Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

FAR > F2 > Flashcards

F2 Flashcards

1
Q

What is the conversion from Cash to Accrual basis Revenue?

A

Cash basis income
ADD Ending AR (rev relating to the pd to be collected in future)
SUBTRACT Beg AR (Rev from py pd)
SUBTRACT Ending Unearned/Deferred Rev (Cash collected in CY to be performed in future)
ADD Beg Unearned/Deferred Rev (cash collected py, for CY services)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What is the conversion from Cash to Accrual basis Expense?

A

Cash Basis expense
ADD Beg Prepaid (cash in py for expense in CY)
SUBTRACT End Prepaid (cash in cy for future expense)
SUBTRACT Beg Accrued exp (expense in py, cash this year)
ADD End Accrued exp (expense in CY, cash future)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What is conversion from Cash to Accrual basis interest exp?

A

Cash basis interest
ADD Decrease in prepaid int (beg in bigger –> Cash for PY expense)
LESS: Decrease in int payable ( expese in CY

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What is the Times interest earned ratio?

A

Income before interest expense and taxes
_____________________________________________
Interest Expense

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What is the formula for Working Capital turnover?

A

Sales
____________
Avg Working capital

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What is the basic formula for a Turnover equation?

A

Sales/COGS
_______________
AVG Balance Sheet

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

How do you calc Net Profit margin?

A

Net Income (after tax)
____________
Net Sales

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What is the basis of an asset contributed by partner to a partnership?

A

At fair value net any liabilities

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

When is the FV method of “Highest and best use applied”

A

nonfinancial assets (PPE), stocks and bonds,

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

What are the valuation techniques for FV (MIC)

A

Market (using prices from mkt)
Income (PVFCF)
Cost (replacement cost)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What are the 3 hierarchy of FV inputs?

A

Level 1 - observable, quoted prices of identical assets on active markets
Level 2 - observable, quoted prices for similar assets on active markets OR identical assets on non-active markets
Level 3 - unobservable, use discounted cashflows

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What is NOT an operating segment but can be a component of a company?

A

Pension plan or Corp HQ

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What is the quantitative 10% threshold for a reportable operating segment?

A
  1. 10% test

If segment revenue (including I/C rev, excluding interest income) > 10% combined revenue

If ABS value of P/L is : > 10% of profit (not including loss) OR >10% of combined loss of all loss reported

ID Assets are > 10% combined assets

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

what is the 75% rule for reporting segments

A

if total rev reported by segments is < 75% of total revenue –> report additional segments

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What is the difference between

Large accelerated filer
Accelerated filer
Small filer

A

Larger the company –> smaller reporting pd

Large accelerated = 700M of CE
Accelerated = 70 - 700M of CE
Small = <100M in rev or <75M of CE

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What are the periods to be presented for Regulation S-X for public companies?

A

BS 2 yrs
IS/Equity/CF –> 3 years

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

What is the sub event evaluation period for public vs private

A

Public: When FS are issued (does not have to included the date)

Private: when available to be issued

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What are the 4 disclosures that a public entity must report?

A
  1. Operating segments
  2. Products/services
  3. Major customer
  4. Geographic area
19
Q

What are the 3 objectives of segment reporting?

A
  1. Better understand entity performance
  2. Better assess prospects for future cash flows
  3. Make more informed judgements about entity as a whole
20
Q

What defines a component of an entity?

A
  1. engages in business activities which it will earn revenue and incur expenses
  2. Operating results are reviewed by chief operating decision maker
  3. Discrete financial info is available (traceable cash flow)
21
Q

If no principal market - what quoted price would yield the most advantageous market?

