Accounting Harnischfeger Corporation Case

From Financial Note 2, we know that, in 1984, the corporation had computed depreciation expenses on plants, machinery and equipment using straight-line method for financial reporting purpose. Prior to 1984, the corporation used principally accelerated methods for its U.S operating plants.The cumulative effect of this change, which was applied retroactively to all assets previously subjected to accelerated depreciation, increased net income for 1984 by $11.0 million or $0.93per common and common equivalent share. The impact of the new method on income for the year 1984 before the cumulative effect was insignificant.

Answer number 2: I can also identify changes is the following: Changes in the sales calculation, by including the re-sales of products from Kobe Steel Ltd company in the Corporation sales Changes in the depreciation method mentioned before

LIFO inventories liquidation boosted the net income by $2.4MM The effect from changes in allowance for doubtful accounts
The funding of R&D expenses by Kobe Steel Ltd company
The restructure of the pension plan reducing the expenses by .

Get quality help now
writer-marian
writer-marian
checked Verified writer

Proficient in: Accounting

star star star star 4.8 (309)

“ Writer-marian did a very good job with my paper, she got straight to the point, she made it clear and organized ”

avatar avatar avatar
+84 relevant experts are online
Hire writer

0MM I believe the net income could have been roughly around: $17.3MM Net Loss Answer number 3: the reasons I think why management made this changes within the company are: Some of the executive board members hold some shares of the corporation. Evidently, a better net income would have booted the price of share. There was a 40% compensation opportunity for some on the most decision influence members by the end of the year in case of the company exceeds the expectation. There are several requirements the company needs to meet in order to keep the three year loan agreement for its working capital.

Get to Know The Price Estimate For Your Paper
Topic
Number of pages
Email Invalid email

By clicking “Check Writers’ Offers”, you agree to our terms of service and privacy policy. We’ll occasionally send you promo and account related email

"You must agree to out terms of services and privacy policy"
Write my paper

You won’t be charged yet!

Updated: Jul 06, 2022
Cite this page

Accounting Harnischfeger Corporation Case. (2016, May 08). Retrieved from https://studymoose.com/accounting-harnischfeger-corporation-case-essay

Accounting Harnischfeger Corporation Case essay
Live chat  with support 24/7

👋 Hi! I’m your smart assistant Amy!

Don’t know where to start? Type your requirements and I’ll connect you to an academic expert within 3 minutes.

get help with your assignment