Question: 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,

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?

Mars, Inc.Jerome Companyo$-0-$30,000o$30,000$-0-o$-0-$-0-o$30,000330,000

Mars, Inc. $-0- $30,000 $-0- $30,000 Jerome Company $30,000 $-0- $-0- $30,000

Step by Step Solution

★★★★★

3.42 Rating (168 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

s the effet f hnge Mrs In wuld regnise exense f 0 s the ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

(a) Why is the MD&A section of the annual report useful to the financial analyst? What types of information can be found in this section? (b) Using the excerpts from the MD&A of the Biolase,...

Citigroup Inc. (Citi) is a leading global financial services company with over 200 million customer accounts and operations in more than 140 countries. Its operating units Citicorp and Citi Holdings...

The following questions are adapted from a variety of sources including questions developed by the AICPA Board of Examiners and those used in the Kaplan CPA Review Course to study revenue recognition...

Disclosures Required in Various Situations Ace Inc. produces electronic components for sale to manufacturers of radios, television sets, and digital sound systems. In connection with her examination...

1. [Preferred stock] Pin Corporation owns 20% of Sob Corporation's preferred stock and 80% of its common stock. Sob's stock outstanding on December 31, 2011, is as follows: 10% cumulative preferred...

Correcting errors in income statement transactions Broyo Corporation (Brow), a large paper company, reported the following income statement for its year ended December 31, 2008. Broyo applies IFRS...

Hometown Cleaners Inc. operates a small dry-cleaning business. The company has always maintained a complete and accurate set of records. Unfortunately, the company's accountant left in a dispute with...

As of January 1, 2012, the trial balance for Haven Hospital was as follows: During the fiscal year ended December 31, 2012, the following transactions occurred: 1. Patient service revenue amounted to...

Each of the following items must be considered in preparing a statement of cash flows (indirect method) for Grander son Inc. for the year ended December 31, 2010. (a) Plant assets that had cost...

Recognition of Profit and Balance Sheet Amounts for Long-Term Contracts Yanmei Construction Company began operations January 1, 2010. During the year, Yanmei Construction entered into a contract with...

What is production budget?

Iowa Group reports net income of $36,000 for 2010. At the beginning of 2010, Iowa Group had $135,000 in assets. By the end of 2010, assets had grown to $185,000. What is Iowa Groups 2010 return on...

Name the two dimensions of the employee value proposition? Question 8 Answer a . timeframe and performance contingencies b . business contingencies and budget timeframe c . transactions and relations...

A vessel containing a fixed volume of gas is cooled. Does the mean free path of the molecules increase, decrease, or remain constant in the cooling process? What about the collision frequency?

A vertical cylinder with a movable piston contains 1.00 mol of a diatomic ideal gas. The volume of the gas is Vi, and its temperature is Ti. Then the cylinder is set on a stove and additional weights...

A vertical cylinder with a heavy piston contains air at a temperature of 300 K. The initial pressure is 200 kPa, and the initial volume is 0.350 m3. Take the molar mass of air as 28.9 g/mol and...

A vertical cylinder of cross-sectional area A is fitted with a tight-fitting, frictionless piston of mass m (Fig. P19.53) (a) If n moles of an ideal gas are in the cylinder at a temperature of T,...

Verify Equations 21.27 and 21.28 for the rms and average speed of the molecules of a gas at a temperature T. Note that the average value of vn is

Choose the Degree (D) and Leading Coefficient (LC) for: 8x 4 2x 3 x 6 +3 LC: -1 LC: 8 D: 8 not a polynomial D: 6

On February 28, 2018, Star Theatre Inc.'s general ledger showed Cash $15,000; Land $85,000; Buildings $77,000; Equipment $20,000; Accounts Payable $12,000; Mortgage Payable $118,000; Common Shares...

Fly Right Travel Agency Ltd. was organized on January 1, 2016, by Joe Paul. Joe is a good manager but a poor accountant. From the trial balance prepared by a part-time bookkeeper, Joe prepared the...

Explain why external auditors are required to be independent of the company, whereas internal auditors are not.

Many statisticians recommend using trimmed means to estimate a population mean yU if there are outliers. The procedure used to find an -trimmed mean in an SRS of size n is to remove the largest n...

Return to the supermarket example of Section 6.1. Now lets select two supermarkets with replacement. List the 16 possible samples (A,A), (A,B), etc., and find the probability with which each sample...

Use the data in file nhanes.dat for this exercise. (If you prefer, you may download the NHANES data from the website at www.cdc.gov/nchs/nhanes.htm.) Triceps skinfold measurements are sometimes used...