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Elena L [17]
2 years ago
13

Barry Company has a calendar year-end. On December 15, Year 1, a customer was injured using a product manufactured by Barry. Tha

t customer files a lawsuit against Barry on January 15, Year 2. On February 15, Year 2, Barry’s attorney advises Barry to settle the claim for $100,000 because a loss in that amount is probable and material. Barry has not yet distributed its Year 1 financial statements. What must Barry do with regards to those financial statements?
Business
1 answer:
mart [117]2 years ago
4 0

Answer:

Record the loss contingency in the December 31, Year 1, balance sheet and also disclose the lawsuit in the footnotes.

Explanation:

Since the loss is both probable and material, then it must be recorded as a liability in the balance sheet. This is a loss contingency, and depending on whether the probability of occurrence is probable, possible or not possible, and the amount can be determined, then it will be recorded in the balance sheet, included in the footnotes or not considered.

Since the loss is probable and it can be quantified, plus the incident occurred during last year, then the loss contingency must be included as a liability. The company should also disclose the lawsuit in the footnotes.

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Answer:

The depreciation expense for year 1 is $16,000

Explanation:

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Under the straight-line method, the depreciation should be charged with the same amount over the useful life.

The calculation is shown below:

= \dfrac{(original\ cost - residual\ value)}{(useful \ life)}

= \dfrac{(\$90,000 - \$10,000)}{(5 \ years)}

= $16,000

The depreciation should be charged for $16,000 in year 1. Moreover, it is shown in the income statement in the debit side and in the cash flow statement also.

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2 years ago
Bob's electronics company has quite a buzz around a new television they're launching, called UltraView1000. This television is e
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Answer:

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If Bob uses the broad match modifier keywords “television,” “accessible,” and “voice.” His ads will appear for people searching for any combination of these terms in a search (and possibly including additional terms). However, the ads won’t appear if any one of these keywords aren’t in the search term.

7 0
2 years ago
Plz, help ASAP!!
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Answer:

1. 23-24

2. 65+

3. very little teens pay taxes, meaning they dont have a job

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5. jobs would need to become more readily available for younger people

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2 years ago
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Simulation taining is being defined as having to exercise or train the skills of individuals with the use of basic equipment or rather a computer software by means of modelling a real world scenario that the individual is training.

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Answer:

The Electronics, beverages, fast-food, and automobile industry are some sectors that have witness proliferation of products and the shortening of product life-cycle.

Supply chain in these industries have seen their processes change overtime and presently more focus on service, and the ability to quickly react and continuously meet the requirements of customers. They have also leverage on information technology and globalisation in extending their supply chain beyond national and regional boundaries with some companies in these industries having aspects of their processes in different country.  

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