Additional Problems-Chapter 10

Additional - Try Exercises 10-1,2,3,4,6,18,21,23,24 EXERCISE 10-1 Item Land Land Improvements Building Other Accounts(a($275,000 Notes Payable(b

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Unformatted text preview: Try Exercises 10-1,2,3,4,6,18,21,23,24 EXERCISE 10-1 Item Land Land Improvements Building Other Accounts (a) ($275,000) Notes Payable (b) $275,000 (c) $ 10,000 (d) 7,000 (e) 6,000 (f) (1,000) (g) 25,000 (h) 250,000 (i) 9,000 (j) $ 4,000 (k) 11,000 (l) (5,000) (m) 13,000 (n) 19,000 (o) 14,000 (p) 3,000 EXERCISE 10-2 The allocation of costs would be as follows: Land Building Land.................................................................... ............................................................................ $450,000 Razing costs...................................................... 42,000 Salvage............................................................... (6,300) Legal fees........................................................... 1,850 Survey................................................................ $ 2,200 Plans................................................................... 65,000 Title insurance................................................... 1,500 Liability insurance............................................ 900 Construction...................................................... 2,740,000 Interest............................................................... 170,000 $489,050 $2,978,100 EXERCISE 10-3 1. Truck #1................................................................ 13,900 Cash............................................................ 13,900 2. Truck #2................................................................ 18,364* Discount on Notes Payable................................ 1,636 Cash............................................................ 2,000 Notes Payable............................................ 18,000 *PV of $18,000 @ 10% for 1 year = $18,000 X .90909 = $16,364 $16,364 + $2,000 = $18,364 3. Truck #3................................................................ 15,200 Cost of Goods Sold............................................. 12,000 Inventory..................................................... 12,000 Sales............................................................ 15,200 [Note to instructor : The selling (retail) price of the computer system appears to be a better gauge of the fair value of the consideration given than is the list price of the truck as a gauge of the fair value of the consideration received (truck). Vehicles are very often sold at a price below the list price.] 4. Truck #4................................................................ 13,000 Common Stock........................................... 10,000 Paid-in Capital in Excess of Par (1,000 shares X $13 = $13,000; $13,000 less $10,000 par value)............ 3,000 EXERCISE 10-4...
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This note was uploaded on 04/29/2011 for the course ACCT 3001 taught by Professor Erickson during the Spring '10 term at University of Minnesota Duluth.

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Additional - Try Exercises 10-1,2,3,4,6,18,21,23,24 EXERCISE 10-1 Item Land Land Improvements Building Other Accounts(a($275,000 Notes Payable(b

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