Please provide answers for a, b, and taking it further. Thanks! NILUJ CAPELLULO recognition? (Hint: Significant cash discounts are a type of variable consideration.) P11-7A Czyz and Ng are accountants at Kwick Kopy Printers, Kwick Kopy has not adopted the revaluati model for accounting for its property, plant, and equipment. The accountants are having disagreements over th following transactions during the fiscal year ended December 31, 2017 1. Kwick Kopy bought equipment on January 1, 2017, for $80,000, including installation costs. The equipment ha. a useful life of five years. Kwick Kopy depreciates equipment using the double diminishing-balance method “Since the equipment as installed in our system cannot be removed without considerable damage, it will have no resale value. It should not be depreciated but, instead, expensed immediately,” Czyz argues. 2. Depreciation for the year was $43,000. Since the company's profit is expected to be low this year, Czyz suggeste deferring depreciation to a year when there are higher profits. 3. Kwick Kopy purchased equipment at a fire sale for $36,000. The equipment would normally have cost $50,000 Czyz believes that the following entry should be made: Equipment 50,000 Cash 36,000 Gain on Fair Value Adjustment of Equipment 14,000 4. Czyz says that Kwick Kopy should carry its furnishings on the balance sheet at their liquidation value, which is $30,000 less than cost. 5. Kwick Kopy rented office space for one year, effective September 1, 2017. Six months of rent at $3,000 per month was paid in advance. Czyz believes that the following entry should be made on September 1: Rent Expense 18,000 Cash 18,000 6. Land that cost $41,000 was appraised at $60,000. Czyz suggests the following journal entry: 19,000 Land Gain on Fair Value Adjustment of Land Ng disagrees with Czyz in each of the situations. Instructions 19,000 (a) For each transaction, indicate why Ng disagrees. Support your answer with reference to the conceptual frame- work definition of elements, qualitative characteristics, assumption, constraint, recognition, and measure- ment criteria. (b) Prepare the correct journal entry to record each transaction. TAKING IT FURTHER Discuss the circumstances in which it is appropriate to record property, plant, an equipment at its liquidation value.
https://zactutor.com/wp-content/uploads/2021/03/logo-300x75.png 0 0 developer https://zactutor.com/wp-content/uploads/2021/03/logo-300x75.png developer2022-07-19 18:52:502022-07-19 18:52:50Please provide answers for a, b, and taking it further. Thanks! NILUJ CAPELLULO recognition? (Hint: