7. Antlers Company adopted the dollar-value LIFO retail method at the beginning of 20Y1 (base year). The retail price index at the end of 20Y1 was 10%. The following data applies to Antlers inventory:
|Plus: Net Purchases||$60,000||$90,000|
|Plus: Net Markups||$30,000|
|Less: Net Markdowns||. .||(20,000)|
|Less: Net Sales||(62,000)|
|Estimated Ending Inventory||$110,000|
What is the inventory balance that Antlers would report in its 12/31/20Y1 balance sheet?
8. Johnson Corporation acquired all of the outstanding common stock of Smith Corporation for $11,000,000 in cash. The book value of Smith’s net assets was $7,800,000. The fair values of all Smith’s assets and liabilities were equal to their book values with the following exceptions:
|Book Value||Fair Value|
Calculate the amount Johnson should record as goodwill as a result of the transaction.
9. On January 1, 20Y1, Myner Corporation purchased a used machine. Myner paid $50,000 down and signed a noninterest-bearing note requiring $250,000 to be paid on 12/31/20Y3. The fair value of the machine is not determinable. An interest rate of 8% properly reflects the time-value of money for this type of loan agreement. At what amount should Myner record the acquisit?
11. On June 1, 20Y1, Cricket Company began construction of a new factory. The factory was completed on October 31, 20Y2. Expenditures on the project were as follows:
|July 1, 20Y1||$54,000|
|October 1, 20Y1||$22,000|
|February 1, 20Y2||$30,000|
|April 1, 20Y2||$21,000|
|September 1, 20Y2||$20,000|
|October 1, 20Y2||$6,000|
On July 1, 20Y1, Cricket obtained a $700,000 construction loan with a 6% interest rate. The loan was outstanding through the end of October, 20Y2. The company’s only other interest-bearing debt was a long-term note for $100,000 with an interest rate of 8%. This note was outstanding during all of 20Y1 and 20Y2. The company’s fiscal year-end is December 31. What is the amount of interest that Cricket should capitalize in 20Y1, using the specific interest method?