Easy Bhd recently purchased a new lensmeter to measure a patient's refractive error, and to determine the appropriate prescription to be used with eyeglasses and contact lenses. The following information refers to the purchase and installation of this equipment. (i) The list price of the equipment was RM46,800. However, Easy Bhd qualified for a discount of RM 1,800. It paid RM25,000 in cash for the equipment and the balance would be paid in 12 months. The discount rate used was 9 per cent. (ii) In addition to (i) above, Easy Bhd paid import duties of RM2,250. (iii) Freight charges for delivery of the equipment totalled RM500. (iv) Installation costs related to the equipment amounted to RM2,500. (v) As soon as the equipment was installed, Easy Bhd paid RM2,000 to print brochures featuring the company's new facilities. Required: (a) Make a general statement summarizing the nature of the expenditure that forms the cost of the equipment. (b) Explain which items above should be included as the total cost of equipment. (c) Discuss the proper accounting treatment of those items that are not included in the cost of equipment. the journal entries to

Easy Bhd recently purchased a new lensmeter to measure a patient's refractive error, and to determine the appropriate prescription to be used with eyeglasses and contact lenses. The following information refers to the purchase and installation of this equipment. (i) The list price of the equipment was RM46,800. However, Easy Bhd qualified for a discount of RM 1,800. It paid RM25,000 in cash for the equipment and the balance would be paid in 12 months. The discount rate used was 9 per cent. (ii) In addition to (i) above, Easy Bhd paid import duties of RM2,250. (iii) Freight charges for delivery of the equipment totalled RM500. (iv) Installation costs related to the equipment amounted to RM2,500. (v) As soon as the equipment was installed, Easy Bhd paid RM2,000 to print brochures featuring the company's new facilities. Required: (a) Make a general statement summarizing the nature of the expenditure that forms the cost of the equipment. (b) Explain which items above should be included as the total cost of equipment. (c) Discuss the proper accounting treatment of those items that are not included in the cost of equipment. the journal entries to

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Rand Medical manufactures lithotripters. Lithotripsy uses shock waves instead of surgery to eliminate kidney stones. Physicians' Leasing purchased a lithotripter from Rand for $2,450,000 and leased it to Mid-South Urologists Group, Incorporated, on January 1, 2024. Note: Use tables, Excel, or a financial calculator. (EV of $1. PV of $1. FVA of $1. PVA of $1, FVAD of $1 and PVAD of $1) Lease Description: Quarterly lease payments Lease term No residual value; no purchase option $159,882-beginning of each period 5 years (20 quarters) 5 years Implicit interest rate and lessee's incremental borrowing rate 12% $ 2,450,000 Economic life of lithotripter Fair value of asset Required: 1. How should this lease be classified by Mid-South Urologists Group and by Physicians' Leasing? 2. Prepare appropriate entries for both Mid-South Urologists Group and Physicians' Leasing from the beginning of the lease through the second rental payment on April 1, 2024. Adjusting entries are recorded at the end of…
Rand Medical manufactures lithotripters. Lithotripsy uses shock waves instead of surgery to eliminate kidney stones. Physicians' Leasing purchased a lithotripter from Rand for $2,090,000 and leased it to Mid-South Urologists Group, Incorporated, on January 1, 2024. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Lease Description: Quarterly lease payments Lease term No residual value; no purchase option Economic life of lithotripter Implicit interest rate and lessee's incremental borrowing rate Fair value of asset Required: 1. How should this lease be classified by Mid-South Urologists Group and by Physicians' Leasing? 2. Prepare appropriate entries for both Mid-South Urologists Group and Physicians' Leasing from the beginning of the lease through the second rental payment on April 1, 2024. Adjusting entries are recorded at the end of each fiscal year (December 31). 3. Assume Mid-South Urologists Group leased the…
Topsy Corporation started a promotional program. A towel is offered as a premium to customers who send in 10 box tops of facial soap returned and a remittance of ₱20. Distribution cost is ₱5 per towel. The entityestimated that only 60% of the box tops reaching the market will be redeemed. The entity provided the following information: 2019 2020 Facial Soap sales, P45 per unit 2,400,000 php 2,785,000 php Towel purchases, P70 per unit 320,500 php 355,000 php Number of box tops returned 20,500 php 34,850 php REQUIRED:Compute for the premiums expense for the year ended December 31, 2019 and 2020.
Topsy Corporation started a promotional program. A towel is offered as a premium to customers who send in 10 box tops of facial soap returned and a remittance of ₱20. Distribution cost is ₱5 per towel. The entityestimated that only 60% of the box tops reaching the market will be redeemed. The entity provided the following information: 2019 2020 Facial Soap sales, P45 per unit 2,400,000 php 2,785,000 php Towel purchases, P70 per unit 320,500 php 355,000 php Number of box tops returned 20,500 php 34,850 php REQUIRED: How much net cash did the entity receive (give) with regards to the premium transactions for the year 2019 and 2020?
