FAR Module 12 Misc

Question 0

T/F

Treasury Stock are examples of cash?

Answer 0

FALSE

Question 1

T/F

Checking accounts are examples of cash?

Answer 1

TRUE

Question 2

T/F

Treasury Bills are examples of cash?

Answer 2

TRUE

Question 3

T/F

Money Market Funds are examples of cash?

Answer 3

TRUE

Question 4

T/F

Petty Cash are examples of cash?

Answer 4

TRUE

Question 5

T/F

Trading Securities are examples of cash?

Answer 5

FALSE

Question 6

T/F

Savings Accounts are examples of cash?

Answer 6

TRUE

Question 7

T/F

Sinking Fund Cash are examples of cash?

Answer 7

FALSE

Question 8

T/F

Compensating balances against long-term borrowing are examples of cash?

Answer 8

FALSE

Question 9

T/F

Restricted cash funds are examples of cash?

Answer 9

FALSE

Question 10

T/F

Postdated checks for customers are examples of cash?

Answer 10

FALSE

Question 11

T/F

Available for sale securities are examples of cash?

Answer 11

FALSE

Question 12

A change from using the percentage of sales method to the aging method is considered what type of change and therefore is treated how

Answer 12

Change in accounting estimate - therefore this change is applied prospectively

Question 13

What is the entry to set up an allowance for doubtful accounts

Answer 13

Debit bad debt expense

credit the allowance account

Question 14

What is the entry to write off an allowance

Answer 14

Debit the allowance account

credit accounts receivable

Question 15

What is the entry to record a recovery under the allowance account

Answer 15

First, reverse the write off:
Debit accounts receivable
credit the allowance account

Second, recognize the cash receipt:
Debit cash
credit accounts receivable

Question 16

When no number is better than another in a range, what number do you use?

Answer 16

The minimum number

Question 17

What is the risk of accounting loss?

Answer 17

This is the amount of write off a company would record if any party failed to fully perform

Question 18

What is off balance sheet risk?

Answer 18

When an accounting loss exceeds the associated assets/liabilities on the balance sheet

Question 19

T/F

segregated cash accounts can be current or no current assets, depending on the timing

Answer 19

FALSE

segregated cash accounts are never considered current assets no matter what timing is involved. They should be classified as non current assets.

Question 20

T/F

Always use PV when calculating the liability of a note payable

Answer 20

FALSE

use the face amount if the note matured within one year! If the note matures in greater than one year, then use PV

Question 21

T/F

you don’t need to do anything with gain contingencies until they are recognized

Answer 21

FALSE

Gain contingencies are disclosed when realized

Question 22

T/F

whether or not a CD is considered a current asset is based on its original maturity date, not how soon it can be used

Answer 22

TRUE

Question 23

T/F

an employer only has to accrue a liability for non vesting rights

Answer 23

FALSE

An employer must accrue a liability for vesting rights but does not have to accrue a liability for non vesting rights !

Question 24

T/F

the FASB ASC 825-10-25-1 per mints the FV election on a contract by contract basis

Answer 24

TRUE