Bell international estimates that a $10 million loss will occur if a foreign government expropriates some company property. expropriation is considered reasonably possible. how should bell report the loss contingency? (you may select more than one answer.

The contingency is not accrued.

This is a loss contingency.

The contingency can be reasonably estimated.

A disclosure note should describe the contingency.

Explanation:

Since this is a loss due to expropriation, it is an example of loss contingency. Since we are given a concrete number (estimation of loss), this is a contingency that can be logically estimated. Since it is likely that the loss will really occur, it is important to attach a disclosure note to thoroughly describe the actual contingency (giving it a basis).

in 2001, dell computer became the world’s largest personal computer vendor, continuing to

gain market share and post profits in an industry struggling with slumping sales and billions of

dollars in losses. dell sells 90% of its pcs directly to the final customer, largely bypassing the

reseller channel that accounts for most of the world’s pc sales. this direct customer relationship

is the key to dell’s business model, and provides distinct advantages over the indirect sales

model. dell’s direct relationship with the customer allows it to tailor its offerings to customer

needs, offer add-on products and services, and use the internet to offer a variety of customer

services. in addition, dell’s pcs are built to customers’ specifications upon receipt of an order,

giving dell additional advantages over indirect pc vendors who must try to forecast demand and

ship products based on those forecasts. dell’s direct sales and build-to-order model has achieved

superior performance in the pc industry in terms of inventory turnover, reduced overhead, cash

conversion, and return on investment (kraemer, et al., 2000).

explanation: