User Account

All Pages

Journalize the contingent liabilities

Assignment Help Accounting Basics
Reference no: EM133099594

Question - Contingent Liabilities - 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 $550,000. The company is contesting the fine. In addition, an employee is seeking $480,000 in damages related to the spill. Finally, a homeowner has sued the company for $350,000. The homeowner lives 30 miles from the plant but believes that the incident has reduced the home's resale value by $350,000.

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 $210,000 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.

Required -

a. Journalize the contingent liabilities associated with the hazardous materials spill. Use the account Damage Awards and Fines to recognize the expense for the period. If an amount box does not require an entry, leave it blank.

b. The note disclosure would ______ a statement that the EPA fine is probable and would ______ a statement about the homeowner lawsuit.

Reference no: EM133099594

Questions Cloud

Determining the effectiveness and impact of training : What constructivism is as a paradigm and then explain how it fits your research project of determining the effectiveness and impact of training?
Evaluate the competitive factors of asian countries : Asia is considered as a preferred region to do business. Determine and evaluate the competitive factors of Asian countries.
Describe the problem to be investigated : Describe the problem to be investigated, give the key PDE and include a sketch of the geometry with labelled boundary conditions
Calculate the closing inventory to be recorded : How to calculate the closing inventory to be recorded in Statement of Financial Position and which amount should be deducted with Cost of Sales
Journalize the contingent liabilities : Journalize the contingent liabilities associated with the hazardous materials spill. Use the account Damage Awards and Fines to recognize the expense
Describe innovation strategy : Describe innovation strategy and discuss why it is required in a competitive market
Key drivers of high costs : In separate and numbered paragraphs, identify clearly and describe fully what you consider to be the key drivers of high costs for the company over the last fif
Explain the significance of the resource : 1) Explain the significance of the resource - based view (RBV) theory of a firm in the study of strategic management.
Influence of digital platforms and social media : Thesis on understanding the influence of digital platforms and social media for the improvement of sales in the market using the adaptive research approaches.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Explain pending why or why not there is a violation

State the rule in question and explain Pending why or why not there is a violation of the code. You need not refer to the rule number

  Compute the adjusted cash balance per the books on January

EFT automatically deducted monthly, not yet recorded by Maxi $680. Compute the adjusted cash balance per the books on January 31

  Give a statement reconciling the profit or loss on the cases

A company makes a charge to its customers for cases in which its product is delivered; if they are returned in good condition within three months a refund.

  Baddour report in its statement of cash flows

1.On January 1, 2013, Baddour, Inc., issued 10% bonds with a face amount of $160 million. The bonds were priced at $140 million to yield 12%. Interest is paid semiannually on June 30 and December 31. Baddour's fiscal year ends September 30.

  Research how financial market influence the global economies

Choose 4 financial markets or institutions. Briefly explain what each specializes in (mortgages, stocks, government securities, etc.).

  Evaluate angela peters attorneys first month of operations

angela peters practiced law with a partnership for 10 years. recently she opened her own law office which she operates

  Find which accounts will be credited by the borrower

Find which accounts will be credited by the borrower when a promissory note is issued? Note Receivable. / Interest Payable. / Note Payable

  Formulate the adjusted cash book as at september

A direct deposit of RM188 appeared in the Bank Statement only. Formulate the Adjusted Cash Book as at 30 September 2020

  Prepare the income tax section of the 2012

Prepare the income tax section of the 2011 income statement beginning with the line "Operating loss before income taxes."

  What must keep in mind about using averages

You have used the best data available and framed the best and most focused questions you could. What must you keep in mind about using averages?

  Analyze how involuntary conversions differ from condemnation

Under the authority of the IRS, real property can be seized for nonpayment of taxes. In addition, the local government could confiscate personal property for public use. Analyze how involuntary conversions differ from condemnations and how to dete..

  Total liabilities 403500 387400 stockholders equity common

the comparative statements of villa tool company are presented below. villa tool company income statement for the year

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd