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Question
For each of the accounting treatments below, indicate whether it is followed in GAAP, or IFRS, or both, by placing an X in the appropriate column(s).
| Accounting Treatment | GAAP | IFRS |
| 1. Record the purchase of assets at cost. | ||
| 2. Report assets at current value on the balance sheet. | ||
| 3. May use FIFO for inventory costing. | ||
| 4. May use LIFO for inventory costing. | ||
| 5. Contingent liabilities are accrued under specified circumstances. | ||
| 6. Some preferred stock is classified as a liability. | ||
| 7. Common stock is classified as stockholders equity. | ||
| 8. Current assets precede noncurrent assets on the balance sheet. | ||
| 9. Equity precedes liabilities on the balance sheet. | ||
| 10. Dividends and interest received may be classified as either operating or investing activities. | ||
| 11. May use either the direct method or the indirect method to prepare the statement of cash flows. | ||
| 12. Different parts of a piece of equipment may be depreciated over different periods of time (e.g., for a roller coaster, the engine may be depreciated over 5 years, the seats, over 7 years, and the track over 10 years). |
Answer
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$14,500 Net cash provided by investing activities
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Which of the following statements about straight-line depreciation is correct?
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Q:
Which of the following is not an amount that is needed to calculate straight-line depreciation?
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Q:
Which of the following statements most appropriately describes the purpose of depreciating a long-lived tangible asset?
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Under the cost principle, a company capitalizes:
A) all ordinary repair expenditures incurred in the use of an asset.
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Q:
The following information was summarized from the adjusted trial balance of Reliance Yacht Repair, Inc. as of September 30, 2015, the end of the companys fiscal year. Accounts Payable
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2,000 Cash
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500 Interest Expense
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5,500 Prepaid Rent
500 Retained Earnings
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Part a. Prepare the closing entry for the company for the year ended September 30, 2015.
Part b. Draw a T-account for the Retained Earnings account. Enter the beginning balance into the T-account, post the closing entry, and then determine the ending balance.
Part c. Prepare a post-closing trial balance at September 30, 2015.
Q:
On December 31, 2016, Ditka Inc. had Retained Earnings of $267,800 before its closing entries were prepared and posted. During 2016, the company had service revenue of $168,100 and interest revenue of $81,300. The company used supplies in the amount of $87,900, advertising expenses were $16,400, salaries and wages totaled $18,300, and income tax expense was calculated as $13,700. During the year, the company declared and paid dividends of $6,000.
Required:
Part a. Prepare the closing entries dated December 31, 2016.
Part b. Draw a T-account for the Retained Earnings account. Enter the beginning balance into the T-account, post the closing entries, and then determine the ending balance.