A

One with highest price

22
Q

What is the difference between: Income from operations vs income from continuing operations

A

income from continuing operations is NET of tax

23
Q

What are the three things included in a disclosure for vulnerability due to concentration

A
  1. Concentration exists at F/S date
  2. Concentration makes entity vulnerable to risk of near term sever impact
  3. Reasonably possible that events could cause a sever impact from vulnerability in the short term
24
Q

What is the quick ratio

A

Cash + net receivables + Mkt securities
_________________________________________

CL

**Note no inv and prepaids

25
Q

What is the value of assets contributed to a partnership valued at?

A

Fair market value net of any related liabilities

26
Q

Under the bonus method - how would you calc new capital balance of incoming partners?

A

Existing captial balance of existing partners
+ FV of contributing partner
_______________________________________________
New pship balance
*new partners interest

27
Q

What are the other comprehensive basis of accounting? (4)

A
  1. Cash basis/ modified cash basis
  2. Tax basis
  3. regulatory basis (income tax, govt)
  4. other basis
28
Q

What is the formula for Days in AR?

A

ENDING AR
_______________
Sales/365

29
Q

How do you calc the goodwill to other partners in the GW method?

A
  1. total investment / % interest = total capital
  2. Existing balance of original partners + FV of capital from new partner
  3. 1 - 2 = GW
30
Q

A change in valuation technique is what type of accounting change?

A

Change is estimate

31
Q

What is form 8-k and when is it reported

A

Form 8-k is filed to report major corporate events (acquisition, disposals, change in mgmt)

Only filed when such event occurs (so not set annually/qrtly)

32
Q

what is the emphasis on interim reporting?

A

timeliness is emphasized over reliability

company will make more effort to get reports out over reliability of data (i.e auditor is not required to s/o)

33
Q

In determining FV price -> what is the calc to determine most advantageous market and what is the amount reported on the F/S

A
  1. To determine most adv –> highest volume is most adv
  2. when volume is the same –> FV - Transaction cost - Transportation cost for each

Highest amount net is the FV

  1. FV is reported on F/S as highest amt from #2 W/o transaction cost (FV - Transportation cost)
34
Q

In determining reportable segments - what is the difference between the “Size” test and the “reportable sufficiency” test?

A

Size test = 10% (profit, all rev, assets)
sufficiency test = reportable segments have at least 75% of total external sales

35
Q

What are the 2 requirements for a change in estimate to be disclosed on the F/S?

A
  1. reasonably possible that estimate will change in the near term
    AND
  2. change is material
36
Q

If an entity reissues F/S to a later date to adjust for sub events from original sub event period - is there any change in the sub event period evaluation? if so, what dates are now used in evaluation of sub events

A

NO CHANGE IN SUB EVENT PERIOD –> Sub event evaluation period = date of f/S through date of original issuance

37
Q

What are 2 requirements that qualify F/S to be classified as “issued” for Public entity?

A
  1. Date when form and format that comply with GAAP AND
  2. Date which FS have been widely distributed to F/S users
38
Q

What is the requirement for reporting major customers in public disclosures?

A

Must report customer if that customer provides 10% or more of the combined revenues

39
Q

Total debt ratio

A

Total liabilities
______________
Total asset

40
Q

What are the 5 things included in an SEC securities offerings registration statement?

A
  1. Disclosures about securities being offered
  2. Relationship of the new securities to the companys other securities
  3. information similar to that filed in the annual filing
  4. Audited financial statements
  5. Description of business factors
41
Q

under Regulation S-X - what should an entity’s F/S include? (5)

A
  1. BS as of the end of the most recent quarter
  2. BS of preceding year
  3. IS for most recent fiscal quarter
  4. IS for period b/n end of preceding year and end of the most recent fiscal quarter
    5.IS for 12 month pd ending during most recent fiscal quarter and corresponding preceding pd
42
Q

How many days after year end do you need to report 10k for
- Large accel
- Accel
- Small

A
  1. Large = 60
  2. Accel = 75
  3. Small = 90
43
Q

How many days after quarter end do you need to report 10Q

A

Large = 40
Accel/Small = 45

FAR (9 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions