Question 1
CANADIAN TAXABLE INCOME AND TAX PAYABLE FOR INDIVIDUALS Death of a Taxpayer On June 3, 2009, Andrea Steele unexpectedly died of complications associated with minor surgery. Her husband, a man with little experience in financial matters has asked you to assist him with the administration of Mrs. Steele???s estate. After working with her records for several days, you have accumulated the following information: Mrs. Steele has a net capital loss carry forward from 2007 of $76,500. During 2009, but prior to the date of her death, Mrs. Steele???s investments paid eligible dividends of $1,090. In addition, she had Canadian source interest income of $2,025 during this period. Mrs. Steele was the proprietor of a successful boutique that had been in operation for eight years. The fiscal year of this unincorporated business ends on December 31. From January 1, 2009, until the date of Mrs. Steele???s death, this business had net business income for tax purposes of $55,200. The fair market value of the assets of the boutique at the time of Mrs. Steele???s death was $4,800 greater than their UCC. None of the individual assets had a fair market value that exceed its capital cost. In connection with the boutique, Mrs. Steele paid Mr. Steele wages of $425 during the period January 1, 2009 through June 3, 2009. This money was paid for assistance in handling the inventories of the operation. Mr. Steele???s only other income for the year was $2,100 in interest on a group of mortgages, which had been given to him as a gift by Mrs. Steele three years ago. Mrs. Steele had a rental property that she had owned for a number of years. Rents received in 2009, prior to her death, amounted to $41,200, while cash expenses totalled $24,650. The UCC of the building was $144,800 on January 1, 2009. The building had been purchased for $183,000. At the time of her death, an appraisal indicated that the fair market value of the building was $235,000. The land on which the building is situated has a cost of $92,000, and a fair market value at the time of her death that is estimated to be $164,000. Other assets that were owned by Mrs. Steele at the time of her death are as follows: Shares in AGF industries: AGF Industries is a Canadian public company and Mrs. Steele purchased common shares at a cost of $10,600. Their value at the time of Mrs. Steele???s death was $7,900. Shares in Rolston Inc: Rolston Inc is also a Canadian public company and Mrs. Steele purchased shares at a cost of $36,800. Their value at the time of Mrs. Steele???s death was $169,400. Painting: A painting Mrs. Steele had purchased for $8,000 had a fair market value of $37,000 at the time of her death. Residence: Mrs. Steele owned the family home. It had been purchased at a cost of $209,400. At the time of her death, the appraised value of the property was $344,000. The terms of Mrs. Steele???s will provide that the shares in AGF Industries and Rolston Inc., the painting, and the assets of the boutique be left to Mr. Steele. The family home and the rental property are to be left to Mrs. Steele???s 27 year old daughter. REQUIRED: Calculate Mrs. Steele???s minimum 2009 federal tax payable,CANADIAN TAXABLE INCOME AND TAX PAYABLE FOR INDIVIDUALS Death of a Taxpayer On June 3, 2009, Andrea Steele unexpectedly died of complications associated with minor surgery. Her husband, a man with little experience in financial matters has asked you to assist him with the administration of Mrs. Steele???s estate. After working with her records for several days, you have accumulated the following information: Mrs. Steele has a net capital loss carry forward from 2007 of $76,500. During 2009, but prior to the date of her death, Mrs. Steele???s investments paid eligible dividends of $1,090. In addition, she had Canadian source interest income of $2,025 during this period. Mrs. Steele was the proprietor of a successful boutique that had been in operation for eight years. The fiscal year of this unincorporated business ends on December 31. From January 1, 2009, until the date of Mrs. Steele???s death, this business had net business income for tax purposes of $55,200. The fair market value of the assets of the boutique at the time of Mrs. Steele???s death was $4,800 greater than their UCC. None of the individual assets had a fair market value that exceed its capital cost. In connection with the boutique, Mrs. Steele paid Mr. Steele wages of $425 during the period January 1, 2009 through June 3, 2009. This money was paid for assistance in handling the inventories of the operation. Mr. Steele???s only other income for the year was $2,100 in interest on a group of mortgages, which had been given to him as a gift by Mrs. Steele three years ago. Mrs. Steele had a rental property that she had owned for a number of years. Rents received in 