Rand Medical manufactures lithotripters. Lithotripsy uses shock waves instead of surgery to eliminate kidney stones. Physicians' Leasing purchased a lithotripter from Rand for $2,260,000 and leased it to Mid-South Urologists Group, Incorporated, on January 1, 2024. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Lease Description: Quarterly lease payments Lease term No residual value; no purchase option Economic life of lithotripter Implicit interest rate and lessee's incremental borrowing rate Fair value of asset $ 135,504-beginning of each period 5 years (20 quarters) 5 years 8% $ 2,260,000 Required: 1. How should this lease be classified by Mid-South Urologists Group and by Physicians' Leasing? 2. Prepare appropriate entries for both Mid-South Urologists Group and Physicians' Leasing from the beginning of the lease through the second rental payment on April 1, 2024. Adjusting entries are recorded at the end of…
Topsy Corporation started a promotional program. A towel is offered as a premium to customers who send in 10 box tops of facial soap returned and a remittance of ₱20. Distribution cost is ₱5 per towel. The entityestimated that only 60% of the box tops reaching the market will be redeemed. The entity provided the following information: 2019 2020 Facial Soap sales, P45 per unit 2,400,000 php 2,785,000 php Towel purchases, P70 per unit 320,500 php 355,000 php Number of box tops returned 20,500 php 34,850 php REQUIRED: Compute for the premium liability for the year ended December 31, 2019 and 2020.
As a medical administrator at the local hospital, you made a total purchase of $4447.85. Currently, your cardiovascular department purchased 40 saline solution bags; 25 catheters; and 150 syringe speciality packages. The cost for the saline solution, catheter, syringe package is $4.99/solution, $19.99/catheter, and unknown amount per package, respectively. No taxes are added. Round to the cent. What is the of each syringe package? Include unit symbol. 200 D
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GoodBuy sells gift cards redeemable for GoodBuy products either in store or online. During 2018, GoodBuysold $1,000,000 of gift cards, and $840,000 of the gift cards were redeemed for products. As of December 31,2018, $30,000 of the remaining gift cards had passed the date at which GoodBuy concludes that the cards willnever be redeemed. How much gift card revenue should GoodBuy recognize in 2018?
Rand Medical manufactures lithotripters. Lithotripsy uses shock waves instead of surgery to eliminate kidney stones. Physicians' Leasing purchased a lithotripter from Rand for $1,900,000 and leased it to Mid-South Urologists Group, Inc., on January 1, 2018. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Lease Description: Quarterly lease payments $123,990-beginning of each period 5 years (20 quarters) Lease term No residual value; no purchase option Economic life of lithotripter Implicit interest rate and lessee's incremental borrowing rate Fair value of asset 5 years 12% $1,900,000 Required: 1. How should this lease be classified by Mid-South Urologists Group and by Physicians' Leasing? 2. Prepare appropriate entries for both Mid-South Urologists Group and Physicians' Leasing from the beginning of the lease through the second rental payment on April 1, 2018. Adjusting entries are recorded at the end of each…
Rand Medical manufactures lithotripters. Lithotripsy uses shock waves instead of surgery to eliminate kidney stones. Physicians’ Leasing purchased a lithotripter from Rand for $1,590,000 and leased it to Mid-South Urologists Group, Inc., on January 1, 2021. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Lease Description: Quarterly lease payments $ 103,760—beginning of each period Lease term 5 years (20 quarters) No residual value; no purchase option Economic life of lithotripter 5 years Implicit interest rate and lessee's incremental borrowing rate 12% Fair value of asset $ 1,590,000 Required:1. How should this lease be classified by Mid-South Urologists Group and by Physicians' Leasing?2. Compute appropriate entries for both Mid-South Urologists Group and Physicians' Leasing from the beginning of the lease through the second rental payment on April 1,…
Rand Medical manufactures lithotripters. Lithotripsy uses shock waves instead of surgery to eliminate kidney stones. Physicians’ Leasing purchased a lithotripter from Rand for $2,520,000 and leased it to Mid-South Urologists Group, Inc., on January 1, 2021. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Lease Description: Quarterly lease payments $ 151,093—beginning of each period Lease term 5 years (20 quarters) No residual value; no purchase option Economic life of lithotripter 5 years Implicit interest rate and lessee's incremental borrowing rate 8% Fair value of asset $ 2,520,000 Required:1. How should this lease be classified by Mid-South Urologists Group and by Physicians' Leasing?2. Prepare appropriate entries for both Mid-South Urologists Group and Physicians' Leasing from the beginning of the lease through the second rental payment on April 1, 2021.…