You are the Accounts Manager for a small computer programming company. You must record the following...

 

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You are the Accounts Manager for a small computer programming company. You must record the following transactions. What values do you think you will use for each transaction? Required: Justify your answer with accounting concepts, principles and assumptions. A. The company purchased a secondhand van to be used to travel to customers. The sellers told you they believe it is worth $12,500 but agreed to sell it to your company for $11,000. You believe the company got a really good deal because the van has a $13,000 Blue Book value. B. Your company purchased its office building five years ago for $175,000. Values of real estate haven been rising quickly over the last five years, and a realtor told you the company could easily sell it for $250,000 today. Since the building is now worth $250,000, you are contemplating whether you should increase its value on the books to reflect this estimated current market value. C. Your company has performed a task for a customer. The customer agreed to a minimum price of $2,350 for the work, but if the customer has absolutely no issues with the programming for the first month, the customer will pay you $2,500 (which includes a bonus for work well done). The owner of the company is almost 100% sure she will receive $2,500 for the job done. You have to record the revenue earned and need to decide how much should be recorded. D. The owner of the company believes the most valuable asset for his company is the employees. The service the company provides depends on having intelligent. hardworking, dependable employees who believe they need to deliver exactly what the customer wants in a reasonable amount of time. Without the employees, the company would not be so successful. The owner wants to know if she can include the value of her employees on the balance sheet as an asset You are the Accounts Manager for a small computer programming company. You must record the following transactions. What values do you think you will use for each transaction? Required: Justify your answer with accounting concepts, principles and assumptions. A. The company purchased a secondhand van to be used to travel to customers. The sellers told you they believe it is worth $12,500 but agreed to sell it to your company for $11,000. You believe the company got a really good deal because the van has a $13,000 Blue Book value. B. Your company purchased its office building five years ago for $175,000. Values of real estate haven been rising quickly over the last five years, and a realtor told you the company could easily sell it for $250,000 today. Since the building is now worth $250,000, you are contemplating whether you should increase its value on the books to reflect this estimated current market value. C. Your company has performed a task for a customer. The customer agreed to a minimum price of $2,350 for the work, but if the customer has absolutely no issues with the programming for the first month, the customer will pay you $2,500 (which includes a bonus for work well done). The owner of the company is almost 100% sure she will receive $2,500 for the job done. You have to record the revenue earned and need to decide how much should be recorded. D. The owner of the company believes the most valuable asset for his company is the employees. The service the company provides depends on having intelligent. hardworking, dependable employees who believe they need to deliver exactly what the customer wants in a reasonable amount of time. Without the employees, the company would not be so successful. The owner wants to know if she can include the value of her employees on the balance sheet as an asset

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Answer A The company purchased a secondhand van to be used to travel to customers The sellers told you they believe it is worth 12500 but agreed to sell it to your company for 11000 You believe the co... View the full answer