The following financial information is available for Paul Company, a hypothetical non-U.S. firm with shares listed on a U.S. stock exchange:

If Paul were following U.S. GAAP, development costs would be expensed when incurred.
According to U.S. GAAP, the possible obligation for severance benefits would not be recognized until it had become probable.
Prepare a reconciliation of Paul's reported stockholders' equity and net income to the amounts of these items under U.S. GAAP.

Question

The following financial information is available for Paul Company, a hypothetical non-U.S. firm with shares listed on a U.S. stock exchange:
  
If Paul were following U.S. GAAP, development costs would be expensed when incurred.
According to U.S. GAAP, the possible obligation for severance benefits would not be recognized until it had become probable.
Prepare a reconciliation of Paul's reported stockholders' equity and net income to the amounts of these items under U.S. GAAP.

Quizplus · Accepted Answer

The Answer of The following financial information is available for Paul Company, a hypothetical non-U.S. firm with shares listed on a U.S. stock exchange:
  
If Paul were following U.S. GAAP, development costs would be expensed when incurred.
According to U.S. GAAP, the possible obligation for severance benefits would not be recognized until it had become probable.
Prepare a reconciliation of Paul's reported stockholders' equity and net income to the amounts of these items under U.S. GAAP.

The Following Financial Information Is Available for Paul Company, a Hypothetical