List Of Accounts

Cumulative Coverage - Chapters 10 to 12

Accounts Payable Accounts Receivable Accumulated Amortization - Copyrights Accumulated Amortization - Customer Lists Accumulated Amortization - Development Costs Accumulated Amortization - Franchises Accumulated Amortization - Licenses Accumulated Amortization - Patent Accumulated Amortization - Software Accumulated Amortization - Trademarks Accumulated Depreciation Accumulated Impairment Losses - Goodwill Accumulated Impairment Losses - Licences Accumulated Impairment Losses - Trademark Accumulated Impairment Losses - Copyrights Administrative Expenses Advances to Employees Advertising Expense Allowance for Doubtful Accounts Amortization Expense Asset Additions and Disposals Bad Debt Expense Bank Loans Buildings Cash Common Shares Copyright Cost of Goods Sold Customer Lists Delivery Expense Delivery Truck Depreciation Expense Development Costs Discount on Bonds Payable Due from Factor Due to Customer Equipment Fair Value - NI Investments Finance Expense Finance Revenue Franchises Freight-in Freight-out Gain on Sale of Copyright Gain on Sale of Equipment Gain on Sale of Land Gain on Sale of Patent Goodwill Income Summary Intangible Assets Interest Expense Interest Income Interest Receivable Inventory Land Leasehold Improvements Licenses Loss on Disposal of Delivery Truck Loss on Disposal of Software Loss on Disposal of Vehicle Loss on Impairment Loss on Impairment - Goodwill Loss on Impairment - Licences Loss on Impairment - Trademarks Loss on Impairment - Copyrights Loss on Impairment - Patents Loss on Sale of Copyright Loss on Sale of Patent Loss on Sale of Receivables Machinery Maintenance and Repairs Expense Miscellaneous Expense No Entry Notes Payable Notes Receivable Office Expense Office Expense - Bank Charges Patents Petty Cash Prepaid Expenses Prepaid Rent Purchase Discounts Recovery of Loss from Impairment Rent Expense Research and Development Expense Resource Liability Retained Earnings Revaluation Gain or Loss Revaluation Surplus Royalty Expense Sales Sales Discounts Sales Discounts Forfeited Sales Revenue Selling Expenses Servicing Liability Service Revenue Sick Pay Wages Payable Software Start-up Expenses Supplies Supplies Expense Trademarks Unearned Revenue Unrealized Gain or Loss - FV-NI Vehicles

Fit Fixtures Incorporated (FFI) is a manufacturer of exercise equipment such as treadmills, stair climbers, and elliptical machines. The company has a December 31 year end and uses ASPE. The accounting staff member who normally looks after the capital asset accounts was on maternity leave for the year, and the company put all transactions in a temporary account called Asset Additions and Disposals, which has a current balance of $3,469,680. The company policy on calculating depreciation for partial periods of ownership is to take 50% of the normal amount of depreciation in the year of addition or disposal. Due to the staff members maternity leave, no depreciation or amortization expense has yet been taken in 2017.

1.

The company completed construction of a new plant in Saskatchewan on December 15, 2017, to help it better meet the needs of its customers west of Ontario. The costs associated with this construction project were as follows:

Land		$610,000
Construction contract: building, 20 years of useful life, residual value of $610,000		1,830,000
Manufacturing equipment		(See below)
Office equipment		305,000
Training costs (employees learning to use equipment)		54,900
Avoidable interest calculated at 8% on financing of project from inception until put in use		91,500

Manufacturing equipment: The equipment purchased for the new plant was purchased on a deferred payment contract signed on December 1. FFI issued a $8-million, five-year, non interest-bearing note payable to the equipment supplier at a time when the annual market rate of interest was 5%. The note will be repaid with five equal payments made on December 1 of each year, beginning in 2018.

2.

FFI purchased a used computer and a printer at an auction for $3,050. The printer needed a new drum. The cost of the new drum was $610. The used computers fair market value was $2,440 if purchased separately. The printer was worth $1,220 without a drum and $1,830 with the drum replaced.

3.

On July 1, 2017, FFI sold a delivery truck for $12,200. The truck originally cost $30,500, and accumulated depreciation on the truck to December 31, 2016, was $12,200. The truck was amortized on a straight-line basis over a five-year period, with no residual value. The sale was recorded as a debit to Cash and a credit to Asset Additions and Disposals. No amortization was recorded in the current year.

