(A4Q3)

Several reporting situations follow:

1. Tercek Company recognizes revenue during the production cycle. The price of the product and how many items will be sold are not certain.

2 In preparing its financial statements, Seco Company left out information about its cost flow assumption for inventories.

3 Martinez Company amortizes patents over their legal life of 20 years instead of their economic life, which is usually about five years.

4 Ravine Hospital Supply Corporation reports only current assets and current liabilities on its balance sheet. Long-term assets and liabilities are reported as current. The company is unlikely to be liquidated.

5 Barton Company reports merchandise inventory on its balance sheet at its current market value of $100,000. The inventory has an original cost of $110.000.

6 Bonilla Company is in its third year of operations and has not yet issued financial statements.

7 Watts Company has merchandise inventory on hand that cost $400,000. Watts reports merchandise inventory on its balance sheet at its current market value of $425,000.

8 Steph Wolfson, president of Download Music Company, bought a computer for her personal use. She paid for the computer with company funds and debited the Equipment account.

9 Sagoo Company decided not to implement a perpetual inventory system that would save $40,000 annually because the cost of the system was $100,000 and it was estimated to have a 10-year life.

Instructions

-> For each of the above, list what concept in the conceptual framework has been violated, if any.