Chapter 11, Problem 1QAP

Superb Corporation is being sued for illness caused to local residents as a result of negligence on the company's part in permitting the local residents to be exposed to highly toxic chemicals from its plant. Superb’s lawyer states that it is probable that Superb will lose the suit and be found liable for a judgment costing Superb anywhere from $1,200,000 to $6,000,000. However, the lawyer states that the most probable cost is $3,600,000. As a result of the above facts, Superb should accrue Select one: a loss contingency of $3,600,000 and disclose an additional contingency of up to $2,400,000. a loss contingency of $3,600,000 but not disclose any additional contingency. a loss contingency of $1,200,000 and disclose an additional contingency of up to $4,800,000. no loss contingency but disclose a contingency of $1,200,000 to $6,000,000.

Your project team has been tasked to complete a project to build a new bridge to replace an old one on a road at a point that crosses a small river in a rural community. The old bridge to be replaced is on a single access road to the community and was recently damaged by heavy vehicles crossing it for a construction work in the village. The old bridge is still in use but has failed in the mid-section and can collapse in anytime – the project is therefore urgent from a safety point of view. The bridge is used by both vehicles and pedestrians at all times of the year. The community had petitioned the local council for support in replacing the old bridge but the response had been slow. A private company took the initiative and is replacing the bridge at their expense and has hired you and your team to manage the replacement project.   Create a time estimate and cost estimate using estimation methods (1 page each inn tabular form).? Please Answer related to this question only. I posted…

Several months ago, Ayers Industries Inc. experienced a hazardous materials spill at one of its plants. As a result, the Environmental Protection Agency (EPA) fined the company $470,000. The company is contesting the fine. In addition, an employee is seeking $540,000 in damages related to the spill. Lastly, a homeowner has sued the company for $300,000. The homeowner lives 30 miles from the plant, but believes that the incident has reduced the home's resale value by $300,000. Ayers’ legal counsel believes that it is probable that the EPA fine will stand. In addition, counsel indicates that an out-of-court settlement of $230,000 has recently been reached with the employee. The final papers will be signed next week. Counsel believes that the homeowner's case is much weaker and will be decided in favor of Ayers. Other litigation related to the spill is possible, but the damage amounts are uncertain. a.  Journalize the contingent liabilities associated with the hazardous materials…

Swifty Corporation is being sued for illness caused to local residents as a result of negligence on the company's part in permitting the local residents to be exposed to highly toxic chemicals from its plant. Swifty's lawyer states that it is probable that Swifty will lose the suit and be found liable for a judgment costing Swifty anywhere from $ 1830000 to $ 8960000. However, the lawyer states that the most probable cost is $ 5410000. As a result of the above facts, Swifty should accrue a loss contingency of $ 1830000 and disclose an additional contingency of up to $ 7130000. a loss contingency of $ 5410000 and disclose an additional contingency of up to $ 3550000. no loss contingency but disclose a contingency of $ 1830000 to $ 8960000. a loss contingency of $ 5410000 but not disclose any additional contingency.

A fertilizer manufacturing company wants to relocate to Yellowstone County. A report from a fired researcher at the company indicates the company’s product is releasing toxic by-products. The company suppressed that report. A later report commissioned by the company shows there is no problem with the fertilizer.Should the company’s chief executive officer reveal the content of the unfavorable report in discussions with Yellowstone County representatives? Discuss.

There is a high chance that our audit work will be disturbed by protesters who will at any moment occupy the two MapleX’s farms located on the lands claimed by the Métis indigenous peoples of Canada. Due to serious safety concerns associated with the protesters, I don’t want anyone from our firm going to these two farms. This means that we will not be able to physically inspect and count of the maple trees at the two occupied farms. In addition, I have a feeling that the AFDA set by the bookkeeper could be materially misstated and therefore the A/R balance presented on MapleX’s financial statements would be incorrect. In a separate memo, please discuss and explain, how each of these two situations (on its own separately), would impact the type of audit report and the opinion that our firm would issue. Also, please explain what specific changes I would need to make to the auditor’s report and show an example of how the wording in the report would be changed for each situation. Remember,…

Environmental scientists David Pimentel, Rodolfo Zuniga, and Doug Morrison of Cornell University reviewed scientific estimates for the economic and ecological costs imposed by introduced and invasive species in the United States. They found that, as of 2005, approximately 50,000 species had been introduced in the United States and that these accountedfor over $120 billion in economic costs each year. These costs include direct losses and damage, as well as costs required to control the species. (The researchers did not quantify monetary estimates for losses of biodiversity, ecosystem services, and aesthetics, which they said would drive total costs several times higher.) Calculate values missing from the table to determine the number of introduced species of each type of organism and the annual cost that each imposes on our economy. Organisms that damage crop plants are the most costlyof introduced species. Weeds, pathogenic microbes, andarthropods that attack crops together account…

On April 20, 2010, an explosion at BP PLC’s Macondo well in the Gulf of Mexico caused the largest oil spill and one of the worst environmental disasters in U.S. history. Because the incident occurred at the Deepwater Horizon drilling rig, this incident is often referred to as the Deepwater Horizon spill. Approximately 4.9 million barrels of oil were released, threatening the marine environment of the Gulf of Mexico as well as the environment and communities of the Gulf Coast region of the United States. In addition, 11 workers died and 17 were injured in the explosion. While BP bore primary legal responsibility for the spill, Transocean Corporation (the drilling rig operator) and Halliburton Company (the construction contractor) were also held partially responsible. The spill’s financial costs to BP were enormous but also highly uncertain in the years that followed. Initially, the company incurred large costs to respond to the explosion and contain the spill. As time passed, the…

Several months ago, Ayers Industries Inc. experienced a hazardous materials spill at one of its plants. As a result, the Environmental Protection Agency (EPA) fined the company $430,000. The company is contesting the fine. In addition, an employee is seeking $540,000 in damages related to the spill. Lastly, a homeowner has sued the company for $270,000. The homeowner lives 30 miles from the plant, but believes that the incident has reduced the home's resale value by $270,000. Ayers’ legal counsel believes that it is probable that the EPA fine will stand. In addition, counsel indicates that an out-of-court settlement of $230,000 has recently been reached with the employee. The final papers will be signed next week. Counsel believes that the homeowner's case is much weaker and will be decided in favor of Ayers. Other litigation related to the spill is possible, but the damage amounts are uncertain. a.  Journalize the contingent liabilities associated with the hazardous materials…