How do record necessary adjusting journal entries

Assignment Help Financial Accounting
Reference no: EM132969749

Problem 1: Using the following information, record the necessary adjusting journal entries ended December 31st 2021.

Due to tax purposes, the company changes (1) depreciation method for building ($100,000,000) from double-declining to straight, and (2) salvage value from $25,000,000 to $900,000. Tax rate is 20% for all years. Balances in the deferred tax asset and deferred tax liability accounts at January 1, 2021, were $3,500,000, and $270,000 (1,350,000*20%). Expenses include $2,000,000 for life insurance on key executives.

  • Income before income tax- $1,500,000
  • The building was originally acquired on 1/1/18 for $100,000,000, with a salvage of $25,000,000 and a useful life of 25 years. The accumulated depreciation as of 12/31/21, using the double-decline method, is $28,360,704.

Reference no: EM132969749

Questions Cloud

Compute osawa operating income using variable costing : Planned and actual fixed operating (nonmanufacturing) costs totaled $400,000. Compute Osawa's 2020 operating income using variable costing
Describe standard costs : Describe standard costs. Explain the benefits of using a standard cost system at a well-known company. Do not post on a company
Explain the purpose of the balanced scorecard : Explain the purpose of the balanced scorecard and identify two examples of nonfinancial measures that might be included in a balanced scorecard
Determine the increase in share premium issuance : Determine the increase in share premium issuance if 60% of the share warrants were exercised on December 31, 2021
How do record necessary adjusting journal entries : Due to tax purposes, the company changes depreciation method. Record the necessary adjusting journal entries ended December 31st 2021.
What is the carrying amount of the investment : On January 1, 2023, Too Early sold inventory to Too Late for P900,000. What is the carrying amount of the investment
Contrast the yield to maturity and the yield to redemption : Explain how the return on equity (ROE) affects the use of higher debt in the company. Contrast the yield to maturity and the yield to redemption
Prepare the related journal entry for recognizing expense : An aging analysis shows that the ending balance of allowance for doubtful debts should still be $4,000. Prepare related journal entry for recognizing expense
Describe the relationship between risk and return : Explain how the DuPont equation helps managers improve company performance. Describe the relationship between risk and return.

Reviews

Write a Review

Financial Accounting Questions & Answers

  What amount does John realize

On December 12, 2020, he sells the shares for $42.50 per share. He also incurs a $1,000 fee for this transaction. What amount does John realize

  Should a bank reconciliation take place

In managing company funds, transparency is required regarding the flow incoming funds disbursed funds, In your opinion, should a bank reconciliation take place?

  What are the current yield and capital gains yield

Assuming there are no changes to interest rates during the course of the year, what are the current yield and capital gains yield on the bonds for this year

  Federal unemployment taxes

Employees are paid 1.5 times the regular hourly rate for all hours worked in excess of 40 hours per week. FICA taxes are 7.65% on the first $117,000 of gross earnings. Ramirez Company is subject to 5.4% state unemployment taxes and 0.8% federal unemp..

  What depreciation would abc record for the year

ABC revised the remaining useful life to four years with no residual value. What depreciation would ABC record for the year 2020 on this equipment?

  How much additional interest would be necessary

Assuming that duration cannot be changed, how much additional interest and fee income would be necessary to make the loan acceptable?

  Prepare cheyenne journal entries to record the purchase

Prepare Cheyenne's journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair value adjustment

  Demonstrate what is the required rate of return on B stock

Beta of 1.30, and its required return is 11.50%. Stock B's beta is 0.80. If the risk-free rate is 4.75%, what is the required rate of return on B's stock?

  What is the capital balance of h in the new partnership

What is the capital balance of H in the new partnership assuming bonus method? J, H, and N are partners with present capital balances of $40,000, $50,000.

  Calculate additional finance requirements

Calculate Additional Finance Requirements and CFO of IPOD Accessories, Inc. has asked for your help in estimating the firm's additional financing needed for next year.

  Units completed and transferred out during the period

Maxwell company had the following data for the current fiscal period. units in process at the beginning of the month 12000 units in process at the end of the month 8000 units started during the month 40000. Materials are added at the beginning of the..

  What is the implied risk-free rate

A trike price of $130 and an expiration date in 12 months are $20 and $15, respectively. The current stock price is $130. What is the implied risk-free rate ?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd