Deck19 Flashcards
Are stock dividends counted as income under GAAP?
No, because (theoretically) they decrease the value of the stock that is already issued
Should advertising expense and interest expense be considered in G and A?
NO
How should an item that is unusual but not infrequent be recorded on the Income Statement?
Component of Income from Continuing Operations but NOT net of taxes
Purpose of Liquidation Basis Accounting?
Inform financial statement users that Liquidation in imminent.
What is the equation for Comprehensive Income?
Net Income plus “Other Comprehensive Income” = Comprehensive Income
Will Conversion of Debt to Equity appear as a supplemental disclosure on the Statement of Cash Flows?
Yes - Cash Flow per share will not though
All intangibles are subject to impairment. Can the impairment losses be reversed?
No - The reversal of an impairment loss is prohibited.
Are dividends on life insurance policies treated as a separate revenue?
No. They are treated as an offset against insurance expense.
For a patent, when would litigation costs be capitalized?
If the patent is successfully defended.
Goodwill should be tested for value impairment at which of the following levels?
Each reporting unit
A company should recognize goodwill in its balance sheet at which point?
Goodwill has been created in the acquisition of a business.
(IFRS- Unidentifiable Intangible) - is a reversal of an impairment loss permitted?
Yes - this is in contrast to GAAP which does not allow reversal
