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Acct 550 Week 6

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10-1 (Acquisition Costs of Realty)
Item Land Land Improvements Buildings Other Accounts
(a) $(275,000) Accounts Payable
(b) $275,000
(c) $8,000
(d) $7,000
(e) $6,000
(f) $(1,000)
(g) $22,000
(h) $250,000
(i) $9,000
(j) $4,000
(k) $11,000
(l) $(5,000)
(m) $13,000
(n) $19,000
(o) $14,000
(p) $3,000

E

E 10-3 (Acquisition Costs of Trucks).
1.
Truck # 1………………………………$13,900 Cash……………………………………………$13,900

2.
Truck # 2………………………………$14,727.27
Discount on Notes Payable……………$1,272.73 Cash…………………………………………..$2,000 Notes Payable…………………………………$14,000

Truck # 2 = 2,000 + 12,727.27 = 14,727.27
N=1 I/Y=10% PMT=0 FV=14,000 PV=-12,727.2727
Discount on Notes Payable = 16,000 – 14,727.27 = 1,272.73
3.
Truck # 3………………………….. $15,200
Cost of goods sold…………………$12,000 Inventory Account…………………………. $12,000 Sales………………………………………...$15,200
4.
Truck # 4 (1,000 x $13)……………………... $13,000 Common Stock (1,000 x $10)…………………………………$10,000 Paid-In capital in excess of par-common stock………………..$3,000

E 10-7 (Capitalization of Interest)
a)
Weighted-average
Accumulated expenditures x…...

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