Questions from International Accounting

Q: Updike and Patterson Investments Inc. (UPI) holds equity investments

Updike and Patterson Investments Inc. (UPI) holds equity investments with a cost basis of $250,000. UPI accounts for these investments as available-for sale securities. As such, the investments are ca...

Q: Gotti Manufacturing Inc., a U.S.-based company,

Gotti Manufacturing Inc., a U.S.-based company, operates in three countries in addition to the United States. The following table reports the company’s pretax income and the applicab...

Q: Mishima Technologies Company introduced Product X to the market on December 1

Mishima Technologies Company introduced Product X to the market on December 1. The new product carries a one-year warranty. In its first month on the market, Mishima sold 1,000 units of the new produc...

Q: Ultima Company offers its customers discounts to purchase goods and take title

Ultima Company offers its customers discounts to purchase goods and take title before they actually need the goods. The company offers to hold the goods for the customers until they request delivery....

Q: he Miller-Porter Company sells powder coating equipment at a sales

he Miller-Porter Company sells powder coating equipment at a sales price of $50,000 per unit. The sales price includes delivery, installation, and initial testing of the equipment, as well as a monthl...

Q: Cypress Company enters into a fixed-fee contract to provide architectural

Cypress Company enters into a fixed-fee contract to provide architectural services to the Gervais Group for $240,000. The Gervais Group, which will make monthly payments of $40,000, is a new client fo...

Q: What is hedge accounting?

What is hedge accounting?

Q: Phil’s Sandwich Company sells sandwiches at several locations in the northeastern part

Phil’s Sandwich Company sells sandwiches at several locations in the northeastern part of the country. Phil’s customers receive a card on their first visit that allows them to receive one free sandwic...

Q: Saffron Enterprises Inc., a U.S.-based company,

Saffron Enterprises Inc., a U.S.-based company, purchases a 4 percent bond denominated in euros for $1,500 on January 1, Year 1, when the exchange rate is $1.50 per euro. (In other words, the purchase...

Q: On January 1, Year 1, Spectrum Fabricators Inc. issues

On January 1, Year 1, Spectrum Fabricators Inc. issues $20 million of convertible bonds at par value. The bonds have a stated annual interest rate of 6 percent, pay interest annually, and come due Dec...