Under what conditions should a provision be recorded?
While considering the expense in the income statement, the company needs to record the liability for the same in the balance sheet as a provision.
Provision is defined as an amount that is usually set aside out of profit so as to incur all the anticipated expense or depreciation in the asset value, although the exact amount is yet to be ascertained.
Provisions are generally recorded when an expense is listed by the company in the income statement, and then liability is recorded for the same in the balance sheet. Typically, provisions are recorded in the form of bad debts, unused inventory, and allowances made for sales.
They occur in the balance sheet of the company within the current liabilities section of the liabilities account.
Question: E13-1 (L01) (Balance Sheet Classification of Various Liabilities) How would each of the following items be reported on the balance sheet? (a) Accrued vacation pay. (j) Premium offers outstanding. (b) Estimated taxes payable. (k) Discount on notes payable. (c) Service warranties on appliance sales. (l) Personal injury claim pending. (d) Bank overdraft. (m) Current maturities of long-term debts to be paid (e) Employee payroll deductions unremitted. from current assets. (f) Unpaid bonus to officers. (n) Cash dividends declared but unpaid. (g) Deposit received from customer to guarantee (o) Dividends in arrears on preferred stock. performance of a contract. (p) Loans from officers. (h) Sales taxes payable. (i) Gift certificates sold to customers but not yet redeemed.
Question: The following information relates to Moran Co. for the year ended December 31, 2017: net income $1,245.7 million; unrealized holding loss of $10.9 million related to available-for-sale debt securities during the year; accumulated other comprehensive income of $57.2 million on December 31, 2016. Assuming no other changes in accumulated other comprehensive income, determine (a) other comprehensive income for 2017, (b)comprehensive income for 2017, and (c) accumulated other comprehensive income at December 31, 2017.
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