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Accounting > FINAL EXAM > Flashcards

FINAL EXAM Flashcards

1
Q

Non-financial non-current assets

A
  • Intangibles
  • Tangibles (Property, plant and equipment)
  • Property investment
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2
Q

Long-term financial investments

A
  • Shares of another company (Equity instruments)
  • Long-term Bonds (Debt securities)
  • Long-term deposits
  • Long-term credits (Loans)
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3
Q

173

A

Non-current payables to suppliers of fixed assets

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4
Q

161

A

Non-current payables to suppliers of fixed assets, related parties

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5
Q

253

A

Non-current loans for disposal of fixed assets

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6
Q

242

A

Non-current loans to related parties

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7
Q

523

A

Current payables to suppliers of fixed assets

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8
Q

511

A

Current payables to suppliers of fixed assets, related parties

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9
Q

543

A

Current loans for disposal of fixed assets

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10
Q

532

A

Current loans to related parties

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11
Q

Initial Valuation: Purchase Price is not Acquisition Price

A

The Acquisition Price includes the purchase Price plus all necessary expenditures to get the asset in place and ready to be used, minus discounts in the invoices

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12
Q

Post-Valuation: Book value

A

It is the initial value minus the correction amounts (accumulated depreciation, accumulated amortization, accumulated impairment)

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13
Q

Systematic losses

A
  • depreciation

- amortization

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14
Q

Potential non-systematic losses

A

Impairment

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15
Q

680

A

Amortization of intangible assets

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16
Q

681

A

Depreciation of property, plant and equipment

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17
Q

Depreciation or Amortization Expense Account

A

It represents the economic impact of depreciation or amortization expense that must be shown in the income statement at the end of the accounting cycle.

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18
Q

Accumulated Depreciation or Amortization Account

A

It represents the financial impact of depreciation or amortization being disclosed on the balance sheet as an asset correction. It stands for the cumulative amount charged year by year, since the initial recognition and measurement of an asset.

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19
Q

280

A

Accumulated Amortization of intangible assets

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20
Q

281

A

Accumulated Depreciation of property, plant and equipmen

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21
Q

For depreciation (tangible assets) or amortization (intangible assets) we need:

A

The asset cost: the acquisition Price

The estimated useful life: period over which an asset is expected to be utilized.

The estimated residual value: estimated amount less estimated disposal costs (disposal of the asset at the end of its expected life).

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22
Q

Methods for calculating depreciation/amortization, generally accepted according to IFRS

A

Straight-line

Accelerated depreciation

Usage-based (technical and functional)

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23
Q

STRAIGHT-LINE

A

The depreciation/amortization expense is the same in each period, implying that the contribution to revenue generation by the asset is the same each period.

24
Q

ACCELERATED DEPRECIATION

A

The depreciation is more allocated to expense in the early years of life and less in the later years.

It is appropriate for assets sensitive to obsolescence, like computers.

25
Q

USAGE-BASED (Technical and functional)

A

When the asset’s consumption is readily associated with its use and not to the passage of time or obsolescence.
The annual depreciation expense depends on the degree of use of the asset.
Units of production
Kilometers traveled by a vehicle
Hours of machinery use

26
Q

IMPAIRMENT

A

At the end of the accounting cycle, the company must compare the net book value of the non-current asset with its recoverable value.
The recoverable amount is the largest one between the net fair value (fair value minus expenses) and the value in use (the current value of the expected cash flows – cash-generating ability)

27
Q

IMPAIRMENT

Two possibilities:

A

When cost is higher than market value: impairment has to be recorded as a real loss, although it is only estimated;

When cost is lower than market value: due to prudence principle the company cannot record the estimated profit.

28
Q

Impairment Expense/Surplus Accounts

A

It represents an expense in the period of the income statement. It is the estimated loss suffered by assets, recorded when the net book value of it exceeds its recoverable value.

(690) Impairment losses on intangible 
assets
(691) Impairment losses in property, 
plant and equipment
(790) Reversal of impairment of 
intangible assets
(791) Reversal of impairment of 
property, plant and equipment
29
Q

Accumulated Impairment Accounts

A

It represents the asset correction. It corrects the value of an overestimated asset disclosure on the balance sheet.

(290) Impairment of intangible assets
(291) Impairment of property, plant
and equipment

30
Q

690

A

Impairment losses on intangible assets

31
Q

691

A

Impairment losses in property, plant and equipment

32
Q

790

A

Reversal of impairment of intangible assets

33
Q

791

A

) Reversal of impairment of property, plant and equipment

34
Q

290

A

Impairment of intangible assets

35
Q

291

A

Impairment of property, plant and equipment

36
Q

DERECONGITION OF NON-CURRENT ASSETS

A

Sales of non-current assets

Irreversible loss

When no future economic benefits are expected from them

37
Q

Financial Instruments

A 
A Financial Instrument is a contract 
that gives rise to a financial asset in 
one company and, simultaneously, 
a financial liability or an equity 
instrument(*) in another company
38
Q

Financial assets

A
  • Cash and cash equivalents
  • Trade and other receivables
  • Loans and credits extended to third parties, including those relating to the sale of non-current assets
  • Acquired debt securities of other companies, such as obligations, bonds and promissory notes
  • Acquired equity instruments of other companies
  • Other financial assets, such as bank deposits, loans and advances to personnel, guarantees, dividends
    recievables, etc.
39
Q

Financial liabilities

A
  • Trade and other payables
  • Debts with financial institutions
  • Obligations and other securities issued, such as bonds and promissory notes
  • Payables of special nature
  • Loans and credits extended by individuals or companies other than financial institutions, including those
    relating to the purchase of non-current assets, guarantees and payables to third parties
40
Q

Current liabilities accounts

A

(50-) Current debentures, payables of
special nature and similar issuances

(51-) Current payables to related parties

52-) Current payables for loans and others

56-) Current guarantees, deposits, prepaid
expenses and deferred income

41
Q

Non-current liabilities accounts

A

(16-) Non-current payables to related parties

(17-) Non-current payables for loans,
debentures and others

(18-) Non-current guarantees, deposits and
other liabilities

42
Q

Current assets accounts

A

(53-) Current investments in related parties

(54-) Other current investments

56-) Current guarantees, deposits, prepaid
expenses and deferred income

43
Q

Non-current assets accounts

A

(24-) Non-current investments in related
parties

(25-) Other non-current investments

(26-) Non-current guarantees and deposits
extended

44
Q

Group 4

A

Has assets and liabilities

45
Q

Group 5

A

Has assets and liabilities

46
Q

Land

A

Never depriciated (unless mining, farming etc)

47
Q

(4751)

A

Taxation authorities, withholding tax

48
Q

(5208)

A

Payables, discounted trade bills

49
Q

(4708)

A

Grants receivable

50
Q

(4412) (4312)

A

debt collection

51
Q

(4411) (4311)

A

discounted note

52
Q

(4410) (4310)

A

bill of exchange

53
Q

(4415) (4315)

A

past maturity

54
Q

(4752)

A

income tax payable

55
Q

(4330)

A

Trade receivables, group companies

56
Q

(4307)

A

Trade receivables, foreign currency

57
Q

(4331)

A

Trade bills receivables, group companies

Accounting (5 decks)

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