FAR 4 Module 1 Flashcards
How should a change in a decommissioning liability be recognized after the related property is fully depreciated?
What is SOCR?
How are the following expense for employer:
Payroll Taxes
Payroll Deductions
Used for Accrued Vacation:
what is an accretion expense?
What is the formula?
Increases the ARO liability due to the passage of time using the appropriate rate
Accretion expense: Beginning ARO X Credit adjusted risk-free (Discount rate)
When can a short-term liability be reclassified as long-term, and how is cash payment treated? Include timing of refinancing.
How should compensation expense be recognized for a contract with future payments contingent on employment?
Compensation expense is recognized over the service period leading to the payment, not when the payment is made.
How should sales tax be recorded in the financial statements, and what is the treatment of unremitted tax?
What is an Asset retirement obligation? (ARO)
Arises when there’s a legal requirement to incur removal or dismantling costs at the end of an asset’s life.
How should an Asset Retirement Obligation (ARO) be recorded when an asset is placed into service?
Liability or Expense?
What is the criteria for liability recognition?
What are costs associated with exit/disposal activities?
When should exit disclosures be made?
What should be included in the disclosure?
