CH10

Question 1

Bonus Method
Goodwill
Liquidation

Answer 1

changes partners captial
changes partnership total assets
based on capital accounts with poorest partners not receiving anything

Question 2

Enterprise Wide disclosure requirements

Answer 2

must disclose for only public companies and production is required

Question 3

Asset Retirement Obligation w/ accretion expense @ disposal

JE

Answer 3

ARO Liability XX
Additional Demo Exp. XX
Cash XX

Question 4

Accretion expense formula

Answer 4

BEG ARO * risk adjusted rate

Question 5

Troubled Debt restructuring gain

Answer 5

Carrying amount - Future cash flow payments

Question 6

Debtor exchanges stock for debt; when is a gain recognized and how is it recognized

Answer 6

value of stock equals the amount originally owed if CS is less then amount owed it is a gain

Question 7

Subsequent events that do not require inclusion to current year F/S

Answer 7

when the event takes place AFTER the year end

Question 8

IFRS impairment losses

Answer 8

can be reversed to CY income

Question 9

IFRS disallows FMV of what balance sheet item

Answer 9

INVENTORY

Question 10

SPE must be consolidated when

Answer 10

company controls SPE

Question 11

IFRS property in exchange for property & cash

Answer 11

cash is recorded as a loss

Question 12

IFRS pension gains

Answer 12

actuarial gains go to OCI

Question 13

IFRS Foreign exchange gain or loss for debt securities

Answer 13

Reported on I/S

Question 14

IFRS deferred tax assets and liabilities

Answer 14

NONCURRENT

Question 15

IFRS deferred lease gains can be amortized if

Answer 15

they are above sales price

Question 16

IFRS research expenditures

Answer 16

always expense same as GAAP

Question 17

Revaluation gains

Revaluation losses

Answer 17

can reverse prior losses I/S

can reverse prior gains OCI

Question 18

Holding Gains for inventory

Answer 18

Replacement cost - Original

Question 19

Derivatives include

Answer 19

future, forwards and swaps

Question 20

OCI Derivatives

Answer 20

Effective Cash Flows
Effect Foreign Cash Flows
Foreign Investment Hedge

Question 21

Fair Value Option is increased by

Answer 21

dividends received and increase in FMV

Question 22

Income approach

Answer 22

Future Cash Flows

Question 23

Discontinued Operations included FMV write down

Answer 23

in 1st year

Question 24

IFRS Liquidation

Answer 24

no standards

Question 25

Liquidation of assets increase

Answer 25

PROCEEDS

Question 26

ARO Liability is expensed how

Answer 26

amortized over the passage of time

Question 27

Fair Value is used to assess

Answer 27

amounts received for assets and amounts paid for liabilities
EXIT COST

Question 28

Fair Value Measurement Market

Answer 28

Principle Market

Question 29

Derivatives Assets or Liabilities

Answer 29

derivatives are not assets or liabilities themselves

Question 30

Cash received from sale of equipment

Answer 30

Investing

Whereas gain or loss is operating

Question 31

Allowance for collectibles is treated as what in regards to CF

Answer 31

ASSET

Question 32

GAAP versus IFRS cash flows for bank overdrafts

Answer 32

GAAP - Financing

IFRS - Operating

Question 33

Contingencies
1 - Losses
2 - Gains 
3 - amount disclosed 
4 - appeals

Answer 33

1 - disclose all except for probable then accrued
2 - disclose all except for remote; never accrued
3 - lowest estimate unless specially states an amount is most likely
4 - if gain is made but there is an appeal process DO NOT accrued gain

Question 34

Accrued Liabilities can be offset by

Answer 34

INSURANCE; deductible remains as liability

Question 35

Payroll Liability

Payroll Expense

Answer 35

included employee portion and FICA

only employer portion

Question 36

Warranty Costs are recognized

Answer 36

at the date of the sale

Question 37

Level 1
Level 2
Level 3

Answer 37

1 - quoted stock prices active marker
2 - observable and quote stock price similar market
3 - projections and internally developed

Question 38

Fair Value Option Derivatives

Answer 38

1- An investment in a subsidiary that the entity is required to consolidate
2 - An interest in a variable interest entity that the entity is required to consolidate
3 - Employers’ and plans’ obligations (or assets representing net overfunded positions) for pension benefits, other postretirement benefits (including health care and life insurance benefits), postemployment benefits, employee stock option and stock purchase plans, and other forms of deferred compensation arrangements,
4- Financial assets and financial liabilities recognized under leases a
5- Deposit liabilities, withdrawable on demand, of banks, savings and loan associations, credit unions, and other similar depository institutions
6- Financial instruments that are, in whole or in part, classified by the issuer as a component of shareholder’s equity (including “temporary equity”). An example is a convertible debt security with a noncontingent beneficial conversion feature.

Question 39

Settlement amount

Answer 39

underlying (original amount) * notion

Question 40

Accretion Expense is not included in the ARO liability

Answer 40

n