Answered step by step
Verified Expert Solution
Question
1 Approved Answer
answer asap, will leave thumbs up and positive feedback Cathy Company began construction on a new reginal office building on January 1, 2021. The building
answer asap, will leave thumbs up and positive feedback
Cathy Company began construction on a new reginal office building on January 1, 2021. The building was finished and ready for use on December 31, 2021. During 2021, Cathy spent $5,000,000 on the building as follows: Date Amount 1/1/2021 $2,000,000 7/1/2021 $3,000,000 Cathy had $10 million in 9% bonds outstanding throughout 2021. Cathy had no other debt. What should Cathy report as interest expense on its income statement for 2021? $900,000 O $0 O $315,000 $450,000 O $585,000 Cathy Company is a pharmaceutical company. The grid below is a list of possible effects on the Income Statement and the Balance Sheet. The code is: + increase; decrease; NE = no effect. --= Revenue/Gain Expense/Loss Net Income Assets Liabilities Equity 1. NE +100 --100 +50 +150 --100 11. NE NE NE +150 +150 NE III. NE +150 --150 NE +150 --150 IV. NE NE NE NE NE NE V. NE +50 --50 +100 +150 --50 Match the effect that the saction below would have on Cathy Company's Income Statement and Balance Sheet. Choose (I), (II), (III), (IV), br (V) from the grid. For example, if the transaction were "Collected cash on accounts receivable," the correct answer would be (IV) because there is no effect on revenue, expense, net income, overall assets, liabilities, or equity. Transaction: Purchased a patent for $50 and incurred research and development costs of $100. The total cost of $150 was put on account. Ignore any amortization. OI OV ON ||| 11 Cathy Company is a pharmaceutical company. The grid below is a list of possible effects on the Income Statement and the Balance Sheet. The code is: += increase; -= decrease; NE = no effect. Revenue/Gain Liabilities. Equity Expense/Loss +20 Net Income --20 Assets --20 1. NE NE --20 11. NE +400 --400 --400 NE --400 III. NE +80 --80 --80 NE --80 IV. NE NE NE NE NE NE V. NE +80 --80 NE +80 -80 Match the effect that the transaction below would have on Cathy Company's Income Statement and Balance Sheet. Choose (I), (II), (IN), (IV), or (V) from the grid. For example, if the transaction were "Collected cash on accounts receivable," the correct answer would be (IV) because there is no effect on revenue, expense, net income, overall assets, liabilities, or equity. Transaction: On 12/31, Cathy recorded one year of amortization on a purchased patent that cost $400. The patent has a legal life of 20 years and an economic life of 5 years. NOTE: This question is only asking for the effect of recording amortization (not the purchase of the patent). ||| OV Oll ON C Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started