A plant site donated by a city to Ace Manufacturing, which plans to open a new factory, should be recorded on Ace's books at: a. The nominal cost of taking title to it b. It's fair market value c. Zero value, but footnoted d. The value assigned to it by the company's directors
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A plant site donated by a city to Ace Manufacturing, which plans to open a new factory, should be recorded on Ace's books at:
a. The nominal cost of taking title to it
b. It's fair market value
c. Zero value, but footnoted
d. The value assigned to it by the company's directors
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- What is the maximum price you would be willing to pay for the business? If an investor group purchased the restaurant near the campus for $255,867 and the fair value of the assets they acquired was $202,000, identify the account along with its balance, that is used to record the additional amount paid over the fair value of the assets.The following expenditures shall be expensed when incurred, except O Payment in advance of delivery of goods or the rendering of services. O Start up costs O Advertising and promotion costs O Business relocation or reorganization costs Which of the following items would qualify as an intangible asset? * College tuition fees paid to employees who decide to enroll in an executive MBA program while working with the company. O Legal costs paid to intellectual property lawyers to register a patent. O Advertising and promotion on the launch of a huge product. Operating losses during the initial stages of the project. Which is not considered a research and development activity? O Design, construction and operation of a pilot plant. O Laboratory research aimed at discovery of new knowledge. O Conceptual formulation and design of possible product or process. O Routine on-going effort to refine, enrich or improve quality of existing product. Which statement is correct concerning the amortization…A company may acquire plant assets (among other ways) for cash, on a deffered payment plan, by exchanging other assets, or by a combination of these ways. Required: Identify six costs that should be capitalized as the cost of the land. For your answer, assume that land with an existing building is acquired for cash and that the existing building is to be removed in the immediate future so that a new building can be constructed on the site! At what amount should a company capitalize a plant asset acquired on a deffered payment plan? In general, at what amount should plant assets received in exchange for other nonmonetery assets to be recorded a new machine acquired by exchanging an older, similar machine and paying cash? Would your answe be the same if cash were received?
- During the current year, Alanna Co. had the following transactions pertaining to its new office building. A. What should Alanna Co. record on its books for the land? The total cost of land includes all costs of preparing the land for use. The demolition cost of the old building is added to the land costs, and the sale of the old building scrap is subtracted from the land cost. B. What should Alanna Co. record on its books for the building?On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 March 1, 2021 BY June 30, 2021 October 1, 2021 January 31, 2022 April 30, 2022 August 31, 2022 On January 1, 2021, the company obtained a $4,600,000 construction loan with a 15% interest rate. The loan was outstanding all of 2021 and 2022. The company's other interest-bearing debt included two long-term notes of $2,000,000 and $8,000,000 with interest rates of 8% and 12%, respectively. Both notes were outstanding during all of 2021 and 2022. Interest is paid annually on all debt. The company's fiscal year-end is December 31. $1,870,000 1,560,000 1,760,000 1,560,000 414,000 747,000 1,044,000 Required: 1. Calculate the amount of interest that Mason should capitalize in 2021 and 2022 using the specific interest method. 2. What is the total cost of the…During the current year, Alanna Co. had the following transactions pertaining to its new office building. A. What should Alanna Co. record on its books for the land? The total cost of land includes all costs of preparing the land for use. The demolition cost of the old building is added to the land costs, and the sale of the old building scrap is subtracted from the land cost. B. What should Alanna Co. record on its books for the building?
- During the current year, Alanna Co. had the following transactions pertaining to its new office building. Purchase price of land Legal fees for contracts to purchase land Architech fees Demolition of the old building on site Sale of scrap from old building Construction cost of new building A. What should Alanna Co. record on its books for the land? The total cost of land includes all costs of preparing the land for use. The demolition cost of the old building is added to the land costs, and the sale of the old building scrap is subtracted from the land cost. $130,000 5,000 20,000 8,000 7,000 610,000 B. What should Alanna Co. record on its books for the building?American Golf Corporation operates golf courses throughout the country. For each of thefollowing items, enter the correct letter to show whether the cost should be capitalized (C) orexpensed (E).Transactions1. Purchased a golf course in Orange County, California.2. Paid a landscaping company to clear 100 acres of land on which to build a new course.3. Paid a landscaping company to apply fertilizer to the fairways on its Coyote Hills GolfCourse.4. Hired a building maintenance company to build a 2,000-square-foot addition on aclubhouse.5. Hired a building maintenance company to replace the locks on a clubhouse and equipment shed.6. Paid an advertising company to create a campaign to build goodwill.You own a construction company and have recently received a contract with the local school district to refurbish one of its elementary schools. You are given an up-front payment from the school district in the amount of $5 million. The contract terms extend from years 2018 to 2020. When would you recognize revenue for this payment? What method of accounting would you use for this construction project and why? What would be the benefits and challenges with your method selection? Give an example of your distribution selection and associated costs of the project (you may estimate based on other industry competitors). What might be some benefits and challenges associated with the other method of construction revenue recognition?
- A company may acquire property, plant, and equipment and intangible assets for cash, in exchange for a deferred payment contract, by exchanging other assets, or by a combination of these methods. Required: 1. Identify six types of costs that should be capitalized as the cost of a parcel of land. For your answer, assume that the land has an existing building that is to be removed in the immediate future in order that a new building can be constructed on the site. 2. At what amount should a company record an asset acquired in exchange for a deferred payment contract? 3. In general, at what amount should assets received in exchange for other nonmonetary assets be valued? Specifically, at what amount should a company value a new machine acquired by exchanging an older, similar machine and paying cash?Finley Company is looking for a new office location and sees a building with a fair value of $740,000. Finley also notices that much of the equipment in the existing building would be useful to its own operations. Finley estimates the fair value of the equipment to be $114,000. Finley offers to buy both the building and the equipment for $790,000, and the offer is accepted. Determine the amounts Finley should record in the separate accounts for building and equipment. (Do not round intermediate calculations.)Cornett Company, a tennis racket manufacturing company, was given $600,000 worth of property from an independent developer as an incentive to build a factory there. Required: Prepare the journal entry for Cornett to record the receipt of the land.