Question 1 Condensed financial data of Fairfield Company for 2010


Question Description:

35

please see attached assignment. lengthy and complicated. advise that you can meet deadline, it’s essential acct01.docx Question 1 Condensed financial data of Fairfield Company for 2010 and 2009 are presented below: Comparative Balance Sheet as at December 31, 2010 and 2009 Accounts Payable Accrued Liabilities Bonds Payable Capital Stock Retained Earnings 2010 $2,205 1,650 1,700 1,820 (1,200) 1,300 $7,475 2009 $1,215 1,400 1,800 1,700 (1,170) 1,470 $6,415 $1,250 150 1,450 1,910 2,715 $7,475 Cash Receivables Inventory Plant Assets Accumulated Depreciation Long-term investments (Held-to-Maturity) $800 300 1,600 1,700 2,015 $6,415 Income Statement For the year ended December 31, 2010 Sales Cost of goods sold Gross margin Selling and administrative expense Income from operations Gain on sale of investments Income before tax Income tax expense Net Income $8,000 5,700 2,300 880 1,420 80 1,500 600 900 Additional information: During the year common stock was issued for cash. No plant assets were sold in 2010. Cash dividends were $200. Required: (a) Prepare a statement of cash flows for 2010 using the indirect method. (b) Using the direct method, prepare the Operating Activities section of the statement of cash flows for 2010. 1 Question 2 Shamrock Company is involved in five separate industries. The following information is available for each of the five industries: Operating Segment Total Revenue Ohio Texas Iowa Delaware Nevada $18,100 $25,000 $35,000 $15,000 $90,000 $183,100 Operating Profit (Loss) ($2,100) ($1,500) $1,100 $1,800 $15,000 $14,300 Identifiable Assets $70,000 $160,000 $40,000 $15,000 $70,000 $355,000 Required: Determine which of the operating segments are reportable based on the: a.) Revenue test. b.) Operating profit (loss) test. c.) Identifiable assets test. d.) What are the benefits of disclosing financial results based on segments? e.) Shamrock is a US-based large accelerated filer who uses US GAAP. It also has non-affiliate-held equity securities valued at $3 billion. What year was Shamrock required to begin filing their financial statements with the SEC using XBRL? Question 3 – Week 1 (a) Company sells a machine for $6,500 under a 12-month warranty agreement that requires the company to replace all defective parts and to provide the repair labor at no cost to the customers. With sales being made evenly throughout the year, the company sells 600 machines in 2010 (warranty expense is incurred 30% in 2010, 20% in 2011 and 50% in 2012). As a result of product testing, the company estimates that the warranty cost is $400 per machine ($250 parts and $150 labor). Required: Assuming that actual warranty costs are incurred exactly as estimated, prepare the journal entries that would be made under application of the expense warranty accrual method for the following: i. Warranty costs incurred in 2010. ii. Warranty costs incurred in 2011. (b) Yellow Cab Co. began operations on January 2, 2010. It employs 15 drivers who work 8-hour days. Each employee earns 10 paid vacation days annually. Vacation days may be taken after January 10 of the year following the year in which they are earned. The average hourly wage rate was $28.00 in 2010 and $20.00 in 2011. The average vacation days used by each driver in 2011 was 8. Yellow Cab Co. accrues the cost of compensated absences at rates of pay in effect when earned. 2 Required: Prepare journal entries to record the transactions related to paid vacation days during 2010 and 2011. Question 4 XYZ Company is building a new baseball stadium at a cost of $5,000,000. It received a down payment of $3,000,000 from local businesses to support the project, and now needs to borrow $2,000,000 to complete the project. It therefore decides to issue $2,000,000 of 8%, 10-year bonds. These bonds were issued on January 1, 2010, and pay interest semi-annually on each January 1 and July 1, beginning 2010. The bonds yield 10%. Required: a) Prepare the journal entry to

Answer

35