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ivolga24 [154]
3 years ago
15

In 2018, the Barton and Barton Company changed its method of valuing inventory from the FIFO method to the average cost method.

At December 31, 2017, B & B's inventories were $32.6 million (FIFO). B & B's records indicated that the inventories would have totaled $24.1 million at December 31, 2017, if determined on an average cost basisIgnoring income taxes, what journal entry will B & B use to record the adjustment in 2018?
Business
1 answer:
babunello [35]3 years ago
6 0

Answer: The journal entry is as follows:

Explanation:

Given that,

Barton and Barton company's inventories were $32.6 million at December 31st, 2017

But the records of B and B's company indicated that inventories would have totaled $24.1 million  December 31st, 2017

Therefore, the journal entry for the adjustment in the records of B and B's company in 2018 is as follows:

                                             <u>Debit</u>                  <u>Credit</u>

Retained Earnings A\c       $8.5 million

To Inventory                                                      $8.5 million

Retained Earnings = $32.6 million - $24.1 million

                               = $8.5 million

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Suppose that two things happen simultaneously in the market for fish. First, a new technology allows fishing boats to catch more
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On January 1, 2016, Parker Company issued bonds with a face value of $62,000, a stated rate of interest of 11 percent, and a fiv
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Answer:

Parker Company

a. Amortization Table

Date                                                 Interest        Discount

                            Cash Payment   Expense   Amortization   Carrying Value

January 1, 2016                                                                            $57,639

December 31, 2016    $6,820         $7,493           $673               58,312

December 31, 2017      6,820            7,581               761              59,073

December 31, 2018      6,820           7,679              859             59,932

December 31, 2019     6,820            7,791               971              60,903

December 31, 2020    6,820            7,917            1,097             62,000

b. The carrying value that would appear on the 2019 balance sheet is:

= $60,903.

c. The interest expense that would appear on the 2019 income statement is:

= $7,791.

d. The amount of cash outflow for interest that would appear in the operating activities section of the 2019 statement of cash flows is:

= $6,820.

Explanation:

a) Data and Calculations:

Face value of bonds =      $62,000

Proceeds from the issue = 57,639

Bonds discount =                $4,361

Stated rate of interest = 11% paid annually on December 31

Effective rate of interest = 13%

December 31, 2016:

Interest expense =      $7,493 ($57,639 * 13%)

Interest payable =       $6,820 ($62,000 * 11%)

Discount amortization    $673 ($7,493 - $6,820)

Bond value = $58,312 ($57,639 + $672)

December 31, 2017:

Interest expense =     $7,581 ($58,312 * 13%)

Interest payable        $6,820 ($62,000 * 11%)

Discount amortization   $761 ($7,581 - $6,820)

Bond value = $59,073  ($58,312 + $761)

December 31, 2018:

Interest expense =     $7,679 ($59,073 * 13%)

Interest payable        $6,820 ($62,000 * 11%)

Discount amortization $859 ($7,679 - $6,820)

Bond value = $59,932 ($59,073 + $859)

December 31, 2019:

Interest expense =     $7,791 ($59,932 * 13%)

Interest payable        $6,820 ($62,000 * 11%)

Discount amortization  $971 ($7,791 - $6,820)

Bond value = $60,903 ($59,932 + $971)

December 31, 2020:

Interest expense =         $7,917 ($60,903 * 13%)

Interest payable           $6,820 ($62,000 * 11%)

Discount amortization  $1,097 ($7,917 - $6,820)

Bond value = $62,000 ($60,903 + $1,097)

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Explanation:

Given that;

Annuity = $150

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Earl is 25years now

Earl plans to withdraw the money when he is 65

which mean Period N = ( 65 - 25 ) = 40

To find the future value, we use use the express

Future value = annuity × (((1+r)^n)-1)/r)

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Future Value = 150 × (((1 + 10/100)^40)-1)/10/100)

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150 × ((45.2592 - 1)/0.1)

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therefore the total sum Earl will receive when he withdraws the money in his  65th birthday is $66,388.86

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<h3>Answer Options:</h3>

A. It is a strategic alliance in which two countries share the risks and rewards of starting a new enterprise together in a foreign country.

B. It is a wholly owned subsidiary in which a foreign subsidiary is totally owned and controlled by an organization.

C. It is a greenfield venture in which owning the organization has been built from scratch.

D. It is an example of a franchise in which a company allows a foreign company to pay it a fee and a share of the profit in return for using the first company’s brand name and a package of materials and services.

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Thus, the counter-trade between these companies is mutually beneficial because of <u>Option E</u>.

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