2009, prior to her death, amounted to $41,200, while cash expenses totalled $24,650. The UCC of the building was $144,800 on January 1, 2009. The building had been purchased for $183,000. At the time of her death, an appraisal indicated that the fair market value of the building was $235,000. The land on which the building is situated has a cost of $92,000, and a fair market value at the time of her death that is estimated to be $164,000. Other assets that were owned by Mrs. Steele at the time of her death are as follows: Shares in AGF industries: AGF Industries is a Canadian public company and Mrs. Steele purchased common shares at a cost of $10,600. Their value at the time of Mrs. Steele???s death was $7,900. Shares in Rolston Inc: Rolston Inc is also a Canadian public company and Mrs. Steele purchased shares at a cost of $36,800. Their value at the time of Mrs. Steele???s death was $169,400. Painting: A painting Mrs. Steele had purchased for $8,000 had a fair market value of $37,000 at the time of her death. Residence: Mrs. Steele owned the family home. It had been purchased at a cost of $209,400. At the time of her death, the appraised value of the property was $344,000. The terms of Mrs. Steele???s will provide that the shares in AGF Industries and Rolston Inc., the painting, and the assets of the boutique be left to Mr. Steele. The family home and the rental property are to be left to Mrs. Steele???s 27 year old daughter. REQUIRED: Calculate Mrs. Steele???s minimum 2009 federal tax payable,where is the answer?
Question 2
Assignment 2 (100 marks) ? Session 1 Note: This assignment integrates concepts covered in Modules 1 through 6 inclusive. It is worth 100 marks and 10% of your final course grade. Refer to the general instructions in Assignment 1. Part I ? Journal Entries (35 marks) It is July 1, 2013, and you are the accountant for Turnbull Corp. The company operates with monthly accounting periods and has a June year-end. Turnbull Corp. sells only one product. All of the accounting work has been completed through the end of June 2013. The post-closing trial balance as at June 30, 2013, follows: TURNBULL INC. Post-Closing Trial Balance June 30, 2013 Debit Credit Cash 95,000 Accounts receivable1 198,000 Allowance for doubtful accounts 10,923 Merchandise inventory2 240,000 Office supplies 11,600 Store supplies 14,800 Prepaid insurance 2,500 Interest receivable3 29 Office equipment 67,000 Accumulated depreciation ? Office equiptment 16,080 Store equipment 82,000 Accumulated depreciation ? Store equipment 19,680 Note receivable4 14,000 Accounts payable5 176,800 Property tax payable Chris Turnbull, capital 502,046 725,529 725,529 Notes: 1 Accounts receivable balance is made up of ? Purchase by Lakeview Ltd. on June 27 for $195,500 ? Purchase by Rico Inc. on March 26 for $3,100. 2 There are currently 25,000 units in inventory. The company uses a moving weighted-average system (rounding the average cost per unit to the nearest $0.01). 3 Interest receivable represents half month of interest earned on the note receivable but not yet paid at the end of June; refer to the Note receivable amortization schedule for details. 4 This is a 5.0% note due June 15, 2015 with interest and principal payable on the 15th of each month; refer to the Note receivable amortization schedule for details. 5 Accounts payable balance is made up of ? Purchase from Astros Co. on June 11 for $176,800 terms 2/10, n/30. The terms of all credit sales are 2/10, n/30. Merchandise sells for $25.00 per unit. During the month of July, the following events occur: July 1 Collected the amount owing from Lakeview Ltd. 2 Issued cheque to Astros Co. regarding the June purchase. 3 Purchased on credit from Acer Inc. ? 980 units of merchandise at $9.75 per unit; store supplies, $480; and office supplies, $530. Invoice dated July 3, terms 1/10, n/30. 4 Sold 465 units of merchandise on credit to Sharp Ltd. 5 Acer Inc. issued a memorandum regarding the return of 25 defective units of merchandise purchased on July 3. 7 Issued cheque to Boardwalk Corp. in payment of the July rent for $5,000. Charge 60% of the rent to Rent expense, selling space and the balance to Rent expense, office space. 8 Sold 175 units to Houston Inc. for cash. 9 Received the July property tax bill today; $2,500, it will be paid September 15. 9 Purchased store supplies on credit from Acer Inc., invoice dated July 9, terms 1/10, n/15, $3,300. 11 Received payment from Sharp Ltd. for the July 4 sale. 12 Received a $800 credit memorandum from Acer Inc. for defective store supplies received on July 9 and returned for credit. 13 Received 1,260 units of merchandise from Anthro Corp. and an invoice dated July 13 totalling $10,710, terms 1/15, n/60. 14 Issued cheque to Acer Inc. to pay for the July 3 purchase less the July 5 return. 