F1 M1 Flashcards
B/S, I/S, and CI
how are gains and losses reported?
at net amts (proceeds less net book value)
where should items of income or loss be reported if they are infrequent and unusual?
reported separately as part of income from continuing operations
nature of item and F/S effects disclosed on face of I/S or in footnotes
what is the multi-step I/S? And what are its benefits?
reports operating revenues and expenses separately from non-operating revenues and expenses
-enhances user info (ex. analytical ratios)
what is the single-step I/S? And what are its benefits?
total revenues and total expenses reported in single step
-simple design and no revenues or expenses are considered more important that any other
examples of discontinued operations?
1) component of an entity
2) groups of components of an entity
3) business or nonprofit activity
4) impairment loss
5) gain or loss from actual operations or on disposal
where is discontinued operations reported?
reported separately from continuing operations in the I/S, net of tax
what are three conditions in which an item will be reported in discontinued operations?
1) has been disposed of
2) held for sale
OR
3) major strategic shift
initial impairment loss calculation
carrying value of assets - fair value
and calculated net of tax rate
what should you do when you have subsequent increases in fair value?
gain recognized for any subsequent increase in fair value - costs to sell, but not in excess of previously recognized cumulative loss
do assets continue to be depreciated or amortized after its disposed of?
No
how is a component classified as held for sale measured at?
the lower of its carrying amt or fair value less costs to sell
what are costs to sell?
the costs associated with making a sale happen
where are foreign currency transaction gains and losses reported?
on the I/S
where are foreign currency translation gains and losses reported?
in OCI
are transactions between a sub and parent considered for foreign currency transactions?
No
