(Interim Reporting) Snider Corporation, a publicly traded company, is preparing the interim financial data which it will issue to its stockholders and the Securities and Exchange Commission (SEC) at the end of the first quarter of the 2017–2018 fiscal year. Snider’s financial accounting department has compiled the following summarized revenue and expense data for the first quarter of the year.

Sales revenue \(60,000,000

Cost of goods sold 36,000,000

Variable selling expenses 1,000,000

Fixed selling expenses 3,000,000

Included in the fixed selling expenses was the single lump-sum payment of \)2,000,000 for television advertisements for the entire year.

Instructions

(b) What financial information, as a minimum, must Snider Corporation disclose to its stockholders in its quarterly reports?

Step by step solution

01

Meaning of interim reporting

An interim report is a statement made for a short period (less than one financial year). Its main components are the cash flow statement, income statement, and balance sheet, which are prepared monthly, quarterly, semi-annually, or on an ad hoc basis.

02

Explaining the financial information that Snyder Corporation must disclose to its shareholders in its quarterly reports

1. Snider Corporation must disclose a condensed statement of financial statement.
2. Informative comments about the regularity or cyclicality of interim operations.
3. The nature and sum of items affecting assets, liabilities, equity, net income, or cash flows are unusual because of their nature, size, or frequency.
4. The type and magnitude of the accounting policy changes, as well as estimates of the amounts previously reported.
5. Issuance, repurchase, and repayment of debt and equity securities.

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