This website uses cookies to ensure you have the best experience. Learn more

Answer To Problem 2 Finacc2 Essay

7904 words - 32 pages

CHAPTER 2
PROBLEM 2-1 Multiple choice (IFRIC 13)
1. It is a marketing scheme whereby an entity grants award credits to customers and the entity can redeem the award credits in exchange for free or discounted goods or services.
a.. Customer Loyalty Program c. Marketing Program

b. Premium plan d. Loyalty award
2. The award credits granted to customers under a customer loyalty program is often described as
a. Points b. Awards c. Credits d. Loyalty

3. The consideration allocated to the award credits is measured at
a. Fair value of award credits
b. Carrying amount of goods to be received in exchange
c. Fair value of the goods to be received in exchange
d. The proportion of ...view middle of the document...

The accrual approach in accounting for product warranty cost
a. Is required for income tax purposes
b. Is frequently justified on the basis of expediency when warranty cost is immaterial
c. Finds the expense account being charged when the seller performs in compliance with the warranty

d. Represents accepted practice and should be used whenever the warranty is an integral and inseparable part of the sale.

2. Which of the following best describes the accrual approach of accounting for warranty cost?
A. Expensed when paid
b. Expensed when warranty claims are uncertain
c. Expensed based on estimate in year of sale
d. Expensed when incurred

3. Which of the following best describes the accrual approach of accounting for warranty cost?
a. Expensed based on estimate in year of sale
b. Expensed when liability is accrued
c. Expensed when warranty claims are uncertain
d. Expensed when incurred

4. An entity has a continuing policy of guaranteeing new products against defects for three years. What is the classification of the estimated warranty liability?
a. Noncurrent
b. Current
c. Partly current and partly noncurrent
d. No need for disclosure

5. Which of the following is a characteristic of the accrual of warranty but not the sale of warranty?
a. Warranty liability
b. Warranty expense
c. Unearned warranty revenue
d. Warranty revenue

PROBLEM 2-3 (IAA)
Required: Prepare journal entries that would be made in 2014 and 2015 to record sales, premium purchases, and redemptions, and year-end adjustments
2014
Cash 3,600,000
Sales 3,600,000
* To record the sales

Premiums-Plates 390,000
Cash 390,000
* To record the purchase of the premiums

Cash (5000x10) 50,000
Premium Expense (5000x40) 200,000
Premiums- Plates (5000x50) 250,000
* To record the redemption

Premium Expense (2000x60) 120000
Estimated premium liability 120000
* To record the liability for the premiums at the end of the first year
2015
Cash 4,200,000
Sales 4,200,000
* To record the sales

Premiums-Plates 580,000
Cash 580,000
* To record the purchase of the premiums

Cash (9000x10) 90,000
Premium Expense (9000x40) 360,000
Premiums- Plates (9000X50) 450,000
* To record the redemption

Premium Expense (3000x60) 180,000
Estimated premium liability 180,000
* To record the liability for the premiums at the end of the first year

PROBLEM 2-4 (IAA)
Required: Prepare journal entries to record the transactions relating to the premium plan for the current year.
Cash (400,000X9) 3,600,000
Sales 3,600,000
* To record the sales

Premiums 900,000
Cash 900,000
* To record the purchase of the premiums

Premium Expense 30,000
Cash 30,000
* To record nondeferrable costs applicable to the premium plan

Cash (8000x5) 40,000
Premium Expense (8000X85) 680,000
Premiums (8000x90) 720,000
* To record the redemptions

Premium expense...

Other Papers Like Answer To Problem 2 Finacc2

Cosc 1301 Final Essay

4868 words - 20 pages records a particular user is allowed to read. Answer Selected Answer: False Correct Answer: False • Question 1 1 out of 1 points It is easy for most consumers to fix a problem that occurs at run-time, which is why the box appears asking if you want to debug. Answer Selected Answer: False Correct Answer: False • Question 2 1 out of 1 points Control structures are instructions that specify the sequence

Eco550 Midterm Part 1 Essay

1024 words - 5 pages Economic profit is defined as the difference between revenue and ____. Answer Selected Answer: total economic cost Correct Answer: total economic cost . Question 2 .4 out of 4 points Correct The form of economics most relevant to managerial decision-making within the firm is: Answer Selected Answer: microeconomics Correct Answer: microeconomics . Question 3 .4 out of 4 points Correct The moral hazard

Course Business and Society Test Quiz 2

1140 words - 5 pages Answer: Study the results and make necessary adjustments. Correct Answer: Study the results and make necessary adjustments. Question 2 5 out of 5 points Correct A corporation’s issue management activities are usually linked to: Answer Selected Answer: Both the board of directors and top management levels. Correct Answer: Both the board of directors and top

Course Health Services Marketing Test Quiz 10

1281 words - 6 pages Correct If a company is giving away too many services free, how can it tighten up policies to solve the problem? Answer Selected Answer: The company should offer and price services at different levels. Correct Answer: The company should offer and price services at different levels. Question 20 4 out of 4 points Correct What is a comprehensive, systematic, independent and periodic

