1. Make all 16 adjustments on the "Adjusting Journal Entries" tab. Remember to include a description under each journal entry. ABC Corporation Unadjusted Trial Balance December 31, 2014 Credit $ Debit 675,232 167,000 190,300 $ $ Cash Short term investments Fair value adjustment (Trading) Accounts receivable Allowance for doubtful accounts Inventory Purchases Prepaid insurance LT Debt) investments (HTM Land Building - Accumulated depreciation: building 3 Equipment Accumulated depreciation equipment Patent 1 Accounts payable 2 Notes payable 3 Income taxes payable 4 Unearned rent revenue 25 Bonds Payable 26 Premium on Bonds Pavable 350,000 24,600 177,824 75,000 150,000 4,000 60,000 20,000 37,500 75,240 235,000 63,800 36,000 800.000 61,771 86,000 13,000 49,000 41,000 892,945 Common stock PIC In Excess of Par-Common Stock Retained earnings Treasury stock 1 Dividends Sales Revenue 3 Advertising expense 4 Wages expense 5 Office expense 6 Amortization expense -7 Depreciation expense -8 Utilities expense 59 Insurance expense 0 Income taxes expense 11 8,400 67,600 21,700 24,000 31,000 73,800 63,800 2,287,756 $ 2,287,756 42 12 1 On March 1, ABC purchased a one-year liability insurance policy for $98,400 Upon purchase, the following journal entry was made Dr Prepaid insurance 98,400 Cr Cash 98,400 The expired portion of insurance must be recorded as of 12/31/14 Notice that the expired portion from March through November has been recorded already. Make sure that the Prepaid Insurance balance after the adjusting entry is correct 2 Depreciation expense must be recorded for the month of December The building was purchased with cash on Februay 1, 2014 for $150,000 with a remaining useful life of 30 years and a salvage value of $6.000 The method of depreciation for the building is straight-line. The equipment was purchased with cash on February 1, 2014 for $60,000 with a recuning useful life of 5 years and a salvage value of $3,000 The method of depreciation for the equipment is double-declining balance Depreciation has been recorded for the building and equipment for months February through November 3 On December 1, XYZ Co agreed to rent space in ABC's building for $12,000 per mouth, and XYZ paid ABC on December I in advance for the first three months' rent. The entry made on December 1 was as follows: D: Cash 36,000 Uneamed rest revenue 36,000 "The mearned revenue account must be adjusted to reflect the amount earned as of 12/31/14 4 Per timecards from the last payroll date through December 31 2014. ABC's employees have worked a total of 250 hours Including payroll taxes, ABC's wage expense aveorges about $51 per hour. The next payroll date is Jamuary 5, 2015 The lability for wages payable must be recorded as of 12/51/14 5 On November 30, 2014, ABC borrowed $235,000 from American National Bank by issuing an interest-bearing note payable. This loan is to be repaid in three months on February 28, 2015), along with interest computed at an annual rate of 6% The entry made on November 30 to record the borrowing was: (for Statement of Cash Flow purposes, consider a financing item) Dr Cash 235,000 Ce Notes payable 235,000 On February 28, 2015 ABC must pay the bank the amount bortowed plus interest. Assume the beginning balance for Notes Payable is correct Interest through 12/31/14 must be accrued on the $235,000 note 6 ABC uses a penodic aventory system, and the ending inventory for each year is determined by taking a complete physical inventory at year-end A plysical count was taken on December 31, 2014, and the inventory on-hand at that time totaled $75,000 which reflects historical cost Record the 2014 Cost of Goods Sold and the 12/31/14 Inventory adjustment Additionally, ABC adheres to GAAP by recording ending nventory at the lower of cost and net realizable value at a total inventory level A review of wventory data further indicated that the current retail sales value of the ending inventory is $110,000 and estimated costs of completion and slupping : 15% of retail Be sure to make an additional adjustment, if necessary, to properly value ending inventory uring the Loss and Allowance methodology For Income Statement presentation purposes, be sure to use the Lons Method for accounting for adjustments of inventory to market value 7 It would be unusual for a company to live an asset impautment in Yent i but for the sake of this example, ABC realized that their intangible asset might be uputed on December 31, 2014 Record the impairment if any The expected future net cash flows for this intangible asset totals 530,000, and the fair value of the asset is $27,500 8 On 7/1/14, ABC purchased 7,000 shares of its own stock from existing stockholders as treasury stock The cost of the treasury stock was $7 per share, or $49,000 in total. The effects of this transaction are already shown in the unadjusted trial balance. On 12/31/14, ABC teissued these 7,000 shares of treasury stock at $10 per share. Record the journal entry required for the reissuance of the treasury stock 9 On 12/31/14, ABC issued 5,000 shares of $3 par value common stock at the closing market price of $7 per share. Prepare ABC's journal entry to reflect the issuance of the stock on 12/31/14. 10 O. 7/1/14. ABC sold 12% bonds having a maturity value of $800,000 for $861,771, resulting in an effective yield of 10%. The bonds we dated 7/1/14, and mature 7/1/19. Interest is payable semiannually on July 1 and January 1 ABC uses the effective materest method of amortization for bond premium or discount Record the adjusting entry for the accrual of interest and the related amortization on 12/31/14 Hint Develop an abbreviated amortization schedule to accurately determine the interest expense 11 The following information is available for ABC Corporation at 12/31/14 regarding its investments in stocks of other companies Securities Cost Fr Value 2,200 shares of Toyota Corporation Common Stock $ 100,000 $125,000 1.100 shares of GM Corporation Common Stock $ 67.000 $ 34,000 S 167,000 $ 159.000 Prepare the adjusting entry (if any) for 2014, samning the secunties se classified as trading K M N A B D H 12 On 1/1/14, ABC Corporation purchased as a beld-10-maturity investmeat, $200,000 of the 85-yeat bonds of Intuit Corporation for $177824 which provides an 11% etun Prepae ABC, 12/31/14 journal entry to reflect the recept of an interest od discovet amortization Assume the bond investment pays interest wally on 12/31 each year and that effective interest motion is used Note Notice that count account is not uted for this etment. Therefore, for proposes of the actug enty, amortize the discount directly to the investment account 15 ABC Corporation propune og schedule on 12/31/14 that estimate total collectible neem $25.000 Arming the allowance method is wed prepare the entry to record bad debt espeare 14 On 1/1/14, ABC Corporation de concancelale lene for delivery vehicle. The one of the base called for ABC to Composition to make al payments of 510,503 st the beginning of each you, starting Jamry 1, 2014. The delivery vehicle bu sostiteoseful life of 6 yeus od 57.000 steed endal vloe. The delivery vehicle revests back to the lessons at the end of the lease term ABC Corporation the delivery vehicle ABC Corporation's cemental broccowing te is 10%, and the Lessor's implicit me know. No corries have yet been made conceming this lease arrangement. After determining the type of lease angement (fuancong or opera prepare the necesitple-putuna entry for 2014 for ABC Corporation. Hat You will need to compute the present value of the momente payments and 4 separate shentes for this lease traction Also, for Statement of Cash Flow paspores, the principal portion of lease pas e corectly eleganrednegaty) hy BIU-23 Es Merge Center $ % -88 Control Formulas Cal Formatting Table Styles Ste 5 Nigment bet H91 X D G H B M 15 ABC Corporation provides a defined benefit pension plan for its employees. A combination adpasting entry should be made to correctly account for this type of pensen plan green the following stems of information for the 2014 plsa year, including the recording of pension expense and the employer's contabution to the pension plan in 2014 Note: Use the ummy entry method us demonstrated and discussed in the chape lectures on pentine accounting to prepare the adjusting entry 103 104 1015 106 107 108 109 110 111 112 113 114 115 116 Pension asset/ability (aky !) 90 Actualan on planets $40.000 Expected retum og plan assets $20,000 Contributions (funding in 2014 $37,000 Per value of plan assets (December 31) $75,000 Settlement rate 10 Projected benefit obligation (Jamiary 1) 50 Service cont 560.000 Benefits paid in 2014 50 *For purposes official statement presentation, consider Pension Expenses operating iemand any resulting Pension Asset/ability as long terminatore 118 16 On December 31, 2014, ABC Corporation 1.000 suces of testocted stock to its Chef Fuel Officer ABC stock had falut (cloning market price of 510 pet share on December 31, 2014. Additional information is as follow 170 . The service pecorelated to the restricted stockis 2 years 121 b. Vesting or if the CFOs maith the company for two yest period 122 - The per valine of the common stock is preshare 123 Make the appropriate accounting atay n of the gut date, 12/31/14 Note use the alternative method as descabed in your textbook for defend compensation 124 125 Dehu atpelo popong the waterpt for the Team a line modele Blue In Tewanber te labeuta TE 126 17 Copocate teses se due in fou estimated quietly parust on April 15. June 15, September 15, and December 15 127 However, for the poses of this AHC doo, we will see the estanter se not pul and that the bus is paid in full 128 on the sunset 15, 2015 de dus 129 ABC colette is 04 The cote come to peor estimated at the beging of 2014 to be 509 400 130 through Norber com a pregaditeto $65.900/11/12 131 Sincesse estimates eo made in the year, the balance parable presents instructions Unadjusted Trial Balance Adjustments Needed Adjusting lournal Entries 1231-14 T.Accounts Adusted Twalance Income Statement 3 Type here to search O RE Do thus pofter popong the Income Statement expt for the Income taas lone (You need to calowate Income Before Income Tax in onder to malalte tatal In Tae Expense) 17 Corporate taxes are due in four estimated quarterly payments on April 15, June 15, September 15, and December 15. However, for the purposes of this ABC illustration, we wall assume that estimates are not paid, and that the tax is paid in full on the return's March 15, 2015 choe date ABC's income tax rate is 40%. The entire year's income tax expense was estimated at the beginning of 2014 to be $69,600, so January through November income tax expense recognized amounts to $63,800 (11/12 months) Since we are assuming estimates se sot made during the year the balance in Income taxes payable represents tact acerued for January through November. Assume no deferred tax assets or deferred tax liabilities Based on the income