Homework Help for Accounting

22. State wheter each of the following expenditures incurredduring the current year should be treated as a repair expense orcapitalized and depreciated using MACRS:

a, Replacement of the carpeting in a rental apartment.

b. Replacement of the drill bit on gas-powered post-holedigger

c. Replacement of the water in the ponds of a catfish farm

d. Replacement of spark plugs in a delivery truck

e. Repainting the exterior of a personal use auto

25.Firegly, Inc, acquires business equipment in July 2016 for$2,005,000.

a.What is Firefly's maximum Section 179 deduction for 2016?Explain

b. What happens to any portion of the annual limit not deductedin 2016? Explain

c.What is depreciable basis of the equipment? Explain

27, In 2016, Theo purchases $16,000 of Section 179 property foruse in his delivery business. During 2016, he has $12,000 intaxable income from his business.

a. What is Theo's maximum Section 179 deduction in 2016?Explain

b.Theo's business taxable income for 2017 is $5000. He purchases$1,000 of new Section 179 property in 2017. What is Theo's maximumsection 179 deduction for 2017?

Charles is at a neighbourhood Christmas party with several ofhis flatmates. Over a few
beers, Charles gets into a conversation with a neighbour, William,about mutual
acquaintances. Charles is a senior auditor with a large accountingfirm (although he
tells William that he is a partner at the firm) and William worksfor a large bank. During
the conversation Charles and William discover that they have bothhad professional
dealings with a particular family-owned manufacturing company.William reveals that
the company’s line of credit is about to be cancelled because ofsome irregularities with
the security. Charles is concerned to hear this news because he hasjust participated in
the company’s financial report audit and there was no indication ofany problems with
its borrowings. However, as Charles explains to William, he has hisdoubts about the
patriarch of the family, whom Charles believes is having an affairwith his personal
assistant. Charles also tells William that the family has quietlyincreased its
shareholdings in a listed company that supplies components to thefamily
manufacturing company. The components manufacturing company isabout to
announce to the share market that it has just won a very large, andvery profitable,
contract with a Chinese company.

Discuss the ethical principles that are potentially breached byCharles’s
behaviour at the party and explain how the principles arebreached.

A firm has experienced an increasing currrent ratio but adecreasing operating cash flow to current liabilities ratio duringthe last three years. What is the likely explanation for theseresults?

Hong Kong Taxation

Mr. Cheung holds the following four properties. Each propertyhas its own function.

1. Tsuen Wan property: It was let and derived rental income.

2. Wan Chai property: It was occupied as Mr Cheung’s office forhis sole proprietorship business.

3. Kowloon Tong property: It was Mr Cheung’s home, residentialplace.

4. Kowloon Bay property: It was vacant. No one stay or livethere.

Required: Advice Mr. Cheung the possible Hong Kong tax chargedon him for each of the properties, and also advise him whethermortgage interest on the properties isdeductible.

variable costing is more compatible with cost volumeprofit analysis than is absorption costing.

Information on Psi Phi Inc.’s three products are as follows:

A B C

Unit sales per month ……………………………………………………… 1,600 3,000 1,600

Selling price per unit ………………………………………………………. $10.00 $15.00 $8.00

Variable cost per unit……………………………………………………... (10.40) (12.00) (4.00)

Unit contribution margin………………………………………………….. $(0.40) $3.00 $4.00

Required:

Determine the effect of each of the following situations wouldhave on monthly profits. Each situation should be evaluatedindependently of all others.

Product A is discontinued.

Product A is discontinued and the subsequent loss of customerscause sales of Product B to decline by 200 units.

The selling price of Product A is increased to $11.00 with asales decrease of 300 units.

The price of Product B is increased to $16.00 with a resultingsales decrease of 400 units. However, some of the customers shiftto Product A; sales of Product A increase by 280 units.

Product A is discontinued, and the plant in which Product A wasproduced is used to produce Product D, a new product. Product D hasa unit contribution margin of $0.60.Monthly sales of Product D arepredicted to be 1,200 units.

The selling price of Product C is increased to $9.00 and theselling price of Product B is decreased to $14.00.Sales of ProductC decline by 400 units, while sales of Product N increase by 600units.

Recommend at least two (2) tax-planning strategies thattaxpayers could implement in order to ensure that the itemizeddeductions exceed their standard deductions, including thosedeductions that do not require itemization in order to reduce taxliability. Provide support for your recommendation.

Identify at least two (2) deductions that impact the amount ofthe itemized deduction claimed, and suggest at least two (2)tax-planning strategies for maximizing such deductions. Providespecific recommendations.

The Taxpayer Relief Act of 1997 (changing treatment of the sale of principal residences)

1. What is ordinary, necessary and reasonable in relation tobusiness expenses deduction.

2.Discuss geographic impact on the above.

3. Discuss the impact of cash bases and accrual based accountingin business expense deductions.

I need help paraphrasing these 6 sentences

1-The current ratio and quick ratio were a little below the industry average initially. However, the quick ratio fell by a lot while the current ratio fell by just a little. This indicates a build-up in inventory relative to other current assets.

2-All asset management ration were close to the industry averages initially (although the DSO was a little better than the industry average. However, all ratios worsened, with the inventory turnover showing the biggest change, which again indicates a buildup in inventory.

3-All profit margins improved and are comparable to the industry averages.

4- ROE improved because the profit margin improved and the equity multiplier increases, despite the reduction in the total asset turnover ratio. Thus, J&W became more profitable, more leveraged, but less efficient.

5-Common size analysis shows that inventories now make up a greater proportion of assets and that the combined long-term debt and notes payable make up a greater proportion of liabilities & equity. Profits margins have gone up (even though interest expense has also gone up).

6- Percent change analysis shows that sales increased at a rate of 5%, but that several items grew much faster. For example, inventories grew by 50%. Notes payable also grew by a substantial amount. Fortunately, profitability also grew by more than sales. The trend analysis confirms that profitability increased, but the increase in inventories is a red flag.

Where would the Goods in Process Inventory account appear on a set of financial statements?

plant asset section on the balance sheet

cost of goods sold section on the balance sheet

operating expense section on the income statement

current asset section on the balance sheet

Which of the following best describes how you would determine the cost to make a product?

actual materials + actual direct labor + applied factory overhead

actual materials + actual direct labor + actual factory overhead

estimated materials + estimated direct labor + applied overhead

actual materials + actual direct labor

Assume you work for a job cost manufacturer. Where would you look to find the overhead cost allocated to one particular job?

a. labor time record c. materials requisition

b. job cost sheet d. schedule of costs of goods manufactured

purchased 30, 6% Company bands for $30000 cash plus brokeragefees of $300. Interest is payable semiannually on July 1 andJanuary 1. The entry to record the July 1 semiannual interestpayment would include a:

a. Credit to interest revenue for $900.

b. Credit to interest Revenue for $909.

c. Credit to Debt Investments for $909.

d. Debt to Interest Receivable for $900.