Blago Wholesale Company began operations on January 1, 2017, and uses the average cost method in costing its inventory Management is contemplating a change to the FIFO method in 2018 and is interested in determining how such a change will affect net income. Accordingly, the following information has been developed: 2017 2018 Final inventory: Average cost FIFO $150,000 $255,000 160,eee 270,000 Condensed income statements for Blago Wholesale appear below: Sales Cost of goods sold Gross profit Selling, general, and administrative Net income 2017 $1,000,000 600.000 400,000 250.000 $ 150,000 2018 $1,200,000 720,000 480,000 275,000 $ 205,000 Required: Based on this information, what would 2018 net income be after the change to the FIFO method? Ignore any income tax effects of this change in accounting method. 2017 2018 Sales Cost of goods sold Gross profit Selling general, and administrative Net Income Weir Company uses straight-line depreciation for its property, plant, and equipment, which, stated at cost, consisted of the following: Land Buildings Machinery and equipment December 31, 2017 2016 $ 25,00 $ 25,000 195,000 195,000 695,000 650,000 915,000 870,000 (480,000) (370,000) $ 515,000 $ 500,000 Less accumulated depreciation Weir's depreciation expense for 2017 and 2016 was $55,000 and $50,000, respectively, Required: What amount was debited to accumulated depreciation during 2017 because of property, plant, and equipment retirements? Debit amount to accumulated depreciation due to retirements 31 On December 31, 2017. Vale Company had an unadjusted credit balance of $1,000 in its Allowance for uncollectible accounts. An analysis of Vale's trade accounts receivable at that date revealed the following: Age 0-30 31-60 Over 60 days days days Amount $ 60,000 4.ee 2,080 Estimated Uncollectible 5% 10 70 01:56:35 Required: What amount should Vale report as Allowance for uncollectible accounts in its December 31, 2017. balance sheet? Vale should report an Allowance for uncollectible accounts of 32 Lake Company sold some machinery to View Company on January 1, 2017, for which the cash selling price was $758,200 View entered into an installment sales contract with Lake at a 10% interest rate. The contract required payments of $200,000 a year over five years with the first payment due on December 31, 2017 Required: Prepare an amortization schedule that shows what portion of each $200,000 payment will be shown as interest income over the period 2017-2021. (Round your answers to the nearest whole dollar amount.) 01:56:16 Net installments Date Payments Interest Income Reduction of Principal Due 0 0 1/1/17 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 0 0 0