before income taxes figure from the income statement record December's come tax expense so that the entire year's total tas expense is correct ABC Corporation is a new company that buys and sells office supplies. Business began on January 1, 2014 Given on the first two tabs are ABCs 12/31/14 Uradjusted Teal Balance and a list of needed adjustments, 1. Make all 16 adjustments on the "Adjusting Journal Entries" tab. Remember to include a description under each journal entsy. = AC 323 Comprehensive Problem Spring 2021(0 (1) Protected View - out Formulas Data Review View Help rom the Internet can contain viet Unlets you need to edit afer to stay in Protected View Enable Editing A D 1 ABC Corporation Unadjusted Trial Balance 3 December 31, 2014 4 5 Debut Candel 6. Cal 5 675,232 7 Short term west 167.000 8 Feie vale apostment (Craig 9 Accounts recewable 190.300 10 Allowance for doubtful accounts 11 Inventory 12 Purchases 350.000 13 Prepaid cance 24600 14 LT Debt) investment (HTM 177824 15 Land 75.000 16 Holding 150.000 17 Aecamdated depreciation building 4.000 18 Et 60.000 19 Acuted deprecationequat 20.000 20 Patent 21. As parable 75.240 22. Notes parable 235,000 23 Incotes payable 4,000 20 Ured senter 36.000 25 Bonde Parable 800.000 26 Poo Beads Pyable 61,71 27 Come stock 36.000 28 PC in Estof Ps. Como Stock 13.000 29 de 30 Turystock 000 31 Desde 41000 12 Sites Per instructions Unadjusted Triat Balance Adjustments needed Ating our Ents ON O EP t Formulas Data Review View Help m the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View Enable Editing 1 2 3 ABC Corporation Unadjusted Trial Balance December 31, 2014 4 5 Debit Credit 6 Cash $ 675,232 7 Short term investments 167,000 8 Fair value adjustment (Trading) 9 Accounts receivable 190,300 10 Allowance for doubtful accounts $ 11 Inventory 12 Purchases 350,000 13 Prepaid insurance 24,600 14 LT (Debt) investments (HTM) 177,824 15 Land 75,000 16 Building 150.000 17 Accumulated depreciation building 4,000 18 Equipment 60,000 19 Accumulated depreciation: equpment 20.000 20 Patent 37.500 21 Accounts payable 75.240 22 Notes payable 235,000 23 Income taxes payable 63.800 24 Uneamed rent revenue 36,000 25 Bonds Payable 800.000 26 Premium on Bonds Payable 61.771 27 Common stock 86,000 28 PIC In Excess of Par-Common Stock 13.000 29 Retained earnings 30 Treasury stock +9.000 31 Dividends 41.000 32 Sales Revenue 592 945 Instructions Unadjusted Trial Balance Adjustments Needed Adjusting Jou 49,000 41,000 892,945 30 Treasury stock 31 Dividends 32 Sales Revenue 33 Advertising expense 34 Wages expense 35 Office expense 36 Amortization expense 37 Depreciation expense 38 Utilities expense 39 Insurance expense 40 Income taxes expense 41 8,400 67,600 21,700 24,000 31,000 73,800 63,800 $ 2,287,756 $ 2,287,756 42 43 Close Instructions Unadjusted Trial Balance Adjustments Needed Adjusting o search AC 323 Comprehensive Problem Soring 2023(1) (1) - Protected View Formulas Data Review View Help out from the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View. Enable Editing 1 2 3 4 5 6 A B D 1 On March 1, ABC purchased a one-year liability insurance policy for $98,400 Upon purchase the following journal entry was made De Prepaid insurance 98,100 C Cash 98,100 The expired portion of insurance must be recorded as of 12/31/14 Notice that the expired poction from March through November has been recorded already Make sure that the Prepaid Insurance balance after the adjusting cotry is correct 7 8 9 2 Deprecation expense must be recorded for the month of December The bulding was purchased with cash on February 1, 2014 for $150,000 with a remaining useful life of 30 years and a salvage value of $6,000 The method of depreciation for the building is straight-line The equipment was purchased with cash on February 12014 for $60,000 with a remaining useful life of 5 years and a salvage value of $3,000 The method of depreciation for the equipment is double-declining balance Depreciation has been recorded for the building and equpment for months February through November 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 20 30 3 On December 1, XYZ Co agreed to rent space in ABCs bulding for $12,000 per month, and XYZ paad ABC on December 1 in advance for the first three months' sent The entey made on December 1 was as follows: De Cash 36,000 CUeamed teot evene 36,000 The weared revenue account must be adjusted to retleet the amount eated as of 12/31/14 4 Per timecards, from the last payroll date through December 31, 2014, ABC's employees have worked a total of 250 hours. Including payroll taxes, ABC's wage expense averages about 551 pes hou The next payroll date is January 5, 2015 The liability for wages payable must be recorded as of 12/31/14 B D F 5 On November 30, 2014, ABC borrowed $235,000 from American National Bank by issuing an interest-bearing note payable. This loan is to be repaid in three months on February 28, 2015), along with interest computed at an annual rate of 6%. The entry made on November 30 to record the borrowing was (for Statement of Cash Flow purposes, consider a financing item) DCash 235,000 CNotes payable 235,000 On February 28, 2015 ABC must pay the bank the amount borrowed plus interest Assume the beginning balance for Notes Pavable is correct. Interest through 12/31/14 must be accrued on the $235.000 note, 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 6 ABC uses a periodic inventory system, and the ending inventory for each year is determined by taking a complete physical inventory at year-end A physical count was taken on December 31, 2014, and the inventory on-hand st that time totaled $75,000, which reflects historical cost Record the 2014 Cost of Goods Sold and the 12/31/14 Inventory acustment Additionally, ABC adheres to GAAP by recording ending inventory at the lower of cost and net realizable value at a total inventory level. A review of inventory data further indicated that the current retail sales value of the ending inventory is $110,000 and estimated costs of completion and shipping is 15% of retail. Be sure to make an additional adjustment, if necesary, to propedy value ending wventory tising the Loss and Allowance methodology. For Income Statement presentation purposes, be sure to use the Lost Method for accounting for adjustments of inventory to market value 52 53 54 55 56 57 7 It would be used for a company to have an asset impairment in Year 1, but for the sake of this example, ABC realised that their intangible asset might be impaired on December 31, 2014 Record the impament if any. The expected future net cash flows for this intangible asset totals $30,000, and the fait value of the asset is $27.500 A D G H - 58 fo 8 On 7/1/14, ABC purchased 7000 shares of its own stock from existing stockholders as treasury stock The cost of the texty stock was 57 per shume, $19.000 in total The effects of this transaction are already shown in the nad tested toalbulance On 12/31/14, ABC trunced these 7,000 shares of travery stock at $10 per share. Record the oturnal moty Brquted for the restance of the treasury stock 2021 63 61 90. 12/31/14, ABC med 5,000 shares of $3 per valor common Hock at the closing market poice of 57 per lunce. Prepare ABC's yournal entry to reflect the stance of the stock on 12/31/14 65 66 10 0 7/1/14, ABC od 12% bonds having mataoty valoe of $800,000 for $861,771, tenulting so effective yeld of 10%. The bonds ate dated 7/1/14, and motore 7/1/19 Interest in payable ennully on July 1 and Jay 1 ABC use the effective interest method of sociation for bood premom ordneount Record the adjusting coty for the secraal of interest and the related mortation on 12/31/14 Hint Develop an abbreviated amortization schedule to setely determine the interest expense 68 69 70 71 72 73 74 75 16 77 78 79 11 The following information wulable for ABC Corporation at 12/31/14 coading es wwestments in stocks of other companies Secco Cost Far Valur 2.200 shares of Toyota Corportion Common Stock $ 100,000 $125,000 1 100 slutes of GM Corporation Common Stock $ 67 0005 34.000 $ 167.000 $ 159.000 Prepare the openbay Gif say) fos 2014g the secuies we clavified as weling 80 81 82 84 85 86 87 12 01/1/14 ABC Corporation pricehased, held to stotywestret, $200.000 of the 8 .year boods of Laut Cocpocoon for $177824 which provides o 119 return Prepare ABC 12/31/14 jounalty to reflect the receipt of Anul interest and discount amortization Assume the bood reste passen alle on 12/31 machen od that effective interest mortization is and Note Notice that decout accomo ured for this lavestment. Therefore, for puposes of the dustig entry, amortize the discount duectly to the vesticut account ecovery e following tiles hon 89 SO 31 15 AUC C portreedelem 12/31/14htestates total collectible 35.000 Ansuring that the allowance medias prepare the way to recordad del expense michas 3 1401/1/14ABC Copeyen mellem deneywell The team of de les called for ABC Caption to make 23 de pays of 310,50 m the beau of each you, Munge 2014 The delivery well and beyond. 7.000 96 nganteed sidual value The delivery vebete eest tek tada del of belewem ABC Copertinam 93 that deres velle ABC Corpool becoming and the Laod's plea No entie I made coming this wegen Afre de the people get ople pentrum tyfer 2014 ABC Cachos Yes will be complete pe value of the minimub for 100 this feet Alue for Sent of Cash Flow pupeen the peopl pain of repenent de conected fantactivity) 101 102 301) ADC Coppede ele fois comployees in my make comedy me for this type 304 plus en the following dient of infomation for the 2014 play, the song of printemployer's contemplia 2014 TOS Note Use the ummary try ched in demored odced in the chapelet pestice coppe de distinct 106 Pentakty 10 100 Mrsal $10.000 100 Bepple $20.000 110 Contribution 2014 17.000 111 Prof December 31 375.000 132 Senentate IN 111 Dreated this doma ) $0 $60.000 115 Budin 2014 50 116 Fewpoint of fait preceder Peppemand way my long 102 114 11 118 16 On Dec 31, 2014. ABC Corporate med 100 share of costrettock Claelusal Ofte ABC och land for valued 110 $10 per she Deceber 31, 2016 Addo follow 120 The service pelated to the years 121 Veccon if the CFOyst the company for torrar pered 122 The pa value of the cock spet 123 Mate the protecting stays of the gradu, 12/31/14 Note use the weed described in your textbook for delived camp 124 125 De Mewtwo Mewwwwwwwwwwwwww telewTE 126 17 Copie dhe informed tedy puncan Apol 15 Jue 1) September 15, wd Decibec 15 227 Home for the purpose of this ABC, we will see that we got pail, od the two poinfall other's March 2015 dodir ARCS 10 The entire was takespeone with bref 2014 to be 500.00 130 om the Norwegian so 565,300 (11/12 mooth Seget made in the you, the bloce in conta peable spesete icensed for a longh Norbet A deed sets or deferred to be 133 Bandog the con bloc cfarlion the counted December cespeare 134 No hit the rolepti 135 Instruction adjustod Trillance Adjustments Needed Acutting lournal intre 12-31-14 Accounts Alised anta CH 