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CPA FAR > Random > Flashcards

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1
Q

What is impairment of an asset?

A

Carrying amount is no longer recoverable.

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2
Q

What are the 2 steps of the recoverability test?

A
  1. Carrying amount exceeds the sum of future cashflows
  2. The loss is equal to excess of carrying amount over FV
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3
Q

What are the 3 accounting changes?

A

Change in
accounting principle
accounting estimate
reporting entity

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4
Q

What is the time frame to file 10k for non accelerated filer?

A

90 days

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5
Q

What is the time frame to file 10k for large accelerated filer?

A

60 days

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6
Q

What is the time frame to file 10k for accelerated filer?

A

75 days

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7
Q

What is filing time frame for 10Q for large accelerated and accelerated filers?

A

40 days

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8
Q

What is filing time frame for 10Q for non accelerated filers?

A

45 days

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9
Q

What is the time frame to file 8k?

A

4 days

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10
Q

What 5 events require an 8k to be filed?

A

1Changes in control
2Acquisition/disposition of significant assets
3Bankruptcy
4resignation of director
5change in accountant

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11
Q

What is the revenue threshold for large accelerated filers?

A

700 million or more

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12
Q

What is the revenue threshold for accelerated filers?

A

75 million to 699 million

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13
Q

What does MD & A stand for?

A

Management Discussion & Analysis

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14
Q

What 3 items does MD & A cover?

A

Liquidity
Capital resources
Results of operations

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15
Q

5 categories of government funds?

A

General fund
Special revenue funds
Capital project funds
Debt service funds
Permanent funds

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16
Q

What are the 4 types of fiduciary funds?

A

Pension trusts funds
Investment trust funds
Private purpose trust funds
Custodial funds

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17
Q

What are the 2 categories of proprietary funds?

A

Enterprise funds
Internal service funds

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18
Q

What are the 3 statements for NFPs?

A

Statement of
Activities
Financial position
Cashflows

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19
Q

Are cash, cash equivalents and restricted cash reported in the statement of cashflows?

A

No

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20
Q

What are operating activities?

A

Anything not classified as financing and investing activities.

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21
Q

On the statement of cashflows, what are Expenditures intended to generate future income and cashflows?

A

Investing Activities

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22
Q

On the statement of cashflows activities that relate to issuing, settling, or reacquiring debt or equity are known as?

A

Financing activities

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23
Q

What is the payment of a cash dividend on the stmt of cashflows?

A

A financing activity

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24
Q

What is cash received in the form of a dividend on the stmt of cashflows?

A

An operating activity

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25
Q

What are examples of debt issues cost?

A

Promotion cost

Engraving and printing

underwriters commission

Attorney fees

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26
Q

What 3 things are added to the book balance on bank recon?

A

Interest earned
Deposits collected
Errors

27
Q

What is subtracted from the book balance on the bank recon?

A

Service charges
NSF checks
Errors

28
Q

What is added to the bank balance on a Bank recon?

A

Deposits in transit
errors

29
Q

What is subtracted from the bank balance on a bank recon?

A

Outstanding checks
Errors

30
Q

What is the formula for an impairment loss?

A

Carrying amount of asset minus the FV

31
Q

What are the components of OCI?

A

Gains/losses on AFS debt securities, foreign currency translations, cashflows hedges and pension liabilities

32
Q

What is the Cash to accrual formula for expenses and revenues?

A

Rev: A/R & Accrued liabilities, add increase & subtract to decrease. Exp: pp exp & deferred revenue, subtract increase &add decrease

33
Q

What is straight line depreciation?

A

Depreciable base/estimated useful life

34
Q

What is the carrying amount formula?

A

Historical cost minus accumulated depreciation and impairment losses

35
Q

What is the measurement of inventory subsequent to initial measurement for LIFO?

A

LCM subject to a ceiling and floor. Market can’t exceed NRV (ceiling) of fall below NRV-npm (floor). Market is replacement cost.

36
Q

What is the measurement of inventory subsequent to initial measurement for FIFO?

A

Lower of cost or NRV.

37
Q

What is the formula for NRV in LCM?

A

NRV is acquisition cost minus selling cost or CDT(cost of completion, disposal and transportation)

38
Q

What is historical cost?

A

Acquisition cost plus cost to bring the asset to the necessary C & L (condition and location)

39
Q

What is the the depreciable base?

A

Historical cost minus salvage value and impairment loss

40
Q

What is the declining balance method?

A

Carrying amount X declining balance percentage

(multiply carrying amount by declining balance percentage)

41
Q

What is sum of the years digits?

A

Depreciable base times remaining years in useful life divided by Sum of all years in useful life.

42
Q

How to do sum of the years digits numbers denominator

A

Example: 5 years useful life is 15 years denominator.
1+2+3+4+5=15

43
Q

How to do sum of the years digits numbers numerator

A

Yr 1: 5 years remaining
2: 4 years remaining
3: 3 years remaining
4: 2 years remaining
5: 1 years remaining

44
Q

What is the COGM formula

A

Ending Inventory
Plus purchases (Cost of sales)
Minus beginning inventory
=COGM

45
Q

What is the COGS formula

A

Beginning inventory
Plus purchases for period
Minus ending inventory

46
Q

Additions to book balance on bank reconciliation include…

A

Interest earned
Deposits collected
errors

47
Q

Subtractions from book balance on bank reconciliation include…

A

Service charges
NSF checks
Errors

48
Q

Subtraction from bank balance on bank reconciliation include…

A

Outstanding checks
Errors

49
Q

Additions to bank balance on bank reconciliation include…

A

Deposits in transit
Errors

50
Q

Additions to book balance on bank reconciliation include…

A

Interest earned
Deposits collected
Errors

51
Q

What are the 4 examples of debt costs?

A

Promotion cost
Engraving and printing costs
Underwriters commission
Attorney fees

52
Q

What are the 5 criteria for finance leases?

A

Trf of ownership, option to purchase, lease term at least 75% of economic life, PV of lease payments at least 90% of FV, specialized asset

Least term & Economic life = years
PV & FV = time

53
Q

What is composite depreciation?

A

A group of dissimilar assets depreciated together. It uses straight line depreciation

54
Q

What is group deprecation?

A

A group of similar assets depreciated together. It uses straight line depreciation

55
Q

What are the 3 levels of Fair Value Heirarchy?

A

Level 1: most reliable (identical assets and liabilities)
Level 2: observable (similar items)
Level 3: Least Reliable

56
Q

When are contribution of services recognized?

A
  1. Create or enhance non financial assets. 2. Require special skills 3.provided by those w/special skills 4.would be purchased if not donated
57
Q

How are intangible assets amortized when they have a finite useful life?

A

They are amortized over the useful life. Not the legal life.

58
Q

T or F. An intangible asset with an indefinite useful life is NOT amortized.

A

True

59
Q

What amounts are expenses in a business combination?

A

1 Finders fees
2 Professional & consulting fees
3 General and administrative cost

60
Q

How are capital donations classified?

A

Capital donations should be classified as non-operating revenue.

61
Q

What are the 4 components of OCI?

A

• Unrealized gains and losses on AFS debt securities
• gains and losses on Foreign currency translation adjustments
• gains and losses on pension benefits
• gains and losses on derivatives

62
Q

What is consistency?

A

Consistency refers to the use of the same accounting methods and policies from period to period within a company, allowing for comparability over time.

63
Q

Fun fact

A

A decline in fair value that is due to credit losses is included in net income

64
Q

Trading securities

A

Are brought and held for sale primarily in the near term

CPA FAR (19 decks)

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