Post on 08-Feb-2023
H 141 – MALAM
Kelompok 1
Case 7-1Stern Corporation (B)Accounting for Manager
Presented by:
1. Irfan Fauzi2. Joseph Tampubolon3. Maria Veronika Dede4. Medisa Aris Ginanjar5. Reza Meidyawati6. Nasrul Nabil Sangadji
H 141 – MALAM
Kelompok 1
STERN CORPORATIONBalance Sheet
As of December 31, 2009
AssetsCurrent Assets :
Cash 671.344
Account receivables 988.257
Less : Allowance for doubtful account 29.648
958.609
US Treasury securities at cost 274.060
Inventories 1.734.405
Total current assets 3.638.418
Other Assets :
Investments 412.294
Land 186.563
Buildings 2.405.259
Less : Accumulated depreciation 663.379
1.741.880
Factory machinery 3.425.585
Less : Accumulated depreciation 1.642.358
1.783.227
Furniture and fixtures 56.484
Less : Accumulated depreciation 40.400
16.084
Automotive equipment 58.298
Less : Accumulated depreciation 37.156
21.142
Office machines 42.534
Less : Accumulated depreciation 28.005
14.529
Tools 61.294
Patent 56.250
Prepaid expense 100.190
Total assets 8.031.871
Stern Corporation Other Asset as of Dec 31, 2009
Other Asset Value ($)Investments 412.294Land 186.563Buildings 1.741.880Factory Machinery 1.783.227Furniture and Fixtures
16.084
Automotive Equipment
21.142
Office Machines 14.529Tools 61.294Patent 56.250Prepaid expense 100.190
H 141 – MALAM
Kelompok 1
Questions :
1. In a manner of similiar to that used in Stern Corporation (A), analyze the effect of each of these transactions on the property, plant, and equipment accounts, accumulated depreciation, and any other accounts that may be involved. Prepare journal entries for these transactions.
2. Give the correct totals for the property, plant, and equipment, and the amount of accumulated depreciation as of December 31, 2010, after the transaction affecting them had been recorded.
H 141 – MALAM
Kelompok 1
On January 2, 2010, one of the factory machines was sold for its book value, $3.886. This machine was recorded on the books at $31.233 with accumulated depreciation of $27.367.Date Item Debit
Credit
Jan 02 Cash 3.866Acc. depreciation - Factory machinery
27.367
Factory Machinery31.23
3
Effect
Accumulated depreciation – Factory machinery account amount decreased by $27.367
Factory machinery account amount decreased by $31.233
Transaction 1Question 1
H 141 – MALAM
Kelompok 1
Tools were carried on the books at cost, and at the end of each year a physical inventory was taken to determine what tools still remained. The account was written down to the extent of the decrease in tools as ascertained by the year-end inventory. At he end of 2010, it was determined that there had been a decrease in the tool inventory amounting to $7.850. Effect
Tools account amount decreased by $7.850
Date Item Debit Credit
Dec 31Tools expense 7.850Tools 7.850
Transaction 2
H 141 – MALAM
Kelompok 1
On March 1, 2010, The company sold for $2.366 cash of automobile that was recorded on the books at a cost of $8.354 and had an accumulated depreciation of $5.180, giving a net book value of $3.174 as of January 1, 2010. In this and other cases of the sale of long-lived assets during the year, the accumulated depreciation and depreciation expense items were both increased by amount that reflected the depreciation chargeable for the months in 2010 in which the asset was held prior the the sales, as rates listed in item 7 below.Effect
Acc. Depreciation –Automotive equipment account amount decreased by $5.458
Automotive equipment account amount decreased by $8.354
Loss on sale of other assets recognized by $560
Transaction 3
Date Item DebitCredit
March 1 Cash 2.336
Acc. Depreciation - Automotive equipment 5.458Loss on sale of other assets 560Automotive Equipment 8.354
H 141 – MALAM
Kelompok 1
The patent listed on the balance sheet had been purchased by the Stern Corporation. The cost of the patent was written off as an expense over the remainder of its legal life as of December 31, 2009, the patent’s remaining legal life was five years.
Effect
Patent account amount decreased by $11.250
Date Item Debit Credit
Dec 31Patent Amortization Expense 11.250Patent 11.250
Transaction 4
H 141 – MALAM
Kelompok 1
On July 1, 2010, a typewriter that had cost $1.027 and had been fully depreciated on December 31, 2009, was sold for $75.
Effect
Acc. Depreciation –Office machines account amount decreased by $1.027
Office machines account amount decreased by $1.027
Gain on sale of other assets recognized by $75
Date Item Debit CreditJuly 1 Cash 75
Acc. depreciation - Office machines 1.027Gain on sale of other assets 75Office machines 1.027
Transaction 5
H 141 – MALAM
Kelompok 1
On October 1, 2010, the company sold a desk for $80. This piece of furniture was recorded on the books at a cost of $490 with an accumulated depreciation of $395 as of January 1, 2010.
Effect
Acc. Depreciation – Furniture and fixtures account amount decreased by $431,75
Furniture and fixtures account amount decreased by $490
Gain on sale of other assets recognized by $21,75
Transaction 6
Date Item DebitCredit
Oct 1 Cash 80
Accumulated Depreciation - Furniture and fixtures
431,75
Gain on sale of other assets 21,75Furniture and fixtures 490
H 141 – MALAM
Kelompok 1
Transaction 7
Depreciation was calculated at the following rates:
Buildings 2 %Factory machinery 10 %* Furniture and fixtures 10 %Automotive equipment 20 %Office machines 10 %
*Included in the factory machinery cost of $3.425.585, was a machine costing $85.000 that had been fully depreciated on December 31, 2009, and that was still in use.
H 141 – MALAM
Kelompok 1
Date Item Debit CreditDec 31Depreciation Expense - Buildings 48.105
Acc. Depreciation - Buildings 48.105($2.405.259 x 2% = $48.105)
Dec 31Depreciation Expense - Factory machinery
330.935
Acc. Depreciation - Factory machinery
330.935
($3.425.585 - $31.233 - $85,000) x 10% = $330.935
Dec 31Depreciation Expense - Furniture and fixtures 5.599Acc. Depreciation - Furniture and fixtures 5.599
($56.484 - $490) x 10% = $5.599
Dec 31Depreciation Expense - Automotive equipment 9.989Acc. Depreciation - Automotive equipment 9.989
($58.298 - $8.354) x 20% = $9.989
Dec 31Depreciation Expense - Office machines 4.151Acc. Depreciation - Office machines 4.151
($42.534 - $1.027) x 10% = $4.151
H 141 – MALAM
Kelompok 1
Other Assets Value ($)
Investments 412.294
Land 186.563
Buildings 2.405.259
Less : Accumulated depreciation 711.484
1.693.775
Factory machinery 3.394.352
Less : Accumulated depreciation 1.945.926
1.448.426
Furniture and fixtures 55.994
Less : Accumulated depreciation 45.604
10.390
Automotive equipment 49.944
Less : Accumulated depreciation 41.965
7.979 Office machines 41.507
Less : Accumulated depreciation 31.129 10.378
Tools 53.444
Patent 45.000
Prepaid expense
100.190
Question 2
H 141 – MALAM
Kelompok 1
Description CalculationAcc. Depreciation Expense – Buildings $663.379 + $48.105 = $711.484 Acc. Depreciation Expense - Factory machinery
$1.642.358 - $27.367 + $330.935 = $1.945.926
Acc. Depreciation Expense - Furniture and fixtures
$40.400 - $395 + $5.599 = $45.604
Acc. Depreciation Expense - Automotive equipment
$37.156 - $5.180 + $9.988 = $41.965
Acc. Depreciation Expense - Office MachineToolsPatent
$28.005 - $1.027 + $4.151 = $31.129$61.294 -$7.850 = $53.444$56.250 - $11.250 = $45.000
Calculation