Becker FAR Flashcards
What are the authoritative literature included in the codification?
FEDPRIA, Financial Accounting Standards Board, Emerging issues Task Force Abstracts and Topic D, Derivative Implementation Group issues, Accounting Principles Board opinions, Accounting research bulletins, Accounting interpretations, American Institute of Certified Public Accountants
What are the elements of financial statements?
REGL ALE needs ID, Revenues, Expenses, Gains, Losses (impairement/writedown), Assets, Liabilities, Equity, Investments by owners, Distributions by owners
What is the presentation of an income and retained earnings statement?
IDEA, Income (or loss) from continuing operations, Income (or loss) from discounted operations, extraordinary items, Cumulative effect of change in accounting principle
What is included in Other comprehensive income?
PUFER, Pension adjustments, Unrealized gains and losses (AFS securities), Foreign currency items, Effective portion cash flow hedges, Revaluation surplus (IFRS only)
What is the equity method account analysis?
BASE, Beginning balance, Add: Investors share of investee earning, Subtract: Investors share of investees dividends, Ending balance
How does a corporation adjust the acquisition method during consolidation?
CAR IN BIG, Common Stock, APIC, Retained earnings are eliminated, Investment in subsidiary is eliminated, Noncontrolling interest is created, Balance sheet of subsidiary is adjusted to fair value, Identifiable intangible assets of the subsidiary are recorded at their fair value, Goodwill (or Gain) is required
How do you calculate accounts receivable?
Beginning balance, +Credit sales, -Writeoffs, -Convert to note, -Cash collected, =Ending balance
How do you calculate market ceiling (NRV)?
Selling price, -Costs of completion, =Market Ceiling (NRV)
How do you calculate Market Floor?
Market Ceiling (NRV), -Normal Profit (profit margin), = Market Floor
What do you use to compute depletion on land?
REAL property, Residual value (subtract), Extraction/development cost, Anticipated restoration cost, Land purchase price
What is the conditions to capitalize a capital lease (US GAAP)?
OWNS, Ownership transfers at end of lease, Written option for bargain purchase, Ninety percent of leased property, Seventy five percent or more of asset economic life is being committed in lease term, Only 1 is required
What are the finance lease criteria (IFRS)?
OWES FACS, Ownership, Written bargain, Economic life, Substantially all of the fair value, Fluctuation, Ability to continue the lease, Cancel the lease, Specialized nature
What are the sales type/direct financing type criteria (US GAAP)?
LUC, Lessee owns the leased property, Uncertainties do not exist regarding any unreimbursable costs to be incurred, Collectability of the lease payments is reasonably predictable, Must have all three
How do you calculate Net periodic pension costs?
SIRAGE, Current service cost, +Interest cost, - Return on Plan assets, +Amortization of prior service cost, -Gains and +Losses, +Amortization of existing net obligation or net asset, =Net periodic pension cost
How do you calculate Basic EPS?
Basic EPS=, Income available to common shareholders (NI - PD)/, Weighted average number of common shares outstanding
How do you calculate Weighted average number of common shares outstanding (WACSO)?
Shares outstanding at the beginning of the period, +Shares sold during the period (on a time weighted basis), -Shares reacquired during the period (on a time weighted basis), +Stock dividends and stock splits (retroactively adjusted), -Reverse stock splits (retroactively adjusted), =Weighted average number of common shares outstanding for the entire period (WACSO)
How do you calculate Diluted EPS?
Diluted EPS=, Income available to the common stock shareholder, +Interest on dilutive securities, /Weighted average number of common shares
What are in the governmental funds?
GRASPP, General fund, Special revenue funds, Debt service funds, Capital projects funds, Permanent fund
What are in the proprietary funds?
SE, Internal Service funds, Enterprise funds
What are in the Fiduciary (trust) funds?
PAPI, Pension (and other employee benefit) trust funds, Agency trust funds, Private purpose trust funds, Investment trust funds
What is the measurement focus and accrual basis for fiduciary and proprietary funds?
SPACE, SE, PAPI, Accrual, Carry Fixed assets & Long term debt, Economic resources measurement focus
What are the constraints for the governmental fund balances?
NU CAR, Non-spendable fund balance, Restricted fund balance, Committed fund balance, Assigned fund balance, Unassigned Fund Balance
The governmental funds use modified accrual accounting for what accounts?
BAE, Budget, Activity, Encumbrances
Net position in proprietary funds displays three categories?
RUN, Restricted, Unrestricted, Net investment
Primary government entities that meet the following criteria:
SELF, Separately elected governing body, Legally separate, Fiscally independent of other state and local governments
What are the program revenue category types?
SOC, Charges for services, Operating grants and contributions, Capital grants and contributions
How to prepare the reconcliation for the balance sheet?
GALS BARE, Graspp fund balance, +Assets (noncurrent), -Liabilities (noncurrent), +Service (internal) fund net position, Basis of accounting, Accrued, Revenues and, Expenses
How to prepare the reconcliation for the changes in fund balance (statement of revenues, expenditures)?
GOES BARE, Graspp net change in fund balance, -Other financing sources, +Expenditure- capital outlay (net of depreciation), +Service (internal) fund net income, Basis of accounting, Additional accrued, Revenues and, Expenses
What are the components of net assets of not-for-profit organizations?
PUT, Permanently restricted net assets, Unrestricted Net assets, Temporarily restricted net assets
How are contributions of donated services recognized?
SOME, Specialized skills are required and possessed by the donor, Otherwise needed by the organization, Measurable, Easily (at fair value)
Disclosure should be made for guarantee type remote loss contingencies, such as:
DOG, Debts of others guaranteed (officers/related parties), Obligations of commercial banks under standby letters of credit, Guarantees to repurchase receivables (or related property) that have been sold
Step 1: Compute gross profit of completed contract?
Contract price
(Estimated total cost)
=Gross profit
Step 2: Compute percentage of completion
Total cost to date/Total estimated cost of contract
Step 3: Compute gross profit earned (profit to date)
Step 1 x Step 2 = Profit to date
Step 1) Contract price = gross profit
Step 2) Total cost to date/Total estimated cost of contract
Step 4: Compute gross profit earned for current year
Profit to date at current FYE
(Profit to date at beginning of period)
= Current year to date gross profit
How do you calculate gross profit?
Sales - Cost of goods sold = Gross Profit
How do you calculate gross profit percentage?
Gross Profit/Sales Price = Gross Profit percentage
How do you calculate earned gross profit?
Cash collections x gross profit percentage = Earned gross profit
How do you calculate deferred gross profit?
Installment receivable x gross profit percentage = Deferred gross profit
How do calculate Cost of Goods Sold?
Beginning inventory + Purchases = Cost of Goods Available for Sale - Ending Inventory = Cost of Goods Sold
