Multiple Choice Question 133

On January 3, 2018, Concord Corporation owned a machine that had cost $405000. The accumulated depreciation was $243000, estimated salvage value was $24300, and fair value was $645000. On January 4, 2018, this machine was irreparably damaged by Pharoah and became worthless. In October 2018, a court awarded damages of $481000 against Pharoah in favor of Concord. At December 31, 2018, the final outcome of this case was awaiting appeal and was, therefore, uncertain. However, in the opinion of Concord's attorney, Pharoahs appeal will be denied. At December 31, 2018, what amount should Concord accrue for this gain contingency?

$402000.

$523500.

$0.

$645000.

Multiple Choice Question 103

Vaughn Manufacturing has $3130000 of short-term debt it expects to retire with proceeds from the sale of 81000 shares of common stock. If the stock is sold for $30 per share subsequent to the balance sheet date, but before the balance sheet is issued, what amount of short-term debt could be excluded from current liabilities?

$2430000

$3130000

$700000

$0