Deck 2

Question 1

Mnemonic IDA

Answer 1

Presentation order of Income statement and RE statement; I: income from continuing operations; D: discontinued operations (net of tax); and A: accounting principle change (net of tax)

Question 2

A loss form discontinued operations can occur from 3 things:

Answer 2

1) Impairment loss; 2) gain/loss from actual operations; 3) gain/loss on disposal

Question 3

Criteria for liability recognition for an “exit or disposal activity” includes:

Answer 3

Obligating event has occurred; present obligation to transfer assets; and entity has little or no discretion to avoid future transfer of assets (exit plan not enough)

Question 4

Where do you report changes in an accounting principle?

Answer 4

Adjust beginning retained earnings in the earliest period presented

Question 5

Available-for-sale security vs trading security; reported in:

Answer 5

AFS: OCI; Trading: NI

Question 6

Purpose of reporting comprehensive income:

Answer 6

To summarize all changes in equity from non owner sources

Question 7

PUFER (OCI)

Answer 7

Pension adjustments; unrealized gains/losses (AFS); Foreign currency items; Effective portion cash flow hedges; Revaluation surplus

Question 8

Under the two-statement approach, what does the statement of comprehensive income begin with?

Answer 8

Net income and ends with comprehensive income

Question 9

Total accumulated other comprehensive income is shown in:

Answer 9

The balance sheet

Question 10

Losses are recored in full when they are both:

Answer 10

Probable and estimable

Question 11

In order to calculate income tax expense on an interim statement, the appropriate methodology is to:

Answer 11

multiply year to date income by the effective tax rate and subtract from that the income tax expense recorded in the previous quarter

Question 12

The 10% size test to be a reportable segment includes the follow three criteria:

Answer 12

10% of either: 1) total combined revenue; 2) profit/loss; 3) assets

Question 13

Under IFRS and GAAP, what is not disclosed for an entity’s reportable segments?

Answer 13

Cash flows

Question 14

Segment operating profit (EBIT) =

Answer 14

Revenues - directly traceable costs - reasonably allocated costs

Question 15

Form 10K

Answer 15

File annually by US registered companies; 60 days for large accelerated filers; 75 days for accelerate filers; and 90 days for anyone else

Question 16

Form 10Q

Answer 16

Filed quarterly by US registered companies; 40 days for large accelerated filers and accelerated filers; and 45 days for anyone else