Answer:
is made if it is more likely than not that the liability has been incurred.
Explanation:
When contingent liability is recorded it is recorded by debiting income statement and creating a liability in balance sheet, also it is not accounted for until the amount of liability is pretty certain as without being clear about its occurrence and the amount involved the liability cannot be recorded.
There is no such loss account, there exists only income statement.
Therefore, with the above we can conclude that contingent liability is recorded only if:
is made if it is more likely than not that the liability has been incurred.
She should do C, to find the best way to optimize profits.
Answer:
$180,000.
Explanation:
The Guaranteed direct labor cost to be recognized by the company is the cost of labour incurred directly in the course of production.
From the cost group given, the cost of plant supervisor, corporate executives, and security guards are all indirect cost.
The only direct cost for this company is the assembly-line workers cost at $180,000.
Answer:
The statement of cash flows is one of the most important financial statements of a company, since a company might be very profitable but if it doesn't have enough cash to function, then it will go bankrupt. This is normally more important when things are not going well, e.g. Ford didn't go bankrupt during the great recession because it had lots of cash, while GM and Chrysler ran out of cash and had to be bailed out.
Companies can survive without making any profits during many years and still be a success, e.g. Amazon, but no company can survive without cash. In finance and investing, cash is king.
The two ways to calculate cash flows are the direct and indirect method. The direct method is calculating through the differences between cash inflows and outflows. On the other hand, the indirect method starts with net income and is then adjusted for depreciation and amortization, increase in accounts receivables, etc.
Personally, I prefer the indirect method because it is much more simple to prepare and understand. Folks at FASB and IASB prefer the direct method because according to them it provides a clearer picture of the company's cash outflows and inflows. It sounds reasonable until you learn that companies that present the cash flows using the direct method must also present them using the indirect method. Or the companies can simply present the indirect method. So I'm not really sure that their argument is very solid.
