1. At the beginning of 2016, this company changes from Average Cost to
FIFO. The following table presents information concerning the change.
The income tax rate for all years is 40%.
Income before Income Tax
EisnerAmper is the 14th largest accounting firm with nearly 1,300 employees and 180
partners. The firm provides many different services such as audit, tax, internal audit, pension
audit, executive compensation review and variety of other servi
Accountants legal responsibilities and liabilities
1. To whom can a CPA be liable?
Named 3rd party
Unanticipated 3rd parties
2. What are distinguishing characteristic between negligence, gross negligence and fraud?
Element of Fraud
1. The factors that defines my moral value today is culture, environment and experience.
Culture has an influence in my moral today because of how my culture believe that we
should do certain things. You should do what is right even if yo
Asset C3PO has a depreciable base of $16.5 million and a service life of 10 years. What would the
accumulated depreciation be at the end of year five under the sum-of-the-years' digits method?
None of these answer choices are correct.
Below is information relative to an exchange of similar assets by Grand Forks Corp. Assume the
exchange has commercial substance.
In Case A, Grand
Archie Co. purchased a framing machine for $45,000 on January 1, 2016. The machine is expected
to have a four-year life, with a residual value of $5,000 at the end of four years.
Using the sum-of-the years'-digits method, depreciation for 2017 and book va
Horton Stores exchanged land and cash of $5,900 for similar land. The book value and the fair value of
the land were $88,200 and $101,300, respectively.
Assuming that the exchange lacks commercial substance, Horton would record land-new and a gain/
Items to be Answered:
61. in auditing the long-term investments account, an auditor is~unable to obtain audited financial statemean for an
investee located in a foreign country. The auditor concludes that sufficient competent. evidential matter regarding
1. Techno Inc. has a defined contribution pension plan which requires the
firm to contribute an amount equal to 4% of the annual gross salary for each
covered employee to the fund each Dec. 31. Each employee also matches
this 4% yielding an 8% total contr
@n audrt report for a pnvate cllent rndrcates that the audrt was performed In accordance w1th
a Generally Accepted Audrtrng Standards
b Generally Accepted Accountrng pnncrples
c Standards of the PCAOB
d Generally accepted pnncrples of the PCAOB
An audrt r
3,76 J 4nd
For each of the following, please indicate on questions 36-45 of your scantron whether
the appropriate opinion should be:
e. Unmodied with an explanatory paragraph
1. You are unable to observe the
Daniel Robert Miller an CPA who had his CPA license revokes because he failed to prepare and
file both clients tax return, he failed to respond to the subpoena, he practiced public accountancy
PO = performance obligation
Exercise 52 1 PO, recognize revenue over time
Ski West should recognize revenue over the ski season. Ski West fulfills its
performance obligation over time as it delivers the s
Financial Reporting4 Items
1. Pension expense is reported as an operating expense.
2. PBO is not reported on the BSit is reported in the footnotes. This is part of the informal
record (not housed in account balances).
3. Pension fund assetsthe pension pla
This example is well worth spending the time to understand every aspect.
Full Example. This example illustrates all aspects of component 5 and also
reviews the entire pension accounting cycle with all its components, PBO and
assets. Some of the data is as
IMPORTANT ANNOUNCEMENT: Your text and these solutions use PBO and
Plan Assets as temporary accounts in the JEs. These accounts are then
closed to Pension Liability. In each solution below presenting a JE, you can
substitute Pension Liability for both PBO
What is a IMA?
Institute of Management Accountant.
What are the standard for IMA?
What is integrity?
Its the sections of the IMA Statements of Ethical Practice requires members to avoid
conflict of in
On January 1, 2016, Dreamworld Co. began construction of a new warehouse. The building was finished
and ready for use on September 30, 2017. Expenditures on the project were as follows:
January 1, 2016
September 1, 2016
December 31, 2016
March 31, 2017
Fellingham Corporation purchased equipment on January 1, 2014, for $276,000. The company estimated
the equipment would have a useful life of 10 years with a $16,000 residual value. Fellingham uses the
straight-line depreciation method. Early in 2016, Fell
Simpson and Homer Corporation acquired an office building on three acres of land for a lump-sum
price of $2,400,000. The building was completely furnished. According to independent appraisals,
the fair values were $1,300,000, $780,000, and $520,000 for th
Jung Inc. owns a patent for which it paid $77 million. At the end of 2016, it had accumulated amortization
on the patent of $15 million. Due to adverse economic conditions, Jung's management determined that it
should assess whether an impairment loss shou
On January 1, 2016, Kendall Inc. began construction of an automated cattle feeder system. The
system was finished and ready for use on September 30, 2017. Expenditures on the project were as
January 1, 2016
September 1, 2016
On June 1, 2015, the Crocus Company began construction of a new manufacturing plant. The plant
was completed on October 31, 2016. Expenditures on the project were as follows ($ in millions):
July 1, 2015
October 1, 2015
February 1, 2016
April 1, 2016
Chapter 7 Class Notes Accy 171
1) Realized Gain/Loss- Calculate net amount realized and adjusted basis
a) Sales Price Minus Selling expenses = Net Amount Realized then subtract the
adjusted basis= to get Gain or loss
i) Original basis (Cost) + additionals
1. A local firm sponsors a defined contribution pension plan for its
full-time employees. Under the plan, the firm is obligated to contribute an amount that matches the employees contribution up to
a maximum of 5% of gross salary. The firm has no responsi
1. A firm changed its method of patent amortization in the current year, and
also the estimated remaining economic life of affected patents. These
changes will cause: (1) a recasting of prior year financial statements shown
comparatively with the current
1. A firm sponsors a defined benefit pension plan that has been
covering its employees for decades. The most recent annual report shows a $40 million negative (debit) component in the footnote detailing the composition of the ending $94 net credit balance