Cumulative effect of this accounting change

Assignment Help Financial Accounting
Reference no: EM13144065

On January 7, 2005, Aaron Corporation acquired machinery at a cost of $1,200,000. Aaron adopted the sum-of-the-years’-digits method of depreciation for this machine and had been recording depreciation over an estimated life of five years, with no residual value. At the beginning of 2007, a decision was made to change to the straight-line method of depreciation for this machine. Assuming a 30% tax rate, the cumulative effect of this accounting change, net of tax is?

Reference no: EM13144065

Questions Cloud

Problem on revenue and payroll cycles : What internal controls components are commonly found among the revenue and payroll cycles? What components are unique to each cycle? - Answer 150-200 words.
Application of internal controls to systems : Identify all risks and internal control points by incorporating the controls and risks into the flowcharts. Design internal controls to mitigate risks to the systems. Evaluate the application of internal controls to the systems.
What was balance in the cash account at beginning of oct : the account was debited for a total of $4,250 and credited for a total of $5,340. What was balance in the Cash account at the beginning of October?
What would be the loss accrual : Sue Co. has a probable loss that can only be reasonably estimated within a range of outcomes. No single amount within the range is a better estimate than any other amount. The loss accrual should be:
Cumulative effect of this accounting change : At the beginning of 2007, a decision was made to change to the straight-line method of depreciation for this machine. Assuming a 30% tax rate, the cumulative effect of this accounting change, net of tax is?
What is relationship between inventory and cost of goods : What is the relationship between inventory and cost of goods sold by a pharmacy or medical supply business? Explain the depreciation concept. What items in a physician practice can be depreciated? What is the purpose?
What is the balance of irving capital account : The partnership pays Gast $100,000 cash for her partnership interst. After Gast's retirement, what is the balance of Irving's capital account?
What is the net present value of the investment : Income taxes are not considered in this problem. What is the net present value of the investment assuming the required rate of return is 10 percent? Would the company want to purchase the new machine?
Match her capital deficiency : Prior to the final distribution of cash,Mary's capital balance was $200,000,Ann's capital balance was $150,000,and Tina had a capital deficiency of $50,000. Assuming Tina contributes cash to match her capital deficiency, Mary should receive?

Reviews

Write a Review

 

Financial Accounting Questions & Answers

  Theory question based on revenue recognition

Theory question based on revenue recognition - What factors does the standard discuss that may impair the ability to make a reasonable estimate of returns?

  Highest amount of income tax expense

Which depreciation method would result in the highest amount of income tax expense being paid in the first year of an asset's useful life

  Illustrate what is the amount of dividends received

There were no dividends declared in 2009. The board of directors declares and pays a $90,000 dividend in 2010 and in 2011. Illustrate what is the amount of dividends received by the common stockholders in 2011?

  Purpose the journal entries required on wild expansion co

Purpose the journal entries required on Wild Expansion Co.'s books to record the exchanges.

  Calculation of net income

On the basis of this information, what will be the forecast for Roberts' year-end net income and Calculation of net income

  Explain how depreciation provides a means of expensing

A newly hired manager of a engineering company,does not understand how the cost of the firm's equipment is expensed. In memo format, explain how depreciation provides a means of expensing the cost of equipment.

  Find accounts receivable turnover

Find the financial statements for 2 related/similar companies (Nike and reebok) and calculate the following ratios for each (note whether a particular ratio is not applicable):

  Determine the propriety of harriers plans

Harrier repurchases the stock in 2011. On its 2010 corporate income tax return, Harrier plans to deduct a net capital loss of $3,000. Determine the propriety of Harrier's plans.

  Evaluate the unit product cost for each month

Evaluate the unit product cost for each month using the absorption, variable and throughput costing approaches. Purpose an income statement for November using the variable costing approach

  Evaluate the company''s total required production

Evaluate the company's total required production in units of finished product for the whole three month period ending September 30.

  What is his federal income tax

Richard, a single taxpayer, has adjusted gross income of $40,450. His AGI includes $4,000 of qualified dividends. Richard has no dependents and does not itemize deductions. What is his 2008 federal income tax

  Financial reporting and analysis

Prepare a trial balance at January 31, 2012, in the trial balance columns of the worksheet. Complete the worksheet using the following additional information and Prepare and post adjusting and closing entries.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd