For Each of the Independent Situations Described Below, List the Assumption

question 26

Short Answer

For each of the independent situations described below, list the assumption, characteristic, concept, or constraint that has been violated, if any. List only one term for each case.
1. The Who Company reports only current assets and current liabilities on its balance sheet. Intangible assets and a 20-year mortgage payable are reported as a current asset and a current liability, respectively. Liquidation of the company is unlikely.
2. Gabi Company is in its third year of operation and has yet to issue financial statements. (Do not use full disclosure principle.)
3. Griffin Company is carrying inventory at its net realizable value of $ 110,000. The inventory had an original cost of $ 135,000.
4. Paul Company expenses some office equipment that is inexpensive even though it has a useful life that exceeds 1 year.
5. Singh Corporation has selected FIFO as its inventory cost flow formula during the current year. Next year it plans to change to the weighted average cost formula.

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Definitions:

Latino

A term referring to individuals or communities with cultural or ancestral ties to Latin America, often used interchangeably with Hispanic in the United States.

American Families

The diverse family structures and dynamics found within the United States, influenced by cultural, socioeconomic, and historical factors.

Saturation

Point when all carrier molecules or enzymes are attached to substrate molecules and no more molecules can be transported or reacted.

Carrier Molecules

Proteins that facilitate the transport of substances across a cell membrane, either by passive or active transport.