Chap020 - Student Name Instructor Class McGraw-Hill/Irwin...

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Student Name: Instructor Class: McGraw-Hill/Irwin Problem 20-01 Requirement 1: CECIL-BOOKER VENDING COMPANY General Journal Account Debit Credit To record the change: Inventory 35,000 Deferred tax liability 14,000 Cumulative effect of accounting change 21,000 «- Correct! Requirement 2: CECIL-BOOKER VENDING COMPANY Comparative Income Statements 2011 2010 Income before taxes $525,000 $399,000 Income tax expense (210,000) (159,600) Net income $315,000 $239,400 Correct! Correct! Earnings per share: Earnings per common share $3.15 $2.39 Correct! Correct!
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Given P20-01: CECIL-BOOKER VENDING COMPANY Inventories (average cost basis), 12/31/10 $120,000 Inventories (average cost basis), 12/31/09 $124,000 Inventories (FIFO basis), 12/31/10 $155,000 Inventories (FIFO basis), 12/31/09 $160,000 Tax rate 40% Common shares outstanding each year 100,000 Income from continuing operations, 2010 $400,000 Income from continuing operations, 2011 $525,000
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Student Name: Instructor Class: McGraw-Hill/Irwin Problem 20-02 Requirement 1: PYRAMID CONSTRUCTION COMPANY General Journal Account Debit Credit Construction in process 39,000 Deferred tax liability 15,600 Retained earnings 23,400 «- Correct! Requirement 2: PYRAMID CONSTRUCTION COMPANY Comparative Income Statement 2011 2010 Income before income taxes $51,000 $45,000 Income tax expense (20,400) (18,000) Net Income $30,600 $27,000 Correct! Correct! Earnings per share $0.61 $0.54 50,000 Correct! Correct!
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