Chapter 12: Liabilities Suggested Time Case 12-1 Dry Clean Depot Limited 12-2 Darcy Limited 12-3 Homebake Incorporated Assignment 12-1 Liability issues 25 12-2 Liability recognition (W*) 25 12-3 Warranty 10 12-4 Estimated obligations 20 12-5 Liability measurement……………………….. 15 12-6 Measurement of estimated liabilities 20 12-7 Long-term note—borrower and lender 35 12-8 Note with below-market interest rate 35 12-9 Debt issuance‚ fair value
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000 of income‚ because of incorrect standards for intercompany inventory cost. Fifth is an understated income of $700‚000‚ because of a failure to reverse accrual customer incentive program. All amounts in this report are amount of pre-income tax earnings. Rule During this time period Green Mountain has violated three rules from the FASB accounting standards codification: inventory measurement‚ revenue recognition and multi element revenue recognition. Although the SEC had found more problems
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pseudo-partnerships that allowed the company to sell assets and "create" earnings that artificially enhanced its bottom line” (p. 245). They also used overstated and inflated income projections from trading contracts after signing them. When Arthur Anderson‚ an outside auditing firm‚ accurately accounted for a partnership deal in 2001‚ large quarterly losses resulted. Those losses and ensuing profit and debt restatements caused Enron ’s stock price to drop‚ triggering the unraveling of the partnership
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Vitek‚ was not named defendant because by that time they were bankrupt. The court held for Central medical‚ Cafazzo appealed. Issues Can a hospital and a physician be held strictly liable under the Restatement of Torts Section: 402 for defects in a product incidental to the provision of medical services? Ruling No. To decide that a surgeon and hospital is liable under circumstances for strict
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raise needed capital. In effort to satisfy short-term obligations‚ management might pass on profitable long-term project. Reorganization is process designed to revive a financially troubled or bankrupt firm. Reorganization process involves the restatement of assets and liabilities‚ in addition holding meeting with creditors in order to make new arrangements for maintain repayment. It is considered as an attempt to extend the life of distressed company. Bankruptcy is a legal proceeding involving
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Introduction There have been proposals that have been working on with regard to the replacement of GAAP (Generally Accepted Accounting Principles) with IFRS (International Financial Reporting Standards) as used in the accounting and financial reporting aspects. Such convergence requires that the functions of the GAAP standards be added to the IFRS. The International Accounting Standards Board (IASB) developed the IFRS which is a less-detailed financial reporting system. This paper seeks to analyze
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Cash flows were negative while profit was reported. Early 1999‚ liqutity problem arised‚ sold $200M of high-yield or Junk bonds in mid 1999. - Justice Department: Adam Gilburne: guilty to conspriracy to commit wire and securities fraud to inflate earning 96-99. He was alleged of drawing up a list of good and bad items to adjust income to meet analyst ’s expectations. Imporperly recogmnzing unearned and fictitious recievales from its vendors - SEC: 3 Financial Fraudent Schemes 1 Imporperly recogmnzing
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Budgeting can be an important management tool if implemented properly. Identify several positive results when budgets are used properly. Since budgets affect people‚ identify several negative aspects if budgets are not implemented properly. (20marks) Identify several positive results when budgets are used properly. 1) Monetary Control To implement a budget‚ it enables us to know more about finances control. A budget that give us a full idea on the amount of money that coming in and going
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many government-like regulatory functions. The PCAOB was created in response to an increasing number of accounting restatements by public companies during the 1990s and a series of recent high-profile scandals like Enron and WorldCom. Prior to the PCAOB‚ the audit industry was self-regulated through the Public Oversight Board of the AICPA‚ but with the recent scandals and restatements something had to be changed. The PCAOB consists of five members‚ of which one of them is the chairperson. All members
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Roles and Functions of Law According to Merriam Webster law is “a binding custom or practice of a community: a rule of conduct or action prescribed or formally recognized as binding or enforced by a controlling authority” (Merriam). Law has many roles and functions within business and society. Some of the roles of laws set rules of conduct and ethical standards for business and society. Laws also provide a means to settle disputes. The law plays many functions such as “peacekeeping; checking government
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