FAR 33 Flashcards
What are considered charitable contributions as an expense on the companies income statement
- direct contribution like 250K to youth org.
- If you have a matching program - you can only count the amount the the entity ( not employees gave)
- If you do repackaging design to be more environmentally friendly - this is a cost of operations - not charitable contributions
What is the purpose of comprehensive income
- it is to report overall enterprise performance
- It summarizes all changes in equity from non-owner sources
What is included in the summary of significant accounting policies
- the acting principles used
- the methods used
- anything unusual that the use
- and because there are alternative to recall revenue
- must disclose your policies for revenue recognition
- they should NOT duplicate info contained elsewhere in the F/S
- NOT limited to just the one industry in which you operate
When you calculate net loss from disco items declined in X2 and disposed in X3 - what do you include in X2 financial Statements
You include the operating losses for X2 (1,400,0000) plus any impairments - immediately recognized (300,000) then take tax (30%)
disposal values less than carry value = impairment
1,400 + 300 = 1,700*70% = 1,190
What happens when a c opponent is identified as being held - for -sale
- All F/S amounts are reported separately:
- the carry value is measured at NRV - Held for Sale
- The income statement items will be reported separately - net of tax - as disco operations - these include current periods operating loss and any impairment
S-X - for the real thing
S-K - non financial
S-X - for F/S presentation and disclosures
S-K - requirements for non-financial presentation and disclosure
What is intro period income tax allocation and when does it apply
- Intraperiod income tax allocation - is when total tax for a period is divided between:
- continuing operations
- disco operations
- extraordinary items
- the cumulative effects of changes to acc principles
- components of OCI
Not allocated to Operating income
What do you do when the expected service life of an asset changes because of new info
- this is a change in acc estimate
- this is reported current and future periods only
So no cumulative or pro form retroactive application is required
What does the 8-K report on
- major events between reporting periods for public co:
- off-balance sheet arrangements
- selling unregistered securities
- change in auditor
How long does an large accelerated filer, and accelerated filer, and a smaller registrant have to file form 10-K with SEC
large - accelerated filer - 60 days
accelerated filer - 75 days
smaller - 90 days
When do you recognize revenue when a buyer has unlimited right of returns and not obligated to pay until goods are sold (BUT you can estimate how much is returned)
$0 - you have not met rev rec requirements so do not recognize revenue until later
In a single step income statement - what items are included in revenues
Everything except those requiring special reporting
- Sales Revenues
+ interest revenues
+ Gains
= Income from continuing operations
Separate would include: gain from disco operations - this is separately stated
also cumulative affects of a change in acc principle
these are excluded from income from continuing operations
What are the JE for stock warrants:
On June 30, 20X14, Ariadne, Inc. issued 2,500 of its 6%, ten-year, $1,000 face value bonds with detachable stock warrants at par. Each bond carried a detachable warrant for one share of Ariadne’s common stock at a specified option price of $24 per share. Immediately after issuance, the market value of the bonds without the warrants was $2,250,000 and the market value of the warrants was $305,000. In its December 31, 20X14 balance sheet, what amount should Ariadne report as bonds payable, net of discount or premium? Assume straight-line amortization.
Fair Value of Bonds are 2,250,000
the Fair value of warrants is : 305,000
2,250,000 + 305,000 = 2,555,000
bonds account for 2,500,000/2,555,000 = 88% or 2,201,565
warrants account for 305,000/255,000 = 12% or 298435
dr Cash 2,500,000
dr discount 298435
cr Bonds Payable 2,500,000
cr APIC 298435
How do you calculate Return on Assets
Net Income / avg assets
Financial statements prepared under which of the following methods include adjustments for both specific price changes and general price-level changes?
current cost - /nominal dollar - items are adjusted to current amounts, but not adjusted for changes in the general price level
historical cost / constant dollar - - items are recorded ar their original cost, but are adjusted for change in the general price level
