changes and the accounting estimates that Harnischfeger made during 1984. Estimate, as accurately as possible, the effect of these on the company’s 1984 reported profits. a. Changes that affect the Harnischfeger Revenues: • The company start to account Kobe Steel sales in US, previously it only add the gross margin in the financial statement. (this sales represents $28 millions) Following are the accounting policy changes and accounting estimates that Harnischfeger made during 1984 : • Starting November
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Harnischfeger Corporation CHAPTER 3 OVERVIEW OF ACCOUNTING ANALYSIS HARNISCHFEGER CORPORATION 1 Identify all the accounting policy changes and accounting estimates that Harnischfeger made during 1984. Estimate, as accurately as possible, the effect of these on the company’s 1984 reported profits. i. Harnischfeger Corporation had changed from accelerated to straight-line method for computing depreciation expenses on plants, machinery and equipment in 1984.The cumulative effect is that net
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ACC 725 Harnischfeger Corporation Case Kai Chen 1. Prepare a brief description of the company and its environment. Harnischfeger Corporation was a machinery company based in Milwaukee. Harnischfeger was a leading producer of construction, mining and electrical equipments, export and foreign sales constituted more than 50% of the total revenues of the company. In 1980s, the company suffered a financial crisis due to the worldwide recession. Harnischfeger Corporation took some
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Case Write Up Harnischfeger Corporation Questions 1. Identify the accounting policy changes and accounting estimates that Harnischfeger made during 1984. Estimate the effect of these changes on the company's 1984 reported profits. Changes made and the effects of these changes: · In the financial notes, note 2, in 1984 the corporation calculated depreciation using the straight line method. In previous years they were using an accelerated methods of depreciating. By changing this method
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Case Study: | Harnischfeger Corporation | | | Q1: Changes in accounting policy and accounting estimates. (i) Inclusion of full sales price of construction and mining equipment purchased from Kobe Steel, Ltd. (later resold by the Corporation) in net sales If the Corporation continued with the prior recognition, which was to recognize gross margin, a loss of $5.7 million would be reflected in net sales. However, under the new recognition method no loss would be recorded, instead, revenue
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Chapter 1 The Evolution of the Modern Firm Chapter Contents 1) Introduction 2) The World in 1840 • Doing Business in 1840 • Conditions of Business in 1840: Life Without a Modern Infrastructure Example 1.1: The Emergence of Chicago 3) The World in 1910 • Doing Business in 1910 Example 1.2: Responding to the Business Environment: The Case of American Whaling • Business Conditions in 1910: A "Modern" Infrastructure Example 1.3: Evolution of the
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