Please answer these questions correctly!

(1) Your friend Yong has a company making and selling watches with bands that are customized to match university colors. The business started locally, but now has expanded around the world. His strategy is to sell in bulk to small retailers or to alumni clubs in various cities. His banker has just told him he needs to make a revenue recognition policy and suggested he begin by considering a few transactions from today.

Yong tells you that today he delivered $1,000 worth of watches to a University bookstore that has been a long time client. They will pay him in a week.

He also received two big orders, one for $700 worth of watches to an established customer and another for $4,000 to a brand new customer in another country where he has never done business. The new customer sent payment in advance. Yong will be able to ship both orders out in the next week. He just needs to finish making a couple of watches for the established customers. He already has all the watches made for the new customer, but wants to inspect them one more time and has to figure out how to ship to that country.

How much revenue should Yong recognize at the end of the day?

The answer not 1000

(2) During the current year, Warren's company sold 10,000 shares of no par value common stock for $20,000. They also had a net income of $40,000 and paid dividends of $8,000. By how much, if any, did their shareholder's contributed capital change?

not 2000

(3) During the year, Jessica's firm had net income of $700,000. It was a record year, but most of the sales were on credit and have not yet been paid. In fact, there are still $400,000 waiting for collection. Management believes they will be paid, but some of the terms allow almost a year before that occurs. The firms also paid a dividend of $4,000. How much, if at all, did retained earnings change this year?

ans not 296000

(4)Emily purchased a tractor for her farm four years ago. She paid $100,000 for it, planned to use it for 10 years and then to sell it $20,000. However, she has now decided to plow using Oxen as part of a bioorganic certification. It will take her two years to train the Oxen, and then she plans to sell the tractor. She believes she will be able to sell it for $35,000 at that time. How much depreciation expense should she recognize in the fifth year of use?

ans not 5500 or 8000

5) Doran company had an accident with its delivery truck at the end of the quarter. The accident caused a fire that burnt down a building housinga restaurant and dry cleaner near Doran's plant. Contractors have predicted it will cost $1,000,000 to replace the restaurant due to the need to clear away the wreckage from the old building and do a new foundation. However, there is some chance the new foundation can be salvaged, which would reduce the cost to $900,000. There is also a chance that the fire caused toxic chemicals in the dry cleaner to spread across the site. That would require an additional $400,000 in clean up costs.

Doran intends to challenge their liability in court. They will argue the building was constructed wrong. However, their attorneys tell them it is probable they will have to pay. How much, if any, liability should Doran include on their financial statements?