Assignment
Question 1
Metlock Family Importers sold goods to Tung Decorators for $45,000 on November 1, 2017, accepting Tung's $45,000, 6-month, 5% note.
Prepare Metlock's November 1 entry, December 31 annual adjusting entry, and May 1 entry for the collection of the note and interest.
Question 2
Swifty Corporation traded a used truck (cost $26,800, accumulated depreciation $24,120) for a small computer with a fair value of $4,422. Swifty also paid $670 in the transaction.
Prepare the journal entry to record the exchange. (The exchange has commercial substance.)
Question 3
The expenditures and receipts below are related to land, land improvements, and buildings acquired for use in a business enterprise. The receipts are enclosed in parentheses.
(a) Money borrowed to pay building contractor (signed a note) $(289,100)
(b) Payment for construction from note proceeds 289,100
(c) Cost of land fill and clearing 11,860
(d) Delinquent real estate taxes on property assumed by purchaser 7,990
(e) Premium on 6-month insurance policy during construction 9,480
(f) Refund of 1-month insurance premium because construction completed early (1,580)
(g) Architect's fee on building 26,400
(h) Cost of real estate purchased as a plant site (land $202,900 and building $56,600) 259,500
(i) Commission fee paid to real estate agency 9,690
(j) Installation of fences around property 4,140
(k) Cost of razing and removing building 10,530
(l) Proceeds from salvage of demolished building (4,690)
(m) Interest paid during construction on money borrowed for construction 12,230
(n) Cost of parking lots and driveways 17,750
(o) Cost of trees and shrubbery planted (permanent in nature) 13,350
(p) Excavation costs for new building 3,290
Identify each item by letter and list the items in columnar form, using the headings shown below. All receipt amounts should be reported in parentheses. For any amounts entered in the Other Accounts column, also indicate the account title.
Question 4
Buffalo Company purchased machinery for $161,700 on January 1, 2017. It is estimated that the machinery will have a useful life of 20 years, salvage value of $14,700, production of 80,400 units, and working hours of 46,200. During 2017, the company uses the machinery for 21,714 hours, and the machinery produces 25,728 units. Compute depreciation under the straight-line, units-of-output, working hours, sum-of-the-years'-digits, and double-declining-balance methods.
Question 5
Oriole Company borrowed $32,400 on November 1, 2017, by signing a $32,400, 8%, 3-month note. Prepare Oriole's November 1, 2017, entry; the December 31, 2017, annual adjusting entry; and the February 1, 2018, entry.
Question 6
Bridgeport Corporation has elected to use the fair value option for one of its notes payable. The note was issued at an effective rate of 10% and has a carrying value of $15,000. At year-end, Bridgeport's borrowing rate (credit risk) has declined; the fair value of the note payable is now $16,300.
Determine the unrealized holding gain or loss on the note.
Prepare the entry to record any unrealized holding gain or loss.
Attachment:- Template.rar