F5 Flashcards
Accrued liabilites/exp=lookingback
A
unpaid portion of salaries and wages..exp incurred that not been paid exprent, utilites,phone bill
sales tax collected form customer tax payable
deferred income tax=noncurrent liability
in the term of deferred compensiton arrangemnet attribute all or a portion of excpected
future bennifit to a period of service greater then one year
(here CEO has to last 5 years before
obtaing the bounus)
Cost shouldbe recognized over the at required peirod of service (like deprecition)
The compensation exp must be takenin systematic and rational manner over the period service
reuired for payment. Which are years 1 through 5 in this problem.
Refinance portion of current Liability to LTD by issuing stock.
we will exclude 1500K form the note as it is being paid off by issue stock
the reaming 250k will be current liabilty
paid 50000 for customer job that was debited in AP
50k payment to mnf should be
prepaid $50,000.00
cash $50,000.00
not
accounts payable NOT worng
Ap $50,000.00
cash $50,000.00
Yes, what you have is exactly right. That will bring the liability down to 600,000, which is where it needs to be. Then, we will actually pay which will debit the liability 600,000 and credit cash for 600,000.
Question :
Lawsuit exp $725000
Accured liability *725000
But settled for $60000 adjusting entry would be
Accured liability 1$25000
lawsuit. $12500
Just want to make sure I understand this correctly.
compensation
Rule: Employes compensation for future absences (mostly Vaction) should be accrued if :
1. services have already been rendered and
2. The obligation relates to vested or accumulated rights and
3. The amount can be reasonably estimated and
4. payment is probable
bond date
The bond date is the day it begins accruing interest.
It is not uncommon for there to be a delay in a bond being issued. Why that happens has no impact on the accounting treatment.
The purchaser pay the accrued interest to the issuer on the date of purchase. The amount is returned to the purchaser at the first interest payment.
debt restructuring,
in a trouble debt restructuring, if the debtor achieves full stettlement of the d
settlement of the debtor achieves full settlement of the debt by transferring assets having a fmv that is less than the amount of the debt, a gain is recognized for the difference between
the amoutn of the debt, a gain is recognized for the difference between the cv fo the payable at date of transer and the fir mkv
of the asset at the date of the transfer
UNAMORTIZED
THE UNAMORTIZED PREMIUM (BS)
AS DIRECT ADDITION TO THE FACE VALUE OF THE BONDS
TO ARIVE AT THE BOND’S CARRYING VALUE
RESLUT IN DECREASE INTERST EXP EACH PERIOD
THE AMORTIZATION OF THE PREMIUM IS SUBTRACTED
FROM THE AMOUNT OF CASH PAID AT THE SATED RATE TO
OBTAIN GAAP INTERST EXP
FACE
ADD UNAMORTIZED PREMIUM
CV
FACE
SUBTRACT UNAMORIZED DISCOUNT
CV
ask is the bond at discount/preium
Don’t forget to set up everything under simi.. If asked for simi
Rule for non interest bearing notes
a non-interst bearing notes should be recorded at its presentvalue calculated using the prevalling market interst rate.
The market rate interest rate is then used to calculate interest on the note
to calculate interest on the note
face amount of non-interest bearing note
times pv factor
carry amount *interest rate %
interst income
Customary trade
Rule -trade notes and AR with customary trade terms not exceeding one year may be recorded at
face amount
FV=face/pv factor
pv=future amount pv factor
10000=FV.826
FV=10000/.826
pv, fv
fv(/1+r)^n PV
PV*(1+r)^n FV