Cse Quiz

1763 words - 8 pages an e-mail attachment named OurProject.tif. Andy tries to open the attachment but can’t. His problem may be that ___.Answer | | | | | Selected Answer: |  b.  he doesn’t have the correct software | Correct Answer: |  d.  any of the above | | | | |  Question 10 0 out of 0.5 points | | | The strengths of Mac OS include ____.Answer | | | | | Selected Answer: |  d.  all of the above | Correct Answer: |  c.  security

Mat 540 Quiz 4 2015

1433 words - 6 pages  Question 1 2 out of 2 points | | | A constraint for a linear programming problem can never have a zero as its right-hand-side value.  Answer | | | | | Selected Answer: |  False | Correct Answer: |  False | | | | |  Question 2 2 out of 2 points | | | When using a linear programming model to solve the "diet" problem, the objective is generally to maximize profit.  Answer | | | | | Selected Answer: |  False

Course Phed-1106-Py1 Walking and Fitness

1204 words - 5 pages Selected Answer: 2. the beginner to exercise Question 3 2 out of 2 points Resting heart rate_____ with exercise. Answer Selected Answer: b. decreases Question 4 0 out of 2 points The energy system for muscle contraction during the first few seconds of exercise is the: Answer Selected Answer: a. lactate acid system Question 5 2 out of 2 points The ability of a muscle to exert maximum force against resistance is Answer

Manerial Economics and Globalization

999 words - 4 pages Question 1 4 out of 4 points | | | When demand elasticity is ____ in absolute value (or ____), an increase in price will result in a(n) ____ in total revenues.Answer | | | | | Selected Answer: |    less than 1; inelastic; increase | Correct Answer: |    less than 1; inelastic; increase | | | | | Question 2 4 out of 4 points | | | Iron ore is an example of a:Answer | | | | | Selected Answer

Quiz 4 Mkt 402

1334 words - 6 pages aligning cost with the increase Question 2 2 out of 2 points Correct _____ allows high initial pricing when profits from selling to fewer price insensitive customers exceed those of selling to a larger market share at lower prices. Answer Selected Answer: Skim pricing Correct Answer: Skim pricing Question 3 2 out of 2 points Correct _____ is a low cost method of testing new prices on a portion of the market and is particularly

Mat540Quiz1

974 words - 4 pages Selected Answer: all of the above Correct Answer: all of the above Question 9 2 out of 2 points Correct A university is planning a seminar. It costs $3000 to reserve a room, hire an instructor, and bring in the equipment. Assume it costs $25 per student for the administrators to provide the course materials. If we know that 20 people will attend, what price should be charged per person to break

Quiz 1 540 Math

992 words - 4 pages $180. What their variable cost per occupied room? Answer Selected Answer: $40 Correct Answer: $40 • Question 10 2 out of 2 points EKA manufacturing company produces Part # 2206 for the aerospace industry. Each unit of part # 2206 is sold for $15. The unit production cost of part # 2206 is $3. The fixed monthly cost of operating the production facility is $3000. How many units of part # 2206 have to be sold in a

Related Essays

Cis 175 Final Essay

1773 words - 8 pages Base 2   10 Base 5   | Correct Answers: |    10 Base 2    10 Base 5   | | | | | * Question 3 2 out of 2 points | | | Which of the following is a common Layer 2 protocol that could run over a dedicated leased line?Answer | | | | | Selected Answer: |   Point-to-Point Protocol (PPP) | Correct Answer: |   Point-to-Point Protocol (PPP) | | | | | * Question 4 2 out of 2 points | | | SONET uses

Mat540 Quiz 5 Essay

1088 words - 5 pages correctly models this situation? Answer Selected Answer: x1 + x5 ≤ 1, x2 + x5 ≤ 1 Correct Answer: x1 + x5 ≤ 1, x2 + x5 ≤ 1 • Question 17 0 out of 2 points Incorrect Assume that we are using 0-1 integer programming model to solve a capital budgeting problem and xj = 1 if project j is selected and xj = 0, otherwise. The constraint (x1 + x2 + x3 + x4 ≤ 2) means that __________ out of the 4 projects

Quiz.1.Soc100 Essay

859 words - 4 pages . | | | | | | | | | | Question 5 2 out of 2 points | | | |[pic] |The sociologist who called on his colleagues to be “value-free” was: | | | | | |Answer | | | | | |Selected

Mat 540 Q5 Essay

1126 words - 5 pages | | | | | * Question 4 2 out of 2 points | | | The solution to the LP relaxation of a maximization integer linear program provides an upper bound for the value of the objective function.   Answer | | | | | Selected Answer: |  True | Correct Answer: |  True | | | | | * Question 5 2 out of 2 points | | | If we are solving a 0-1 integer programming problem with three decision variables, the constraint x1 + x2