E3.26 (LO 6) Writing Speyeware International, headquartered in Vancouver, Canada, specializes in Internet safety and computer security products for both the home and commercial markets, in a recent statement of financial position, it reported a deficit of US\$5,678,288. It has reported only net losses since its inception. In spite of these losses, Speyeware's shares have traded anywhere from a high of $3.70 to a low of $0.32 on the Canadian Venture Exchange (in Canadian dollars). Speyeware's financial statements have historically been prepared in Canadian dollars, Recently, the company adopted the U.S. dollar as its reporting currency. Instructions a. What is the objective of financial reporting? How does this objective meet or not meet Speyeware's investors' needs? b. Why would investors want to buy Speyeware's shares if the company has consistently reported losses over the last few years? Include in your answer an assessment of the relevance of the information reported on Speyeware's financial statements. c. Comment on how the change in reporting information from Canadian dollars to U.S. dollars likely affected the readers of Speyeware's financial statements. Include in your answer an assessment of the comparability of the information. In addition to those accounts listed on the trial balance, the chart of accounts for Cuono Consulting also contains the following accounts and account numbers: No. 150 Accumulated Depreciation-Equipment, No. 212 Salaries and Wages Payable, No. 631 Supplies Expense, No. 717 Depreciation Expense, No. 722 Insurance Expense, and No. 732 Utilities Expense. Other data: 1. 900 of supplies have been used during the month. 2. Utilities expense incurred but not paid on May 31,2025,250. 3. The insurance policy is for 2 years. 4. 400 of the balance in the unearned service revenue account remains unearned at the end of the month. 5. Assume May 31 is a Wednesday, and employees are paid on Fridays. Cuono Consulting has two employees, who are paid 920 each for a 5-day work week. 6. The office furniture has a 5 -year life with no residual value. It is being depreciated at 190 per month for 60 months. 7. Invoices representing 1,700 of services performed during the month have not been recorded as of May 31. Instructions a. Prepare the adjusting entries for the month of May. Use J4 as the page number for your journal. b. Post the adjusting entries to the ledger accounts. Enter the totals from the trial balance as beginning account balances and place a check mark in the posting reference column. c. Prepare an adjusted trial balance at May 31, 2025. E3.24 (LO 6) Weber Co. had three major business transactions during 2025. a. Reported at its current value of $260,000 merchandise inventory with a cost of $208,000 (in CanaIdentify the assumption or pritcipie dian dollars). that has been violated. b. The president of Weber Co., Austin Weber, purchased a truck for personal use and charged it to his expense account. c. Weber Co, wanted to make its 2025 income look better, so it added 2 more weeks to the year (a 54 week year). Previous years were 52 weeks. Instructions In each situation, identify the assumption of principle that has been violated, if any, and discuss what the company should have done. Identity financial accounting con- E3.27 (LO 6) Writing A friend of yours, Mindy Gare, recently completed an undergraduate degree in science and has just started working with a blotechnology company. Mindy tells you that the company is trying to secure new sources of financing in order to proceed with the development of a new healthcare product. Mindy said that her boss told her that the company must put together a report to present to potential investors. Mindy thought that the company should include in this package the detailed scientific findings related to the Phase I clinical trials for this product. She said, "I know that the biotech industry sometimes has only a 10% success rate with new products, but if we report all the scientific findings, everyone will see what a sure success this is going to bel The president was talking about the importance of following some set of accounting principles. Why do we need to look at some accounting rules? What they need to realize is that we have scientific results that are quite encouraging, some of the most talented employees around, and the start of some really great customer relationships. We haven't made any sales yet, but we will. We just need the funds to get through all the clinical testing and get government approval for our product. Then these investors will be quite happy that they bought in to our company early!" Instructions a. What is accounting information? b. Comment on how Mindy's suggestions for what should be reported to prospective investors conforms to the qualitative characteristics of accounting information. Do you think that the things that Mindy wants to include in the information for investors will conform to financial reporting guidelines? P3.1 (LO 2, 3, 4) Sadie Cuono started her own consulting firm, Cuono Consulting, on May 1, 2025. The trial balance at May 31 is as follows. E3.25 (LO G) The following characteristies, assumptions, principles, or constraint guide the IASB when it creates accounting standards. Match each item above with a description below. 1. Ability to easily evaluate one company's results relative to another's. 2. Assumption that a company will continue to operate for the foreseeable future. 3. The judgment concerning whether an item's size is large enough to matter to decision: makers. 4. The reporting of all information that would make a difference to financial statement users. 5. The practice of preparing financial statements at regular intervals. 6. The quality of information that indicates the information makes a difference in a decision. 7. A belief that items should be reported on the statement of financial position at the price that was paid to acquire them. 8. A company's use of the same accounting principles and methods from year to year. 9. Tracing accounting events to particular companies. 10. The desire to minimize bias in financial statements. 11. Reporting only those things that can be measured in monetary units. 12. Dictates that efforts (expenses) be recognized in the period in which a company generates results (revenues). Identity financial accounting concepts and principles