Investments And Sale Leaseback, TS Flashcards Preview

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Flashcards in Investments And Sale Leaseback, TS Deck (26):
0

How is the following treated?

Investment securities transferred from trading to held to maturity

Do not reverse unrealized gain/loss previously recognized in
Income

1

How is the following treated?

Investment securities transferred from trading to available for sale

Do not reverse unrealized gain/loss previously recognized in
Income

2

How is the following treated?

Investment securities transferred from available for sale to held to maturity

Report unrealized gain/loss as separate component of stockholder's
Equity

And amortize of remaining life of security

3

How is the following treated?

Investment securities transferred from available for sale to trading

Recognize unrealized gain/loss immediately

4

How is the following treated?

Investment securities transferred from held to maturity to available for sale

Report unrealized gain/loss as separate component of stockholder's equity

5

How is the following treated?

Investment securities transferred from held to maturity to trading

Recognize unrealized gain/loss immediately

6

Sales type capital lease:

Lessor has 2 profits derived from this transaction

1 gain or loss on sale (lease) of asset

2 interest income from collection of lease payment

7

Lessor vs lessee

Lessor owns the property

Lessee rents the property from the lessor

8

Lessor direct financing capital lease:

The lessor has what from the collection of the lease payment?

Lessor has only interest income from collection of the lease payment

9

Sale leaseback define

Property is sold by owner and immediately leased (operating or
Capital) back to owner

10

Under a sale leaseback the original owner/seller never...

Gives up possession or use of property

11

Minor lease (sale leaseback criteria)

If present value of future lease payments is less than 10% of
FMV of property just sold (use sale price)

12

Major lease (sale leaseback criteria)

If present value of future lease payments is more than 10% of
FMV of property just sold (use sale price)

13

Minor lease (back) is...

Not a sale leaseback

14

Major lease (back) is...

A sale leaseback

15

When a leaseback is minor (less than 10% of FMV) and there is a loss on sale...2

1 Recognize entire loss in year of sale

2 Record rent expense for each payment

16

When a leaseback is minor (less than 10% of FMV) and there is a gain on sale...2

1 recognize entire gain in year of sale

2 record rent expense for each payment

17

When a leaseback is major (more than 10% of FMV) and there is a loss on sale...

Recognize entire loss in year of sale

18

When a leaseback is major (more than 10% of FMV) and there is a gain on sale...2

1 Defer gain up to present value of lease liability

2 amortize gain as offset (reduction)

19

When a leaseback is major (more than 10% of FMV) and there is a gain on sale, what is the treatment of an operating leaseback?

Amortize deferred gain on sale as offset to rent expense to be
Paid in future

20

When a leaseback is major (more than 10% of FMV) and there is a gain on sale, what is the treatment of an capital leaseback?

Amortize deferred gain on sale as offset to depreciation expense
On capitalized asset that original owner/seller owns again

21

Exception to gain recognition on sale leaseback, entire gain should be recognized when...

Lease term is 10% or less of remaining useful life of leased asset

22

What is the journal entry to reissue stock for more cash under the par value method?

Cash. Xxx
T/S. Xxx
PiC. Xxx

23

What is the journal entry to reissue stock for less cash under the par value method?

Cash. Xxx
T/S. Xxx
PiC. Xxx

24

What is the journal entry to reissue stock for more cash under the cost method?

Cash. Xxx
T/S. Xxx
PiC- T/S transactions. Xxx

25

What is the journal entry to reissue stock for less cash under the cost method?

Cash. Xxx
R/E. Xxx
T/S. Xxx