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7nadin3 [17]
3 years ago
11

On September 30, 2016, Athens Software began developing a software program to shield personal computers from malware and spyware

. Technological feasibility was established on February 28, 2017, and the program was available for release on April 30, 2017. Development costs were incurred as follows:
September 30 through December 31, 2016 $ 2,200,000
January 1 through February 28, 2017 800,000
March 1 through April 30, 2017 400,000
Athens expects a useful life of four years for the software and total revenues of $5,000,000 during that time. During 2017, revenue of $1,000,000 was recognized.

Required:
1.
Prepare the journal entries to record the development costs in 2016 and 2017. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)


2.
Calculate the required amortization for 2017. (Enter your answer in whole dollars.)

Business
1 answer:
Cloud [144]3 years ago
6 0

Answer:

Check the explanation

Explanation:

1. Record the journals as shone, below:

Date       Accounts title & explanation             Debit (S)             Credit(S) 2016     Research and development expense    2,200,000                                 `                               Cash                                             2,200,000  

                 (To record the expense incurred

                    on research and development)

2017   Research and development expense    800,000  `             `                            Software and development costs      400.000

                                           Cash                                              1,200,000

                         (To record the sc&ware

                         development costs incanted)

kindly check the answer to the second question in the attached image below

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A $2,000 cash dividend is planned in 2019. No dividend was paid in 2018. 1,000 shares of 5% cumulative $10 par value preferred s
Irina-Kira [14]

Answer:

C) $1000

Explanation:

First lets calculate the cumulative preferred stock dividend for 2 years

(1000 * 10 ) * 5% = 500 / year

so for 2 years = $1000 since it is cumulative and not paid in one year is added to next year.

Total dividend payable = $2000

so for common stock whatever is left over is paid thus,

Common stock share = Total - Preferred cumulative = 2000 - 1000 = $1000

Hope that helps.

4 0
3 years ago
Which of the following describes a potential risk for facing online predators?
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5 0
3 years ago
Jones company lends Alabater Inc. $85,000 on August 6, 2018. This loan was memorialized with a signed note receivable with a rep
Tju [1.3M]

Answer:C) $2,125.

Explanation:

Interest = Principal x rate x time (period)

using days in a year = 360 days

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=$2,125

Therefore, Alabaster Inc, must repay the $85,000 principle and $2,125 in interest

8 0
3 years ago
The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $166,436. The bank statement indicated a balance
daser333 [38]

Answer:

1. Pala Medical Co. Bank Reconciliation Statement as on June 30, 20Y1    

       PARTICULARS                                                        $                 $

Balance as per cash book                                              166,436  

Add: Cheques issued but not yet presented          19,427  

 25,000 note collected by Bank                          <u>26,500  </u>

                                                                                        <u> 45,927 </u>

                                                                                       212,363  

Deduct: Checks deposited but not yet collected

         by the bank                                                             12,300  

  Overstatement of figure by the bank                      720  

  Returned check wrongly recorded by Pala

         Medical Co.                                                            3,600  

  Bank service charge                                         <u>        55   </u>

                                                                                     <u>     16,675  </u>

Balance as per bank statement as on June 30, 20Y1       <u>   </u><u>195,688  </u>

<u></u>

<u></u>

2.          DETAIL                                                                  DR            CR

                                                                                               $                  $

Cash Account                                                             25,000  

  Investment                                                                                  25,000  

Matured Investment ($25,000 Notes)  

Cash Account                                                                 1,500  

  Interst Income                                                                             1,500  

Being interest on $25,000 Notes received  

Cash Account                                                                      400  

  Creditors - Skyline Supply Co.                                                                400  

Being correction of Payment to Skyline Supply Co. wronfly recorded  

Creditors - Skyline Supply Co.                                      4,000  

  Cash Account                                                                                  4,000  

Being Payment to Skyline Supply Co.  

Bank Charges                                                                    55  

Cash Account                                                                                55  

Bank Charges recorded captured in the bank statement

3. If a balance sheet were prepared for Pala Medical Co. on June 30, 20Y1 the amount to be reported as cask is $166,436  

Explanation:

1. The balance shown by the bank statement seldom agree with the balance shown by the cash book, bank reconciliation statement is usually drawn up to  agree the balance shown by the bank statement with the balance shown by the cash book.

In this question:

a. Check  outstanding of $19,427 are checks issued to creditors which where not presented for payment. generally known as unpresented checks.

b. The receipts of $12,300 recorded in Pala Medical Co. cash book was not credited by the bank, this will obviously cause a disagreement between the bank statement and the cash book at month end.

c. The amount of $26,500 recorded in the bank statement must be reported correctly the the cash book and the relevant ledger by debiting the cash book by the total receipt of $26,500 and crediting investment and with $25,000 and crediting the interest elements to interest income account.

d. The wrong recording of $400 instead of $4000 must be corrected by reversing the initial entry. this is done by debiting Cash book with $400 and crediting Creditor account - Skyline Supply Co. with $400   and recording the correct entry by debiting Creditor account - Skyline Supply Co. with $4000 and crediting cash book by $4000.

e. The check of $195 is recorded correctly already in the cash book, it is the bank to pass the necessary entry but it will only enter the company cash book.

f. Bank service charge should be recorded by debiting bank charges with $55 and crediting cash book with $55

8 0
3 years ago
Paula Boothe, president of the Armange Corporation, has mandated a minimum 10% return on investment for any project undertaken b
Vlad1618 [11]

Answer:

Residual income= $36,000

Explanation:

Residual income is the income that is generated in excess of the minimum required rate of return, which in this case is 10%. Any income above 10% return is considered as residual income. In this case the investment is 1,800,000 and 10% of that is 180,000 (0.1*1,800,000). So any income made above $180,000 will be residual income. In order to find the residual income we subtract the minimum income required from the actual income.

In this case the minimum income required is 180,000 and the actual operating income is 216,000 so residual income=

216,000-180,000= $36,000

4 0
3 years ago
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