2. Pablo purchased a lathe on January 1, 2009, at a cost of $45,000. At the time of purchase, the lathe was expected to have a five-year economic life and a residual value of $3,000. Pablo uses straight-line depreciation. At the beginning of 2011, Pablo estimated the
CORREC T 4. Jane purchased an annuity contract that pays her $800 per month. The annuity cost her $50,000 and it has an expected return of $100,000. How much of each monthly annuity payment is includible in Jane's gross income? Your Answer: $400 $440 $500 $0 5.
A company leases a machine on January 1, Year One for five years which call for annual payments of $4,000 for the first year and then $10,000 per year after that. The present value of these payments based on a reasonable interest rate of 10 percent is assumed to be $38,000. This lease
ACCT 324 Final Exam Solution https://hwguiders.com/downloads/acct-324-final-exam-solution/ ACCT 324 Final Exam Solution Question 1. (TCOs 2 & 3) Evelyn sold her personal residence to Drew on March 1 for $300,000. Before the sale, Evelyn paid the real estate taxes of $3,000 for the calendar year. For income tax purposes, the real estate tax deduction is apportioned as follows: $750 to Evelyn and $2,250 to Drew. Drew’s basis in the residence is: Question 2.
Calexico Hospital plans to invest $1.6 million in a new MRI machine. The MRI will be depreciated its 5-year economic life to a $200,000 salvage value. Additional revenues attributed to the new MRI will be in the amount of $1.5 million per year for 5 years. Additional operating expenses, excluding depreciation expense, will amount to $1 million per year for 5 years. Over the life of the machine, net working capital will increase by $30,000 over the life of the project.
Name:_______________ Part I Open-ended question (10 points; 20% of exam) ID:____________ For Quick Start the first month in business has ended. In the last days of December 2005, they already received contributed capital of € 6,000 and they obtained a five-year bank loan of € 24,000 at an annual rate of interest of 10 percent. Interest has to be paid each year on October 31. On December 31, 2005 various store equipment was purchased at a total cost of € 12,000, paid in cash. It is expected that the equipment has to be replaced after five years.
ACCT 311 Final Exam Solution https://hwguiders.com/downloads/acct-311-final-exam-solution/ ACCT 311 Final Exam Solution 1. XYZ Company sells appliance service contracts agreeing to repair appliances for a two-year period. XYZ’s past experience is that, of the total dollars spent for repairs on service contracts, 40% is incurred evenly during the first contract year and 60% evenly during the second contract year. Receipts from service contract sales for the two years ended December 31, year 2, are as follows: Year 1 | $500,000 | Year 2 | $600,000 | Receipts from contracts are credited to unearned service contract revenue. Assume that all contract sales are made evenly during the year.
This reduction is expected to be completed by January 31, 2012 and will approximately cost $3 million dollars. The cost of terminating employees shall not be recorded in the year ended December 31, 2011. ASC 420-10-25-4 says, “An arrangement for one-time employee termination benefits exists at the date the plan meets all of the following criteria and has been communicated to employees.” Following these guidelines we do not meet requirements, because we have not communicated to the employees the benefits they will receive upon termination and Pharma Co. hasn’t specified the job classification of the 120 employees. Otherwise, this cost will be recognized when incurred at fair
All sales are made on account at $20 per unit. Sixty percent of the sales are collected in the month of sale; the remaining 40% are collected in the following month. Forecasted sales for the first five months of 20X2 are: January, 1,500 units,- February, 1,600 units; March, 1,800 units; April, 2,000 units; May, 2,100 units. 2. Management wants to maintain the finished goods inventory at 30% of the following month's sales.
On March 31, 2011, Mary borrowed $200,000 to buy her principal residence. Mary paid 3 points to reduce her interest rate from 6 percent to 5 percent. The loan is for a 30-year period. What is Mary's 2011 deduction for her points paid? A.