Mars, Inc. follows IFRS for its external financial reporting, while Jerome Company uses GAAP for its external financial reporting. During the year ended December 31, 2018, both companies changed from using the completed-contract method of revenue recognition for long-term construction contracts to the percentage-of-completion method. Both companies experienced an indirect effect, related to increased profit-sharing payments in 2018, of $30,000. As a result of this change, how much expense related to the profit-sharing payment must be recognized by each company on the income statement for the year ended December 31, 2018?
Homework Answers
As the effect of change Mars Inc. would recognise expense of $ 0.
As the effect of change Jerome company would recognise expense of $ 30,000.
As both the companies changed from using the completed contractual method to percentage completion method. Expense of profit sharing payment must be recognised by each company in the income statement.
So the answer is Option a.
Add Answer to:
Mars, Inc. follows IFRS for its external financial reporting, while Jerome Company uses GAAP for its external financial...
Ridge, Inc. follows IFRS for its external financial reporting, and Cannon Company follows GAAP for its...
Ridge, Inc. follows IFRS for its external financial reporting,
and Cannon Company follows GAAP for its external financial
reporting. During 2018, both companies changed depreciation
methods, from double-declining balance to straight-line. Compared
to double-declining balance, for Ridge, Inc. the change resulted in
a decrease in reported depreciation expense of $90,000, and for
Cannon Company the change resulted in a reported decrease in
depreciation expense of $105,000. The remaining useful lives of the
assets impacted by the change in depreciation method...
IFRS MULTIPLE CHOICE QUESTION 09 ridge, inc follows IFRS FOR ITS EXTERNAL FINANCIAL REPORTING , and...
IFRS MULTIPLE CHOICE QUESTION 09 ridge, inc follows IFRS FOR
ITS EXTERNAL FINANCIAL REPORTING , and cannon company follows GAAP
for its external financial reporting. during 2018 both companies
changed depreciation methods, from double decking balance to
straight line. Compated to double declining balance, for Ridge I Mc
the change resulted in a decrease in reported depreciation expense
of $90,000, and for Cannon company the change resulted in a
reported decrease in depreciation expense of $105,000. the
remaining useful lives...
SaulGroup, Inc., a U.S.-based corporation, currently uses U.S. GAAP to prepare its consolidated financial statements. SaulGroup...
SaulGroup, Inc., a U.S.-based corporation, currently uses U.S. GAAP to prepare its consolidated financial statements. SaulGroup is considering switching to IFRS and asking for your help in assessing the impact this change will have on its financial statements. SaulGroup’s accounting principles differ from IFRS in the following areas– restructuring, pension plan, stock options, revenue recognition, and bonds payable. Instructions: Please respond to the following questions in each scenario: 1. Restructuring Provision On December 1, 2017 the management of SaulGroup, Inc....
SaulGroup, Inc., a U.S.-based corporation, currently uses U.S. GAAP to prepare its consolidated financial statements. SaulGroup...
SaulGroup, Inc., a U.S.-based corporation, currently uses U.S. GAAP to prepare its consolidated financial statements. SaulGroup is considering switching to IFRS and asking for your help in assessing the impact this change will have on its financial statements. SaulGroup’s accounting principles differ from IFRS in the following areas– restructuring, pension plan, stock options, revenue recognition, and bonds payable. Instructions: Please respond to the following questions in each scenario: 1. Restructuring Provision On December 1, 2017 the management of SaulGroup, Inc....
At the end of its reporting year (December 31, 2017), Acme Inc. reports a $60,000 patent...
At the end of its reporting year (December 31, 2017), Acme Inc. reports a $60,000 patent with estimated remaining useful life of 10 years. Before closing its books, the company identifies a $20,000 impairment in the patent. For IFRS, Acme Inc. does not revalue its intangible assets. a. How will the impairment loss be recorded using US GAAP and for IFRS? b. Assume that at the end of 2018, Acme Inc. determines the company has recovered $12,000 of the patent...
1) Swifty Company uses the LIFO method for financial reporting purposes but FIFO for internal reporting purposes. At Jan...
1) Swifty Company uses the LIFO method for financial reporting purposes but FIFO for internal reporting purposes. At January 1, 2020, the LIFO reserve has a credit balance of $1,415,000. At December 31, 2020, Swifty’s internal reports indicated that the FIFO inventory balance was $3,129,000 and for external reporting purposes the LIFO inventory balance was $1,616,500. What is the amount of the LIFO reserve and the LIFO effect related to 2020? LIFO reserve at December 31, 2020 $enter a dollar...
1 points A company that prepares its financial statements according to International Financial Reporting Standards (IFRS)...
1 points A company that prepares its financial statements according to International Financial Reporting Standards (IFRS) can use each of the following inventory valuation methods except FIFO. LIFO Average cost All of these methods can be used, 1 points are Ramen Inc. adopted dollar value LIFO (DVL) as of January 1, 2021, when it had a cost inventory of $600,000. Its inventory as of December 31, 2021, was 5667800 at year end costs and the cost index was 1.06. What...
Sarasota Company uses the LIFO method for financial reporting purposes but FIFO for internal reporting purposes....
Sarasota Company uses the LIFO method for financial reporting
purposes but FIFO for internal reporting purposes. At January 1,
2017, the LIFO reserve has a credit balance of $1,210,200. At
December 31, 2017, Sarasota’s internal reports indicated that the
FIFO inventory balance was $2,829,800 and for external reporting
purposes the LIFO inventory balance was $1,528,200.
