Intermediate Financial Accounting I

PART A Answer the following questions. (7*2) 1) Which organization initiated the convergence process between GAAP and IFRS and why 2) Why sometimes soft assets can be more important that hard assets? 3) Mr. Tee order ...

PART A Answer the following questions. (7*2) 1) Which organization initiated the convergence process between GAAP and IFRS and why 2) Why sometimes soft assets can be more important that hard assets? 3) Mr. Tee ordered two computers which he is going to receive after 1 month. He is going to pay for the computers after their arrival. Besides, one of this computer is for his personal use at home. Should Mr. Tee record this transaction in the accounting book of the business? Give your explanations. Which accounting principle or assumptions should we apply here? 4) Evergreen Co. has land that he has purchased at the cost of $85,000. Currently, the value of the land has been appreciated by $30,000. Should evergreen recognize any loss or gain in the income statement? Give your explanations. 5) Which method to account for allowance for doubtful account is better according to you and why? 6) Lawrence Co. restricted 50% of its’ retained earnings for further expansion of the business. What do we call this restriction and how should we report this? 7) What is the normal balance for bank overdraft and why? PART B 1) Presented below is information related to Opra Company for 2019. Beginning retained earnings $ 120,400 Sales discounts 55,500 Interest expense 12,700 Sales commission expenses 44,400 Sales returns and allowances 85,000 Sales revenue 5,800,000 Dividend revenue 51,000 Cost of goods sold 1,175,100 Loss on sale of plant assets 85,500 Unrealized gain on held-to-maturity investments 15,000 Loss on the disposition of retail division 95,000 Salaries and wages expense 284,000 Unearned sales revenue 115,000 Freight-Out 45,000 Telephone and Internet expense 19,000 Utilities expense 40,000 Instructor: Ani Total Marks: 55 Insurance expense 18,000 Advertising expense 85,000 Loss due to Hailstorm 70,000 Depreciation expense 58,000 Write-off-of Goodwill 125,000 Dividends declared and paid on Common Stock 50,000 Dividends declared and paid on Preferred Stock 40,000 During 2019, there were 900,000 shares of common stock outstanding all year. (Assume a tax rate of 30% on all items, unless indicated otherwise.)