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Flashcards in Challnge Quiz Wrong Answers Deck (22):
0

Bonds are viewed as retired from a consolidated viewpoint, when...

There is no longer an obligation to an outside party

1

Bonds are viewed as retired from a consolidated viewpoint, how are they treated when a sub buys them from the parent on the consolidated statements?

Noncontrolling interest not affected, consolidated retained earnings
Is affected

2

For a sole proprietor's cash basis financial statements, when the proprietorship has been bought for $350,000, it's assets have a carrying amount of $375,000 and a fair value of $360,000. Which amount is included in calculating the owner's capital balance?

Amount paid to acquire business, $350,000

3

An expense recorded in a tax return, that is not recorded in the income statement results in...

2) income instead of expense would have resulted in...

A deferred tax liability

2) deferred tax asset

4

How do you calculate average collection period of accounts receivable?

Accounts receivable turnover = net credit sales/avg. receivables

Average collection period = 360 days/accounts receivable turnover

5

When resources are under control of the governing board and not specifically restricted by the donor, the income is recorded as...

Increase in unrestricted revenues, gains and other support

6

What is the entry in government accounting to record the adopted budget, when there is a transfer to debt service and a budgetary fund balance?

Estimated revenue. Xxx
Appropriations control. Xxx
Estimated transfer to debt service Xxx
Budgetary fund balance. Xxx

7

If an acquirer owns 95% of a sub. After a year, how much of the sub's net income should be reported accruing to the parent?

95%

8

What is the journal entry under the cost method, when treasury stock is reissued at a gain?

Cash. Xxx
Treasury stock. Xxx
PiC- Treasury stock transactions Xxx

9

Non current deferred tax assets and liabilities can be...

Netted together, only current and non current can't be netted

10

GASB establishes accounting and reporting standards for...

Nonprofit organizations that are government organizations

11

Freight out costs paid by a parent on an intercompany sale to a sub, should be...

Eliminated from selling expenses on the consolidated income statement

12

The rights and obligations under an insurance contract that is not a financial instrument (because it requires or permits the insurer to provide goods or services rather than a cash settlement) but whose terms permit the insurer to settle by paying a third party to provide those goods or services is...

An eligible item for the fair value option

13

Under GASB, interest that clearly derives from borrowing that is essential to support a program should be reported as...

A direct expense of that program

14

Under GASB, interest that does not qualify as a direct expense should be reported as...

A separate line (should not be combined with direct expenses)

15

Under GASB, interest on Longterm debt is usually...

2) How should it be reported?

An indirect expense

2) should be reported as a separate line and not allocated

16

Operating segments defined as components of a business enterprise must have what 3 characteristics?

1 earn revenues and incur expenses in transactions with other
Segments
2 operating results regularly reviewed by chief operating decision
Maker
3 discrete financial info is available

17

Separate legal standing as a sole proprietorship, partnership, corporation or corporate joint venture, is...

Not a necessary characteristic of an operating segment

18

If a company has adopted Classification of Investment Securities, it should report the marketable equity securities that it has classified as trading at fair value with...

Holding gains and losses included in earnings

19

Compared to the cost method of accounting for treasury stock, the par value method reports for retained earnings?, paid in capital?

Neither paid in capital nor retained earnings

20

Group depreciation applies...

An average (straight line depreciation) rate to an entire group
Of similar assets

21

Composite depreciation applies...

An average (straight line depreciation) rate to an entire group of
Dissimilar assets