Overton Corporation, a manufacturer of household paints, is preparing annual financial statements at December 31, 2014
June 7th, 2024
Overton Corporation, a manufacturer of household paints, is preparing annual financial statements at December 31, 2014. Because of a recently proven health hazard in one of its paints, the government has clearly indicated its intention of having Overton recall all cans of this paint sold in the last six months. The management of Overton estimates that this recall would cost $800,000. What accounting recognition, if any, should be accorded this situation?.1em;”>No recognitionNote disclosure onlyAppropriation of retained earnings of $800,000Operating expense of $800,000 and liability of $800,000