Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following are transactions related to Cullumber Limited: 1. The City of Piedmont gives the company five hectares of land as a plant site. This

image text in transcribed

The following are transactions related to Cullumber Limited: 1. The City of Piedmont gives the company five hectares of land as a plant site. This land's fair value is determined to be $91,750. 2. Cullumber issues 12,670 common shares in exchange for land and buildings. The property has been appraised at a fair value of $1,629,230, of which $406,940 has been allocated to land, $886,860 to the structure of the buildings, $219,900 to the building HVAC (heating, ventilation, air conditioning), and $115,530 to the interior coverings in the buildings (such as flooring). Cullumber's shares are not listed on any exchange, but a block of 91 shares was sold by a shareholder 12 months ago at $56 per share, and a block of 200 shares was sold by another shareholder 18 months ago at $33 per share. 3. No entry has been made to remove amounts for machinery constructed during the year that were charged to the accounts Inventory, Supplies, and Salaries and Wages Expense and should have been charged to plant asset accounts. The following information relates to the costs of the machinery that was constructed: $22,840 595 950 55,600 Construction materials on hand in opening inventory used Direct materials used in calibrating the equipment Supplies used Direct labour incurred Additional variable overhead (over regular) caused by construction of machinery, excluding supplies used (charged to Inventory) Fixed overhead rate applied to regular manufacturing operations Lost revenue due to downtime during construction Cost of similar machinery if it had been purchased from outside suppliers 8,430 69% of direct labour cost 45,000 124,620 Prepare journal entries on the books of Cullumber Limited to record these transactions. Assume that Cullumber Limited prepares financial statements in accordance with IFRS. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Business Reporting For Decision Making

Authors: Jacqueline Birt, Keryn Chalmers, Suzanne Maloney, Albie Brooks, Judy Oliver

6th Edition

978-0730363415, 0730363414

More Books

Students also viewed these Accounting questions