Solultios.F09.Final

Solultios.F09.Final - CONCORDIA UNIVERSITY DEPARTMENT OF...

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CONCORDIA UNIVERSITY FINANCIAL ACCOUNTING DEPARTMENT OF ACCOUNTANCY COMM 217 ALL SECTIONS SUGGESTED SOLUTION FINAL EXAMINATION Fall 2009 Question 1 (21 marks) Multiple-choice (1.5 marks per correct answer) 1. b 2. a 3. c 4. b 5. a 6. a 7. d 8. a 9. c 10. d 11. d 12. c 13. c 14. c
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Question 2 (16 marks) Req. 1 Total market value of two machines = $240,000 + $160,000 = $400,000 Allocation of the purchase price: Machine A $350,000 x (240,000/400,000) = $210,000 Machine B $350,000 x (160,000/400,000) = $140,000 Req. 2 Equipment/Machinery ($350,000 + $2,000 + $1,000) 353,000 Cash ($353,000 – $250,000 ) 103,000 Notes payable 250,000 Req. 3 Amortization of Machine A– 2009 = ($212,000 – 0 ) x 2/10 = $42,400 Amortization of Machine A– 2010 = ($212,000 – 42,400 ) x 2/10 = $33,920 Req. 4 Amortization rate per unit for Machine B = ($140,000 + $1,000 – $6,000 ) / 100,000 = $1.35 Accumulated amortization at September 30, 2009 = $1.35 x 9,000 units = $12,150 Net book value at September 30, 2009 = $141,000 – 12,150 = $128,850 Loss on sale of equipment = $128,850 – $125,000 = $3850 Amortization Expense 12,150 Accumulated amortization 12,150 Cash 125,000 Accumulated amortization 12,150 Loss on sale of equipment 3,850 Equipment 141,000
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Question 3 (21 marks) RT Ltd. Cash Flow Statement
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Solultios.F09.Final - CONCORDIA UNIVERSITY DEPARTMENT OF...

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