What is the amount of the LIFO reserve and the LIFO effect
related to 2017?
LIFO reserve at December 31, 2017
$
LIFO effect for...
1. A company acquires a subsidiary and will prepare consolidated financial statements for extemal reporting purposes....
1. A company acquires a subsidiary and will prepare consolidated financial statements for extemal reporting purposes. For internal reporting purposes, the company has decided to apply the initial value method, Why might the company have made this decision? a. It is a relatively easy method to apply. 5. Operating results appearing on the parent's financial records rellect consolidated totals. c. GAAP now requires the use of this particular method for internal reporting purposes. d. Consolidation is not required when the...
Blossom Company uses the LIFO method for financial reporting purposes but FIFO for internal reporting purposes....
Blossom Company uses the LIFO method for financial reporting purposes but FIFO for internal reporting purposes. At January 1, 2020, the LIFO reserve has a credit balance of $1,387,700. At December 31, 2020, Blossom's internal reports indicated that the FIFO inventory balance was $2,875,500 and for external reporting purposes the LIFO inventory balance was $1,390,400. (a) Your answer is correct. What is the amount of the LIFO reserve and the LIFO effect related to 2020? LIFO reserve at December 31,...
Ridge, Inc. follows IFRS for its external financial reporting,
and Cannon Company follows GAAP for its external financial
reporting. During 2018, both companies changed depreciation
methods, from double-declining balance to straight-line. Compared
to double-declining balance, for Ridge, Inc. the change resulted in
a decrease in reported depreciation expense of $90,000, and for
Cannon Company the change resulted in a reported decrease in
depreciation expense of $105,000. The remaining useful lives of the
assets impacted by the change in depreciation method...
IFRS MULTIPLE CHOICE QUESTION 09 ridge, inc follows IFRS FOR
ITS EXTERNAL FINANCIAL REPORTING , and cannon company follows GAAP
for its external financial reporting. during 2018 both companies
changed depreciation methods, from double decking balance to
straight line. Compated to double declining balance, for Ridge I Mc
the change resulted in a decrease in reported depreciation expense
of $90,000, and for Cannon company the change resulted in a
reported decrease in depreciation expense of $105,000. the
remaining useful lives...
1 points A company that prepares its financial statements according to International Financial Reporting Standards (IFRS) can use each of the following inventory valuation methods except FIFO. LIFO Average cost All of these methods can be used, 1 points are Ramen Inc. adopted dollar value LIFO (DVL) as of January 1, 2021, when it had a cost inventory of $600,000. Its inventory as of December 31, 2021, was 5667800 at year end costs and the cost index was 1.06. What...
Sarasota Company uses the LIFO method for financial reporting
purposes but FIFO for internal reporting purposes. At January 1,
2017, the LIFO reserve has a credit balance of $1,210,200. At
December 31, 2017, Sarasota’s internal reports indicated that the
FIFO inventory balance was $2,829,800 and for external reporting
purposes the LIFO inventory balance was $1,528,200.
What is the amount of the LIFO reserve and the LIFO effect
related to 2017?
LIFO reserve at December 31, 2017
$
LIFO effect for...
1. A company acquires a subsidiary and will prepare consolidated financial statements for extemal reporting purposes. For internal reporting purposes, the company has decided to apply the initial value method, Why might the company have made this decision? a. It is a relatively easy method to apply. 5. Operating results appearing on the parent's financial records rellect consolidated totals. c. GAAP now requires the use of this particular method for internal reporting purposes. d. Consolidation is not required when the...
Blossom Company uses the LIFO method for financial reporting purposes but FIFO for internal reporting purposes. At January 1, 2020, the LIFO reserve has a credit balance of $1,387,700. At December 31, 2020, Blossom's internal reports indicated that the FIFO inventory balance was $2,875,500 and for external reporting purposes the LIFO inventory balance was $1,390,400. (a) Your answer is correct. What is the amount of the LIFO reserve and the LIFO effect related to 2020? LIFO reserve at December 31,...
Most questions answered within 3 hours.
-
Where is the error in this code sequence?
String s1 = "Hello";
String s2 = "ello";...
asked 10 months ago -
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance...
asked 10 months ago -
Consider this reaction:
Al2(SO4)3 (aq)+ BaCl3
(aq) Al2Cl6 (aq)- +
3BaSO4(s) . What is the...
asked 10 months ago -
Suppose that Savneet is considering increasing her
recent random sample from 20 car rentals to 40...
asked 10 months ago -
Trucks arrive at an unloading terminal at an average rate of 120
per hour.
Trucks arrive...
asked 10 months ago -
Why are methanol and ethanol completely soluble in water while
octanol is not very little soluble....
asked 10 months ago -
A facilities manager at a university reads in a research report
that the mean amount of...
asked 10 months ago -
When the CuSO4 is rehydrated by adding water to the anhydrous
compound, is this an endothermic...
asked 10 months ago -
A ray of sunlight is passing from diamond into crown glass; the
angle of incidence is...
asked 10 months ago -
A block of mass 0.249 kg is placed on top of a light, vertical
spring of...
asked 10 months ago -
how do the kidneys compensate in the presences of acidosis
a) trigger hyperventilate
b) reserve acid...
asked 10 months ago -
Question 501 pts
The rental rate of capital to the firm increases. Which of the
following...
asked 10 months ago