Anderson Accounting Services LLC provides accounting and tax preparation and consulting services. Sometimes customers only wish to have financial statements and/or tax returns prepared. Sometimes customers bundle accounting and tax preparation with consulting services to be provided over a period of time. Sometimes customers only wish to have consulting services provided over a period of time. Because Anderson is a service firm there is no cost of goods sold associated with their services. Round all answers and do not worry about minor rounding differences. Customer is Civic Corporation and they purchase one bundled package Date of contract: 10/1/X7 Tax consulting begins: 10/1/X7 Length of consulting services: 12 months Tax return preparation occurs over the period January through April of 20X8 Length of tax preparation: 4 months Price of tax preparation to be allocated over the return preparation period: $ 8,000 stand alone price Price of consulting services to be allocated over consulting period: $ 18,000 stand alone price Customers are charged a lesser amount as follows for both tax and consulting: $ 24,800 Anderson Accounting Services LLC's current year end: 12/31/X7 Customers pay at the contract date for BOTH the consulting services and the preparation services.
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To determine the total balance in all deferred revenue accounts at the end of the current accounting period (12/31/X7), we need to consider all deferred revenue accounts for any/all performance obligations. In this case, we have two performance obligations: tax Show more…
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The following adjusted revenue and expense accounts appeared in the accounting records of Pashi, Inc., an accrual basis taxpayer, for the year ended December 31, Year 2. Revenues Net sales: $3,000,000 Interest: $18,000 Gains on sales of stock: $5,000 Key-man life insurance proceeds: $100,000 Subtotal: $3,123,000 Costs and Expenses Cost of goods sold: $2,000,000 Salaries and wages: $500,000 Bad debt expense: $13,000 Taxes, other than federal income: $62,000 Interest: $12,000 Contributions: $5,000 Depreciation: $60,000 Other: $40,000 Federal income taxes: $120,000 Subtotal: $2,812,000 Net Income: $311,000 The following additional information is provided: 1. Interest revenue consists of: Corporate bonds: $15,000 Municipal bonds: $3,000 2. Gains on sales of stock consist of the following unrelated corporations: Ral Corp. (bought in May Year 1, sold in June Year 2): $1,000 Blu, Inc. (bought in November Year 1, sold in September Year 2): $4,000 3. Pashi, Inc. owned the key-man life insurance policy, paid the premiums, and was the direct beneficiary. The proceeds were collected on the death of the corporation's treasurer. 4. Bad debt expense represents a reasonable addition to Pashi, Inc.'s allowance for uncollectible accounts, under the method consistently used. Actual accounts written off in Year 2 amounted to $4,000. 5. Taxes, other than federal income, consist of: Payroll taxes: $40,000 Property taxes: $20,000 Penalty for late payment of taxes: $2,000 6. Interest expense consists of $11,000 interest on funds borrowed for working capital and $1,000 interest on funds borrowed to buy the municipal bonds. 7. Contributions were all paid in Year 2 to State University, specifically designated for the purchase of laboratory equipment. 8. Depreciation per books is straight-line. For tax purposes, depreciation amounted to $85,000. 9. Other expenses include premiums of $5,000 on the key-man life insurance policy covering the treasurer, who died in December Year 2. 10. Federal income tax paid in Year 2 amounted to $105,000. The difference between the income tax provision and income tax paid is the result of temporary differences. In the associated cells in column C, enter the appropriate amount for the item you selected in column B. Note that not all areas of the M-1 form are presented here.
Akash M.
1a. A company's Inventory balance at the end of the year was $198,800 and $212,000 at the beginning of the year. Its Accounts Payable balance at the end of the year was $96,000 and $90,800 at the beginning of the year, and its cost of goods sold for the year was $732,000. The company's total amount of cash payments for merchandise inventory during the year equals: a. $724,000 b. $732,000 c. $750,400 d. $713,600 e. $740,000 1b. Use the following information to calculate cash paid for income taxes during the year: Income tax expense $ 68,000 Income tax payable, January 1 16,600 Income tax payable, December 31 20,200 a. $68,000 b. $84,600 c. $31,200 d. $64,400 e. $88,200 1c. An examination of the company's income statement showed the following: net income, $125,000; depreciation expense, $35,500; and gain on sale of long-term plant assets, $9500. An examination of the company's current assets and current liabilities showed the following changes: accounts receivable decreased $10,500; merchandise inventory increased $23,500; prepaid expenses increased $7,300; accounts payable increased $4,500. Using the indirect method, calculate the net cash provided by or used by operating activities. a. $147,800 b. $154,600 c. $175,800 d. $149,800 e. $135,200
Madhur L.
Emily Consultants Company has a fiscal year ending December 31. For each of the following independent situations, indicate the journal entry by selecting the appropriate account descriptions and enter the amount(s). The first transaction is used as an example. Emily Consultants Company has a fiscal year ending December 31. For each of the following independent situations, indicate the journal entry by selecting the appropriate account descriptions and enter the amount(s). The first transaction is used as an example. Independent Situations Debit Account | Amount Credit Account | Amount a. Accrued wages, unrecorded and unpaid at year-end, $480. Wage Expense | 480 Wages Payable | 480 b. Service revenue earned but not yet collected at year-end, $680. Accounts Receivable | 680 Service Revenue | 680 c. Dividends declared during the year, $980, to be paid next year. Dividends payable | 980 Cash | 980 d. Office supplies on hand during the year, $480; supplies on hand at year-end, $240. Supplies Expense | 240 Office Supplies | 240 e. Service revenue collected from customers in advance during the year, $1,580. Cash | 1,580 Unearned Service Revenue | 1,580 f. Depreciation expense for the year, $1,080. Depreciation Expense | 1,080 Accumulated Depreciation | 1,080 g. Earned all but $800 of (e) by the end of the year. Cash | 780 Unearned Service Revenue | 800 h. Sold $2,800 in investments at a gain of $230. Cash | 2,800 Gain on sale of investments | 230 i. Interest on $9,000, 8 percent note payable (borrowed on October 1 of this year); not yet recorded or paid at year end. j. Indicate the closing entry based on balances at year-end in the following accounts: j. Service revenue, $194,000 j. Interest revenue, $75 j. Gain on sale of investments, $230 j. Wage expense, $138,000 j. Depreciation expense, $1,080 j. Interest expense, $180 j. Supplies expense, $240 j. Dividends payable, $980 j. Income tax expense, $1,900
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