Killearn: Deferral of Intra-entity Gross Profit and more

On July 1, 2016, Killearn Company acquired 88,000 of the outstanding shares of Shaun Company for $13 per share. This acquisition gave Killearn a 25 percent ownership of Shaun and allowed Killearn to significantly influence the investee's decisions. As of July 1, 2016, the investee had assets with a...

Southwestern Edison Hi-Tech Leasing Journal entries for 2018

Southwestern Edison Company leased equipment from Hi-Tech Leasing on January 1, 2018. Hi-Tech manufactured the equipment at a cost of $90,000.   Other information:   Lease term 3 years Annual payments $40,000 on January 1 each year Life of asset 3 years Fair value of asset $111,332 Implici...

Cheyenne Hotel: Using the High-Low Method

High-Low Method 1. The Cheyenne Hotel in Big Sky, Montana, has accumulated records of the total electrical costs of the hotel and the number of occupancy-days over the last year. An occupancy-day represents a room rented for one day. The hotel's business is highly seasonal, with peaks occurring d...

Morrison-Greene: Six Ways to Allocate Partnership Income

Mornson and Greene have decided to form a partnership. They have agreed that Mornson is to invest $291,000 and Greene is to invest $97,000. Morrison is to devote one-half time to the business, and Greene is to devote full time. The following plans for the division of income are considered: a. Equa...

Abnormal Accrual Models: Detect Earnings Management

Discuss how the abnormal accrual models in the literature are used to help detect earnings management. These models are widely used in accounting research; provide an example with citation (and link if available), and discuss the major finding and use of the model. In your answer explain the conce...

City of Monroe: General Fund entries and statements governmental

Continuous Problem - City of Monroe The Balance Sheets of the General Fund and the Street and Highway Fund of the City of Monroe as of December 31, 2016, follow. These (beginning) balances have been entered in the proper general ledger accounts, as of 1/1/2017.   CITY OF MONROE General Fun...

Partnerships and Corporations: major lawsuit probable damages

Assume your company is involved in a major lawsuit and the probable damages are estimated to be $2,000,000. A. Describe the effects damage estimates would have on the financial statements of a corporation and a partnership. B. How do disclosure requirements differ from a corporation to a partners...

Statement of Changes in Financial Position Amazon 2017

VI. Statement of Changes in Financial Position A. From the perspective of an investor, determine whether or not you would invest in your chosen company based on the company's statement of changes in financial position (SCFP). Support your opinion. The return on assets is very low, under 3% in e...

What is meant by financial flexibility? (airline industry)

I recently read in a financial magazine an article that indicated that the airline industry has poor financial flexibility. What is meant by financial flexibility? Why financial flexibility is important for the airline industry? How can the airline industry as a whole to improve their financial...

Dialyze USA Capital Budgeting NPV risk sensitivity analysis

Dialyze USA is considering opening a new branch dialysis and infusion center in a suburban free-standing strip center. Dialyze USA is a for-profit corporation, thus subject to income taxes. Equipment and fixtures for the center will cost $2,000,000 and be depreciated to $0 over a 5-year period o...

Nordic Company issued bonds with the following provisions

Nordic Company issued bonds with the following provisions Maturity value: $60,000,000. Interest: 7.9 percent per annum payable semi-annually each June 30 and December 31. Terms: Bonds dated January 1, 2017, due five years from that date. The company's fiscal year ends on December 31. The bonds w...

Determination Letters: Necessity, Role, Limitations, andBenefits

Tthe IRS eliminated the majority of determination letters. Please answer these questions: Questions 1: Did the IRS provide any rationale for the change in practice? Questions 2: How will employer get the clarity that need regarding its retirement plans? ...

Tax Research Environment: Determination Letters

Discuss the necessity, role, limitations, and benefits of Determination Letters. Why is the Determination Letter of value and what does it represent to the receiver? Discuss your thoughts and provide examples where appropriate to illustrate your ideas.

IFRS

https://www.cchdaily.co.uk/ifrs-rules-distort-debt-reporting (Regarding this article) Does IFRS distort debt reporting? Does it give a false report of a business's financial standing? Explain.

NPV to buy Complex Apartment

Jeff Robinson is a real estate developer who specializes in residential apartments. A complex of 40 run-down apartments has recently come on the market for $645,500. Robinson predicts that after remodeling, the 20 one-bedroom units will rent for $500 per month and the 20 two-bedroom apartments fo...

Cash Purchase Budget & Inventory Purchase

A company has adopted the following policies regarding merchandise purchases and inventory. At the end of any month, the inventory should be $18,500 plus 80% of the cost of goods to be sold during the following month. The cost of merchandise sold averages 75% of sales. Purchase terms are generall...

Capital budgeting using the NPV method

EnterTech has noticed a significant decrease in the profitability of its line of portable CD players. The production manager believes that the source of the trouble is old, inefficient equipment used to manufacture the product. The issue raised, therefore, is whether EnterTech should (1) buy new ...

Net present value decisions

The division managers of Chester Construction Corporation submit capital investment proposals each year for evaluation at the corporate level. Typically, the total dollar amount requested by the divisional managers far exceeds the company's capital investment budget. Thus, each proposal is first ...

Return on average investment, Payback, PV & NPV

Pack & Carry is debating whether to invest in new equipment to manufacture a line of high-quality luggage. The new equipment would cost $1,728,125, with an estimated five-year life and no salvage value. The estimated annual operating results with the new equipment are as follows: Revenue from s...

Midwest Region, The Restaurant Chain "Bites and Bits."

You are the manager of the Midwest Region, a 27-restaurant division that is part of the chain "Bites and Bits." The restaurants offer casual dining and compete with such chains in your region as Olive Garden and Outback Steakhouse . You receive an annual cash bonus of 5 percent of sales when resi...

Issues of using ROI as performance evaluation tool

Jennifer Baskiter is president and CEO of Plants& More.com , an Internet company that sells plants and flowers. The success of her startup Internet company has motivated her to expand and create two divisions. One division focuses on sales to the general public and the other focuses on business-t...

E25.5

An investment center in Shellforth Corporation was asked to identify three proposals for its capital budget. Details of those proposals are: Capital Budget Proposals A B ...

Variance Analysis for AGRICHEM INDUSTRIES

AgriChem Industries manufactures fertilizer concentrate and uses cost standards. The fertilizer is produced in 500-pound batches; the normal level of production is 250 batches of fertilizer per month. The standard costs per batch are as follows: ...

E24.6 Marlo Enterprises

Marlo Enterprises produces radon mitigation pumps. Information pertaining to the company's monthly direct labor usage is provided below: Standard labor rate per hour . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $16 Standard hours allowed per radon mitigation...