1. Make all 16 adjustments on the "Adjusting Journal Entries" tab. Remember to include a description under each journal entry. ABC Corporation Unadjusted Trial Balance December 31, 2014 Credit $ Debit 675,232 167,000 190,300 $ $ Cash Short term investments Fair value adjustment (Trading) Accounts receivable Allowance for doubtful accounts Inventory Purchases Prepaid insurance LT Debt) investments (HTM Land Building - Accumulated depreciation: building 3 Equipment Accumulated depreciation equipment Patent 1 Accounts payable 2 Notes payable 3 Income taxes payable 4 Unearned rent revenue 25 Bonds Payable 26 Premium on Bonds Pavable 350,000 24,600 177,824 75,000 150,000 4,000 60,000 20,000 37,500 75,240 235,000 63,800 36,000 800.000 61,771 86,000 13,000 49,000 41,000 892,945 Common stock PIC In Excess of Par-Common Stock Retained earnings Treasury stock 1 Dividends Sales Revenue 3 Advertising expense 4 Wages expense 5 Office expense 6 Amortization expense -7 Depreciation expense -8 Utilities expense 59 Insurance expense 0 Income taxes expense 11 8,400 67,600 21,700 24,000 31,000 73,800 63,800 2,287,756 $ 2,287,756 42 12 1 On March 1, ABC purchased a one-year liability insurance policy for $98,400 Upon purchase, the following journal entry was made Dr Prepaid insurance 98,400 Cr Cash 98,400 The expired portion of insurance must be recorded as of 12/31/14 Notice that the expired portion from March through November has been recorded already. Make sure that the Prepaid Insurance balance after the adjusting entry is correct 2 Depreciation expense must be recorded for the month of December The building was purchased with cash on Februay 1, 2014 for $150,000 with a remaining useful life of 30 years and a salvage value of $6.000 The method of depreciation for the building is straight-line. The equipment was purchased with cash on February 1, 2014 for $60,000 with a recuning useful life of 5 years and a salvage value of $3,000 The method of depreciation for the equipment is double-declining balance Depreciation has been recorded for the building and equipment for months February through November 3 On December 1, XYZ Co agreed to rent space in ABC's building for $12,000 per mouth, and XYZ paid ABC on December I in advance for the first three months' rent. The entry made on December 1 was as follows: D: Cash 36,000 Uneamed rest revenue 36,000 "The mearned revenue account must be adjusted to reflect the amount earned as of 12/31/14 4 Per timecards from the last payroll date through December 31 2014. ABC's employees have worked a total of 250 hours Including payroll taxes, ABC's wage expense aveorges about $51 per hour. The next payroll date is Jamuary 5, 2015 The lability for wages payable must be recorded as of 12/51/14 5 On November 30, 2014, ABC borrowed $235,000 from American National Bank by issuing an interest-bearing note payable. This loan is to be repaid in three months on February 28, 2015), along with interest computed at an annual rate of 6% The entry made on November 30 to record the borrowing was: (for Statement of Cash Flow purposes, consider a financing item) Dr Cash 235,000 Ce Notes payable 235,000 On February 28, 2015 ABC must pay the bank the amount bortowed plus interest. Assume the beginning balance for Notes Payable is correct Interest through 12/31/14 must be accrued on the $235,000 note 6 ABC uses a penodic aventory system, and the ending inventory for each year is determined by taking a complete physical inventory at year-end A plysical count was taken on December 31, 2014, and the inventory on-hand at that time totaled $75,000 which reflects historical cost Record the 2014 Cost of Goods Sold and the 12/31/14 Inventory adjustment Additionally, ABC adheres to GAAP by recording ending nventory at the lower of cost and net realizable value at a total inventory level A review of wventory data further indicated that the current retail sales value of the ending inventory is $110,000 and estimated costs of completion and slupping : 15% of retail Be sure to make an additional adjustment, if necessary, to properly value ending inventory uring the Loss and Allowance methodology For Income Statement presentation purposes, be sure to use the Lons Method for accounting for adjustments of inventory to market value 7 It would be unusual for a company to live an asset impautment in Yent i but for the sake of this example, ABC realized that their intangible asset might be uputed on December 31, 2014 Record the impairment if any The expected future net cash flows for this intangible asset totals 530,000, and the fair value of the asset is $27,500 8 On 7/1/14, ABC purchased 7,000 shares of its own stock from existing stockholders as treasury stock The cost of the treasury stock was $7 per share, or $49,000 in total. The effects of this transaction are already shown in the unadjusted trial balance. On 12/31/14, ABC teissued these 7,000 shares of treasury stock at $10 per share. Record the journal entry required for the reissuance of the treasury stock 9 On 12/31/14, ABC issued 5,000 shares of $3 par value common stock at the closing market price of $7 per share. Prepare ABC's journal entry to reflect the issuance of the stock on 12/31/14. 