Prepare the journal entry to record the accounting change

Assignment Help Accounting Basics
Reference no: EM132013627

Problem 1 - On January 1, 2011, Denozzo Builders evaluated its long-term construction contracts and decided to change them from the completed contract method of accounting to the percentage-of-completion method. Denozzo Builders will then use the completed contract solely for tax purposes. The tax rate is 40%. The following table provides the relevant data concerning the change:

Income before        Income Tax

Year

% of Completion

Completed Contract

Before 2010

$600,000

$400,000

2010

$500,000

$300,000

2011

$450,000

$400,000

Prepare the Journal Entry to record the accounting change.

Problem 2 - The Tildy Company bought a bulldozer for $120,000 on Jan 1, 2009. They have been recording depreciation based upon the sum-of-the-years-digits according to a five year useful life and no salvage value for the bulldozer. On January 1, 2011, Tildy switched to the straight line method of depreciation. The estimate life is the same and so is the salvage value.

1. Prepare the appropriate journal entry, if any, to record the accounting change.

2. Prepare the journal entry to record the depreciation expense for 2011.

Reference no: EM132013627

Questions Cloud

Explain why the use of budgetary slack may be unethical : Explain why the use of budgetary slack may be unethical. Briefly discuss future implications if this situation is not resolved
Baldwin product brat has material costs : Baldwin's product Brat has material costs that are rising from $13.66 to $14.66. Assume that period costs and other labor costs remain unchanged.
Read the screenplay of favorite movie : Would you rather read the screenplay of your favorite movie or watch a movie based on your favorite book?
What is coefficient of variability for the variable price : Using Excel and the "Whitner Data Set" file located in e-learning, conduct a Data Analysis (Descriptive Statistics) of the variable "Price".
Prepare the journal entry to record the accounting change : Denozzo Builders will then use the completed contract solely for tax purposes. The tax rate is 40%. Prepare the Journal Entry to record the accounting change
Examine the variety of preemployment tests : Examine the variety of preemployment tests available for organizations and describe which of the tests you would use at your company if you were hiring security
Risks of starting a new business : If the risks of starting a new business are deemed too high by an individual, he/she might choose to stay with his/her current company and try to develop
Jcaho in the process of accreditation : Why do health care organizations seek accreditation from the JCAHO? What is the role of the JCAHO in the process of accreditation?
Hcis issues and challenges : What are the current issues and challenges pertaining to the use of health care information systems (HCIS) that providers and organizations

Reviews

Write a Review

Accounting Basics Questions & Answers

  Bee-in-the-bonnet company purchased office supplies costing

bee-in-the-bonnet company purchased office supplies costing 6000 and debited office supplies for the full amount. at

  Discuss why the gross profit on intercompany sales

Discuss why the gross profit on intercompany sales, rather than profit after deduction selling and administrative expenses

  What is the total applied overhead

If a product's total cost is $200 and the prime cost is $150, what is the total applied overhead if 1000 units are produced

  An estimated economic life of eight years and no residual

On January 1, 2010, Nelson Company leases certain property to Queens Company at an annual rental of $60,000 payable in advance at the beginning of each year for eight years.

  Securities held by an investment trust fund and carried on

securities held by an investment trust fund and carried on the books at 100000 are sold for 110000. on receiving the

  Write appropriate hypotheses

The average age of online consumers a few years ago was 23.3 years. As older individuals gain con- fidence with the Internet, it is believed that the average age has increased. We would like to test this belief.

  George wilson purchased bright light industries common

george wilson purchased bright light industries common stock for 47.50 on january 31 2010. the firm paid dividends of

  Avocado company has an operating income of 108000 on

avocado company has an operating income of 108000 on revenues of 1002000. average invested assets are 507000 and

  How many jeans must tuff kids sell in order to break even

How many jeans must Tuff Kids sell in order to break even? How many jeans would Tuff Kids have to sell to earn the net income in part 2b?

  What advancement in the mortgage market set

What advancement in the mortgage market set the foundation for the subprime crisis and why?

  Sally and bill are married and file joint returns in 2012

sally and bill are married and file joint returns. in 2012 bill an accountant has a salary of 75000 and sally receives

  Abc company employs a periodic inventory system and sells

abc company employs a periodic inventory system and sells its inventory to customers for 25 per unit. abc company had

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