Consultants notify management of Discount Pharmaceuticals that a stroke medication poses a potential health hazard. Counsel indicates that a product recall is probable and is estimated to cost the company $8 million. How will this affect the company’s income statement and balance sheet this period?
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Consultants notify management of Discount Pharmaceuticals that a stroke medication poses a potential health hazard. Counsel indicates that a product recall is probable and is estimated to cost the company $8 million. How will this affect the company’s income statement and
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- Consultants notify management of Discount Pharmaceuticals that a stroke medication poses a potential health hazard. Counsel indicates a product recall is probable and is estimated to cost the company $11.75 million. Required: How will this affect the company's income statement and balance sheet this period? Note: Enter your answers in dollars, not in millions (i.e., $5.5 million should be entered as $5,500,000). Amounts to be deducted should be indicated by a minus sign. Assets Balance Sheet Liabilities Contingent Liability S 1,175,000 Stockholders' Equity Common Stock Retained Earnings $ (1,175,000) Revenues Income Statement ExpenConsultants notify management of Discount Pharmaceuticals that a stroke medication poses a potential health hazard. Counsel indicates a product recall is probable and is estimated to cost the company $10.00 million. Required: How will this affect the company's income statement and balance sheet this period? Note: Enter your answers in dollars, not in millions (i.e., $5.5 million should be entered as $5,500,000). Amounts to be deducted should be indicated by a minus sign. Assets Balance Sheet Stockholders' Equity Liabilities Revenues Common Stock Retained Earnings Income Statement Expenses Net IncomeConsultants notify management of Discount Pharmaceuticals that a stroke medication poses a potential health hazard. Counsel indicates a product recall is probable and is estimated to cost the company $13.00 million. Required: How will this affect the company's income statement and balance sheet this period? Note: Enter your answers in dollars, not in millions (i.e., $5.5 million should be entered as $5,500,000). Amounts to be deducted should be indicated by a minus sign. Assets Balance Sheet Stockholders' Equity Liabilities Common Stock Retained Earnings Revenues Income Statement Expen
- Consultants notified management of Goo Goo Baby Products that a crib toy poses a potential health hazard.Counsel indicated that a product recall is probable and is estimated to cost the company $5.5 million. How willthis affect the company’s income statement and balance sheet this period?Consultants notified management of Goo Goo Baby Products that a crib toy poses a potential health hazard. Counsel indicated that a product recall is probable and is estimated to cost the company $3.3 million. How will this affect the company’s income statement and balance sheet this period?Sid Berhad year end is 31 December 2020. The accountant of Sid Berhad has asked for your opinion on the accounting treatment of the following items: (v) One of Sid Berhad’s product has suffered some bad publicity as a result of a customer claiming to have harm his health condition. The customer filed a court case in December 2020 claiming damages of RM100,000. Sid’s lawyer advised the company that the most probable outcome is that the company will have to pay the customer RM80,000. Required: Advise Sid Berhad’s accountant on the accounting treatments for all the above- mentioned items. Your answer shall make reference to relevant MFRS Standards.
- Ethical Considerations. In the process of closing thecompany books, you encounter a problematic transaction. One of the company’s customers was invoicedtwice for the same project materials, resulting in a$1,000 overcharge. You immediately notify the controller, whose response is, “Let it go, it happens often.It’ll probably balance out on some future transaction.”What should you do now?Insurance companies agree to pay medical costs to customers who pay into their health insurance program. One such insurance company offers health insurance to customers aged over 60, without any medical examination, it their family also buys the company's health insurance. Although the cost to the company of offering this insurance to customers above 60 is potentially high, the company still feels confident it will make a profit from this health insurance program. Which of the following assumptions is the company basing its expectations for good results on? The insurance payments made by young customers, who are less likely to make insurance claims, outweighs the costs of medical treatments that have to be paid to customers aged over 60. Familles with more older members have a slightly higher average age than familles with fewer older members. Younger customers are likely to submit medical claims which are substantially lower than medical claims submitted by customers over 60. Many…PLEASE answer all of the following questions. Thank you. (a) Discuss the concept of the Agency Problem. (b) Is it ethical for tobacco companies to sell a product that is known to be addictive and a danger to the health of the user? Is it relevant that the product is legal? (c) Using the financial statements provided, compute the following ratios for WITCO for 2019and 2020. i. Debt to Equity ii. Total Debt Ratio iii. Times Interest Earned iv. Cash Coverage v. Return on Equity - Using the Du Pont Identity (d) Briefly discuss the difference(s) between a Trend Analysis and a Peer Group Analysis? (e) Using the results of your calculation in part c (i–iv) above, perform a trend analysison WITCO’s financial leverage ratios (discuss if these ratios improved or deteriorated between 2019and 2020and suggest possiblereasons for increases/decreases where possible). Clearly indicate in your analysis whateach ratio measures/suggests about the company.
- James Madison was brought in as assistant to Computron’s chairman, who had the task of getting the company back into a sound financial position. Madison must prepare an analysis of where the company is now, what it must do to regain its financial health, and what actions to take. Your assignment is to help her answer the following questions, using the recent and projected financial information shown next. Provide clear explanations, not yes or no answers. Calculate the inventory turnover, days sales outstanding (DSO), fixed assets turnover, operating capital requirement, and total assets turnover. How does Computron's utilization of assets stack up against other firms in its industry?In Year 1, began to receive complaints from physicians that patients were experiencing unexpected side effects from the company’s sleep apnea drug. The company took the drug off the Market near the end of Year 1. During Year 2, the company was sued by 800 customers who had a severe allergic reaction to the company’s drug and required hospitalization. At the end of Year 2, the company’s attorneys estimated a 62% chance the company would need to make payments in the range of $2,500 to $7,000 to settle each claim, with all amounts in that range being equally likely. At the end of Year 3, while none of the cases had been resolved, the company’s attorney now estimated an 80% probability the company would be required to make payments in the range of $3,000 to $10,000 to settle each claim with all amounts in that range being equally likely. In Year 4, 400 claims were settled at a total cost of $2.5 million. Based on this experience, the company believes 30% of the remaining cases will be…the supervisor tells you to change the aging category of a large account from over 120 days to current status and prepare a new invoice to the customer with the revised date and that agrees with the new category this will change the required allowance of uncollectible accounts from $180,000 to $135,000. Identify the key internal and external stakeholders. what are the negative impacts that can happen if you do not follow the instructions of the supervisor?