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On January 1, 2024, the beginning balance in the Warranty Liability account was $65,000. Cash sales for the year totaled $900,000 and credit sales totaled $300,000.  The company estimates warranty costs at 6% of sales. During the year, $75,000 was paid to settle warranty claims. As a result of these transactions, what is the amount of warranty liability that is reported on the company’s 2024 year end balance sheet?   Answer:  $_______

Eagle Corp. acquired 30% interest in the voting stock of Bobcat Inc. for $650,000.  During the first year, Bobcat Inc. reported net income of $240,000 and paid cash dividends totaling $60,000.  What amount will Eagle Corp. report on its income statement related to its investment in Bobcat Inc?

On January 1, 2024, the beginning balance in the Warranties Liability account was $95,000. Cash sales for the year totaled $800,000 and credit sales totaled $500,000.  The company estimates warranty costs at 5% of sales. During the year, $85,000 was paid to settle warranty claims. As a result of these transactions, what is the amount of warranty liability that is reported on the company’s 2024 year-end balance sheet?   Answer:  $_______

Eagle Corp. exchanged an old machine with a book value of $39,000 and a fair market value of $35,000, and paid $10,000 cash for a similar new machine.  At what amount should Eagle Corp. record the new machine on their books and what amount of gain/loss should the company record for the old asset that was exchanged? New Machine Gain/Loss Old Machine A) $45,000  $4,000 loss B) $49,000 $4,000 gain C) $49,000 $4,000 loss D) $45,000  $4,000 gain E)  None of the above.  

Eagle Corp. made an ordinary repair to its lab equipment at a cost of $500 and purchased a motor for $3,000.  Eagle Corp.’s accountant debited the asset account for $3,500.  Is the accounting treatment an error?  If it is an error what is the effect on assets and net income for the year the expenditures were made?

Eagle Corp. purchased a new piece of equipment on January 1, 2024.  The equipment had a list price of $110,000, however the seller agreed to allow Eagle Corp. to pay for the equipment in 10 yearly installments of $14,000 on December 31 of each year.  Assuming the note incurs interest at 8% annually, what amount should Eagle Corp. debit the equipment account for on the date of purchase? (Round to the nearest dollar).   Answer:  $_______

Eagle Corp. has total assets as follows: $40,000 in cash, $20,000 in short-term investments, $110,000 in net current receivables, equipment of $60,000, and $8,000 in prepaid expenses. The total long-term liabilities of the firm are $160,000 and total liabilities are $240,000.  Based solely on the above information, Eagle Corp.’s current ratio is (round to two decimal places):  

On January 1, 2024, the beginning balance in the Warranties Liability account was $65,000. Cash sales for the year totaled $450,000 and credit sales totaled $850,000.  The company estimates warranty costs at 7% of sales. During the year, $70,000 was paid to settle warranty claims. As a result of these transactions, what is the amount of warranty liability that is reported on the company’s 2024 year end balance sheet?   Answer:  $_______

Eagle Corp. issues a $951,000, 10% 4 year notes payable on January 1, 2024.  The note will be repaid in four annual installments of $300,000, each payable at the end of the year (i.e. $300,000 at the end of 2024, $300,000 at the end of 2025, $300,000 at the end of 2026, and $300,000 at the end of 2027).  What is the amount of interest expense that should be recorded by Eagle Corp. in the second year (i.e. on the income statement for the year ended December 31, 2025)?  (Round to the nearest dollar).   Answer:  $_______

John Smith wants to retire in 15 years.  He anticipates he will need $3,000,000 to retire.  John has an account that currently pays 7% compounded annually.  If John has $850,000 in his account today how much additional money must he deposit in the account today to have $3,000,000 when he retires (use the appropriate factor table(s) to answer the question and round to the nearest dollar).  Answer:  $_______