Songtress Company bought a machine on January 1 . 2012 . for $24,000, at which time it had an estimated useful life of eight years, with no residual value. Straight-line depreciation is used for all of Songtress' depreciable assets. On January 1 . 2014, the machine's estimated useful life was determined to be only six years from the acquisition date. Accordingly, the appropriate accounting change
was made in 2014 . Songtress' income tax rate was 40 percent in all the affected years. In Songtress' 2014 financial statements, how much should be reported as the cumulative effect on prior years because of the change in the estimated useful life of the machine?
a. $0
b. $1,200
c. $2,000
d. $2,800
A
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Clemente Co. owned all of the voting common stock of Snider Co. On January 2, 2017, Clemente sold equipment to Snider for $125,000. The equipment cost Clemente $140,000. At the time of the transfer, the balance in accumulated depreciation was $40,000. The equipment had a remaining useful life of five years and a $0 salvage value. Both entities use the straight-line method of depreciation.At what amount should the equipment (net of depreciation) be included in the consolidated balance sheet dated December 31, 2017?
A. $80,000. B. $105,000. C. $100,000. D. $95,000. E. $85,000.
A firm with securities outstanding that holders can convert into, or exchange for, shares of common stock may report two earnings-per-share amounts:
a. primary and diluted earnings per share. b. basic and diluted earnings per share. c. primary and secondary earnings per share. d. basic and secondary earnings per share. e. primary and decreased earnings per share.
Judicial review can best be described as the power of federal courts to
a. abstain from adjudicating major issues and to leave such matters to legislatures. b. take it upon itself to decide issues on constitutional grounds. c. declare a statue or governmental action unconstitutional and void. d. take private property for public use.
According to lean philosophy, we should eliminate any activity or process ______.
a. that does not add value to the product or service b. that has a high carbon footprint c. that is likely to be regulated by the government d. that does not conform to ISO standards