Day 24 Flashcards
Credit loss is equal too
The Amortized cost LESS PV of Future expected cash flows (interest and principal to be received)
MCQ-14546
ABC purchased a 3 month Treasury bill, ABC’s policy is to treat as cash equivalents with an original maturity of three months or less. How is this reported on the Stmt of Cash Flows?
Not reported
It is still considered cash so cash bought cash
MCQ-01221
ABC pays salespeople a fixed salary and a sales commission percentage of sales. How is Accrued sales commission calculated?
Sales commission less fixed salaries
MCQ-00623
What type of CF activity: Interest Payments on notes payable
Outflow operating activities
MCQ-14849
True or False: An equal amount for premium on bond payable is credited for Amortization every period under SL method
False
Bond Payable amount is DEBITED
MCQ-01098
For held to maturity debt security, current expected credit losses (CECL) model, a loss is recorded when:
The Amortized cost exceeds the PV of the Principal and Interest expected to be collected
The Original cost and current FV are NOT relevant
MCQ-14544
What is the Commencement Date?
The date the leased property is made available to the Lessee
MCQ-08263
What is the fair value of a financial asset if there is no principal market?
The price is the most advantageous market with the best price AFTER considering transaction costs
Use the Quoted price
MCQ-07258
MGMT can estimate the amount of loss that will occur if a foreign government expropriates company assets. If expropriation is reasonably possible, the loss contingency should be:
Disclosed NOT Accrued
MCQ-00739
MCQ-05103
Intercompany elimination entries
The gain or loss on the extinguishment of a bond equals:
The difference between the Reacquisition Price and the Carrying Value
Reacquisition Price = Face × % Paid
Carrying Value = Face
LESS Unamortized Discount
LESS Unamortized Issuance Cost
= Net Carrying Value
MCQ-08597
ABC issued a stock dividend on Jan 31, Year 2. Their Dec. 31, Year 1 FS are issued on March 1, Year 2. Should ABC’s EPS take into consideration the stock dividend?
YES
Rule: If a STOCK DIVIDEND or a STOCK SPLIT changes common stock outstanding, the computation for EPS shall give RETROACTIVE recognition for all periods being presented
MCQ-01205
How should the effect of a change in accounting principle that is inseparable from the effect of a change in accounting estimate be reported?
Reporting treatment for the overall effect is a change in estimate and is handled Prospectively
MCQ-00038
When is the cumulative effect of an inventory pricing change on PY earnings reported on the FS?
When it is considered practicable = LIFO to Weighted Average (Retrospectively)
The Cumulative Effect is NOT reported when it is considered IMPRACTICABLE = Weighted Average to LIFO (Prospectively)
MCQ-00219
ABC purchases 100% of XYX, at the date of acquisition what is ABC consolidated stockholders’ equity?
Rule: At the date of acquisition, the consolidated equity = the Parent Company’s Equity plus the FV of any Noncontrolling Interest
Subsidiary’s equity accounts are eliminated
MCQ-00429
