Reference no: EM131776239
1. S-Pilot Company incurred the following costs during 2016:
|
Design of tools, jigs, molds and dies involving new Technology
|
$250,000
|
|
Modification of the formulation of a process
|
320,000
|
|
Troubleshooting in connection with breakdowns during commercial production
|
200,000
|
|
Adaption of an existing capability to a particular customer's need as Part of a continuing commercial activity
|
220,000
|
In its 2016 income statement, what expense should S-Pilot report for research and development?
2. Alton Inc. purchased equipment for $20,000 on January 1, 2015. The estimated useful life is 5 years and the residual at the end of the five years is $2,000. Alton uses the double-declining balance depreciation method. What will be the carrying value (book value) at December 31, 2017?
3. A Company on January 1, 2017 purchased B Company at a cost that resulted in recognition of goodwill of $300,000. During the first quarter of 2017, A Company spends an additional $120,000 on expenditures designed to maintain goodwill. In its December 31, 2017 balance sheet, what amount should A Company report as goodwill?
4. Assume a corporation has a cash surrender value of $20,000 at the beginning of the year. During the year, a premium of $100,000 is paid, and the cash surrender value at the end of the year is $32,000.
Required: Record the entry for the premium payment.