10 O. 7/1/14. ABC sold 12% bonds having a maturity value of $800,000 for $861,771, resulting in an effective yield of 10%. The bonds we dated 7/1/14, and mature 7/1/19. Interest is payable semiannually on July 1 and January 1 ABC uses the effective materest method of amortization for bond premium or discount Record the adjusting entry for the accrual of interest and the related amortization on 12/31/14 Hint Develop an abbreviated amortization schedule to accurately determine the interest expense 11 The following information is available for ABC Corporation at 12/31/14 regarding its investments in stocks of other companies Securities Cost Fr Value 2,200 shares of Toyota Corporation Common Stock $ 100,000 $125,000 1.100 shares of GM Corporation Common Stock $ 67.000 $ 34,000 S 167,000 $ 159.000 Prepare the adjusting entry (if any) for 2014, samning the secunties se classified as trading K M N A B D H 12 On 1/1/14, ABC Corporation purchased as a beld-10-maturity investmeat, $200,000 of the 85-yeat bonds of Intuit Corporation for $177824 which provides an 11% etun Prepae ABC, 12/31/14 journal entry to reflect the recept of an interest od discovet amortization Assume the bond investment pays interest wally on 12/31 each year and that effective interest motion is used Note Notice that count account is not uted for this etment. Therefore, for proposes of the actug enty, amortize the discount directly to the investment account 15 ABC Corporation propune og schedule on 12/31/14 that estimate total collectible neem $25.000 Arming the allowance method is wed prepare the entry to record bad debt espeare 14 On 1/1/14, ABC Corporation de concancelale lene for delivery vehicle. The one of the base called for ABC to Composition to make al payments of 510,503 st the beginning of each you, starting Jamry 1, 2014. The delivery vehicle bu sostiteoseful life of 6 yeus od 57.000 steed endal vloe. The delivery vehicle revests back to the lessons at the end of the lease term ABC Corporation the delivery vehicle ABC Corporation's cemental broccowing te is 10%, and the Lessor's implicit me know. No corries have yet been made conceming this lease arrangement. After determining the type of lease angement (fuancong or opera prepare the necesitple-putuna entry for 2014 for ABC Corporation. Hat You will need to compute the present value of the momente payments and 4 separate shentes for this lease traction Also, for Statement of Cash Flow paspores, the principal portion of lease pas e corectly eleganrednegaty) hy BIU-23 Es Merge Center $ % -88 Control Formulas Cal Formatting Table Styles Ste 5 Nigment bet H91 X D G H B M 15 ABC Corporation provides a defined benefit pension plan for its employees. A combination adpasting entry should be made to correctly account for this type of pensen plan green the following stems of information for the 2014 plsa year, including the recording of pension expense and the employer's contabution to the pension plan in 2014 Note: Use the ummy entry method us demonstrated and discussed in the chape lectures on pentine accounting to prepare the adjusting entry 103 104 1015 106 107 108 109 110 111 112 113 114 115 116 Pension asset/ability (aky !) 90 Actualan on planets $40.000 Expected retum og plan assets $20,000 Contributions (funding in 2014 $37,000 Per value of plan assets (December 31) $75,000 Settlement rate 10 Projected benefit obligation (Jamiary 1) 50 Service cont 560.000 Benefits paid in 2014 50 *For purposes official statement presentation, consider Pension Expenses operating iemand any resulting Pension Asset/ability as long terminatore 118 16 On December 31, 2014, ABC Corporation 1.000 suces of testocted stock to its Chef Fuel Officer ABC stock had falut (cloning market price of 510 pet share on December 31, 2014. Additional information is as follow 170 . The service pecorelated to the restricted stockis 2 years 121 b. Vesting or if the CFOs maith the company for two yest period 122 - The per valine of the common stock is preshare 123 Make the appropriate accounting atay n of the gut date, 12/31/14 Note use the alternative method as descabed in your textbook for defend compensation 124 125 Dehu atpelo popong the waterpt for the Team a line modele Blue In Tewanber te labeuta TE 126 17 Copocate teses se due in fou estimated quietly parust on April 15. June 15, September 15, and December 15 127 However, for the poses of this AHC doo, we will see the estanter se not pul and that the bus is paid in full 128 on the sunset 15, 2015 de dus 129 ABC colette is 04 The cote come to peor estimated at the beging of 2014 to be 509 400 130 through Norber com a pregaditeto $65.900/11/12 131 Sincesse estimates eo made in the year, the balance parable presents instructions Unadjusted Trial Balance Adjustments Needed Adjusting lournal Entries 1231-14 T.Accounts Adusted Twalance Income Statement 3 Type here to search O RE Do thus pofter popong the Income Statement expt for the Income taas lone (You need to calowate Income Before Income Tax in onder to malalte tatal In Tae Expense) 17 Corporate taxes are due in four estimated quarterly payments on April 15, June 15, September 15, and December 15. However, for the purposes of this ABC illustration, we wall assume that estimates are not paid, and that the tax is paid in full on the return's March 15, 2015 choe date ABC's income tax rate is 40%. The entire year's income tax expense was estimated at the beginning of 2014 to be $69,600, so January through November income tax expense recognized amounts to $63,800 (11/12 months) Since we are assuming estimates se sot made during the year the balance in Income taxes payable represents tact acerued for January through November. Assume no deferred tax assets or deferred tax liabilities Based on the income before income taxes figure from the income statement record December's come tax expense so that the entire year's total tas expense is correct ABC Corporation is a new company that buys and sells office supplies. Business began on January 1, 2014 Given on the first two tabs are ABCs 12/31/14 Uradjusted Teal Balance and a list of needed adjustments, 1. Make all 16 adjustments on the "Adjusting Journal Entries" tab. Remember to include a description under each journal entsy. = AC 323 Comprehensive Problem Spring 2021(0 (1) Protected View - out Formulas Data Review View Help rom the Internet can contain viet Unlets you need to edit afer to stay in Protected View Enable Editing A D 1 ABC Corporation Unadjusted Trial Balance 3 December 31, 2014 4 5 Debut Candel 6. Cal 5 675,232 7 Short term west 167.000 8 Feie vale apostment (Craig 9 Accounts recewable 190.300 10 Allowance for doubtful accounts 11 Inventory 12 Purchases 350.000 13 Prepaid cance 24600 14 LT Debt) investment (HTM 177824 15 Land 75.000 16 Holding 150.000 17 Aecamdated depreciation building 4.000 18 Et 60.000 19 Acuted deprecationequat 20.000 20 Patent 21. As parable 75.240 22. Notes parable 235,000 23 Incotes payable 4,000 20 Ured senter 36.000 25 Bonde Parable 800.000 26 Poo Beads Pyable 61,71 27 Come stock 36.000 28 PC in Estof Ps. Como Stock 13.000 29 de 30 Turystock 000 31 Desde 41000 12 Sites Per instructions Unadjusted Triat Balance Adjustments needed Ating our Ents ON O EP t Formulas Data Review View Help m the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View Enable Editing 1 2 3 ABC Corporation Unadjusted Trial Balance December 31, 2014 4 5 Debit Credit 6 Cash $ 675,232 7 Short term investments 167,000 8 Fair value adjustment (Trading) 9 Accounts receivable 190,300 10 Allowance for doubtful accounts $ 11 Inventory 12 Purchases 350,000 13 Prepaid insurance 24,600 14 LT (Debt) investments (HTM) 177,824 15 Land 75,000 16 Building 150.000 17 Accumulated depreciation building 4,000 18 Equipment 60,000 19 Accumulated depreciation: equpment 20.000 20 Patent 37.500 21 Accounts payable 75.240 22 Notes payable 235,000 23 Income taxes payable 63.800 24 Uneamed rent revenue 36,000 25 Bonds Payable 800.000 26 Premium on Bonds Payable 61.771 27 Common stock 86,000 28 PIC In Excess of Par-Common Stock 13.000 29 Retained earnings 30 Treasury stock +9.000 31 Dividends 41.000 32 Sales Revenue 592 945 Instructions Unadjusted Trial Balance Adjustments Needed Adjusting Jou 49,000 41,000 892,945 30 Treasury stock 31 Dividends 32 Sales Revenue 33 Advertising expense 34 Wages expense 35 Office expense 36 Amortization expense 37 Depreciation expense 38 Utilities expense 39 Insurance expense 40 Income taxes expense 41 8,400 67,600 21,700 24,000 31,000 73,800 63,800 $ 2,287,756 $ 2,287,756 42 43 Close Instructions Unadjusted Trial Balance Adjustments Needed Adjusting o search AC 323 Comprehensive Problem Soring 2023(1) (1) - Protected View Formulas Data Review View Help out from the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View. Enable Editing 1 2 3 4 5 6 A B D 1 On March 1, ABC purchased a one-year liability insurance policy for $98,400 Upon purchase the following journal entry was made De Prepaid insurance 98,100 C Cash 98,100 The expired portion of insurance must be recorded as of 12/31/14 Notice that the expired poction from March through November has been recorded already Make sure that the Prepaid Insurance balance after the adjusting cotry is correct 7 8 9 2 Deprecation expense must be recorded for the month of December The bulding was purchased with cash on February 1, 2014 for $150,000 with a remaining useful life of 30 years and a salvage value of $6,000 The method of depreciation for the building is straight-line The equipment was purchased with cash on February 12014 for $60,000 with a remaining useful life of 5 years and a salvage value of $3,000 The method of depreciation for the equipment is double-declining balance Depreciation has been recorded for the building and equpment for months February through November 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 20 30 3 On December 1, XYZ Co agreed to rent space in ABCs bulding for $12,000 per month, and XYZ paad ABC on December 1 in advance for the first three months' sent The entey made on December 1 was as follows: De Cash 36,000 CUeamed teot evene 36,000 The weared revenue account must be adjusted to retleet the amount eated as of 12/31/14 4 Per timecards, from the last payroll date through December 31, 2014, ABC's employees have worked a total of 250 hours. Including payroll taxes, ABC's wage expense averages about 551 pes hou The next payroll date is January 5, 2015 The liability for wages payable must be recorded as of 12/31/14 B D F 5 On November 30, 2014, ABC borrowed $235,000 from American National Bank by issuing an interest-bearing note payable. This loan is to be repaid in three months on February 28, 2015), along with interest computed at an annual rate of 6%. The entry made on November 30 to record the borrowing was (for Statement of Cash Flow purposes, consider a financing item) DCash 235,000 CNotes payable 235,000 On February 28, 2015 ABC must pay the bank the amount borrowed plus interest Assume the beginning balance for Notes Pavable is correct. Interest through 12/31/14 must be accrued on the $235.000 note, 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 6 ABC uses a periodic inventory system, and the ending inventory for each year is determined by taking