ACC 291 Week 2: E8-3, BE9-13, 9-4, E9-9, E9-10 and P9-5A

ACC 291 Week 2: E8-3, BE9-13, 9-4, E9-9, E9-10 and P9-5A

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Updates: Updated for 2012-2013 Academic Year. WileyPLUS Answer Guide. 

Type: Instant Download

Format: Microsoft Excel

Textbook: Financial Accounting, Seventh Edition


BE9-13

Information related to plant assets, natural resources, and intangibles at the end of 2011 for Spain Company is as follows: buildings $1,100,000; accumulated depreciation—buildings $650,000; goodwill $410,000; coal mine $500,000; accumulated depletion—coal mine $108,000. Prepare a partial balance sheet of Spain Company for these items.

Classify long-lived assets on balance sheet.

Do It 9-4

Match the statement with the term most directly associated with it.

  1. Goodwill
  2. Intangible assets
  3. Research and development costs
  4. Amortization
  5. Franchise
  1. ______ Rights, privileges, and competitive advantages that result from the ownership of long-lived assets that do not possess physical substance.
  2. ______ The allocation of the cost of an intangible asset to expense in a rational and systematic manner.
  3. ______ A right to sell certain products or services, or use certain trademarks or trade names within a designated geographic area.
  4. ______ Costs incurred by a company that often lead to patents or new products. These costs must be expensed as incurred.
  5. ______ The excess of the cost of a company over the fair market value of the net assets acquired.

Match intangibles classifications concepts.

E9-9

Presented below are selected transactions at Ingles Company for 2011.

Jan. 1 Retired a piece of machinery that was purchased on January 1, 2001. The machine cost $62,000 on that date. It had a useful life of 10 years with no salvage value.
June 30 Sold a computer that was purchased on January 1, 2008. The computer cost $40,000. It had a useful life of 5 years with no salvage value. The computer was sold for $14,000.
Dec. 31 Discarded a delivery truck that was purchased on January 1, 2007. The truck cost $39,000. It was depreciated based on a 6-year useful life with a $3,000 salvage value.

Instructions

Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on assets disposed of. Ingles Company uses straight-line depreciation. (Assume depreciation is up to date as of December 31, 2010.)

E9-10

Beka Company owns equipment that cost $50,000 when purchased on January 1, 2008. It has been depreciated using the straight-line method based on estimated salvage value of $5,000 and an estimated useful life of 5 years.

Instructions

Prepare Beka Company’s journal entries to record the sale of the equipment in these four independent situations.

  1. Sold for $28,000 on January 1, 2011.
  2. Sold for $28,000 on May 1, 2011.
  3. Sold for $11,000 on January 1, 2011.
  4. Sold for $11,000 on October 1, 2011.

Journalize entries for disposal of equipment.

P9-5A

At December 31, 2011, Jimenez Company reported the following as plant assets.

Land   $ 4,000,000
Buildings $28,500,000  
Less: Accumulated depreciation—buildings 12,100,000 16,400,000
Equipment 48,000,000  
Less: Accumulated depreciation—equipment 5,000,000 43,000,000
Total plant assets   $63,400,000
 

During 2012, the following selected cash transactions occurred.

April 1 Purchased land for $2,130,000.
May 1 Sold equipment that cost $780,000 when purchased on January 1, 2008. The equipment was sold for $450,000.
June 1 Sold land purchased on June 1, 2002 for $1,500,000. The land cost $400,000.
July 1 Purchased equipment for $2,000,000.
Dec. 31 Retired equipment that cost $500,000 when purchased on December 31, 2002. No salvage value was received.

Journalize a series of equipment transactions related to purchase, sale, retirement, and depreciation.

(SO 3, 6, 9)

Instructions

  1. Journalize the above transactions. The company uses straight-line depreciation for buildings and equipment. The buildings are estimated to have a 50-year life and no salvage value. The equipment is estimated to have a 10-year useful life and no salvage value. Update depreciation on assets disposed of at the time of sale or retirement.
  2. Record adjusting entries for depreciation for 2012.(b) Depreciation Expense—building $570,000; equipment $4,772,000
  3. Prepare the plant assets section of Jimenez’s balance sheet at December 31, 2012.(c) Total plant assets $61,270,000

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