Answered: On May 15, 2020, Aldean Company, a…

Business

Accounting

On May 15, 2020, Aldean Company, a calendar year taxpayer, purchased and placed into service a nonresidential

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

On April 7, 2024, Crane Corporation purchased two excavators at auction for a combined total cost of $338,000. The excavators were listed in the auction catalogue at $138,000 for excavator A and $284,000 for excavator B. Immediately after the auction, Crane had the excavators professionally appraised so it could purchase adequate insurance coverage. The appraisal put a fair value of $112,520 on excavator A and $275,480 on excavator B. On April 10, Crane paid a total of $4,000 in transportation charges for the two excavators. On April 28, Crane paid $9,000 for improvements to excavator B and no further expenditures were made for excavator A. On April 30, 2024, both excavators were ready to be used. The company expects excavator A to last eight years and to have a residual value of $7,800 when it is removed from service, and it expects excavator B to be useful for six more years and have a residual value of $19,300 at that time. Due to the different characteristics of the two excavators,…
Milk Tea Company acquired a property consisting of land and a building through foreclosure on December 1, 2021. The property was acquired for P 7,000,000 in a lump sum and estimated to benefit the company for 10 years. Milk Tea will not transfer the property to the buyer until it has completed refurbishing to increase its market value. On December 31, 2021, Milk Tea incurred a total of P500,000 for the partial refurbishing, and the property is now selling for P7,600,000. In its December 31, 2021 statement of financial position, at what amount should Milk Tea Company report the held for sale property? P7,600,000 P7,100,000 P0 P6,300,000
Michael Company acquired a depreciable asset at the beginning of 2020 at a cost of $30 million. On December 31, 2020, Madison gathered the following information related to this asset Fair value of the asset (Net Selling Price) $26.5 million Sum of future cash flows from the use of the asset $25 million Present value of future cash flows $26 million The remaining useful life of the asset 9 years Required: Under IFRS: 1) The determination and measurement of impairment loss? 2) Following journal entry would be made to reflect the impairment of this equipment on December 31, 2020?
Tarhata Company received government grant of P2,000,000 related to a factory building that is purchased in January 2019. Tarhata Company acquired the building from an industrialist identified by the government. If Tarhata Company did not purchase the building, which was located in the slums of the city, it would have been repossessed by the government agency. Tarhata Company purchased the building for P12,000,000. The useful life of the building is 5 years with no residual value. On January 1, 2021, the entire amount of the government grant became repayable by reason of noncompliance with conditions attached to the grant. Required: Prepare all journal entries assuming the government grant is accounted for using: 1. Deferred income approach 2. Deduction from asset approach
On January 1, 2018, Bie Corp. purchased a new building at a cost of P3 million. Depreciation was computed on the straight line basis at 4% per year. On December 31, 2019, after recording the depreciation for the year, the building was appraised and was reported to have a fair value of P30 million and an estimated remaining life of fifteen years. This was the first revaluation made on the building since its acquisition. It is the company's policy to transfer a portion of the revaluation surplus to retained earnings as the asset is being used for its remaining life.What is the revaluation surplus balance reported in the financial statements at December 31, 2021?
EB Corporation, a C corporation, purchases a warehouse on August 1, 2007, for $ 1 MILLION Straight-line depreciation is taken in the amount of $411, 750 before the property is sold on June 12, 2023, for $1.2 MIL. What is the amount and character of the gain recognized by EB on the sale of the realty?
ABC Company acquired a rice milling machine to be used by farmers for P 900,000 on January 1, 2020. The company received a government grant of P 81,000 in respect of this asset. It is the policy of the entity to depreciate the asset over 4 years on a straight line basis and to treat the grant as deferred income. 1) What should be the carrying amount of the machine as of December 31, 2021? P 409,500 P 675,000 P 450,000 P 490,500 2) What is the deferred income balance at December 31, 2021? P 60,750 P 81,000 P 0 P 40,500 3) What is the realized income from government grants in 2022?? P 81,000 P 40,500 P 60,750 P 20,250
Please help me
Questions 9 through 12 are based on the following information: On January 1, 2021, Bida-bida Corp. purchased a building for P 20,000,000. The building has a useful life of P 20 years and no residual value. On December 31, 2025, the entity tested the asset for impairment. The fair value on such date is P 12,000,000. On December 31, 2027, Bida-bida Company decided to use the revaluation model. The fair value of the assets on such date has risen to P 18,000,000. 9. What amount should be recognized as impairment loss on 2025? 10. What is the carrying amount of the impaired asset on December 31, 2027? 11. What amount should be recognized as gain in reversal of impairment for 2027? 12. What amount should be recognized as revaluation surplus in 2027?
Swift, LLC purchased equipment (7-year property) for use in its business on October 15, 2021. This was the only asset Swift, LLC acquired during 2021. The cost of the equipment was $2,000,000. In addition to the purchase price, Swift, LLC incurred the following additional costs related to the equipment in 2021: $20,000 to ship the equipment to Swift LLC’s business location in Chicago, Illinois; $10,000 for installation costs to get the equipment operational in Swift LLC’s business; $120,000 for sales tax on the purchase of the equipment; $50,000 for an annual tune up on the equipment Assuming that Swift, LLC continues to own the equipment, what will the company’s adjusted tax basis in the equipment be at December 31, 2024? Answer:
The Jordan Corp (C Corporation), a calendar year taxpayer, sold a piece of equipment, a piece of machinery, and a warehouse on March 30, 2021. Data on these disposals are as follows: The equipment was purchased on February 20, 2016 for $50,000. It was sold for $60,000 cash. After calculating 2021 depreciation, accumulated depreciation totaled $45,538. The machinery was purchased on February 7, 2017 for $130,000. It was sold for $30,000 cash. After calculating 2021 depreciation, accumulated depreciation totaled $112,596. The building was purchased on March 1, 1991 for $2,000,000. It was sold for $1,325,000 cash. After calculating 2021 depreciation, accumulated depreciation totaled $1,589,743. The building had a mortgage with a balance of $200,000 that the buyer assumed from the Jordan Corp. For each asset, Calculate the amount of the realized gain/loss Calculate the amount of the recognized gain/loss Calculate the amount and type of depreciation recapture, if any Calculate the…
TGIF Company owned a building on January 01, 2019, with historical cost of 52,000,000. The property is depreciated over 40 years on a straight-line basis with no residual value. The entity adopted a policy of revaluation of property. The building had so far been revalued twice at fair value. The fair values of the building are as follows: January 01, 2020 : 60,840,000 January 01, 2022 : 72,150,000.How much is the revaluation surplus to be reported in the statement of changes in equity for the year ended December 31, 2022? a. 23,660,000 b. 23,400,000 c. 24,050,000 d. 24,570,000