Berful Industries, a US corporation using US GAAP accounting standards, wants to increase its reported net income this year Will the following actions result in an increase in net income for the firm Berful is going to select double declining balance depreciation for the new assets it acquires this year instead of the straight line method Berful plans to sell treasury stock at a price substantially above its acquisition cost this year Berful plans to issue new common shares this year, with a par value of $1 per share, believing that it can sell the new shares for $40 per share Berful plans to receive about $5,000 in dividends from its marketable security portfolio of publicly traded common stock this year Berful plans to change from LIFO to FIFO in measuring the cost of its ending inventory and cost of goods sold, in a period of rising prices Berful has used the direct write off method to account for bad debts, but must change to the allowance method, in a year in which it has no write offs, but expects to discover next year that some of the current year sales are uncollectible Will this change reduce net income Berful wishes to accelerate the timing of the recognition of revenue by collecting cash in advance of performing services or delivering goods Does net income increase Berful is planning to sell land it has owned for many years, expecting to recognize a gain of $50,000 Berful is considering purchasing a machine, but is concerned that the sales taxes and delivery costs will drive down its reported profit in the year of purchase Will these costs decrease net income in the year of purchase Berful is planning to hire a new officer for the corporation on the last day of the year, with his services to begin next year Will the profit this year be decreased for his salary Berful plans to undertake a large research and development project this year Will the cost of this R D activity reduce net income this year l Berful is planning to acquire another company this year, and hopes to avoid the recognition of goodwill Will the recognition of goodwill reduce the net income of Berful in the year of acquisition Berful is concerned that the dividends it declares will be treated as expenses in the year declaredtrue

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 03, 2024

Berful Industries, a US corporation using US GAAP accounting standards, wants to increase its reported net income this year. Will the following actions result in

Berful Industries, a US corporation using US GAAP accounting standards, wants to increase its reported net income this year. Will the following actions result in an increase in net income for the firm?

Berful is going to select double-declining balance depreciation for the new assets it acquires this year instead of the straight-line method.
Berful plans to sell treasury stock at a price substantially above its acquisition cost this year.
Berful plans to issue new common shares this year, with a par value of $1 per share, believing that it can sell the new shares for $40 per share.
Berful plans to receive about $5,000 in dividends from its marketable security portfolio of publicly-traded common stock this year.
Berful plans to change from LIFO to FIFO in measuring the cost of its ending inventory and cost of goods sold, in a period of rising prices.
Berful has used the direct write-off method to account for bad debts, but must change to the allowance method, in a year in which it has no write-offs, but expects to discover next year that some of the current year sales are uncollectible. Will this change reduce net income?
Berful wishes to accelerate the timing of the recognition of revenue by collecting cash in advance of performing services or delivering goods. Does net income increase?
Berful is planning to sell land it has owned for many years, expecting to recognize a gain of $50,000.
Berful is considering purchasing a machine, but is concerned that the sales taxes and delivery costs will drive down its reported profit in the year of purchase. Will these costs decrease net income in the year of purchase?
Berful is planning to hire a new officer for the corporation on the last day of the year, with his services to begin next year. Will the profit this year be decreased for his salary?
Berful plans to undertake a large research and development project this year. Will the cost of this R&D activity reduce net income this year?
l.Berful is planning to acquire another company this year, and hopes to avoid the recognition of goodwill. Will the recognition of goodwill reduce the net income of Berful in the year of acquisition?
Berful is concerned that the dividends it declares will be treated as expenses in the year declaredtrue?