FAR VOCAB

Question 0

Serial

Bonds

Answer 0

Mature in installments (same date each year)

Question 1

Term bonds

Answer 1

Mature at a single date

Question 2

Short term investments classified as

Answer 2

Current assets

Question 3

What method do you use to account for non-voting stock?

Answer 3

Cost method/ non voting stock doesn’t allow investor to exercise significant influence or control over investee

Question 4

Acquisition method business combination reflects

Answer 4

Economic reality of the parent and sub as of date of acquisition (not beginning of year)

Question 5

Interest expense goes where

Answer 5

Separate line item on Is (non operating)

Question 6

Required disclosure

Answer 6

Transactions with external

Customers constitutes more than 10% of total combined Business enterprise revenues = Major Customer

Question 7

Fair market value equals

Answer 7

Estimated current values

Question 8

Combined FS do not eliminate what but do eliminate what

Answer 8

Don’t eliminate equity accounts(bc there’s no inv in sub acct due to no parent) but do eliminate all other inter company transactions and balances

Question 9

Stock dividends and stock splits are not

Answer 9

Income under both cost and equity So no fair value Instead value per share decrease

Question 10

Quick Assets are what and ex

Answer 10

Assets that can easily be converted into cash ex) ST marketable
Securities, net AR(net of allowance for DA), cash

Question 11

Direct financing lessor

Answer 11

Treat as if sold: lessee owns it, no u certain costs, collectibility assured

Question 12

Sales type has what

Answer 12

Income on profit of sale and interest de financing

Question 13

Direct financing

Answer 13

Interest income only

Question 14

Sale leaseback sell at gain and lease back and I give back you over 90% of the sales price =

Answer 14

Defer gain and amortize over remaining periods of leaseback

Question 15

Lessor can treAt as sold if:

Answer 15

L-lessee OWNS it
Uncertain costs doesn’t exist
Collectibility is assured

Question 16

Operating lease

Answer 16

Off balance sheet financing, Straight line method over lease term

Question 17

Leasehold improvements

Answer 17

Amortize over the lessor of the asset or lease life

Question 18

Capital lease capitalized as
Depreciation?
What interest rate

Answer 18

Lessor of the fair value of the asset at the inception of the lease or PVMLP

• deprecate over asset life (OW) or lease term (NS)
• lessor of implicit rate or borrower rate

Question 19

A correction of an error is not

Answer 19

NOT an accounting change such as change in actg principle

Question 20

Troubled debt restructuring when do you recognize future interest expense and NO gain
-when do you recognize a Gain?

Answer 20

When the TFP>CA

-when the TFP<CA

Question 21

Test of recoverability for long lived assets

Answer 21

I discounted future cf < carrying value recognize loss on impairment

Vs indefinite life
FV < CV

Question 22

Amortize intangible assets over

Answer 22

Shorter of it’s useful life or legAl life

Question 23

Test of recoverability for impairment of long lived assets

Answer 23

Finite- in discounted future cash flows < CV

INFITINTE- FV<CV

Question 24

When is translation used

Answer 24

When going from functional to reporting currency

Question 25

Vested benefits of an employee in a pension plan represent

Answer 25

Benefits that are not contingent on the employees continuing in the service of the employer

Question 26

Income approach Vs Market approach For determine fair value measurements

Answer 26

Using PResent value techniques -using relevant info from recent transactions

Question 27

Test for recoverability formula | -amount of Impairment formula

Answer 27

Fixed asset impairment test Undiscounted of FcF < CV fair value (discounted PV) future CF< CV And DEPRECIATE

Question 28

An entry to record a cash dividend should be made on the date of

Answer 28

Declaration

Question 29

Negative cash balance is classified as

Answer 29

A liability

Question 30

Progress billings JE

Answer 30

Credit to Billings on CIP (contra account to CIP)

Question 31

Cost recovery method of actg, GP on an installment sale is recognized in income

Answer 31

After cash collections equal to the cost of sales received

Question 32

Investment property example

Answer 32

Land held for future use

Question 33

Us GAAP records non controlling interest at

Answer 33

Fair value

Question 34

Compensation expense for employee stock options =

Answer 34

Fair value of compensation over the vesting period

Question 35

Fair value is what? | And fair value option must

Answer 35

What you can sell an asset at or paid to transfer a liability -be applied to all Interests in the same entity

Question 38

Example of defined contribution plan

Answer 38

401k

Question 39

Treasury stock re acquired for less than original price: For more than original price:

Answer 39

APIC is recognized -more APIC is eliminated

Question 40

Treasury stock gain and loss report

Answer 40

NOT ON IS, Not an asset, not does not vote and no dividends

Question 41

EPS

Answer 41

Income avail to common shareholders - taxes and preferred stock dividends (non cumulative must be declared)

Question 74

A/R formula

Answer 74

``` Beg bal + sales - collections (plug) - write offs = end bal ```

Question 75

Dividend income and the balance of the dividend reduced the carrying amt for it's Ima Investment

Answer 75

Cost Method; only a portion of Imas current year dividends represent Oma's earnings

Question 76

Accretion expense of an aRO is what | What do you debit

Answer 76

Increase of liability over time | ARC - expense

Question 77

Derivatives are on what and measured

Answer 77

Recorded as assets or liabilities and measured at fair value

Question 78

Examples of derivatives

Answer 78

OFFS | OPTIONS-forwards-futures-swaps

Question 79

Financial instruments must disclose what

Answer 79

Fair value and carrying value

Question 80

jE for bank loan paid

Answer 80

N/P XX | CASH XX