4.

Due to an office redesign in the Ontario building, FFI traded some old office equipment for different office equipment with a similar life and value in use. The fair value of the equipment disposed of was $6,100. The cost of this equipment was $8,540, and the accumulated depreciation on the equipment at December 31, 2016, was $3,660. This transaction was not recorded in the books of account. No entry was made to record the exchange.

5.

Shortly after the new factory was completed, vandals attacked the building and significant damage was done. The costs to correct the damage, which were not covered by insurance, included:

New paint to cover graffiti		$4,880
Glass for broken windows		12,200
Improved security system		30,500

6.

During the year, the company developed a new piece of exercise equipment that has a built-in video game. It was the policy to amortize development costs on a straight-line basis over three years, with 50% of the normal amount in the year of development. The costs associated with product development included:

Costs to determine how a video game would work with exercise equipment		$61,000
Design, testing, and construction of prototype equipment		427,000
Costs to determine the best production process for the new equipment		48,800
Advertising costs to alert customers about the new product		57,340

7.

The company has goodwill and an intangible asset as follows:

Asset		Details		Carrying Value as at December 31, 2016		Accumulated Amortization as at December 31, 2016		Amortization Method
Goodwill		Recorded in 2012 when the company took over the business of its predecessor		$610,000		$0		Not applicable
Customer list		Purchased in 2012 when the company took over the business of its predecessor		$305,000		$137,250		Straight-line over 10 years

The customer list has lost value and will not provide benefits through to 2022, as was originally predicted. It is now expected to provide undiscounted future cash flows of $61,000 in total over the next two years. There are no estimated costs to sell the list, as it will not be sold, and the value in use is $56,120. Goodwill has a recoverable value of $854,000 as at December 31, 2017.

Determine whether each expenditure related to the new Saskatchewan plant must be capitalized or expensed or whether it could be either (depends on policy choice). (Round answers to 0 decimal places, e.g. 5,275.)

Costs to determine how a video game would work with exercise equipment Design, testing, and construction of prototype equipment Costs to determine the best production process for the new equipment Advertising costs to alert customers about the new product The company has goodwill and an intangible asset as follows: $61,000 427,000 48,800 57,340 7. Carrying Value as Accumulated Amortization as at December 31, 2016 Asset Details at December 31, 2016 $610,000 $305,000 Goodwill Recorded in 2012 when the company took over the business of its predecessor Purchased in 2012 when the company took over the business of its predecessor $0 Not applicable Customer list $137,250 Straight-line over 10 years The customer list has lost value and will not provide benefits through to 2022, as was originally predicted. It is now expected to provide undiscounted future cash flows of $61,000 in total over the next two years. There are no estimated costs to sell the list, as it will not be sold, and the value in use is $56,120. Goodwill has a recoverable value of $854,000 as at December 31, 2017, New Saskatchewan plant Determine whether each expenditure related to the new Saskatchewan plant must be capitalized or expensed or whether it could be either (depends on policy choice). (Round answers to 0 decimal places, e.g. 5,275. Capitalize Expense Policy Choice to Capitalize or Expense Land Building Manufacturing equipment Offce equipment Training costs Avoidable interest Costs to determine how a video game would work with exercise equipment Design, testing, and construction of prototype equipment Costs to determine the best production process for the new equipment Advertising costs to alert customers about the new product The company has goodwill and an intangible asset as follows: $61,000 427,000 48,800 57,340 7. Carrying Value as Accumulated Amortization as at December 31, 2016 Asset Details at December 31, 2016 $610,000 $305,000 Goodwill Recorded in 2012 when the company took over the business of its predecessor Purchased in 2012 when the company took over the business of its predecessor $0 Not applicable Customer list $137,250 Straight-line over 10 years The customer list has lost value and will not provide benefits through to 2022, as was originally predicted. It is now expected to provide undiscounted future cash flows of $61,000 in total over the next two years. There are no estimated costs to sell the list, as it will not be sold, and the value in use is $56,120. Goodwill has a recoverable value of $854,000 as at December 31, 2017, New Saskatchewan plant Determine whether each expenditure related to the new Saskatchewan plant must be capitalized or expensed or whether it could be either (depends on policy choice). (Round answers to 0 decimal places, e.g. 5,275. Capitalize Expense Policy Choice to Capitalize or Expense Land Building Manufacturing equipment Offce equipment Training costs Avoidable interest