only answer the last wuestion and prepare incime statement. but other info is needed to make that.

Information about the Vargo Company for the year ended 12/31/19 is given below. Some of the Sections ask a question and require an answer (the questions are in bold type). Ir information is presented, and no question is asked, the information may be need for the last question (prepare a multi-step income statement for the year ended December 31, 2019). Show your computations and clearly label your answers. This is not a group project. Complete the exam on your own. Exams are due by 1:00 p.m. on Monday, 12/09/19. Prepare a written solution (don't email it) and put it in the inbox outside my office suite if I'm not there when you drop it off. Include the exam questions (what you're holding in your hands) with your solution. a. Vargo sells two products. The first (the "tibed") is sold only for cash and represents a single performance obligation (sale of the product). "Tibed" sales for the year are 204.000 units. "Tibed" sells for a price of $23.80 per unit, and Vargo incurs shipping costs of $3.70 per unit sold. Vargo had sales discounts of $89,000 on "tibed" sales. The second is a software package (the "tidere") and is new for 2019. It has two performance obligations (sale of the software and a software update after 2 years). 59.600 units of "tidere were sold. "Tidere" sells for $30 per unit (also cash sales). The standalone sales price of the software has been determined to be $25 and the standalone sales price of the update is $5. Vargo incurs a costs of $4.25 per software package. Report sales of the two products separately (one line for tibed and one line for tiderc) How much revenue will Vargo record for Tidere in 2019? What journal entry is required to record Tidere sales for 2019? b. Vargo uses the periodic LIFO method to account for the tibed" inventory. Vargo had the following inventory available for sale during the year. Units Cost Balance on 1/1/18 15,000 $6.25 3/15 purchase 55.000 $6.30 5/20 purchase 44,000 $6.45 7/11 purchase 25,000 $7.08 10/27 purchase 33,000 $7.25 12/2 purchase 46,000 $7.37 Freight-in of $2.75 per unit was incurred on tibed" inventory, and is not reflected in the cost per unit above. Compute cost of goods sold for the tibed" product, and ending inventory (at historical cost). c. If the ending inventory had a replacement cost of $112,000 on 12/31/19, a net realizable value of S149,000 and a normal profit of $26,500, what is the dollar value of inventory reported at on the balance sheet? What adjustment and journal entry (if any) would be required? d. Vargo's property plant and equipment consists of a building with a cost of $840,000 and a salvage value of $40,000 with a 15 year life purchased on 6/1/14 and a piece of equipment that cost $88,000 and a salvage value of $4,000 with a 5 year life purchased on 9/1/17. Vargo incurred delivery and installation charges of $8,000 on the equipment. Vargo spent $39,000 painting the building during 2019. On 171719. Vargo revised the estimate on the life of the building. Vargo now estimates that the building will be in service until 12/31/31. On 10/1/19, Vargo exchanged the piece of equipment for a similar piece of equipment with the Eakin Company. The new equipment has salvage a salvage value of $5,000 and is expected to be taken out of service at the same time the old equipment would have been. The transaction had no commercial substance. The fair value of the equipment they gave up was $47.000. The fair value of the equipment received from Eakin was $40,000. In addition to the equipment, they received $7,000 in cash. Prepare the journal entry to record the transaction on Vargo's books. Vargo considers depreciation to be an administrative expense. Compute depreciation expense for the building and equipment for 2019. Vargo computes depreciation to the nearest month and uses the 200% (double) declining balance method for both the building and equipment. e. Vargo purchased land on 3/1/15 for future expansion at a cost of $90,000. They made improvements of $10,000 that will have an indefinite life, and $76,000 of improvements with a 10 year life. Vargo uses straight line depreciation to the nearest month for any land-related items that require depreciation. Compute any depreciation necessary for 2019. 1. On 8/1/18, Vargo decided to discontinue a segment of their business. The segment, which had a book value of $643,000 was sold for $513,000 on 12/1/19. The segment incurred a loss of $45.000 from operations from 8/1/19 to 12/01/19. All amounts are pre-tax g. Vargo pays their salespeople a commission of $2.75 per unit of "tibed" sold. No commissions are paid on sales of "tiderc." Vargo also had the following expenses/revenues during the year: Advertising expense Administrative salaries Sales salaries President's salary Insurance Misc. office expenses Revenue from leasing unused Building space $290,000 802,000 490,000 205,000 52,000 28,500 73.000 h. Early in 2019, Vargo engaged Wheeler Inc. to design and construct a new manufacturing facility. Construction began on March 1, 2019 and was completed on December 31, 2019. (no depreciation is needed) Vargo made the following payments to Wheeler, Inc. during 2019: Date Payment February 1, 2019 $280,000 August 31, 2019 440,000 December 31, 2019 300,000 In order to help finance the construction, Vargo issued the following during 2019: 1. $210,000 of 10-year, 8% bonds payable, issued at par on October 1, 2016, with interest payable annually on Oct 1. In addition to the 8% bonds payable, the only debt outstanding during 2019 was a $140,000, 11% note payable dated January 1, 2010 and due January 1, 2022, and a $230,000 8% note payable dated January 1, 2012 and due January 1, 2021. Interest on each is payable on January 1. Compute the amounts of each of the following (show computations): 1. Weighted average accumulated expenditures qualifying for capitalization of interest cost. 2. Avoidable interest incurred during 2019. 3. Total amount of interest cost to be capitalized during 2019 and interest expense for 2019. Prepare the journal entry to record interest capitalized/expensed. i Vargo had an average of 325.000 shares of common stock outstanding. Vargo has no preferred stock. J. Vargo obtained a patent on 3/1/14 for $96.000 with a legal life remaining of 14 years that was estimated to have a useful life of 12 years. The future cash flows from the patent are estimated to be 544,000 as of 12/31/19 and the fair value is estimated to be $37.000. Make any entries necessary for the patent during 2019. k. Vargo had an unrealized $39.000 gain on marketable securities and a $14.000 loss on translation adjustments from converting the financial statements of a foreign subsidiary to US dollars. 1. Prepare the 2019 income statement in good form for Vargo in a multi-step format and calculate comprehensive income. Use the two statement format shown in Demo 3-5 on page 3- 19 for comprehensive income (more detail is needed for the income statement than is shown in that example). Revenue from each product should be shown on separate lines. Vargo has a tax rate of 21%. Clearly list each expense separately on the income statement (e.g. don't add up 5 things and call them "administrative expenses)