Wyatt Co. has a probable loss that can only be reasonably
estimated within a range of outcomes. No single amount within
the range is a better estimate than any other amount. The loss
accrual should be
Question 19
On September 1, 2005, Cano & Co., a U.S. corporation, sold
merchandise to a foreign firm for 250,000 francs. Terms of the
sale require payment in francs on February 1, 2006. On
September 1, 2005, the spot exchange rate was $.20 per franc.
At December 31, 2005, Cano's year end, the spot rate was $.19,
but the rate increased to $.22 by February 1, 2006, when
payment was received. How much should Cano report as a
foreign exchange gain or loss in its 2006 income statement?
Question 20
During 2005, Rex Co. introduced a new product carrying a
two-year warranty against defects. The estimated warranty
costs related to dollar sales are 2% within 12 months following
sale and 4% in the second 12 months following sale. Sales and
actual warranty expenditures for the years ended December
31, 2005 and 2006 are as follows: At December 31, 2006, Rex
should report an estimated warranty liability of
Question 1
Which of the following should be disclosed for each reportable
operating segment of an enterprise?
Question 2