George's woodcarving company manufactures two types of wooden toys: soldiers and trains. a soldier sells for $27 and uses $10 worth of raw materials. each soldier manufactured increases george's variable labor and overhead costs by $14. a train sells for $21 and uses $9 worth of raw materials. each train built increases george's variable labor and overhead costs by $10. the manufacture of wooden soldiers and trains requires two types of skilled labor: carpentry and finishing. a soldier requires 3 hours of carpentry labor and 2 hours of finishing labor. a train requires 4 hours of carpentry labor and 1 hour of finishing labor. each week, george's can obtain all the needed raw material but only 240 carpentry hours and 100 finishing hours. demand for trains is unlimited, but at most 40 soldiers are bought each week. george wishes to maximize weekly profit (revenue – costs. the company wants to find out the optimal production strategy that maximizes the weekly profit.

For each of the following situations, indicate whether you agree or disagree with the financial reporting practice employed and state the basic assumption, component, or accounting principle that is applied (if you agree) or violated (if you disagree).wagner corporation adjusted the valuation of all assets and liabilities to reflect changes in the purchasing power of the dollar. spooner oil company changed its method of accounting for oil and gas exploration costs from successful efforts to full cost. no mention of the change was included in the financial statements. the change had a material effect on spooner's financial statements. cypress manufacturing company purchased machinery having a five-year life. the cost of the machinery is being expensed over the life of the machinery. rudeen corporation purchased equipment for $180,000 at a liquidation sale of a competitor. because the equipment was worth $230,000, rudeen valued the equipment in its subsequent balance sheet at $230,000.davis bicycle company received a large order for the sale of 1,000 bicycles at $100 each. the customer paid davis the entire amount of $100,000 on march 15. however, davis did not record any revenue until april 17, the date the bicycles were delivered to the customer. gigantic corporation purchased two small calculators at a cost of $32.00. the cost of the calculators was expensed even though they had a three-year estimated useful life. esquire company provides financial statements to external users every three years.