Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 13, Problem 16RE
To determine
Record the journal entries in the books of Company C for the annual payment at the beginning and the adjustment needed at the end of the year to recognize the change in the surrender value.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Hunter Corporation pays an annual insurance premium of $8,500 to cover the lives of its board officers. According to the terms of the insurance contract, the cash surrender value of the policies increase from $10,000 to $11,500 during that year. The adjusting entry that Hunter would record at the end of the year to increase the cash surrender value would include a
credit to Insurance Expense for $8,500.
debit to Prepaid Insurance for $8,500.
debit to Cash Surrender Value of Life Insurance for $1,500.
credit to Cash for $1,500.
On Jan. 1, 2010, ABC entered into an insurance contract covering the life of its founder. The P100,000 annual insurance premium is payable at the start of the year. By the end of the fifth year, the insurance will have a cash surrender value and it was as follows for the following years:Year Cash Surrender Value2014 P80,0002015 100,0002016 130,0002017 180,000
What is the journal entry on Dec. 31, 2014 to recognized the cash surrender value and adjust the related accounts? Parenthetical solutions would suffice.
Riverrun Co. provides medical care and insurance benefits to its retirees. In the current year, Riverrun agrees to pay $5,500 for medical insurance and contribute an additional $9,000 to a retirement program. Record the entry for these accrued (but unpaid) benefits on December 31.
Chapter 13 Solutions
Intermediate Accounting: Reporting And Analysis
Ch. 13 - Prob. 1GICh. 13 - Provide brief definitions for the following terms:...Ch. 13 - What are the three categories of investments in...Ch. 13 - Prob. 4GICh. 13 - Prob. 5GICh. 13 - Identify the accounting methods a company uses for...Ch. 13 - Briefly summarize the accounting for an investment...Ch. 13 - Prob. 8GICh. 13 - Prob. 9GICh. 13 - Prob. 10GI
Ch. 13 - Prob. 11GICh. 13 - Prob. 12GICh. 13 - Prob. 13GICh. 13 - Prob. 14GICh. 13 - Prob. 15GICh. 13 - Briefly describe how to determine and record the...Ch. 13 - Prob. 17GICh. 13 - Prob. 18GICh. 13 - Prob. 19GICh. 13 - Briefly describe how to determine and record any...Ch. 13 - Prob. 21GICh. 13 - Prob. 22GICh. 13 - Prob. 23GICh. 13 - Prob. 24GICh. 13 - How does IFRS categorize minority passive...Ch. 13 - Prob. 26GICh. 13 - Prob. 27GICh. 13 - Prob. 28GICh. 13 - Prob. 29GICh. 13 - Prob. 30GICh. 13 - Prob. 31GICh. 13 - What is a fund? Distinguish between a fund and an...Ch. 13 - Prob. 33GICh. 13 - Prob. 34GICh. 13 - Prob. 1MCCh. 13 - During 2021, Anthony Company purchased debt...Ch. 13 - On July 1, 2019, Aldrich Company purchased as an...Ch. 13 - In 2021, Cromwell Corporation purchased bonds of...Ch. 13 - Prob. 5MCCh. 13 - A security in a portfolio of available-for-sale...Ch. 13 - On its December 31, 2018, balance sheet, Fay...Ch. 13 - Prob. 8MCCh. 13 - Cash dividends declared out of current earnings...Ch. 13 - On January 1, 2019, Park Company accepted a...Ch. 13 - Prob. 1RECh. 13 - Prob. 2RECh. 13 - Prob. 3RECh. 13 - Refer to the information in RE 13-3. Assume that...Ch. 13 - Prob. 5RECh. 13 - Refer to the information in RE13-5. Assume that on...Ch. 13 - Refer to the information in RE13-5. Assume that on...Ch. 13 - Prob. 8RECh. 13 - On February 1, 2019, Razorback Corporation decides...Ch. 13 - On September 30, Franz Corporation notices a...Ch. 13 - Prob. 11RECh. 13 - Refer to the information in RE13-11. Assume that...Ch. 13 - Prob. 13RECh. 13 - Prob. 14RECh. 13 - On January 1, Kilgore Inc. accepts a 20,000...Ch. 13 - Prob. 16RECh. 13 - Prob. 1ECh. 13 - Held-to-Maturity Securities and Amortization of a...Ch. 13 - Prob. 3ECh. 13 - Prob. 4ECh. 13 - Investment Discount Amortization Schedule On...Ch. 13 - Investment Premium Amortization Schedule On...Ch. 13 - Prob. 7ECh. 13 - Trading Securities At the beginning of 2019, Able...Ch. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - Available-for-Sale Securities On December 31,...Ch. 13 - Available-for-Sale Securities At the beginning of...Ch. 13 - Available-for-Sale Securities At the end of 2018,...Ch. 13 - Transfer between Categories On December 31, 2018,...Ch. 13 - Impairment On June 1, 2019, Hansen Company...Ch. 13 - Equity Securities Midwest Bank invests in equity...Ch. 13 - Equity Securities Southeast Bank invests in equity...Ch. 13 - Prob. 18ECh. 13 - Prob. 19ECh. 13 - Prob. 20ECh. 13 - Notes Receivable On January 1, 2019, Crouser...Ch. 13 - Notes Receivable On January 1, 2019, Worthylake...Ch. 13 - Note Receivable in Installments On January 1,...Ch. 13 - Notes Receivable and Income On January 1, 2019,...Ch. 13 - Prob. 25ECh. 13 - Sinking Funds Entries The following information is...Ch. 13 - (Appendix 13.1) Derivatives Anglar Company has a 3...Ch. 13 - Prob. 1PCh. 13 - Prob. 2PCh. 13 - Prob. 3PCh. 13 - Bond Investment Premium Amortization Schedule...Ch. 13 - Prob. 5PCh. 13 - Trading Securities Akers Company invests its...Ch. 13 - Investment in Trading Securities The following...Ch. 13 - Prob. 8PCh. 13 - Available-for-Sale Securities Holly Company...Ch. 13 - Investment in Available-for-Sale Bonds The...Ch. 13 - Investments in Available-for-Sale Bonds During...Ch. 13 - Equity Securities The investment manager of 4th...Ch. 13 - Equity Securities 8th State Bank prepares interim...Ch. 13 - Investments in Equity Securities Noonan...Ch. 13 - Investments in Equity Securities Manson...Ch. 13 - Prob. 16PCh. 13 - Prob. 17PCh. 13 - Prob. 18PCh. 13 - Prob. 19PCh. 13 - Equity Method and Subsequent Sale On January 1,...Ch. 13 - Prob. 21PCh. 13 - Notes Receivable On January 1, 2019, Somerville...Ch. 13 - Notes Receivable On January 1, 2019, Lisa Company...Ch. 13 - Comprehensive Notes Receivable On January 1, 2019,...Ch. 13 - Prob. 25PCh. 13 - (Appendix 13.1) Derivatives Danburg. Company has a...Ch. 13 - Realized and Unrealized Losses An important part...Ch. 13 - Investments in Securities Cane Company has two...Ch. 13 - Prob. 3CCh. 13 - Victoria Company has investments in marketable...Ch. 13 - Available-for-Sale Securities The following are...Ch. 13 - Prob. 6CCh. 13 - You are an accountant for Davanzo Company. The...Ch. 13 - Prob. 8C
Knowledge Booster
Similar questions
- On December 31 (the end of the fiscal year), Ramesh Company received the PBO report from the actuary. The following information was included in the report: ending PBO, $112,000; benefits paid to retirees, $14,500; interest cost, $8,800. The discount rate applied by the actuary was 10%. What was the beginning PBO?arrow_forwardOn Jan. 1, 2010, ABC entered into an insurance contract covering the life of its founder. The P100,000 annual insurance premium is payable at the start of the year. By the end of the fifth year, the insurance will have a cash surrender value and it was as follows for the following years:Year Cash Surrender Value2014 P80,0002015 100,0002016 130,0002017 180,000 Continuing from the previous number and assuming further that P3,000,000 was received from the insurance, what is the journal entry to record the gain on settlement and make the final adjustment to the insurance expense?arrow_forwardDuring the year, FNE Inc. sold gift certificates worth 4,000,000 of which 2,160,000 were redeemed. Local regulation requires that gift certificates do not expire but FNE Inc. experience that 10% of the gift certificates sold are not redeemed. What is the amount of liabilities related to this gift certificates as of December 31 year ended?arrow_forward
- During the first year of operations, a company granted warranties on its products at an estimated cost of $8,500. The product warranty expense should be recorded in the years of the expenditures to repair the products covered by the warranty payments.arrow_forwardPrepare the following journal entry: Baily Corporation purchased a new Bus for $215,000 and paid 15% as a down payment and signed a promissory note for the reminder of the amount owed.arrow_forwardVander Company provides medical care and insurance benefits to its retirees. In the current year, Vander agrees to pay $9,500 for medical insurance and contribute an additional 5% of the employees’ $200,000 gross salaries to a retirement program.  (1) Record the entry for these accrued (but unpaid) benefits on December 31. (2) Assuming $5,000 of the retirement benefits are not to be paid for five years, how should this amount be reported on the current balance sheet?arrow_forward
- uses the calendar year and the cash method of accounting. On December 29, 2018, Brillo made the following cash payment. To what extent can Brillo deduct the payment in 2018? $50,000 for a two-year office lease beginning on February 1, 2019? $79,000 of inventory items held for sale to customers? $1,800 to purchase a new refrigerator for the employees’ lounge. The refrigerator was delivered on January 8, 2019? $4,800 retainer to a consultant who spent three weeks in January 2019 analyzing Brillo’s internal control system? $22,300 property tax to the local government for the first six months of 2019?arrow_forwardVander Co. provides medical care and insurance benefits to its retirees. In the current year, Vander agrees to pay $9,500 for medical insurance and contribute an additional 5% of the employees’ $200,000 gross salaries to a retirement program. (1) Record the entry for these accrued (but unpaid) benefits on December 31. (2) Assuming $5,000 of the retirement benefits are not to be paid for five years, how should this amount be reported on the current balance sheet?arrow_forwardOn Jan. 1, 2010, ABC entered into an insurance contract coveringthe life of its founder. The P100,000 annual insurance premium ispayable at the start of the year. By the end of the fifth year, theinsurance will have a cash surrender value and it was as follows forthe following years:Year   Cash Surrender Value2014       P80,0002015       100,0002016       130,0002017       180,000 1. What is the journal entry on Dec. 31, 2014 to recognized thecash surrender value and adjust the related accounts?Parenthetical solutions would suffice. 2. If the founder died on Mar 31, 2017, what is the journalentry to update the cash surrender value on the said date? 3. Continuing from the previous number and assuming furtherthat P3,000,000 was received from the insurance, what isthe journal entry to record the gain on settlement and makethe final adjustment to the insurance expense?arrow_forward
- On Jan. 1, 2010, ABC entered into an insurance contract coveringthe life of its founder. The P100,000 annual insurance premium ispayable at the start of the year. By the end of the fifth year, theinsurance will have a cash surrender value and it was as follows forthe following years: Year               Cash Surrender Value2014               P80,0002015               100,0002016               130,0002017               180,000 A. What is the journal entry on Dec. 31, 2014 to recognized thecash surrender value and adjust the related accounts?Parenthetical solutions would suffice. B. If the founder died on Mar 31, 2017, what is the journalentry to update the cash surrender value on the said date? C. Continuing from the previous number and assuming furtherthat P3,000,000 was received from the insurance, what isthe journal entry to record the gain on settlement and makethe final adjustment to the insurance expense?arrow_forwardThe City of Greensboro provides its employees two weeks of paid vacation per year. As of December 31, 65 employees have earned two weeks of vacation time each to be taken in the following year. If the average weekly salary for these employees is $900, what is the required journal entry to accrue compensated absences? Debit Salaries and Wages Expense for $58500 and credit Salaries and Wages Payable for $58500. Debit Salaries and Wages Expense for $117000 and credit Salaries and Wages Payable for $117000. No journal entry required. O Debit Salaries and Wages Payable for $116495 and credit Salaries and Wages Expense for $116495.arrow_forwardOn Jan. 1, 2010, ABC entered into an insurance contract coveringthe life of its founder. The P100,000 annual insurance premium ispayable at the start of the year. By the end of the fifth year, theinsurance will have a cash surrender value and it was as follows forthe following years: Year Cash   Surrender Value2014        P80,0002015        100,0002016        130,0002017        180,000  a.) What is the journal entry on Dec. 31, 2014, to recognize thecash surrender value and adjust the related accounts?Parenthetical solutions would suffice. b )If the founder died on Mar 31, 2017, what is the journalentry to update the cash surrender value on the said date? c.) Continuing from the previous number and assuming furtherthat P3,000,000 was received from the insurance, what isthe journal entry to record the gain on settlement and makethe final adjustment to the insurance expense?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage LearningPrinciples of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College