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1...Financial accounting.

Case study (Accounting questions) solution required for questions K, L and M regarding Chicago Corp ration Case at chapter 17, the case no is 10p in (Financial Accounting Book (14th Edition). i was able to find the case but there is no answers! I have attached the financials as PDF


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k. Give the journal entry that explains the change in the treasury shares during 2013. I. If the original acquisition cost of the patent is $1,250,000, and the firm amortizes that cost on a straight-line basis, how long before December 31. 2013, did the firm acquire the patent? m. Chicago Corporation acquired the stock of Hutchinson Company on December 31. 2012. If it held the same amount of stock during the year, but the amount represented only a 15% ownership of the Hutchinson Company, how would the financial state- ments have differed? Disregard income tax effects, and assume the market price of the shares exceeds their acquisition cost of $100,000 by $25,000 on December 31, 2013.

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Chicago Corporation EXHIBIT 17.11 Consolidated Statement of Income and Retained Earnings for 2013 (Problem 10) REVENUES Sales. . .. $13,920,000 Gain on Sale of Machinery and Equipment. . .. 200,000 Equity in Earnings of Affiliates: Chicago Finance Corporation . . $1,800,000 Rosenwald Company . 125,000 Hutchinson Company . . . . 75,000 2,000,000 Total Revenues . . . $16,120,000 EXPENSES Cost of Goods Sold . . . . . . .. $ 5,000,000 Employee Payroll Expense. . . 3,000,000 Depreciation of Plant and Equipment and Amortization of Leased Property Rights.. . . . . 1,000,000 Amortization of Patent . . 125,000 Bad Debt Expense . .. 120,000 Interest Expense . . .. . 455,000 General Corporate Expenses . .. 420,000 Income Taxes-Current 1,430,000 Income Taxes-Deferred. 170,000 Total Expenses . . $11,720,000 Net Income . . $ 4,400,000 Less: Dividends on Preferred Shares . (120,000) Dividends on Common Shares .. . . (2,080,000) Increase in Retained Earnings. . . . . . $ 2,200,000 Retained Earnings, December 31, 2012. . . . . .. 2,800,000 Retained Earnings, December 31, 2013. . . . . . . . . . .... ..... . $ 5,000,000 Basic Earnings per Common Share (Based on 1,600,000 Average Shares Outstanding). .... 2.68 Cengage Lea ming 201 4 Diluted Earnings per Share (Assuming Conversion of Preferred Stock) . ..... 2.20

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Chicago Corporation Consolidated Balance Sheets EXHIBIT 17.12 December 31 (Problem 10) December 31: 2013 2012 ASSETS Current Assets Cash . . . $ 100,000 $ 200,000 Certificate of Deposit. ... . .. . . . 225,000 Accounts Receivable (Net of Estimated Uncollectibles of $100,000 in 2012 and $160,000 in 2013) . .. . . . . . . . . 600,000 500,000 Merchandise Inventory. . . . . . . 1,800,000 1,500,000 Prepayments . . .. 200,000 200,000 Total Current Assets. . . $ 2,925,000 $ 2,400,000 Investments Chicago Finance Corporation (40% Owned) $ 4,000,000 $ 2,200,000 Rosenwald Company (50% Owned). . . 1,025,000 900,000 Hutchinson Company (25% Owned) . . 175,000 100,000 Total Investments . . . . . . . . . $ 5,200,000 $ 3,200,000 Property, Plant, and Equipment Land . . . . . 500,000 S 400,000 Building .. . ... 4,000,000 4,000,000 Machinery and Equipment. . . 8,000,000 7,300,000 Property Rights Acquired Under Lease 1,500,000 1,500,000 Total . . . .. . $14,000,000 $13,200,000 Less Accumulated Depreciation and Amortization. . (4,000,000) (3,800,000) Total Property, Plant, and Equipment . . . . . $10,000,000 $ 9,400,000 Intangibles (at Net Carrying Value) Patent. . . . . . $ 750,000 $ 875,000 Goodwill . . . . . . . . 1,125,000 1,125,000 Total Intangibles. . $ 1,875,000 $ 2,000,000 Total Assets . . $20,000,000 $17,000,000 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts Payable . . . 550,000 400,000 Advances from Customers. . 640,000 660,000 Salaries Payable . . .. 300,000 240,000 Income Taxes Payable . . . 430,000 300,000 Rent Received in Advance 50,000 Other Current Liabilities. 460,000 200,000 Total Current Liabilities . . $ 2,430,000 $ 1,800,000 Long-Term Debt

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Merchandise Inventory. . . . . . . 1,800,000 1,500,000 Prepayments . . 200,000 200,000 Total Current Assets. . . $ 2,925,000 $ 2,400,000 Investments Chicago Finance Corporation (40% Owned) . $ 4,000,000 $ 2,200,000 Rosenwald Company (50% Owned). . . .. 1,025,000 900,000 Hutchinson Company (25% Owned) . . . . . . 175,000 100,000 Total Investments . . .. . . $ 5,200,000 $ 3,200,000 Property, Plant, and Equipment Land . . . . . . . . . $ 500,000 $ 400,000 Building . . . . . . 4,000,000 4,000,000 Machinery and Equipment. . . . . 8,000,000 7,300,000 Property Rights Acquired Under Lease . . . 1,500,000 1,500,000 Total . ... $14,000,000 $13,200,000 Less Accumulated Depreciation and Amortization. (4,000,000) (3,800,000) Total Property, Plant, and Equipment . . .. $10,000,000 $ 9,400,000 Intangibles (at Net Carrying Value) Patent. . .. . $ 750,000 $ 875,000 Goodwill . . . . . . . 1,125,000 1,125,000 Total Intangibles. .. $ 1,875,000 $ 2,000,000 Total Assets . .. $20,000,000 $17,000,000 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts Payable . . $ 550,000 $ 400,000 Advances from Customers. . 640,000 660,000 Salaries Payable . . . . 300,000 240,000 Income Taxes Payable . . 430,000 300,000 Rent Received in Advance 50,000 Other Current Liabilities . . . 460,000 200,000 Total Current Liabilities . $ 2,430,000 $ 1,800,000 Long-Term Debt Bonds Payable .... .. $ 3,648,000 $ 3,600,000 Equipment Mortgage Indebtedness 332,000 1,300,000 Capitalized Lease Obligation . . .. 1,020,000 1,100,000 Total Long-Term Debt. . . $ 5,000,000 $ 6,000,000 Deferred Tax Liability. . $ 1,570,000 $ 1,400,000 Shareholders' Equity Convertible Preferred Stock. $ 2,000,000 $ 2,000,000 Common Stock . . . . . . 2,000,000 2,000,000 Additional Paid-In Capital 3,000,000 2,400,000 Retained Earnings . ... 5,000,000 2,800,000 Total . .. . . . . $12,000,000 $ 9,200,000 Less Cost of Treasury Shares . . (1,000,000) (1,400,000) Total Shareholders' Equity. . .. . . . . $11,000,000 $ 7,800,000 Total Liabilities and Shareholders' Equity $20,000,000 $17,000,000

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2.

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1 /1 ACCT 3101-02 Financial Accounting & Reporting Exam 2 Directions: Write your name, your student number, and the date in the top right comer of a blank sheet of paper. Use it as your answer sheet and record your answers to the following three multi-part questions. To earn credit, show your calculations and label each figure for your response to each question. When complete, take a picture of your answer sheet and upload it to the Exam 2 assignment drop box. I Question 1: Presented below is information for Dale Corporation at December 31, 2019, the end of its first year of operations: Sales revenue $310,000 Cost of Goods Sold 140.000 Selling & administrative 50,000 Gain on sale of plant assets 30,000 Unrealized gain on available-for-sale investments 10,000 Interest expense 6.000 Loss on discontinued operations 12.000 Dividends declared and paid 5,000 Ignoring income tax effects use the information above to compute the following: Gross profit b. Income from continuing operations c. Retained earnings balance at December 31, 2019 d. Comprehensive income Question 2: Use the appropriate PV/FV table to answer the following question. In addition to showing your calculations and labeling each figure, state which table you used. How much money will you have if you invest $5,500 at the end of each year at an 11% interest rate for 25 years? Question 3: Key&Co reported the following items in the most recently ended year Net Income $50,000 Dividends paid 4.000 5

