Question 1. Boris B2B Inc. purchases its inventory from Johnson Supplies Inc. subject to the following terms: 2/10, n/30. Boris is not exactly a cash cow, is short of cash and is therefore debating whether it makes sense at all to take advantage of the discount (at the cost of disbursing cash for these purchases 20 days earlier than otherwise it would be doing). If Boris could borrow money at 10% from a local bank to cover any cash shortfall should it take advantage of the discount offered by Johnson Supplies Inc. ? Explai

Question 2. Mountain Indoors Co. mistakenly recorded purchases of inventory on account received during the last week of December 2016 as purchases during January of 2017 (this is called a purchases cut-off error). Cameron uses a periodic inventory system. Ending inventory however was correctly counted and reported each year.Assuming that no correction was made in 2016 or 2017, indicate whether each of the following financial statement amounts will be understated, overstated, or correct, explain.

A. Retained Earnings for December 31, 2016.

B. Retained Earnings for December 31, 2017.

C. Net Income for 2016.

D. Net Income for 2017.

Question 3. List 4 instances when accounting under GAAP differs from accounting under IFRS

Question 4 .

1. The balance sheet for Colt Corp. provided the following summarized pretax data:

Year 2015 Year 2016

Deferred tax liability $376,000 $248,000

Tax expense as reported on the 2016 Income Statement was $493,000.

Calculate the amount of income taxes payable for 2016?

Question 5. Rae Company purchased a new vehicle by paying $10,000 cash on the purchase date and agreeing to pay $3,000 every three months during the next five years. The first payment is due three months after the purchase date. Rae's incremental borrowing rate is 12% (annual). What is the value of the vehicle as reported on the balance sheet as of the purchase date