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The worksheet method is commonly used to analyze the information for preparing a company's statement of cash flows.
Explain whether each is an inflow or outflow of cash and explain how it should be disclosed in Alfred's statement of cash flows.
How does a company report a change in an accounting principle in its interim financial statements?
Bloom Company had beginning unadjusted retained earnings of $400,000 in the current year.
A change from full cost to successful efforts accounting for oil exploration costs.
A company has been expensing all its manufacturing cost variances. It decides to allocate them between cost of goods sold and inventory in the future.
The company discovers that it had ignored the estimated residual value in the computation of the annual depreciation each year.
Allowance for doubtful accounts of $5,000 was not recorded. The company normally uses the aging method.
Why do you think that the FASB requires one of two different transition methods when a company adopts a newly required accounting principle?
If a public company desires to change from the sum-of-theyears'-digits depreciation method to the straight-line method for its fixed assets.
Describe two situations in which a company could justify a change in an accounting principle.
In which situations may it be impracticable for a company to apply the retrospective adjustment method?
Describe a change in a reporting entity. How does a company account for such changes?
Explain how this change will be accounted for in Bliss Company's financial statements, and compute the current and future annual depreciation expense.
At the end of Year 1, Cortex Company failed to accrue interest revenue of $3,200 that it had earned, but not received on an outstanding note receivable.
The company discovered the correct inventory value at the end of Year 1 should have been $400,000 because it made a counting error.
Write-down of property, plant, and equipment because of closure of inefficient plants.
Payment to the Internal Revenue Service in settlement of a dispute over previous year's taxes.
A company has been using straight-line depreciation in its property, plant, and equipment.
Prepare the journal entries necessary in 2011 if the errors are discovered at the end of that year.
Discount on a note payable issued for purchase of a machine is ignored.
All purchases of materials for construction contracts still in progress have been immediately expensed.
During 2010, Quo increased its investment in Worth, Inc. from a 10% interest, purchased in 2009, to 60%.