If a company determines that a provision has a 51% chance of occurring, would it be required to accrue the provision under IFRS? Under U.S. GAAP? Be sure to explain your answer.
Answer to relevant QuestionsGAAP requires that a company report certain obligations due on demand within one year (or operating cycle, if longer) as current liabilities. Do you agree with this statement? Explain.Smith Company is required to charge customers an 8% sales tax on all goods it sells. Smith Company includes sales tax in its sales amount. At the end of May, Smith Company’s sales account for May has a credit balance of ...On December 1, 2010, Insto Photo Company purchased merchandise, invoice price $25,000, and issued a 12%, 120-day note to Ringo Chemicals Company. Insto uses the calendar year as its fiscal year and uses the perpetual ...On May 1, 2010, the Ramden Company issues 13% serial bonds with a face value of $2 million. The bond contract calls for retirement of the bonds in periodic installments of $200,000, starting on May 1, 2011 and continuing on ...On January 1, 2010, Northern Manufacturing Company bought a piece of equipment by signing a non-interest-bearing $80,000, one-year note. The face value of the note includes the price of the equipment and the interest. The ...
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