Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

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Answer 1

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Chapter 17, Problem 5C

1.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

2.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the publication of the magazine every month.

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After the presentation of your report on the examination of the financial statements to the board of directors of Piper Publishing Company, one of the new directors expresses surprise that the income statement assumes that an equal proportion of the revenue is recognized with the publication of every issue of the company’s magazine. She feels that the “crucial event” in the process of earning revenue in the magazine business is the cash sale of the subscription. She says that she does not understand why most of the revenue cannot be “recognized” in the period of the cash sale. InstructionsDiscuss the propriety of timing the recognition of revenue in Piper Publishing Company’s accounts with:(a) The cash sale of the magazine subscription.(b) The publication of the magazine every month.(c) Over time, as the magazines are published and delivered to customers.

The recently hired CFO of Finger Lakes Vacation Sales Corp. is concerned about some of the Year 4 situations. The CFO has come to you for advice. Finger Lakes Vacation Sales Corp. follows IFRS. Required For each scenario above, state if the situation is a change in policy, a correction of an error, or a change in estimate. Explain your answers. Also state if the situation requires a restatement of retained earnings on January 1, Year 4. What disclosures, if any, are required. Fully discuss any ethical implications related to the scenarios. The items of concern are: A. Finger Lakes Vacation Sales Corp. has provided a loyalty rewards program to customers for the past 6 years. During that time, the amounts were insignificant, and no revenues were deferred, and no accruals were made. With Year 4 changes to the plan, the amount of rewards has become material. The Controller decided that starting in January, Year 4, Finger Lakes Vacation Sales Corp. will defer the revenue related to these…

How can the enhancing characteristic timeliness be improved in high-quality accounting information? Do not simply repeat what it is, provide suggestions as to how a particular part of the enhancing characteristic could be improved. Please provide different answers and explanations than copy and pasting: “Timeliness matters for accounting information because it competes with other information. For example, if a company issues its financial statements a year after its accounting period, users of financial statements would find it difficult to determine how well the company is doing in the present.”

Answer 2

Question

Chapter 17, Problem 5C

1.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

2.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the publication of the magazine every month.

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Answer 3

Question

Chapter 17, Problem 5C

1.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

2.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the publication of the magazine every month.

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Answer 4

Question

Chapter 17, Problem 5C

1.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

2.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the publication of the magazine every month.

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Answer 5

Chapter 17, Problem 5C

1.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

2.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the publication of the magazine every month.

Answer 6

Chapter 17, Problem 5C

1.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

Answer 7

Chapter 17, Problem 5C

1.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

Answer 8

2.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the publication of the magazine every month.

Answer 9

2.

To determine

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the publication of the magazine every month.

Answer 10

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Answer 11

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Answer 12

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Answer 13

Ch. 17 - Prob. 1GI Ch. 17 - Prob. 2GI Ch. 17 - When a company recognizes revenue during a period,...Ch. 17 - Prob. 4GI Ch. 17 - Prob. 5GI Ch. 17 - What is the proper accounting for a wholly...Ch. 17 - If a seller enters into more than one contract...Ch. 17 - Prob. 8GI Ch. 17 - Prob. 9GI Ch. 17 - Prob. 10GI

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

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Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the cash sale of the magazine subscription.

Enumerate the propriety of timing the recognition of revenue in Company S’s accounts with the publication of the magazine every month.

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