Indicate Which of the Items Below Should Be Reported in the Financial

question 42

Essay

Indicate which of the items below should be reported in the financial statements as an extraordinary item.Assume the dollar amounts associated with all items are material.
The items are:
1.Loss from the discontinuance of operations in Peoria.Operations continue in other areas throughout the Midwest.
2.Sale of machinery at a loss.
3.Loss from damage due to a snowstorm in Chicago.
4.Write-down of inventory due to an earthquake in Chicago.
5.A large portion of a tobacco manufacturer's crops are destroyed by a hail storm.Severe damage from hail storms in the locality where the manufacturer grows tobacco is rare.
6.A steel fabricating company sells the only land it owns.The land was acquired ten years ago for future expansion,but shortly thereafter the company abandoned all plans for expansion and held the land for appreciation.
7.An earthquake destroys one of the oil refineries owned by a large multi-national oil company.
8.A citrus grower's Florida crop is damaged by frost.Frost damage is normally experienced every three or four years.
9.A company which operates a chain of warehouses sells the excess land surrounding one of its warehouses.When the company buys property to establish a new warehouse,it usually buys more land than it expects to use for the warehouse with the expectation that the land will appreciate in value.In the past five years,there have been two instances in which the company sold such excess land.
10.A large diversified company sells a block of shares from its portfolio of securities which it has acquired for investment purposes.This is the first sale from its portfolio of securities.The company owns several securities for investment purposes.
11.A textile manufacturer with only one plant moves to another location.It has not relocated a plant in twenty years and has no plans to do so in the foreseeable future.
12.The employees of a major supplier of the reporting company go on strike.
13.The reporting company writes off a material amount of inventory.
14.The reporting company sells a locomotive used to move large,partially-completed subassemblies around the manufacturing plant.

Understand the implications of ethical relativism and moral absolutism.

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Recognize the complexity of ethical decisions and the contextual nature of moral judgments.

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Definitions:

501(c)(3)

A section of the U.S. tax code that provides exemption from federal income tax for nonprofit organizations considered charitable, religious, educational, or scientific.

Internal Revenue Service

A U.S. federal agency responsible for tax collection and tax law enforcement.

Museums

Institutions that collect, preserve, exhibit, and sometimes interpret objects and artifacts of cultural, artistic, scientific, or historical significance.

Federal Spending

The expenditure of government funds by federal authorities on various national programs, infrastructure, and services.