Benjamin Company uses IFRS, while Iris, Inc. uses U.S. GAAP, for their external

Question

Benjamin Company uses IFRS, while Iris, Inc. uses U.S. GAAP, for their external financial reporting. On January 16, 2015, both companies settled lawsuits relating to industrial accidents that occurred in 2013. Benjamin Company paid $550,000 and Iris, Inc. paid $230,000. Assuming that no accrual had been previously made, what amount of loss should be reported on the income statement for the year ended December 31, 2014 for each company?

Ben Co.                              Iris Inc

A. 550,000                              230,000

B. 0    0

C. 0    230,000

D. 550,000 0

Explanation / Answer

Answer: A. 550,000                              230,000

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