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NINJA Flashcards

1
Q

non temporary (permanent) incline/decline in marketable debt security

A

will result in REALIZED gain/loss on income statement

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2
Q

when fair value option is elected

reporting unrealized gains and losses from available-for-sale securities?

A

under the fair value option, the securities are reported at their fair values as of the balance sheet date and unrealized gains and losses are reported in INCOME STATEMENT

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3
Q

reclassify AFS to HTM

how to calculate unrealized gain/loss

A

transfer occur at it’s market value at the date of transfer

value on date of transfer: $530k
cost: $650k

unrealized loss on OCI= $120k

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4
Q

reclassify trading to AFS

how to calculate loss/gain

A

gain/loss from time when security was still a trading security: on income statement: value from beginning of the year to transfer date

gain/loss from time security was AFS: OCI (bs): value from transfer date to end of the period

EXAMPLE:

value on 12/31/18: $5000
value on 6/1/19: transfer date: $2000
value on 12/31/19: $1500

loss on income statement: ($3000)
loss on OCI: ($500)

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5
Q

unrealized gain/loss on TRADING securities

A

income statement

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6
Q

unrealized gain/loss on AFS

A

OCI - balance sheet

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7
Q

deferred tax assets and deferred tax liabilities

A

must be classified as noncurrent

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8
Q

primary objectives of accounting for income taxes:

A

To recognize the current-year amount of taxes payable or refundable, and

To recognize the amount of deferred tax liabilities and deferred tax assets reported for future tax consequences.

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9
Q

income tax exp

A

consists of the combination current income tax expense and deferred income taxes

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10
Q

Deferred tax expense

A

arises when current year taxable income is less than net income per books

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11
Q

LIFO and retail method inventories

A

are valued at lower of cost or market (LCM)

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12
Q

FIFO inventories

A

are valued at lower of cost or net realizable value (LCNRV)

IFRS

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13
Q

IFRS

A

does not allow LIFO

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14
Q

reversal of impairment loss

A

ALLOWED for long-lived assets held for SALE

but not for long-lived assets held for USE

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15
Q

how to calculate capitalized interest exp?

A

less of ACTUAL or WEIGHTED AVG ACCUMULATED EXPENDITURE

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16
Q

new book value of item received from transaction that LACKS commercial substance

A

LOWER of:

(i) the fair value of the asset given up (plus cash paid or minus cash received;
(ii) the fair value of the asset received; or
(iii) the book value of the asset given up (plus cash paid or minus cash received)

USUALLY ALWAYS BOOK VALUE

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17
Q

how to capitalize interest on loan for construction?

A

weighted average expenditures multiplied by the interest rate on the loan financing the construction

loan at beg + loan at end / 2
* int rate

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18
Q

spot rate

A

used for receivables and payables

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19
Q

forward rate

A

used for forward exchange or futures contracts.

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20
Q

remeasurement adjustment

local currency to functional currency

A

gain/loss recognized on income statement

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21
Q

translation adjustment

converting fs from the functional currency into the reporting currency

A

gain/loss on OCI

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22
Q

To translate the income of a subsidiary,

A

a company would normally use an average exchange rate

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23
Q

if functional currency is foreign currency, must translate fs to US currency

A

gain loss on OCI

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24
Q

if functional currency is US dollars, must remeasure

A

gain loss on income statement

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25
Q

trading securities

A

are in current assets AND QUICK ASSETS

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26
Q

times interest earned ratio

A

=EBIT/interest

ratio of the entity’s income that would be available to pay interest to the actual amount of interest incurred

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27
Q

The defensive interval ratio

A

measures the length of time a company can continue to pay its bills using only its liquid current assets

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28
Q

how to calculate fair value when there is no market price?