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3.

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Adjusting Accounts for Financial Statements 03 E3-32. Preparing and Journalizing Adjusting Entries For each of the following separate situations, prepare the necessary adjustments (a) using the finan- Inc cial statement effects template, and (b) in journal entry form. 1. Unrecorded depreciation on equipment is $610. 2. On the date for preparing financial statements, an estimated utilities expense of $390 has been incurred, but no utility bill has yet been received or paid. 3. On the first day of the current period, rent for four periods was paid and recorded as a $2,800 debit to Prepaid Rent and a $2,800 credit to Cash. 4. Nine months ago, the Hartford Financial Services Group sold a one-year policy to a customer and recorded the receipt of the premium by debiting Cash for $624 and crediting Unearned Premium Revenue for $624. No adjusting entries have been prepared during the nine-month period. Hartford's annual financial statements are now being prepared. 5. At the end of the period, employee wages of $965 have been incurred but not yet paid or recorded. 6. At the end of the period, $300 of interest income has been earned but not yet received or recorded.

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4.

From the book financial accounting for undergraduates third edition problem problem P7-4A find the right answers for the red Xs:


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Bank Reconciliation On July 31, Sullivan Company's Cash in Bank account had a balance of $8,112.62. On that date. the bank statement Indicated a balance of $9.098.55. A comparison of returned checks and bank advices revealed the following: 1. Deposits in transit July 31 amounted to $3.358.19. 2. Outstanding checks July 31 totaled $1,251.12. 3. The bank erroneously charged a $215.00 check of Solomon Company against the sullivan bank account. 4. A $15 bank service charge has not yet been recorded by Sullivan Company. S. Sullivan neglected to record $3,000.00 borrowed from the bank on a ten percent six-month note. The bank statement shows the $3,000.00 as a deposit. 5. Included with the returned checks is a memo indicating that ]. Martin's check for $540,00 had been returned NSF, Martin, a customer, had sent the check to pay an account of $660.00 less a $20 discouril. 7. Sullivan Company recorded a $107,00 payment for repairs as $1.070.00 a. Prepare a bank reconciliation for Sullivan Company at July 31. b. Prepare the journal entry (or entries] necessary to bring the Cash In Bank account Into agreement with the reconciled cash balance on the bank reconciliation. SULLIVAN COMPANY Bank Reconciliation July 31 Ending balance from bank scacement # 9,090.55 Balance from general ledger 8,11262 Add: Deposits not credited by bank 3,358.15 Add Proceeds of note 3,000 Add: Rank error- Solomon Company check Check for $ 1,251-12 x charged against Sullivan Company's account 215 modedes$ 1251.12 x 12671.74 12,075 62 Less: Questanding checks 1,251.12 Less: Service charge 15 Less: NSF Check 640 RuLurilud cash bularks $ 11,420.02 Rucamaiud tarah balance 11,420.62 b GENERAL JOURNAL Date Description Debit Credit July 31 Cash in Bank 3,000 Neters Payal:lu 3,000 to record proceeds of note 31 Cash in Bark Repairs Expense 0 453 To correct recording of check. 31 Miscellaneous Expense # 15 Cash in Bank 15 To record service charge. 31 Accounts Receivable E40 % Sales Discounts X Cash in Bank To reclassify NSF check as an account receivable.

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