1. A merchandising company incorrectly overstated its ending inventory 2 years ago. Inventory for all other periods is correctly
Since this is a correction error, this will be treated as a prior period adjustment and adjust it from the cur
For the year ended December 31, 20XX
Net sales revenue
Cost of Goods Sold
Less: Operating expenses
Total selling expenses
CA1-1 (FASB and Standard-Setting) Presented below are four statements which you are to
identify as true or false. If false, explain why the statement is false.
1. GAAP is the term used to indicate the whole body of FASB authoritative literature.
For the Year Ended December 31, 2012
Cost of goods sold
CA1-1 (FASB and Standard-Setting) Presented below are four statements which you are to identify as true or
false. If false, explain why the statement is false.
1. GAAP is the term used to indicate the whole body of FASB authoritative literature. True
Intermediate Accounting 1
January 22, 2007
Professor A. Wu
Questions Chapter 2
1. -What is a conceptual framework? Why is a conceptual framework
necessary in financial accounting?
A conceptual framework is coherent system of interre
Week 4 Assignment
E6-4 (Computation of Future Values and Present Values) Using the appropriate interest table,
answer the following questions. (Each case is independent of the others).
(a) What is the future value of 20 periodic payments of $
Acct 550 Chapter 10
BE10-3 Hanson Company (see BE10-2) borrowed $1,000,000 on March 1 on a 5-year, 12% note
to help finance construction of the building. In addition, the company had outstanding all year a
10%, 5-year, $2,000,000 note payable and an 11%,
BE11-10 In its 2011 annual report, Campbell Soup Company reports beginning-of-the-year total
assets of $6,276 million, end-of-the-year total assets of $6,862 million, total sales of $7,719
million, and net income of $805 million. (a) Compute Campbells ass
*BE11-11 Francis Corporation purchased an asset at a cost of $50,000 on March 1, 2014. The
asset has a useful life of 8 years and a salvage value of $4,000. For tax purposes, the MACRS
class life is 5 years. Compute tax depreciation for each year 20142019
BE11-7 Holt Company purchased a computer for $8,000 on January 1, 2013. Straight-line
depreciation is used, based on a 5-year life and a $1,000 salvage value. In 2015, the estimates are
revised. Holt now feels the computer will be used until December 31,
BE11-2 Lockard Company purchased machinery on January 1, 2014, for $80,000. The
machinery is estimated to have a salvage value of $8,000 after a useful life of 8 years. (a)
Compute 2014 depreciation expense using the straight-line method. (b) Compute 2014
Acct 550 Chapter 8 Discussion Question Page 451
Matlock Company uses a perpetual inventory system. Its beginning inventory consists of 50 units
that cost $34 each. During June, the company purchased 150 units at $34 each, returned 6 units
Compute the composite depreciation rate and the composite life of Dickinsons assets.
Salvage Est Useful Life Formula
BE6-1 Chris Spear invested $15,000 today in a fund that earns 8% compounded annually. To
what amount will the investment grow in 3 years? To what amount would the investment grow in
3 years if the fund earns 8% annual interest compounded semiannually?
ACCT 550 Chapter 8 page 506
BE9-3 Kumar Inc. uses a perpetual inventory system. At January 1, 2014, inventory was
$214,000 at both cost and market value. At December 31, 2014, the inventory was $286,000 at
cost and $265,000 at market value. Prepare the ne
BE11-4 Use the information for Lockard Company given in BE11-2. (a) Compute 2014
depreciation expense using the double-declining-balance method. (b) Compute 2014 depreciation
expense using the double-declining-balance method, assuming the machinery was pu
BE11-1 Fernandez Corporation purchased a truck at the beginning of 2014 for $50,000. The
truck is estimated to have a salvage value of $2,000 and a useful life of 160,000 miles. It was
driven 23,000 miles in 2014 and 31,000 miles in 2015. Compute deprecia
Expense recognition principle
Intangible assets are capitalized and amortized over periods benefite
Repair tools are expensed when purchased
Full disclosure principle
Financial information is presented so that investors wi
E6-5 (Computation of Present Value) Using the appropriate interest table, compute the
present values of the following periodic amounts due at the end of the designated periods.
(a) $30,000 receivable at the end of each period for 8 periods compounded at 1
Include. Title to merchandise passes to customer only when it is
Do not include. Title did not pass until January 3.
Include in inventory. Product belonged to Harlowe Inc. at December 31,
Do not include. Goods recei
What is the International Accounting Standards Board?
The IASB (International Accounting Standards Board) is the independent standard-setting body
of the IFRS Foundation.
The International Accounting Standards Board (IASB) and the Financial Accounting. St
(a) Identify the two committees of the AICPA that established accounting principles prior
to the establishment of the FASB.
The Committee on Accounting Procedure (CAP), created in 1939, and the Accounting
Principles Board (APB), created in 1959
BE2-12 Explain how you would decide whether to record each of the following
expenditures as an asset or
an expense. Assume all items are material.
(a)Legal fees paid in connection with the purchase of land are $1,500. These legal fees can be
a. Differentiate between financial accounting and managerial accounting.
Budgetary bookkeeping has its attention on the money related explanations which
are conveyed to stockholders, moneylenders, monetary experts, and others outside of
What are the benefits of Sarbanes Oxley?
*The officers of a company now have to adhere to a code of ethics. Some violations are
punishable as a crime. CFO and CEO are required to certify that financial statements and
documents are accurate an
(a) The economic activities of FedEx Corporation are divided into 12 month periods for
the purpose of issuing annual reports - Periodicity Assumption
(b) Solectron Corporation, Inc. does not adjust amounts in its financial statements for the