a)
Statement of
Income statement: Income statement is a financial statement that shows the net income or net loss by deducting the expenses from the revenues and vice versa.
To Explain: The differences between cash flows from operating activities and the net income.
b)
To Explain: The accounting method followed by Company T, to record
c)
To Explain: The difference in the accounting method if Company T, followed direct method instead of indirect method, to prepare the statement of cash flows.
d)
To Explain: The difference in the
e)
To Explain: The transactions which do not impact the statement of cash flow of a company.
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INTERMEDIATE ACCT VOL.2>CUSTOM<
- Contingent liabilities Altria Group, Inc., has more than 12 pages dedicated to describing contingent liabilities in the notes to recent financial statements. These pages include extensive descriptions of multiple contingent liabilities. Use the Internet to research Altria Group, Inc., at www.altria.com. a. What are the major business units of Altria Group? b. Based on your understanding of this company, why would Altria Group require more than 12 pages of contingency disclosure?arrow_forwardPls answer number 15 with solutions An entity is the defendant in a patent infringement lawsuit. The entity’s lawyers believe there is a 30% chance that the court will dismiss the case and the entity will incur no outflow of economic benefits. However, if the court rules in favor of the claimant, the lawyers believe that there is a 20% chance that the entity will be required to pay damages of ₱800,000 (the amount sought by the claimant) and an 80% chance that the entity will be required to pay damages of ₱400,000 (the amount that was recently awarded by the same judge in a similar case). Other outcomes are unlikely. The court is expected to rule in late December 20x2. There is no indication that the claimant will settle out of court. A 7% risk adjustment factor to the probability-weighted expected cash flows is considered appropriate to reflect the uncertainties in the cash flow estimates. An appropriate discount rate is 10% per year. How much is the provision for lawsuit at…arrow_forwardA2 7a May I please have the answer in formula form and not excel. thx:) 7. You are making plans for your retirement. You have just turned 30 and want to retire on your 65th birthday. Once retired, you plan to move to a tax-free Caribbean state, where you believe you can live comfortably on your retirement savings. You plan to make your first withdrawal from your retirement savings when you retire at age 65 and your last withdrawal one month before your 85th birthday. Based on family history, you expect to live until exactly age 85. Your plan is to have a total of $1 million when you retire. Your current salary is $36,000 per year, or $3,000 per month. Your personal tax rate is approximately 30%. You estimate that you can earn an average return of 12% APR compounded annually on any money you invest over the next 60 years. You want to start putting aside a fixed amount of money at the end of every month until your retirement at age 65. You will make your first deposit one month from now…arrow_forward
- AP7.10 (LO 6) As discussed in the chapter, the results of tests of controls should ultimately influence the auditor’s audit strategy.RequiredExplain the differences between an audit of internal controls as required by AS 2201 and the testing of internal controls for the purposes of expressing an opinion on the financial statements as mandated by AU-C 315. Refer to the standards in your answer.arrow_forwardsh6 please help me Thankyou Discuss the Sarbanes Oxley Act of 2002. Do you think it was necessary? Has it helped prevent fraudulent reporting?arrow_forward10. LO 12.3If a bankruptcy is deemed likely to occur and is reasonably estimated, what would be the recognition and disclosure requirements for the company?arrow_forward
- Options: a) 2240 b) 2160 c) 2080 d) 2000 e) 1920 f) None of the abovearrow_forwardInvestment reporting Teasdale Inc. manufactures and sells commercial and residential security equipment. The comparative unclassified balance sheets for December 31, Year 2 and Year 1 are provided below. Selected missing balances are shown by letters. Teasdale Inc. Balance Sheet December 31, Year 2 and Year 1 Dec. 31, Year 2 Dec. 31, Year 1 Cash 160,000 156,000 Accounts receivable (net) 11S.OOO 108,000 Available for-sale investments (at cost)Note 1 a. 91,200 Plus valuation allowance for available-for-sale investments b. 8,776 Available for-sale investments (fair value) c 99,976 Interest receivable d. Investment in Wright Co. stockNote 2 e. 69,200 Office equipment (net) 96,000 105,000 Total assets f. 5538,176 Accounts payable 91,000 72,000 Common stock 80,000 80,000 Excess of issue price over par 250,000 250,000 Retained earnings g 127,400 Unrealized gain (loss) on available for-sale investments h. 8,776 Total liabilities and stockholders' equity S i. 5538,176 Note 1. Investments are classified as available for sale. The investments at cost and fair value on December 31, Year 1, are as follows: No. of Shares Cost per Share Total Cost Total Fair Value Alvarez Inc stock 960 38,00 36,480 39,936 Hirsch Inc. stock 1,900 28,80 4,720 60,040 91,200 99,976 Note 2. The Investment in Wright Co. stack is an equity method investment representing 30% of the outstanding shares of Wright Co. The following selected investment transactions occurred during Year 2: Mar. 18. Purchased 800 shares of Richter Inc. at 40, including brokerage commission. Richter is classified as an available-for-sale security. July 12. Dividends of 12,000 art: received on the Wright Co. investment. Oct 1. Purchased 24,000 of Toon Co. 4%, 10-year bonds at 100. the bonds are classified as available for sale. The bonds pay interest on October 1 and April 1. December 31. Wright Co. reported a total net income of 80,000 for Year 2. Teasdale recorder equity earnings for its share of Wright Co. net income. 31. Accrued interest for three months on the Toon Co. bonds purchased on October 1. 31. Adjusted the available-for-sale investment portfolio to fair value, using the following fair value per-share amounts: Available for Sale Investments Fair Value Alvarez Inc. stock 41,50 per share Hirsch Inc stock 26,00 per share Richter Inc. stock 48,00 per share Toon Co. bonds 101 per 100 of face amount 31. Closed the Teasdale Inc. net income of 51,240. Teasdale Int. paid no dividends during the year. Instructions Determine the missing letters in the unclassified balance sheet. Provide appropriate supporting calculations.arrow_forwardA5 4b b. What are the two implications of M&M Proposition I without taxes?arrow_forward
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