15 Issued cheque, payable to Payroll, in payment of sales salaries, $4,580 and office salaries, $3,380. The cheque was cashed immediately to pay the employees. 15 Collected the interest and principal regarding the Note Receivable (Hint: Refer to the Note receivable amortization schedule. Debit Cash for the amount of the payment, credit Notes receivable for the amount of principal paid, credit Interest receivable for the amount of interest that was accrued at the end of last month, and also credit Interest revenue for the amount of interest earned this month). 17 Sold 675 units of merchandise on credit to Sharp Ltd. 20 Issued cheque to Acer Inc. to pay for the July 9 purchase less the July 12 return. 20 Received 360 units of merchandise and an invoice dated July 20 terms 1/5, n/30, from Acer Ltd., $11.25 per unit. 21 Issued cheque to Anthro Corp. in payment of its July 13 invoice. 24 Determined that the customer account belonging to Rico Inc. was uncollectible and wrote it off. 25 Sold 375 units of merchandise on credit to ABC Events. 26 Received payment from Sharp Ltd. regarding the July 17 sale. 28 Issued cheque to Hydro Corp. in payment of the July utility bill, $794. 29 Received 745 units of merchandise and an invoice dated July 29, terms 1/15, n/60, from Scotch Corp., $7,850 total cost. 31 Issued cheque, payable to Payroll, in payment of sales salaries, $4,580, and office salaries, $3,380. The cheque was cashed immediately to pay the employees. 31 The owner, Chris Turnbull, withdrew $25,000 from the business for personal use, using a cheque. Required Note: Ignore GST, PST, and HST. You can use these working papers. Record the journal entries for the month of July (omit explanations). Note: Sub-ledgers for accounts receivables and accounts payables are not required for this assignment. Therefore when journalizing entries for accounts receivables/payables the name of the customer or supplier is not required on the journal entry. As you record the journal entries, use the inventory sub-ledger to keep track of the moving weighted average cost of inventory. Round to the nearest $0.01 on the inventory sub-ledger. (Posting to accounts receivable and accounts payable sub-ledger accounts or the general ledger accounts is not required for this assignment.) Part II ? Work sheet, adjustments, bank reconciliation and financial statements (65 Marks) It is now August 31, and all journal entries to date have been posted to the appropriate general ledger accounts. The balances have been used to prepare the unadjusted trial balance. Now complete the adjusting entries, bank reconciliation, and the financial statements for the month of August. TURNBULL INC. Unadjusted Trial Balance August 31, 2013 Debits Credits Cash 126,783 Short-term investments 2,050 Accounts receivable 264,800 Allowance for doubtful accounts 10,580 Merchandise inventory 317,997 Office supplies 15,565 Store supplies 19,725 Prepaid insurance 15,000 Interest receivable Office furniture 37,800 Accumulated depreciation ? Office furniture 1,512 Office equipment 87,000 Accumulated depreciation ? Office equipment 19,560 Store equipment 117,870 Accumulated depreciation ? Store equipment 24,395 Note receivable 12,886 Accounts payable 67,425 Property taxes payable 2,500 Chris Turnbull, capital 513,990 Chris Turnbull, withdrawals 28,500 Sales 842,570 Sales returns and allowances 8,426 Sales discounts 4,213 Cost of goods sold 379,157 Bad debts expense Sales salaries expense 17,500 Rent expense, selling space 8,900 Store supplies expense Depreciation expense, store equipment Office salaries expense 7,700 Utilities expense 3,800 Rent expense, office space 4,500 Insurance expense Depreciation expense ? Office furniture Depreciation expense ? Office equipment Office supplies expense Bank service charge expense Delivery expense 2,360 Interest earned Totals 1,482,532 1,482,532 Required Transfer the amounts on the unadjusted trial balance to the appropriate columns on the provided work sheet. Additional information about Turnbull Corp. has been provided below; no adjustments have been made for these items: Office supplies used during August totaled $1,890 The balance in Prepaid insurance represents one year of insurance for coverage. The insurance policy started on August 1, 2013. A count of the store supplies was completed on August 30 and the value on hand was $8,900. Turnbull Corp.?s policy is to depreciate the capital assets by 2% of the book value every month. Round depreciation calculations to the nearest dollar. Due to a safety recall in August a number of items in merchandise inventory were affected. As a result the net realizable value of the merchandise inventory on August 31 was determined to be $301,497. Calculate accrued interest on the note receivable for the last half of August (Hint: Refer to the Note receivable amortization