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Sound Audio manufactures and sells audio equipment for automobiles. Engineers notified management in December 2 0 2 4 of a circuit flaw in an amplifier
Sound Audio manufactures and sells audio equipment for automobiles. Engineers notified management in December of a circuit flaw in an amplifier that poses a potential fire hazard. An intense investigation indicated that a product recall is virtually certain, estimated to cost the company $ million. The fiscal year ends on December Required: Should this loss contingency be accrued, only disclosed, or neither? What loss, if any, should Sound Audio report in its income statement? What liability, if any, should Sound Audio report in its balance sheet? Prepare any journal entry needed. Complete this question by entering your answers in the tabs below. Req to Req Prepare any journal entry needed. Note: If no entry is required for a transactionevent select No journal entry required" in the first account field. Enter your answers in millions rounded to decimal place ie should be entered as Journal entry worksheet Record the liability on product recall.
Sound Audio manufactures and sells audio equipment for automobiles. Engineers notified management in December of a circuit
flaw in an amplifier that poses a potential fire hazard. An intense investigation indicated that a product recall is virtually certain,
estimated to cost the company $ million. The fiscal year ends on December
Required:
Should this loss contingency be accrued, only disclosed, or neither?
What loss, if any, should Sound Audio report in its income statement?
What liability, if any, should Sound Audio report in its balance sheet?
Prepare any journal entry needed.
Complete this question by entering your answers in the tabs below.
Req to
Req
Prepare any journal entry needed.
Note: If no entry is required for a transactionevent select No journal entry required" in the first account field. Enter your answers in
millions rounded to decimal place ie should be entered as
Journal entry worksheet
Record the liability on product recall.
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