Deck 1

Question 1

OCI is what 5 elements

Answer 1

1. Reclassification adjustments (A4s/trading/H2m) REVERSE!
2. Unrealized holding G/L on A4S securities
3. Pension (other Post Retirement) G/L;Prior service costs;transition assets
4. Unrealized holding gain/Loss (effective portion) on derivatives held as cash flow hedges including foreign currency hedges as cash flow hedges
5. Cumulative Foreign currency translation adjustment (current rate method)

Question 2

6 Qualitative characteristics under GOV. Accounting

Answer 2

1. Understand-ability
2. Reliability
3. Relevance
4. Timeliness
5. Consistency
6. Comparability

Question 3

U-R-R

Answer 3

Understand-ability- Information can be INTERPRETED by the user
Reliability- Information is reasonably FREE FROM ERROR/BIAS
Relevance- Information makes difference in DECISION BY A USER

Question 4

T-C-C

Answer 4

Timeliness- Information is available before it loses its capacity to AFFECT THE DECISION
Consistency- Information is consistently presented OVER-TIME
Comparability- Users can identify similarities/differences between TWO ENTETIES

Question 5

Fixed asset impairment criteria:

Answer 5

If expected future cash flows<BOOK VALUE

If impaired:
Make book value= FMV credit loss in the I/S

If not impaired:
Do nothing

Question 6

Installment sales measures what

Answer 6

Realized gross profit (gp x cash collections)

Vs

Unrealized gross profit (gp x amount not yet collected)

Question 7

What does received Royalty remittances mean?

What does payed royalty remittances mean?

What does to “remit royalties” mean?

Answer 7

“Received cash”

“Payed cash”

“To pay royalties”

Question 8

Bond issue costs:
Where?
How?

Answer 8

Long term assets

Straight Line

Question 9

Cash equilivent

Answer 9

90 days or less from original maturity date

Question 10

Cost Recovery
=
A/R so doubtful that the installment sales aren’t even acceptable

Answer 10

No interest revenue is recognized until the cost is recovered as well

Question 11

Gross profit %
*
cash collected= “Realized gross profit”
(not collected)unearned= “Deferred gross profit”

Answer 11

All interest revenue earned is recognized immediately
(don't multiply by the gross profit %)
Realized GP
\+ Interest earned
------------------------
=Total revenue