Question
Chapter 24 46. If Benjamin Company and Iris, Inc. are similar companies in every regard, except Benjamin Company uses IFRS while Iris, Inc. uses GAAP,
Chapter 24
46. If Benjamin Company and Iris, Inc. are similar companies in every regard, except Benjamin Company uses IFRS while Iris, Inc. uses GAAP, which of the following is true?
a. Iris, Inc. is required to issue interim statements every 6 months.
b. Benjamin Company need not recognize post-balance sheet events.
c. Benjamin Company is not required by IFRS to issue interim statements.
d. All of these choices are true.
47. Benjamin Company uses IFRS, while Iris, Inc. uses GAAP, for their external financial reporting. On January 16, 2021, both companies settled lawsuits relating to industrial accidents that occurred in 2019. Benjamin Company paid $550,000 and Iris, Inc. paid $230,000. Assuming that no accrual had been previously made, what amount of loss should be reported on the income statement for the year ended December 31, 2021 for each company?
Benjamin Company Iris, Inc.
a. $-0- $-0-
b. $550,000 $230,000
c. $-0- $230,000
d. $550,000 $-0-
48. Nicole, Inc. uses IFRS for its external financial reporting. During 2020, an employee of the company was injured in the factory. Discussions with corporate attorneys resulted in determination that the company would be required to pay between $1,500,000 and
$3,000,000 to settle the injury claim. Nicole, Inc. accrued a contingent liability on December 31, 2020 for $1,500,000. On February 4, 2021, Nicole, Inc. settled the lawsuit for $3,300,000. What amount of loss should be reported on the income statement for the year ended December 31, 2021 for Nicole, Inc. related to this lawsuit? a. $3,300,000
b. $1,800,000
c. $1,500,000
d. $300,000.
49. Identifiable assets for the 4 industry segments of Brittle Company are as follows:
Candy $120,000
Stix $240,000
Chips $980,000
Gum $ 45,000
Brittle Company uses IFRS for its external financial reporting. Using only the identifiable assets test, which of the segments are reportable?
a. Under IFRS, all four segments must be reported.
b. Candy, Stix, and Chips only.
c. Chips only.
d. Stix and Chips only.
50. Operating profits and losses for the 4 industry segments of Brittle Company are as follows:
Candy ($590,000)
Stix $ 20,000
Chips $ 85,000
Gum $ 9,000
Brittle Company uses IFRS for its external financial reporting. Using only the operating profits (loss) test, which of the segments are reportable?
a. Under IFRS, all four segments must be reported.
b. Stix, Chips, and Gum only.
c. Candy and Chips only.
d. Candy only.
Chapter 24
46. If Benjamin Company and Iris, Inc. are similar companies in every regard, except Benjamin Company uses IFRS while Iris, Inc. uses GAAP, which of the following is true?
a. Iris, Inc. is required to issue interim statements every 6 months.
b. Benjamin Company need not recognize post-balance sheet events.
c. Benjamin Company is not required by IFRS to issue interim statements.
d. All of these choices are true.
47. Benjamin Company uses IFRS, while Iris, Inc. uses GAAP, for their external financial reporting. On January 16, 2021, both companies settled lawsuits relating to industrial accidents that occurred in 2019. Benjamin Company paid $550,000 and Iris, Inc. paid $230,000. Assuming that no accrual had been previously made, what amount of loss should be reported on the income statement for the year ended December 31, 2021 for each company?
Benjamin Company Iris, Inc.
a. $-0- $-0-
b. $550,000 $230,000
c. $-0- $230,000
d. $550,000 $-0-
48. Nicole, Inc. uses IFRS for its external financial reporting. During 2020, an employee of the company was injured in the factory. Discussions with corporate attorneys resulted in determination that the company would be required to pay between $1,500,000 and
$3,000,000 to settle the injury claim. Nicole, Inc. accrued a contingent liability on December 31, 2020 for $1,500,000. On February 4, 2021, Nicole, Inc. settled the lawsuit for $3,300,000. What amount of loss should be reported on the income statement for the year ended December 31, 2021 for Nicole, Inc. related to this lawsuit? a. $3,300,000
b. $1,800,000
c. $1,500,000
d. $300,000.
49. Identifiable assets for the 4 industry segments of Brittle Company are as follows:
Candy $120,000
Stix $240,000
Chips $980,000
Gum $ 45,000
Brittle Company uses IFRS for its external financial reporting. Using only the identifiable assets test, which of the segments are reportable?
a. Under IFRS, all four segments must be reported.
b. Candy, Stix, and Chips only.
c. Chips only.
d. Stix and Chips only.
50. Operating profits and losses for the 4 industry segments of Brittle Company are as follows:
Candy ($590,000)
Stix $ 20,000
Chips $ 85,000
Gum $ 9,000
Brittle Company uses IFRS for its external financial reporting. Using only the operating profits (loss) test, which of the segments are reportable?
a. Under IFRS, all four segments must be reported.
b. Stix, Chips, and Gum only.
c. Candy and Chips only.
d. Candy only.Step by Step Solution
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