a complete physical inventory at year-end A physical count was taken on December 31, 2014, and the inventory on-hand st that time totaled $75,000, which reflects historical cost Record the 2014 Cost of Goods Sold and the 12/31/14 Inventory acustment Additionally, ABC adheres to GAAP by recording ending inventory at the lower of cost and net realizable value at a total inventory level. A review of inventory data further indicated that the current retail sales value of the ending inventory is $110,000 and estimated costs of completion and shipping is 15% of retail. Be sure to make an additional adjustment, if necesary, to propedy value ending wventory tising the Loss and Allowance methodology. For Income Statement presentation purposes, be sure to use the Lost Method for accounting for adjustments of inventory to market value 52 53 54 55 56 57 7 It would be used for a company to have an asset impairment in Year 1, but for the sake of this example, ABC realised that their intangible asset might be impaired on December 31, 2014 Record the impament if any. The expected future net cash flows for this intangible asset totals $30,000, and the fait value of the asset is $27.500 A D G H - 58 fo 8 On 7/1/14, ABC purchased 7000 shares of its own stock from existing stockholders as treasury stock The cost of the texty stock was 57 per shume, $19.000 in total The effects of this transaction are already shown in the nad tested toalbulance On 12/31/14, ABC trunced these 7,000 shares of travery stock at $10 per share. Record the oturnal moty Brquted for the restance of the treasury stock 2021 63 61 90. 12/31/14, ABC med 5,000 shares of $3 per valor common Hock at the closing market poice of 57 per lunce. Prepare ABC's yournal entry to reflect the stance of the stock on 12/31/14 65 66 10 0 7/1/14, ABC od 12% bonds having mataoty valoe of $800,000 for $861,771, tenulting so effective yeld of 10%. The bonds ate dated 7/1/14, and motore 7/1/19 Interest in payable ennully on July 1 and Jay 1 ABC use the effective interest method of sociation for bood premom ordneount Record the adjusting coty for the secraal of interest and the related mortation on 12/31/14 Hint Develop an abbreviated amortization schedule to setely determine the interest expense 68 69 70 71 72 73 74 75 16 77 78 79 11 The following information wulable for ABC Corporation at 12/31/14 coading es wwestments in stocks of other companies Secco Cost Far Valur 2.200 shares of Toyota Corportion Common Stock $ 100,000 $125,000 1 100 slutes of GM Corporation Common Stock $ 67 0005 34.000 $ 167.000 $ 159.000 Prepare the openbay Gif say) fos 2014g the secuies we clavified as weling 80 81 82 84 85 86 87 12 01/1/14 ABC Corporation pricehased, held to stotywestret, $200.000 of the 8 .year boods of Laut Cocpocoon for $177824 which provides o 119 return Prepare ABC 12/31/14 jounalty to reflect the receipt of Anul interest and discount amortization Assume the bood reste passen alle on 12/31 machen od that effective interest mortization is and Note Notice that decout accomo ured for this lavestment. Therefore, for puposes of the dustig entry, amortize the discount duectly to the vesticut account ecovery e following tiles hon 89 SO 31 15 AUC C portreedelem 12/31/14htestates total collectible 35.000 Ansuring that the allowance medias prepare the way to recordad del expense michas 3 1401/1/14ABC Copeyen mellem deneywell The team of de les called for ABC Caption to make 23 de pays of 310,50 m the beau of each you, Munge 2014 The delivery well and beyond. 7.000 96 nganteed sidual value The delivery vebete eest tek tada del of belewem ABC Copertinam 93 that deres velle ABC Corpool becoming and the Laod's plea No entie I made coming this wegen Afre de the people get ople pentrum tyfer 2014 ABC Cachos Yes will be complete pe value of the minimub for 100 this feet Alue for Sent of Cash Flow pupeen the peopl pain of repenent de conected fantactivity) 101 102 301) ADC Coppede ele fois comployees in my make comedy me for this type 304 plus en the following dient of infomation for the 2014 play, the song of printemployer's contemplia 2014 TOS Note Use the ummary try ched in demored odced in the chapelet pestice coppe de distinct 106 Pentakty 10 100 Mrsal $10.000 100 Bepple $20.000 110 Contribution 2014 17.000 111 Prof December 31 375.000 132 Senentate IN 111 Dreated this doma ) $0 $60.000 115 Budin 2014 50 116 Fewpoint of fait preceder Peppemand way my long 102 114 11 118 16 On Dec 31, 2014. ABC Corporate med 100 share of costrettock Claelusal Ofte ABC och land for valued 110 $10 per she Deceber 31, 2016 Addo follow 120 The service pelated to the years 121 Veccon if the CFOyst the company for torrar pered 122 The pa value of the cock spet 123 Mate the protecting stays of the gradu, 12/31/14 Note use the weed described in your textbook for delived camp 124 125 De Mewtwo Mewwwwwwwwwwwwww telewTE 126 17 Copie dhe informed tedy puncan Apol 15 Jue 1) September 15, wd Decibec 15 227 Home for the purpose of this ABC, we will see that we got pail, od the two poinfall other's March 2015 dodir ARCS 10 The entire was takespeone with bref 2014 to be 500.00 130 om the Norwegian so 565,300 (11/12 mooth Seget made in the you, the bloce in conta peable spesete icensed for a longh Norbet A deed sets or deferred to be 133 Bandog the con bloc cfarlion the counted December cespeare 134 No hit the rolepti 135 Instruction adjustod Trillance Adjustments Needed Acutting lournal intre 12-31-14 Accounts Alised anta CH