Question

Harbor Corp. had the following situations during the year:
a. Inventory with a cost of $186,400 is reported at its market value of $235,600.
b. Harbor added four additional weeks to its fiscal year so that it could make its income look stronger. Past years were 52 weeks.
c. Harbor's CEO purchased a yacht for personal use and charged it to the company.
d. Revenues of $25,000 earned in the prior year were recorded in the current year.
Required
In each situation, identify the assumption or principle that has been violated and discuss how Harbor should have handled the situation.


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  • CreatedJuly 16, 2015
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