login   register  
melakie10
melakie10
 All content arrowdown greybar search
messages send message
 
 Question

E11-4 (Depreciation Computations—Five Methods) Wenner Furnace Corp. purchased machinery for $527,310 on May 1, 2012. It is estimated that it will have a useful life of 10 years, salvage value of $28,350, production of 453,600 units, and working hours of 25,000. During 2013 Wenner Corp. uses the machinery for 2,650 hours, and the machinery produces 48,195 units.

Instructions
From the information given, compute the depreciation charge for 2013 under each of the following
methods. (Round to the nearest dollar.)
(a) Straight-line.
(b) Units-of-output.
(c) Working hours.
(d) Sum-of-the-years’-digits.
(e) Double-declining-balance.

P11-6 (Depletion, Timber, and Extraordinary Loss) Conan O’Brien Logging and Lumber Company owns 3,300 acres of timberland on the north side of Mount Leno, which was purchased in 2000 at a cost of $620 per acre. In 2012, O’Brien began selectively logging this timber tract. In May of 2012, Mount Leno erupted, burying the timberland of O’Brien under a foot of ash. All of the timber on the O’Brien tract was downed. In addition, the logging roads, built at a cost of $158,000, were destroyed, as well as the logging equipment, with a net book value of $328,300.

At the time of the eruption, O’Brien had logged 20% of the estimated 540,000 board feet of timber.
Prior to the eruption, O’Brien estimated the land to have a value of $290 per acre after the timber was
harvested. O’Brien includes the logging roads in the depletion base.

O’Brien estimates it will take 3 years to salvage the downed timber at a cost of $749,400. The timber
can be sold for pulp wood at an estimated price of $2 per board foot. The value of the land is unknown,
but must be considered nominal due to future uncertainties.

Instructions
(a) Determine the depletion cost per board foot for the timber harvested prior to the eruption of Mount
Leno.
(b) Prepare the journal entry to record the depletion prior to the eruption.
(c) If this tract represents approximately half of the timber holdings of O’Brien, determine the
amount of the extraordinary loss due to the eruption of Mount Leno for the year ended
December 31, 2012.

E12-16 (Accounting for R&D Costs) Margaret Avery Company from time to time embarks on a research program when a special project seems to offer possibilities. In 2011 the company expends $320,940 on a research project, but by the end of 2011 it is impossible to determine whether any benefit will be derived from it.

Instructions
 (a) The project is completed in 2012, and a successful patent is obtained. The R&D costs to complete the project are $125,520. The administrative and legal expenses incurred in obtaining patent number 472-1001-84 in 2012 total $30,500. The patent has an expected useful life of 5 years. Record
these costs in journal entry form. Also, record patent amortization (full year) in 2012.

(b)In 2013, the company successfully defends the patent in extended litigation at a cost of $40,960,
thereby extending the patent life to December 31, 2020. What is the proper way to account for this
cost? Also, record patent amortization (full year) in 2013.

 

P12-1 (Correct Intangible Asset Account) Reichenbach Co., organized in 2011, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2012 and 2013.

Intangible Assets
7/1/12 8-year franchise; expiration date 6/30/19 $54,960
10/1/12 Advance payment on laboratory space (2-year lease) 26,000
12/31/12 Net loss for 2011 including state incorporation fee, $1,980,
and related legal fees of organizing, $45,900 (all fees
incurred in 2011) 16,690
1/2/13 Patent purchased (10-year life) 84,920
3/1/13 Cost of developing a secret formula (indefinite life) 77,190
4/1/13 Goodwill purchased (indefinite life) 275,500
6/1/13 Legal fee for successful defense of patent purchased above 21,505
9/1/13 Research and development costs 167,800

Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. (List multiple deb/credit entries from largest to smaller amount, e.g. 10,5, 2) 
willing to payi am willing to pay 20.00 USD for this help.  ( negotiable )
subjectthis question is about Accounting
due datedue January 20 2014


posted :January 20 2014


 Answers





RAJDEEPSOF
 RAJDEEPSOF
quote
y solu...(5 more words & 2 attachments).
attachments
 2013-11-12_091344_conan.xlsx (9KB)  
 Questions.docx (15KB)