Accounting Answers

Calculate the tax liability of a company with a turnover of 900,000 adjusted profit of 200,000 with a capital allowance of 110,000

You can buy a machine for $100,000 that will produce a net income, after operating expenses, of $10,000 per year. If you plan to keep the machine for four years, what must the market (resale) value be at the end of four years to justify the investment? Assume interest rate at 15%.

DECEMBER 4 PAYROLL 2020
1.What is the total net pay for all employees?

2.What is the total CIT withheld for all employees?

3.What is the amount of the debit to Employees SIT Payable on December 3?

4.What is the amount of the credit to Employees FIT Payable?

5.What is the amount of the debit to Payroll Taxes?

6.What is the balance of Employees CIT Payable?

7.What is the Cash account balance?

8.What is the amount of FIT withheld for Virginia A. Russell?

9.What is the amount of net pay received by Virginia A. Russell's estate?

10.How many withholding allowances did Virginia A. Russell claim?

11.What is the amount of the debit to Union Dues Payable on December 9?

12.What is the amount of the debit to Payroll Cash?

13.What is the amount of the credit to Employees SUTA Payable?

14.What is the amount that was credited to Group Insurance Premiums Collected (account number 27) during this period?

You own a home industries business where you source home made goods from a community and sell them from a shop at the local shopping center. The following transactions took place in the shop (ignore the impact of vat)

-paid R2000 in cash to home bakers
- sold R3000 goods for cash
- paid weekly wages of R2000
-Sold goods on credit to a restaurant for R1500
-received R1500 owed by the restaurant.

Define the transactions in a table format of assets, owners equity and liabilities

RCK Ltd issues a prospectus inviting the public to subscribe for 90 million ordinary shares of $2.00 each. The terms of the issue are that $1.00 is to be paid on application and the remaining $1.00 within one month of allotment.

Applications are received for 108 million shares during July 2018. The directors allot 90 million shares on 15 August 2018. All applicants receive shares on a pro rata basis. The amounts payable on allotment are due by 20 September 2018. By 20 September 2018 the holders of 18 million shares have failed to pay the amounts due on allotment. The directors forfeit the shares on 30 September 2018.

The shares are resold on 15 October 2018 as fully paid. An amount of $2.00 per share is received. The balance of forfeited shares is refunded on 20 October 2018.

Required:
Provide the journal entries necessary to account for the above transactions and events.

Provide some examples of items that would be adjusted directly against equity, rather than being included as part of profit or loss.

Scenario 1: Rabbit Ltd has, in the past always depreciated its factory buildings over 25 years. As a result of new information obtained by the company during the current year a decision was made to reduce the expected life of the buildings to 18 years.
Scenario 2: During the preparation of the financial statements it was discovered that a flood occurred in the previous financial year that destroyed some raw materials which were stored off-site and that were expected to have a long useful life. The materials were uninsured. No expense was recorded in the previous year in relation to the flood damage. The material was valued at $75000 and the expense is considered to be material and will be permitted as a deduction for tax purposes. The tax rate is 30 per cent.
Required
Identify which of the two scenarios outlined above is a change in accounting estimate and which is a prior period error. Also provide any necessary journal entries.

parent company buys merchandise from its 90% owned subsidiary above cost and does not resell it before year end. What percent of the unrealized profit in the parent's ending inventory shoud be removed from the consolidated net income?

Explain the differences between non current assets and current assets. (provide appropriate examples)
b) State the THREE (3) data required to compute depreciation

d) Explain FOUR (4) causes of depreciation for non current assets. (provide relevant examples).

While the initial accounting for the two types of acquisition (asset acquisition and stock acquisition) differs significantly, a stock acquisition and an asset acquisition in some cases have the same effect of creating one larger single reporting entity and should produce the same consolidated balance sheet. Explain