Problem 7.1 Financial Accounting Overview (Problems 7.1-7.5 relate to the chemical industry.) A review of Note 1 (Accounting Policies) of three chemical companies provides the follow- ing information: DuPont Dow PPG Revenue Recognition Recognized when products When risk and title are When goods are shipped are shipped and the title and transferred to customer, gen- and title to inventory passes risk of loss are transferred to erally at time of shipment to customers customer Marketable Securities Held-to-maturity Trading, held-to-maturity, Valued at cost or available-for-sale Inventory Last in, first out (LIFO) and LIFO, FIFO, and Average LIFO and FIFO first in, first out (FIFO) Property, Plant, and Recorded at cost, straight Recorded at cost, straight. Recorded at cost, straight- Equipment line depreciation line depreciation line depreciation Environmental Liabilities Recorded as operating Recorded as operating Probable that a liability has expenses when liability expenses when probable been incurred and amount of incurred and can be reason liability reasonably estimated ably estimated Commodity swaps and Forward exchange contracts, Interest rate swaps, foreign interest rate swaps, com- currency swaps, commodities options, foreign currency and interest rates swaps futures, options, and swaps modities futures contracts Hedging Are there differences in accounting policies across these companies? Explain. Does this information suggest earnings management or the need for further analysis? Explain