Hydromaint Year Essay -- Essays Papers

Hydromaint YearDuring Hydromaints audit, you and Pam had a bend of discussions. You, Pam, and Mike Johnson be generally satisfied that the grievances are in concurrence with GAAP and are supported by underlying facts. Pam tested Jerrys premium accounting (which she found to be correct) by preparing a pension worksheet base on data contained in the actuarys reportCurrent service constitute $1,064,043ABO at 12/31/X7 2,840,000Interest on the PBO8%Interest on plan assets8Jerry has agreed to adjust his accounts and distinguish disclosures for all corrections proposed by C & L. Pam raised a morsel of questions that may require adjustment. No other matters were found to be questionable. Pams questions are as follows1. Accounting for R&D does not appear to be in compliance with SFAS No. 2. The work is of the nature described in SFAS No. 2, para. 9, and is not being conducted for others under contract.2. Pam also noted that imprimatur contracts are given on all sales of pumps and valves. LS-Pump/Valve and now Hydromaint, permit accounted for warranties only on the costs to make good when warranty claims were rattling filed by customers. If warranty costs had been recognized as sales were made, the liability at January 1, 20X7, would have been $500,000. Pam noted, however, that Nick Riley and Ray Ballard were aware of the warranty contracts and took these into account in valuing the acquisition of LS-Pump/Valve. Nick and Ray did ...