhancement liability of $ 732. 802. ensuing from future nonexempt sums of $ 2. 155. 300 and an enacted revenue enhancement rate of 34 % . In May 2013. a new income revenue enhancement act is signed into jurisprudence that raises the revenue enhancement rate to 42 % for 2013 and future old ages. Fix the diary entry for Fell to set the deferred revenue enhancement liability. Question 18: AMR Corporation ( parent company of American Airlines ) reported the following for 2009 ( in 1000000s ) .
Service cost $ 405
Interest cost on P. B. O 736
Tax return on program assets 825
Amortization of service cost 29
Amortization of loss 66
Compute AMR Corporation’s 2009 pension disbursal ( in 1000000s ) .
Question 19: For Warren Corporation. year-end program assets were $ 2. 094. 700. At the beginning of the twelvemonth. program assets were $ 1. 762. 400. During the twelvemonth. parts to the pension fund were $ 120. 000. and benefits paid were $ 200. 000. Calculate Warren’s existent return on program assets.
Question 20: For 2010. Campbell Soup Company had pension disbursal of $ 48 million and contributed $ 296 million to the pension fund. Prepare Campbell Soup Company’s journal entry to enter pension disbursal and support.
Question 21: Lahey Corp. has three defined-benefit pension programs as follows.
Pension Assetss
( at Fair Value ) Projected Benefit
Duty
Plan X $ 637. 500 $ 504. 000
Plan Y 902. 200 739. 900
Plan Z 584. 600 713. 200
How will Lahey describe these multiple programs in its fiscal statements? Question 22: For 2012. Sampsell Inc. computed its one-year postretirement disbursal as $ 278. 680. Sampsell’s part to the program during 2012 was $ 185. 750. Fix Sampsell’s 2012 entry to enter postretirement disbursal.
Question 23: Wertz Corporation decided at the beginning of 2012 to alter from the completed-contract method to the percentage-of-completion method for fiscal coverage intents. The company will go on to utilize completed-contract method for revenue enhancement intents. For old ages prior to 2012. pre-tax income under the two methods was as follows: percentage-of-completion $ 143. 000. and completed-contract $ 65. 800. The revenue enhancement rate is 32 % . Prepare Wertz’s 2012 diary entry to enter the alteration in accounting rule.
Question 24: In 2012. Bailey Corporation discovered that equipment purchased on January 1. 2010. for $ 50. 000 was expensed at that clip. The equipment should hold been depreciated over 5 old ages. with no salvage value. The effectual revenue enhancement rate is 29 % . Prepare Hiatt’s 2012 diary entry to rectify the mistake.
Question 25: At January 1. 2012. Beilder Company reported maintained net incomes of $ 2. 027. 300. In 2012. Beilder discovered that 2011 depreciation disbursal was understated by $ 442. 300. In 2012. net income was $ 931. 270 and dividends declared were $ 204. 310. The revenue enhancement rate is 38 % . Complete the 2012 retained net incomes statement for Beilder Company.
Question 26: Simmons Corporation owns stock of Armstrong. Inc. Prior to 2012. the investing was accounted for utilizing the equity method. In early 2012. Simmons sold portion of its investing in Armstrong. and began utilizing the just value method. In 2012. Armstrong earned net income of $ 81. 100 and paid dividends of $ 90. 400. Prepare Simmons’s entries related to Armstrong’s net income and dividends. presuming Simmons now owns 11 % of Armstrong’s stock.
Question 27: Manno Corporation has the undermentioned information available refering its postretirement benefit program for 2012. Service cost $ 53. 750
Interest cost 58. 360
Actual return on program assets 40. 190
Compute Manno’s 2012 postretirement disbursal
Question 28: Ravonette Corporation issued 310 portions of $ 13 par value common stock and 130 portions of $ 47 par value preferred stock for a lump amount of $ 17. 500. The common stock has a market monetary value of $ 22 per portion. and the preferable stock has a market monetary value of $ 98 per portion. Fix the journal entry to enter the issue
Question 29: Garfield Company purchased. as a held-to-maturity investing. $ 82. 400 of the 9 % . 8-year bonds of Chester Corporation for $ 73. 919. which provides an 11 % return. Prepare Garfield’s journal entries for ( a ) the purchase of the investing and ( B ) the reception of one-year involvement and price reduction amortisation. Assume effectual involvement amortisation is used.
Question 30: Clydesdale Corporation has a cumulative impermanent difference related to depreciation of $ 606. 600 at December 31. 2012. This difference will change by reversal as follows: 2013. $ 43. 100 ; 2014. $ 264. 300 ; and 2015. $ 299. 200. Enacted revenue enhancement rates are 34 % for 2013 and 2014. and 40 % for 2015. Calculate the sum Clydesdale should describe as a deferred revenue enhancement liability at December 31. 2012