A
  1. calculate most advantageous: price - transaction cost - transportation cost
  2. use that market price: price - (unavoidable cost: transportation)
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29
Q

fair value measurement technique

MIC

acceptable valuation techniques

A

MIC

Market: info from market transactions for identical or similar items

Income:expected future amounts of an item to a single, current amount (discounted cash flow analysis)

Cost: how much to replace

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30
Q

CV of bond @ retirement

A

FACE VALUE of bond
+ premium or - discount
minus bond issue cost
= CV of bond @ retirement

use this to compare actual cost to retire bond to find gain/loss on retirement

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31
Q

how to recognize gain/loss on transactions that lack commercial substance

A
  1. value asset given up by taking CV plus any gains
  2. loss is recognized by comparing CV of asset given up to FV of asset received
  3. gain is ONLY recognized if BOOT is received. $$$
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32
Q

ARO

asset retirement obligation

A

must be recorded when asset is placed into service

Will debit “ACCRETION EXPENSE” at the end of each period until all ARO is complete

accretion expense: periodic expense recognized as the present value of a balance sheet liability increases

D: accretion expenese
C: ARO liability

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33
Q

gain/loss on transaction that HAS commercial substance

A

will use FV of new asset against BV of asset giving up

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34
Q

10K with SEC: LARGE accelerated filer

10Q LARGE accelerated filer

700+mill

A

60 days after YE

40 days after end of period

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35
Q

10K with SEC: accelerated filer

10Q accelerated filer

75-700mill

A

75 days after YE

40 days after end of period

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36
Q

10K w SEC: small registrant (non-accelerated)

10Q

less than 75mill

A

90 days after YE

45 days after period

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37
Q

smaller reporting company

A

$75mill or less of public equity float

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38
Q

encumbered

A

order is placed but not filled

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39
Q

expenditure

A

already been spent

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40
Q

appropriation

A

appropriation - encumbered - expenditure = appropriation available

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41
Q

when to perform impairment test for goodwill

public company

A

Any time during the fiscal year, provided that it is performed at the same time every year.

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42
Q

type 1 subsequent event

A

event happens AT balance sheet date

requires adjustment (recognized)

accrue and disclose

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43
Q

type 2 subsequent event

A

event happen after balance sheet date

requires DISCLOSURE

can dual date or use date as of event

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44
Q

how should lessee capitalize their lease?

A

amortize them over the SHORTER of their useful life or the lease term

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45
Q

gain loss on extinguishment of debt/bond

A

When a bond is extinguished, a gain or loss on extinguishment will be recognized for the difference between the cost of extinguishing the bond and its carrying value.

CARRY VALUE=
Face of bond
(unamortized discount) or plus any unamortized premium
(minus any unamortized bond issue costs)

cost of extinguish bond = face * call at value (102)

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46
Q

how to apply amortized cost approach to bond held to maturity?

A
  1. recognize interest income: carry value * yield rate = interest income
  2. face value * stated rate = interest received
  3. difference is discount on amortization
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47
Q

unconditional purchase obligation

A

legal commitment to purchase good at set price

if market price falls below commitment price, loss is accrued on f/s

loss = contract price - market price

gain not recorded (conservatism)

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48
Q

The basic financial statements for a government entity should include

A

government-wide financial statements,
fund financial statements, and
notes to the financial statements.

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49
Q

types of revenue in goverment

A
  1. program revenue (non tax)

2. general revenue (all tax)

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50
Q

program revenue

A

non tax revenue

ex: 
garbage collection fees
admission fees
building permits
parking fines
lottery sales
license
water and sewer fees
lease/rental fees
special assessment
intergovernmental aid for specific programs
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51
Q

how to tell if asset is IMPAIRED

A
  1. sum of the undiscounted future cash flows is lower than its carrying value
  2. amount of impairment is the excess of the carrying value over the asset’s fair value, which may be the discounted cash flows
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52
Q

DENT

A

Derivative and CASH flow hedges
Excess adj. of pension PBO and FV of plan assets
Net unrealized g/L on AFS securities
Translation g/L on foreign currency

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53
Q

derivative option contracts

A
  1. put option

2. call option

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54
Q

put option

A
  1. right to SELL stock
  2. expect stock to decline in value
  3. exercise if FMV is less than strike price

(put out)

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55
Q

call options

A
  1. right to buy stock
  2. expect stock price to INCREASE
  3. exercise if FMV is more than strike price

(call back)

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56
Q

If an item of PP and E under IFRS is revalued,

A

the entire class of which the asset belongs must also be revalued.

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57
Q

expenditures

A

Expenditures are classified as operating, capital, or debt service

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58
Q

non expenditures

A

Nonexpenditure outflows include:

other financing uses (eg, transfers out to other funds)

special items (infrequent or unusual within control of entity)

extraordinary (infrequent and unusual, and not within control of entity)

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59
Q

bonds with detachable stock warrant

A

stock warrant = recorded as a form of additional paid in capital

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60
Q

gross profit

A

sales - COGS

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61
Q

fair value option for investment

A
  1. recognize dividend as income: dividend * % ownership

2. recognize gain in fair value of investment as income

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62
Q

spot rate

A

used for receivables and payables

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63
Q

forward rate

A

used for forward exchange or futures contract

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64
Q

joint ventures

A

both shared control and rights to the arrangement’s net assets

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65
Q

translation from functional to reporting currency

A

gain/loss on balance sheet

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66
Q

derivative acquired on speculation

A

gain loss on income statement

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67
Q

functional, foreign, presentational

A

functional: currency of primary economic
foreign: currency other than functional
presentational: currency in which the financial statements are being presented

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68
Q

GAAP organizational cost

A

expensed immediately

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69
Q

how to capitalize software

A

amortized by the LARGER of either straight-line or the ratio of actual to total revenue percentages

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70
Q

intangible asset with finite life

A

amortize at either shorter of:

legal life

or

useful life

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71
Q

IFRS accounting for intangibles

A

cost method

or

revaluation method

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72
Q

cost before technical feasibility

A

expensed as research and development

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73
Q

Costs after technological feasibility but before commencing commercial production

A

capitalized and amortized

The amount of amortization will be the LARGER amount when calculated under both the straight-line method and the volume of output approach

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74
Q

new partner: BONUS METHOD

A

partner A has capital= 60k
partner B has capital = 40k

new partner C put in 15k for 20%

total capital=95k

95k*20% =19k capital for partner C

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75
Q

research and development expense from assets

A

depreciation will be recognized as R and D expense

  1. take cost divide by useful life
  2. if asset has no alternative use to the company after it’s use for the project, the FULL amount will be research and development cost
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76
Q

amount received from discounting a note receivable

A

it’s based on the maturity value of the loan

EX: 10% $100,000 note receivable
discounted at 12%

maturity value = $100k * 1.10 = $110k
discount= $110k *.12 = $13.2k

proceed from discounted note = $110-13.2 = $96.8k

When discounting a note, the amount that the proceeds will be based on is the maturity value of the note. The discount will then be calculated at an amount equal to the maturity value of the note times the appropriate discount factor, including an adjustment for partial period if applicable.

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77
Q

recognize bad debt (under allowance method)

A

D: allowance
C: A/R

RECOVERY:

D: A/R
C: Allowance

D: cash
C: A/R

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78
Q

direct write off method (NOT GAAP)

A

D: bad debt exp
C: A/R

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79
Q

2 acceptable methods of calculating bad debt exp

A
  1. Income statement approach

2. Balance sheet approach

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80
Q

Income statement approach

A

% of credit sales

credit sales * % of uncollectible = bad debt exp

**actual expense

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81
Q

balance sheet approach

A

% of accounts receivable

aging of a/r

A/R * % uncollectible = allowance for bad debt

**ending target allowance balance

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82
Q

impairment of receivable

A
  1. reduce the carrying value loan’s observable market price

OR

  1. the fair value of the collateral if the loan is secured.

If foreclosure is probable, the receivable will be written down to the net realizable value of the collateral.

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83
Q

diluted EPS

convertible bonds

A
  1. conversion of bonds to CS is assumed to be converted at the BEGINNING of the period. (add to denominator, weighted avg cs os)
  2. interest on bonds would be eliminated (bond int * 1-tax rate) add this to net income
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84
Q

basic EPS

A

=(net income - preferred div)/ WACSOS

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85
Q

fair value option for investment

A
  1. recognize dividend as income: dividend * % ownership

2. recognize gain in fair value of investment as income

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86
Q

spot rate

A

used for receivables and payables

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87
Q

forward rate

A

used for forward exchange or futures contract

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88
Q

remeasure from local currency to functional currency

A

gain/loss on income statement

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89
Q

translation from functional to reporting currency

A

gain/loss on balance sheet

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90
Q

derivative acquired on speculation

A

gain loss on income statement

91
Q

functional, foreign, presentational

A

functional: currency of primary economic
foreign: currency other than functional
presentational: currency in which the financial statements are being presented