schedule provided). Using historical rates management estimates the percentage of accounts receivable that will be uncollectable. This rate is applied to outstanding accounts. The historical rates and accounts receivable aging schedule are as follows (round the result to the nearest dollar): Percentage uncollective (%) Not yet due 1-30 days past due 31-60 days past due 61-90 days as past due Greater than 91 days past due 0% 5% 15% 35% 60% Turnbull Inc. Accounts receivable aging schedule Not yet due 1-30 days past due 31-60 days past due 61-90 days as past due Greater than 91 days past due Total Accounts receivable $135,048 $68,848 $47,664 $9,268 $3,972 $264,800 Journal the adjusting entries using the general journal from part I (omit explanations) and complete the worksheet. While you are not required to do this here, remember that the adjusting journal entries are then posted to the general ledger before the financial statements and closing entries are prepared. Prepare a bank reconciliation given the following information. Record any entries arising from the bank reconciliation in the general journal from Part I (omit explanations) and complete the worksheet. There were no items outstanding from the July 31 bank reconciliation. The bank statement showed the August 31 balance to be $124,806.00. Chris (the owner) made a deposit on August 31 for $4,258 but the bank was closed by the time he got there so he dropped the deposit off in the night deposit slot. As at August 31, there are 5 cheques totaling $1,689 that have not yet been presented to the bank. Interest received from the bank totaled $1,260. The A/P clerk incorrectly recorded cheque #123 for utilities expense as $435. It should have been recorded as $485. The bank incorrectly recorded cheque #156 for delivery expense as $652; it should have been recorded as $625. There was an NSF cheque for $513 from a customer paying their account. Only the issuer?s bank charges NSF fees. Chris has not yet recorded the $78 bank service charges for the month of August. Complete and total the adjusted trial balance, income statement and balance sheet columns on the work sheet. Prepare a classified multiple-step income statement for the month of August, an August statement of changes in equity, and an August 31 classified balance sheet (round all figures to the nearest dollar). Prepare the closing entries (omit explanations). Submission Submit the following reports to your marker for assessment: Part I: (35 marks) General journal entries (30 marks) Merchandise inventory sub-ledger (5 marks) Part II: (65 marks) Work sheet (6 marks) Adjusting entries (8 marks) August 31 bank reconciliation (8 marks) Entries resulting from the bank reconciliation (4 marks) Documents: Classified multiple-step income statement for the month ending August 31 (15 marks) Statement of changes in equity for the month ending August 31 (5 marks) Classified balance sheet as at August 31 (15 marks). Closing entries (4 marks) 100
Question 3
Date: Wed, 6 FEB 2008 10:24:53 +0000 From: "Darlene Wardlaw" Subject: Inventory For inventory, I?ve attached an inventory memo that I received from Bradley. I thought he sent you a copy already, but I don?t doubt that he didn?t. I don?t think he knows what an inventory observation memo is ? you?ll have to write the memo based upon Bradley?s observation notes and what you observed when you were there on December 31. In addition to writing an inventory observation memo, you will need to tie in Bradley?s test counts on the client?s count sheets to Apollo?s Inventory Warehouse Report. Finally, tie the Inventory Warehouse Report to Apollo?s Inventory Status Report supplied by Karina last week. Next, judgmentally sample a number of unit costs from recent invoices and tie them to the Inventory Status Report. If the numbers agree, tie the Inventory Status Report into the Inventory Lead Schedule. Lastly, tie the lead schedule into the Trial Balance. Be careful to determine the proper accounts for adjustment when inventory is included or excluded from the physical count. By ?included,? I mean that the inventory cost should already be in the general ledger balance shown in the trial balance. When the inventory is adjusted to match the physical count, the adjustment is to cost of goods sold. The Reserve for Inventory Obsolescence decreased significantly from last year. My conversation with Samuel Carboy indicated that they received a huge number of odd-sized shoes from their principal supplier last year against which the previous auditors made them set up a reserve. He indicated that, with the exception of the odd-sized shoes, Apollo generally turns over its entire inventory several times a year. As the quantity of odd sizes gradually decreases, the reserve has been decreased by reducing the reserve and Cost of Goods Sold.
Question 4
The accounting for intangible assets and natural resources is very similar to the processes and practices for property, plant, and equipment. The few exceptions arise from the often legal and contractual nature of intangibles and natural resources. Intangible and natural resource assets are also subject to impairment as are tangible assets, and must be written down from time to time if impairment occurs.Complete the problems from Problem Set A in Chapter 18, pages 626 and 627: * 18.7A, Compute and record depletion of natural resources. * 18.8A, Recording impairment of property, plant, and equipment. * 18.9A, Recording intangible asset acquisition, amortization, and impairment. This is from college accounting price haddock farina chapter1-24 Mcgraw-hill-irwin,This week you learned about accounting for long lived assets. The following problems demonstrate how to determine the cost basis of long-lived assets and the allocation of their costs over estimated useful lives. Complete the problems from Problem Set A in Chapter 18, pages 623 and 624: * 18.1A, Determining the cost to be capitalized for acquisition of assets. * 18.2A, Using different depreciation methods and comparing the results. * 18.3A, Using the straight-line and units-of-output methods of depreciation. * 18.4A, Computing depreciation and MACRS on assets. Note: Click on the link Individual Work - Week 5b and use the template to complete this week's individual work.,Complete the problems from Problem Set A in Chapter 19, pages 668 through 671: * 19.1A, Recording cash investment in a partnership. * 19.2A, Recording investment of assets and liabilities in a partnership. * 19.3A, Preparing a balance sheet for partnership. * 19.4A, Computing and recording allocation of net income with salaries and interest allowed. Note: Click on the link Individual Work - Week 7 and use the template to complete this week's individual work.
Question 5
BALANCED SCORE CARD: This is the 1st of 5 questions I have. If you accept this question and answer satisfactorily, I will direct 4 more separate questions to you with due dates over the next 7 weeks. I will offer $30 for each and provide a $10 bonus if provided with good reference and the links to those references. Since this 1st question has a short suspense I am going to offer $40 plus a $10 bonus. The Project will take the form of putting together background from each of the perspectives for a balanced scorecard approach to an organization or organizational unit with which you are familiar. First, you need to identify an organization to which you have access to at least some information concerning financial data; staffing and human resource systems; marketing and customer relations; information systems; and operations. In 2-3 pages in APA format: ? The name of your organization ? What this organization does ? its mission, vision and overall strategy ? The access you have to information about this organization -- remember, you?ll need information about its financial performance, marketing, internal operations, strategy, and management systems. For the second part of this assignment, consider the organization's mission and strategy from the perspective of its financial operations (from your work on the case, your previous course work, and your background reading, you should be reasonably clear what such operations are). In this section of the assignment you?ll begin to identify objectives and measures relevant to that perspective. ? Identify at least three objectives for improving the organization's financial position, and show how they relate to the mission, vision and strategy of the organization. ? For each objective, develop at least one meaningful performance measure (metric). ? For each objective, identify at least one expected level of performance (target). ? For each objective, identify at least one new action or program that needs to be developed to ensure successful implementation of the organization's strategy (initiative). See attached document for background information and references to help answer this question.
