Midland Company Follows U

question 74

Short Answer

Midland Company follows U.S. GAAP for its external financial reporting whereas Bailey Company follows IFRS for its external financial reporting. Both companies have defined-benefit pension plans. At December 31, 2015, prior to any adjusting entries, Midland Company's actuarial loss subject to amortization/recognition amounted to $55,000 and Bailey Company's actuarial loss subject to amortization/recognition amounted to $76,000. The remaining services lives of employees at both firms is estimated to be 10 years. What is the maximum amount of loss that could be recognized by each company in its income statement for the year ended December 31, 2015?

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Definitions:

Time Utility

The value added to products or services by making them available when they are needed.

Good Or Service

Products offered in the market that can be either tangible (goods) or intangible (services) to satisfy consumer needs or wants.

Customers Want

The desires or needs that consumers express, which can influence their buying behavior and decisions.

Purchase

The act of acquiring goods or services in exchange for money.