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Mashutka [201]
2 years ago
9

Overton Corporation, a manufacturer of household paints, is preparing annual financial statements at December 31, 2019. Because

of a recently proven health hazard in one of its paints, the government has ordered Overton to recall all cans of this paint sold in the last six months. The management of Overton believes it is probable it would lose if it contested the recall and estimates that this recall would cost $800,000. What accounting recognition, if any, should be accorded this situation, assuming the amount would be considered material to Overton of the company had to make the recall
Business
1 answer:
Andre45 [30]2 years ago
5 0

Answer:

The answer is "Operating expense of $800,000 and liability of $800,000".

Explanation:

It's obvious from its government that the company must recall any paint cans which have proved health hazardous. Its organization must remember its $800,000 in canned cans. The cost of recall would also be referred to as administration fees since these costs aren't linked to its production of the paints. All operations of the company were performed. It must be held responsible for the calculation of the recalling costs.

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Explain the method of bookkeeping ?​
Mariulka [41]
The two main accounting methods are cash accounting and accrual accounting. Cash accounting records revenues and expenses when they are received and paid. Accrual accounting records revenues and expenses when they occur. Generally accepted accounting principles (GAAP) requires accrual accounting.
3 0
2 years ago
Please hep me solve this thank you!Tevebaugh Corporation is a manufacturer that uses job-order costing. The company closes out a
jarptica [38.1K]

Answer:

$546,750

Explanation:

Sales                  2,498,000

COGS                (1,376,000)

gross profit        1,  112,000

S&A salaries        (219,000)

other S&A           (346,000)

underapplied MO  (10,250) *

net income           536.750‬

*we need to compare the actual voerhead with the applied overhead:

<u>actual overhead:</u> 176,000 + 420,000 = 596,000

<u>applied overhead:</u>

overhead rate:

\frac{Cost\: Of \:Manufacturing \:Overhead}{Cost \:Driver}= Overhead \:Rate

568,000 / 32,000 = 17.75

33,000 x 17.75 = 585.750

      overhead

<u>debit              credit</u>

596,000    585,750

                    10,250 underapplied overhead

As the applied was lower it is underapplied we need to recognzie more cot thus, the net income decrease.

4 0
3 years ago
Neiman Marcus uses time-released atomizers which spray a lavender scent in the lingerie department. The managers say it enhances
Natalija [7]

Answer:

D.

Explanation:

Based on the information provided within the question it can be said that the design should positively influence consumer behavior. This is because it has been implemented specifically for this. Marcus hopes that the smell would put customers at ease and make them like the store as well as the products more, which in term would increase sales.

4 0
3 years ago
Bruce Corporation makes four products in a single facility. These products have the following unit product costs:
VladimirAG [237]

Answer:

The correct answer is option (D).

Explanation:

According to the scenario, computation of the given data are as follows:

Variable cost = Direct material + Direct labor + Variable manufacturing overhead + Variable selling cost per unit

Variable cost of product A =    $17.30 + $19.30 + $6.10 + $3.05 = $45.75

Variable cost of product B =   $21.20 + $22.70 + $7.30 + $3.75 = $54.95

Variable cost of product C =   $14.20 + $17.10 + $9.80 + $4.50 = $45.60

Variable cost of product D =   $16.90 + $11.10 + $6.80 + $5.20 = $40

Contribution per unit (CPU) = selling price per unit – variable cost  

Product A CPU = $87.20 - $45.75 = $41.45

Product B CPU = $79.60 - $54.95 = $24.65

Product C CPU = $76.40 - $45.60 = $30.8

Product D CPU = $71.10 - $40 = $31.10

Contribution per grinding minutes (CPGM)  = CPU ÷ contribution per grinding minutes

CPGM of Product A = $41.45 ÷ 2.30 = $18.02

CPGM of Product B = $24.65 ÷ 1.35 = $18.26

CPGM of Product C = $30.8 ÷ 0.90 = $34.22

CPGM of Product D = $31.10 ÷ 1.20 = $25.92

According to the analysis, Product C makes the most profitable use of grinding machine. Because it’s give the highest contribution per grinding minutes.

7 0
3 years ago
In the aggregate expenditures model if aggregate expenditures equal 800 billion and real GDP equals 600 there is a______________
Llana [10]

Answer:

unplanned inventory accumulation equals -$200 billion.

Explanation:

As we know that

Unplanned inventory equals to

= Real GDP - aggregate expenditures

= 600 billion - 800 billion

= -$200 billion

It shows a difference between the real GDP and the aggregate expenditure

Since the real GDP is less than the aggregate expenditure, so the unplanned inventory should come in negative amount else it comes in a positive amount

4 0
3 years ago
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