FAR F.2 Flashcards
All of F.2
How would you recognize revenue using an output method
recognize revenue as milestones are achieved
A purchase of merchandise was completed prior to year end it was only recorded in the inventory. What would be wrongly stated on the balance sheet?
Assets: No effect
Liabilities: Understated (Accts payable is understated)
if the Accts receivable turnover increases significantly it indicates what?
The company is collecting Accts more aggressively.
What requires a restatement of the financial statements?
A change from the income tax basis of accounting (non-gaap) to accrual basis of accounting.
which financial statement would not be appropriate for OCBOA reporting financial statements
Statement of financial position
Changes in accounting estimates
Whenever it is impossible to determine whether a change in accounting estimate or a change in accounting principle has occurred, the change should be considered a change in estimate.
How do you account for a change in accounting principle that is inseparable from the effect of change in accounting estimate
a component of income from continuing operations
where should the effect of a new estimate be recorded if it is discovered after the yearend.
A change in estimate should be recorded in the following years continuing operations.
what happens when accounting changes that result in financial statements that are, in effect, the statements of a different reporting entity?
Financial statements of all prior periods presented should be restated when there is a “change in entity”