ACC 423 Week 5 WileyPlus Assignment - Exercises
Business - Accounting
ACC423 P13-9 P20-4 E21-7 P22-6
P13-9 (Premium Entries and Financial Statement Presentation) Sycamore Candy Company offers a CD single as a premium for every five candy bar wrappers presented by customers together with $2.50. The candy bars are sold by the company to distributors for 30 cents each. The purchase price of each CD to the company is $2.25; in addition it costs 50 cents to mail each CD. The results of the premium plan for the years 2010 and 2011 are as follows. (All purchases and sales are for cash.) 2010 2011
CDs purchased 250,000 330,000
Candy bars sold 2,895,400 2,743,600
Wrappers redeemed 1,200,000 1,500,000
2010 wrappers expected to be redeemed in 2011 290,000
2011 wrappers expected to be redeemed in 2012 350,000
(a) Prepare the journal entries that should be made in 2010 and 2011 to record the transactions related to the premium plan of the Sycamore Candy Company.
(b) Indicate the account names, amounts, and classifications of the items related to the premium plan that would appear on the balance sheet and the income statement at the end of 2010 and 2011.
P20-4 (Pension Expense, Journal Entries for 2 Years) Gordon Company sponsors a defined benefit pension plan. The following information related to the pension plan is available for 2010 and 2011. 2010 2011
Plan assets (fair value), December 31 $699,000 $849,000
Projected benefit obligation, January 1 700,000 800,000
Pension asset/liability, January 1 140,000 Cr. ?
Prior service cost, January 1 250,000 240,000
Service cost 60,000 90,000
Actual and expected return on plan assets 24,000 30,000
Amortization of prior service cost 10,000 12,000
Contributions (funding) 115,000 120,000
Accumulated benefit obligation, December 31 500,000 550,000...