A fire destroyed 28 of a company's storage units which included stock. If each unit was worth £1,250, and insurance only covers 80%, what is loss incurred by the company?
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A fire destroyed 28 of a company's storage units which included stock. If each unit was worth £1,250, and insurance only covers 80%, what is loss incurred by the company?
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- A fire occurred in the City of Manila and coincided with the looting of stock of plywood of a lumber company. The lumber company, however, failed to record such loss in its books of accounts. Was the loss deductible? Briefly explain.#10 Issue: Sunrise Pools, Inc., is being sued by the Crescent Club for negligence when installing a new pool on Crescent Club’s property. Crescent Club alleges that the employees of Sunrise Pools damaged the foundation of the clubhouse and part of the golf course while operating heavy machinery to install the pool. The lawsuit is for $1.5 million. At the time of the alleged incident, Sunrise Pools carried only $600,000 of liability insurance. While reviewing the draft of Sunrise Pools’ annual report, its president deletes all references to this lawsuit. She is concerned that disclosure of this lawsuit in the annual report will be viewed by Crescent Club as admission of Sunrise’s wrongdoing, even though she privately admits that Sunrise employees were careless and believes that Sunrise Pools will be found liable for an amount in excess of $1 million. The president sends the amended draft of the annual report to the vice president of finance with a note stating that the lawsuit will…a company discarded a computer system originally purchased for $8850.
- Dandy Candy Company sold its licorice division resulting in a loss of $60,000. Assuming a tax rate of 25%, the loss on this disposal will be reported on the income statement at what amount? A) $75,000 B) $15,000 C) $60,000 D) $45,0008 Kong operate a distribution firm with a margin of 1 / 3. At the end of May he had sales of $900,000 and purchases of $550,000. His stock at start of the year was $260,000. At the end of May a firm at the firm destroyed most of his stock. On hand was a salvaged amount of $84,000. What was the value of the stock that was destroyed? $29,667 $126,000 $210,000 $294,000Franklin Manufacturing Company was started on January 1, year 1, when it acquired $81,000 cash by issuing common stock. Franklin immediately purchased office furniture and manufacturing equipment costing $7,700 and $24,900, respectively. The office furniture had an eight-year useful life and a zero salvage value. The manufacturing equipment had a $3,600 salvage value and an expected useful life of three years. The company paid $11,200 for salaries of administrative personnel and $15,500 for wages to production personnel. Finally, the company paid $16,110 for raw materials that were used to make inventory. All inventory was started and completed during the year. Franklin completed production on 4,900 units of product and sold 3,970 units at a price of $15 each in year 1. (Assume that all transactions are cash transactions and that product costs are computed in accordance with GAAP.) Required a. Determine the total product cost and the average cost per unit of the inventory produced in…
- A factory owned by Wonder Inc. was destroyed by fire. Wonder Inc. lodged an insurance claim for the value of the factory building, plant and an amount equal to one year’s net profit. During the year, there were a number of meetings with the representatives of the insurance company. Finally, before the year-end, it was decided that Wonder Inc. would receive compensation of 90% of its claim. Wonder Inc. received a letter that the settlement check for that amount had been mailed, but it was not received before year-end. How should Wonder Inc. treat this in its financial statements? Disclose the contingent asset in the footnotes. Wait until next year when the settlement check is actually received and not recognize or disclose the receivable at all since at year-end it is a contingent asset. Because the settlement of the claim was conveyed by a letter from the insurance company, that also stated that the settlement check was in the mail for 90% of the claim, record the 90% of the claim…All Insure issued a policy for $10 Million Auto liability. The underwriter, following company underwriting guidelines to retain only $5 Million liability risk, placed a facultative excess of loss reinsurance contract for $5 million with ReinsureRE. The insured caused a pile-up car/truck collision with total loss amount of $8 Million in loss payments. How much of the $8 Million will be covered by the excess of loss contract?Oxdale Kennels has insured its building with multiple companies for a total of $1,141,000, of which $855,750 is with Nationwide. Assuming that all coinsurance requirements have been met, how much would Nationwide be responsible for in the event of a $202,000 fire? O $50,500 O $141,400 O $151,500 O $202,000
- 7-9 onlyA company had a tractor destroyed by fire. The tractor originally cost $145,000 with accumulated depreciation of $78,000. The proceeds from the insurance company were $40,000. The company should recognize:38 - Metal Foreign Trade Limited Company made a loss of 200.000 TL in 2020. The company has 300,000 TL accumulated in the legal reserves account until 2020, and it has been decided to deduct the previous year's losses with legal reserves. In this case, which of the following can be said about the accounting records to be made?A) 580 previous year losses account 300.000 is credited.B) 542 Extraordinary reserves account 200.000 is debited.C) 540 legal reserves account is debited 200,000.D) 591 net loss for the period 200.000 is credited.E) 541 Status reserves account 200.000 is debited.