92
Q

GAAP organizational cost

A

expensed immediately

93
Q

how to capitalize software

A

amortized by the LARGER of either straight-line or the ratio of actual to total revenue percentages

94
Q

intangible asset with finite life

A

amortize at either shorter of:

legal life

or

useful life

95
Q

IFRS accounting for intangibles

A

cost method

or

revaluation method

96
Q

cost before technical feasibility

A

expensed as research and development

97
Q

Costs after technological feasibility but before commencing commercial production

A

capitalized and amortized

98
Q

cost associated w production

A

are considered inventory costs and will be allocated between ending inventory and cost of goods sold.

99
Q

not for profit required FS

A
  1. statement of financial position
  2. statement of activities
  3. statement of cash flows
100
Q

revenue VS. other financing sources

A

revenue: taxes, assessments, fines, and activities of the governmental unit

other financing sources: proceeds of bond issues and operating transfers to other funds (MODIFIED ACCRUAL)

101
Q

interest received on investment from enterprise fund

A

treated as cash inflow from INVESTING ACTIVITIES

102
Q

comprehensive annual financial report (CAFR)

A

3 sections: introductory, financial, and statistical

intro section: a title page, a table of contents, and a letter of transmittal

103
Q

financial section of CAFR

A 
auditor's report
1. MD and A
2. Basic FS
notes
3. Required supplementary information (other than MDA)

The financial section would include the auditor’s report, management’s discussion and analysis (MDA), basic financial statements, notes, and any required supplementary information

104
Q

BASIC FS

A
  1. govt wide FS
  2. fund FS
  3. accompanying notes
105
Q

measurement focus for govt wide FS

A

economic resource

106
Q

basis of accounting for govt wide FS

A

accrual

107
Q

Reciprocal interfund activity

A

interfund loans and interfund services provided and used

108
Q

acquisition method

A

cost to acquire acquiree= FV of consideration given up

**consulting/legal fees are expensed

**Costs of registering and issuing securities REDUCE additional paid-in capital.

109
Q

IFRS methods of accounting for treasury stock

A
  1. cost method
  2. the par value method
  3. constructive retirement method
110
Q

small stock dividend (10-25%)

A

debit retained earnings at MARKET value
par = .10
market = $12
# shares = 200

D: RE (200 * 12)
C: CS dividend distributable (200 .10)
C: Paid in cap in excess of par (20011.90)

when its distributed
D: CS dividend distributable
C: Common stock

111
Q

large stock dividend (25%+)

A

debit retained earnings at PAR value

D: RE (200.10)
C: C/S (200.10)

112
Q

dividend in arrears on preferred stock

A

are disclosed NOT accrued

113
Q

A quasi-reorganization

A

gives a corporation an opportunity to eliminate the overstatement of assets and to eliminate any deficit in retained earnings giving the company a “fresh start.”

114
Q

IFRS bond reporting on FS

A

amortized cost

OR

fair value through profit and loss

IFRS requires liab. to be reported at amortized cost, but entity can elect to report financial liabilities at fair value through profit or loss

115
Q

leasehold improvements

A

capitalize and amortized over SHORTER of lease term or economic life

116
Q

finance lease amortization

lease: 4 years
economic useful life: 5 years

A

amortize at the shorter of lease term OR economic life

if there’s a title transfer or purchase option reasonably certain to be exercised: amortize over economic useful life

117
Q

IFRS contingencies VS provisions

A

contingencies = reasonably possible (disclose only)

provision = probable and estimable (accrue)

118
Q

statement of changes in net assets available for benefit

PENSION

A

beg net asset
+ plan additions
- plan deductions
= end of year net assets

119
Q

plan additions (plan assets)

A

+ investment income ( interest, dividends)
+ employer/employee contributions
+ increase in FV of investments

120
Q

plan deductions

A
  • investment expense (admin + taxes)
  • pension benefits paid
  • decrease in FV of investments
121
Q

actual return on plan asset

A

= % * plan asset

122
Q

interest cost

A

= %* PBO

123
Q

VBO
ABO
PBO

A

VBO= benefits if paid TODAY. smallest pension liab

ABO= benefits accumulated, includes vested + nonvested. more pension liab than VBO

PBO= most pension liab. assumes all employee will remain til retirement age. future anticipated pay increase in pay-related plan.

124
Q

disclosure for defined pension benefit plan

A
  1. The components of period pension costs
  2. the amount of unrecognized prior service cost
  3. detailed description of the plan including employee groups covered
125
Q

PBO

A

beg PBO
+ interest cost
+ service cost
- distribution

126
Q

overfunded status of PBO

A

noncurrent asset

127
Q

underfunded status of PBO

A

current liabilities OR non current liab. or both

128
Q

increase prior service cost

A

DEBIT: OCI
CREDIT: additional liability

129
Q

OCI DENT

A
  1. Derivative Cash Flow Hedges
  2. Excess Adjustment of Pension
  3. Net Unrealized Holding Gains on AFS
  4. Translation Adjustments of Foreign Currency
130
Q

adopting IFRS

A
  1. 2 set of income statement
  2. 3 set of balance sheet

for comparative information

131
Q

credit risk

A

a/r

132
Q

market risk

A

multiple assets valued on basis of similar market criteria, such as interest rate

133
Q

risk of measurement uncertainty

A

inability to estimate uncollectable accounts with reasonable degree of accuracy

134
Q

off balance sheet risk

A

when entity has assets/liab that do no appear on BS that may result in loss

135
Q

IFRS interim FS

A

not required

but if interim fs is provided. must also provide 4 condensed FS and selected notes

FS =

  1. stmt of financial position
  2. profit and loss and other comprehensive income
  3. changes in equity
  4. cash flow
136
Q

interim gain/loss

A

if loss is reversed in next period, do not record loss.
if loss is not reversed, recognize it in the period that the loss is first known not to be recovered

gain is not recognized

137
Q

consolidation

fair value method

A

20% or less

138
Q

consolidation

equity method

A

21-50%

“significant influence”

purchase price - par value = goodwill

dividends received reduce investments

changing to equity method: unrealized G/L on in income statement. prospective fs treatment

139
Q

consolidation

A

50%+

investment account eliminated

eliminate intercompany sales

acquired assets/liab recorded at fair value on acquisition date

140
Q

step acquisition

A

Acquirer held previous shares accounted for under Fair Value Method or Equity Method, and are now
re-valued to Fair Value

Š Results in a Gain or Loss in current period

141
Q

acquisition cost

A 
expensed in period incurred:
accounting
legal
valuation
professional
consulting
142
Q

acquisition cost

net against stock proceeds

A

stock registration and issue cost

143
Q

capitalized acquisition cost - equipment

A 
Purchase Price + Liabilities Assumed
ƒ Shipping
ƒ Taxes
ƒ Insurance
ƒ Installation
ƒ Testing
ƒ Legal fees
ƒ Construction Loan Interest
144
Q

Capitalized Acquisition Costs - Land

A

Includes all expenditures to get the land ready for its intended use

  • Title and County Fees
  • Clearing of Land - Dirt Work, etc.
  • Demolition and Removal of Buildings (minus any scrap or salvage)
145
Q

legal fees to SUCESSFULLY defend a patent

A

amortized over ECONomic life of patent

non successful are expense immediately

146
Q

software expense

A

before technical feasibility = expensed as R and D

147
Q

software expense

A

after technical feasibility but before production = capitalized

148
Q

software expense

A

during production = inventory exp

149
Q

software expense

A

during internal training = expense

150
Q

restricted vs. committed fund balance

A

restricted = restricted by contributor

committed= restricted by govt. (less strict, can be undo)

151
Q

derived tax revenue

A

collected by people “doing things”

buy car = sales tax
work = income tax

152
Q

imposed tax revenue

A

collect just because something “exists”

real estate tax
property tax on car (registration)

153
Q

interim fs reporting

A

gross profit method allowed to estimate COGS and ending inventory

matching principle gets messed up. exp in one period may benefit future periods

154
Q

inventoriable cost

A

purchase net of discount
shipping cost to get it
warehouse expenditure

155
Q

non-inventoriable cost

A

sales commission
interest on liabilities to vendors
shipping exp to customer

156
Q

gross margin %

A

= profit/sales

157
Q

In periods of Rising Prices,

A

Ending Inventory under Periodic and Perpetual Methods are identical
under FIFO

158
Q

reporting of segments

A

sales to unaffiliated customer + inter-company sales count in revenue test.

159
Q

segment reporting

A

Only publicly-traded entities are required to report segment information

160
Q

installment method of accounting

A

NOT GAAP

only allowable for tax purposes

161
Q

price earning ratio

A

= market price/ EPS

162
Q

rate of return on asset

A

= net income/ (avg asset)

163
Q

AFS transferred into trading category

A

unrealized G/L not previously recognized in earnings shall be recognized in EARNINGS immediately

164
Q

8-k

A

“current report” companies must file with the SEC to announce major events that shareholders should know about.

4 business day after reportable event

165
Q

What are the two required financial statements of a defined contribution retirement plan

A

A statement of net assets available for benefits of the plan

statement of changes in net assets available for benefits.

166
Q

govt proprietary fund receive interest

A

will record in INVESTING activity section

167
Q

governmental fund

A

NO statement of cash flow

168
Q

order or FS

A
  1. MDandA
  2. Basic FS: govt wide smt, fund fs
  3. Notes
  4. RSI (required budgetary comparison info)

*budgetary comparison can also be presented in the basic fs

169
Q

budgetary comparison

A

required for general fund and all MAJOR revenue fund in general purpose external financial reporting.

NOT for proprietary fund

The budgetary comparison schedule includes the original and final budgets as well as actual inflows, outflows, and balances, stated on the government’s budgetary basis of accounting, with a reconciliation between the budgetary and GAAP information

170
Q

amend defined pension benefit plan for additional PSC

A

D: OCI
C: projected benefit obligation

amortization:
D: pension expense
C: OCI

oci usually has credit balance

171
Q

decommissioning liability

A

A decommissioning liability is the estimated cost to put the property into a usable or saleable condition when it is no longer going to be used for its original purpose.

The liability is reviewed and adjusted to reflect changes in the estimated cost with increases or decreases recognized as adjustments to the carrying value of the property.

When the property is fully depreciated, any adjustment to the decommissioning liability is recognized as a profit or loss since it is too late to recognize it as an adjustment to depreciation or amortization.

172
Q

EQUITY SECURITIES

vs debt sec.

A

measured at FV through net income

changes in FV recognized in net income only (temp or permanent)

no trading or AFS EQUITY sec.

no unrealized gain/loss in OCI.

173
Q

div become liability at

A

date of declaration

D: retain earning
C: div payable

174
Q

EPS must be reported on face of I/S for:

A

income from continuing operation
income from discontinued operation
net income

175
Q

purpose of govt wide fs

A

operational accountability

176
Q

levels of restrictions

A

restricted (donor or law)
committed (govt)
assigned (intended to be used for a purpose)
unrestricted

177
Q

net position

A

is the residual of assets and deferred outflows less liabilities and deferred inflows

178
Q

how to report land acquired by govt through foreclosure?

A

SMALLER:

FV of land

or

fees (amount due for taxes, special assessments, penalties and interest, plus foreclosure costs)

179
Q

governmental fund statement

A

provide FISCAL accountability based on the

modified accrual basis of accounting and

CURRENT FINANCIAL resources measurements

180
Q

columns in govt wide fs

A
  1. govt activities
  2. business like activities
  3. component units
181
Q

govt activities column includes

A

governmental funds plus most INTERNAL SERVICE funds and capital assets not specific to business-type activities or fiduciary funds.

182
Q

internal service fund

A

even tho its a proprietary fund (business like)

it will be reported in the govt activity column

183
Q

general use capital asset

A

should be reported in govt activity column in govt wide fs

NOT in governmental fund

184
Q

purchase of common stock

A

invest

185
Q

issue common stock

A

finance

186
Q

purchase treasury

A

finance

187
Q

gain on sale of equip

A

is deducted from net income on operating activities

188
Q

consistency help

A

achieve comparability

189
Q

htm

A

valued at amortized cost

G/L on fv NOT reported.

when FV option is elected, G/L on fv is reported on INCOME STATEMENT

190
Q

electing FV option instead of equity method

A

will recognized proportion of dividend as INCOME and any gain/loss on value of investment..

(equity method: usually will deduct div from value of investment)

191
Q

allow for uncollectible

income statement approach = % of credits ales

A

uncollectible expense account = % * credit sale

192
Q

balance sheet approach

A

% * accounts receivable

193
Q

inventory turnover

A

= cost of sale/avg inventory

cost of sale = purchase + change in inventory

= cogs/avg inventory

194
Q

historical cost/nominal dollar approach

A

items are recorded at their original amounts and are not adjusted for price level changes

195
Q

current cost/nominal dollar approach,

A

items are adjusted to their current amounts, but are not adjusted for changes in the general price level

196
Q

historical cost/constant dollar approach,

A

items are recorded at their original cost but are adjusted for changes in the general price level

197
Q

current cost/constant dollar approach

A

items adjusted to their current amounts and adjusted for changes in the general price level

198
Q

historical cost

A

recorded at original cost

199
Q

current cost

A

adjusted to current amounts

200
Q

nominal dollar

A

NOt adjusted for price level change

201
Q

constant dollar

A

adjusted for general price level

202
Q

issue or repurchasing treasury stock

A

financing activity

203
Q

impairment losses

A

CV> FV = impairment loss

only if un-discounted cash flow is less than CV
then impairment loss = CV-FV

example:
CV=100
sun of un-discounted CF=95
FV=80

impairment loss = 20

if un-discounted CF is NOT less than CV, then theres no impairment, even if CV is higher than FV.

204
Q

issue bond

A

finance

205
Q

borrow funds

A

finance

206
Q

pay back principal related to bonds and loans

A

finance

207
Q

pmt of interest on bonds

A

operatings

208
Q

segment reporting for IFRS

A

assets
profit and loss
liablities

209
Q

day sales in a/r

A

ending a/r divided by sales/365

210
Q

how many years to depreciate of POETS but does not exercise purchase option

A

lease term since there’s no indication that will exercise purchase option

211
Q

capitalization of successful vs unsuccessful paten

A

capitalized all cost: price+acquisition cost+legal fees

unsuccessful defense = EXPENSE all: price +acquisition cost, legal fees

212
Q

multi year pledge in not for profit

A

discounted to PV and reported in year the pledge was received.

213
Q

intercompany sales: how to eliminate profit

A

allocate (minus) it to COGS of the buyer (sub)

214
Q 
restricted
committed
assigned
unassigned
non-spendable
A

restricted - restricted by donor
committed - restricted by govt
assigned - intended to be used for purpose
unassigned - avail to be spent
non-spendable - not in spendable state (inventory)

215
Q

deff. tax asset will not be realized in the future

A

D: income tax asset (decrease)
C: deferred tax valuation allowance (increase)

216
Q

capitalization of patent

A

amortize over LESSOR of legal life or econ life

217
Q

opening budget

A

D: estimated rev control
D: budgetary control (if deficit)
C: appropriations control
C: budgetary control (if surplus)

218
Q

need separate earnings per share calculation and disclosure

A

discontinued operations

219
Q

consolidated fs: RETAINED EARNINGS

A

only the parent’s RE

220
Q

not for profit (NPP) required FS

A

stmt of fin position
stmt of activities
stmt of cash flow

221
Q

income statement items

sales
expense

A

use weighted avg cost rate to translate

222
Q

balance sheet items

assets
liab

A

use year end exchange rate to translate

223
Q

IFRS revaluation gain

FV-CV= gain/loss

A

gain/loss on OCI

224
Q

blended reporting

A

govt boards of compenent and primary govt are substantially the same

or

component unit exclusively services the primary govt

FAR (33 decks)

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