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Question 0

Capitalize equipment that have future uses in R&D, but

Answer 0

It’s dep should be part of R & D

Question 1

Continuing operations includes

Answer 1

Non operating and operating.

Question 2

Reason for waiting for the sale to take place is

Answer 2

Objectivity

Question 3

Compare to accrued basis cash understates income by decrease in accrued expenses only NOT

Answer 3

Decrease in A/P

Question 4

Economic Value is

Answer 4

PV

Question 5

Expense is

Answer 5

Cost that Benefit current period or allocate to current period.

Question 6

6K semiannual and not

Answer 6

Audited!!!!

Question 7

Gross profit%=

Answer 7

Gross profit/ sales price

Question 8

Earned gross profit =

Deferred Gross profit=

Answer 8

Cash collections X Gross Profit%

Installment receivables X Gross Profit%

Question 11

Impairment. US

1. If CV>undiscounted cash flows= impairment
2. CV vs. FV

Answer 11

IFRS 1 step= CV vs greater of FV or value in use

Question 12

Depreciable property constructed on leased land is dep over the life of the property or the term of the lease, whichever one is shorter

Answer 12

So eg. Cost of building / remaining lease years = annual dep!!

Question 20

To find inter company COGS in order to find CV of inter company inventory when 37.5% is still in sub’s hands you

Answer 20

1. Find GPP then you know the COGS%
2. Multiply COGS% by inter rev = interCOGS
3. CV of inventory = 37.5%* inter COGS

Question 21

COGS% = 100 - GPP

Answer 21

Inter company COGS is {inter rev * COGS %}

Question 22

When calculating for current assets and check is written to vendors and mailed after BS sheet date …

Answer 22

You add the written check back to calc for current asset!

Checks are not considered a disbursement until mailed and land held for resale is a current asset

Question 23

PV rate X annual payments = FV

Answer 23

So If FV is 20000 and PV value is 3.992 , then annual payment is 5010.
20,000/3.992= 5010

Question 24

Net income + OCI =

Answer 24

Comprehensive income

Question 25

Net income is close to RE and OCI is closed to

Answer 25

Accumulated other comprehensive income

Question 27

Reportable segment test: 10% rev
10% reported loss or profit
10% assets.

The 75% test- if total external revenue is less than 75% of total external revenue add more operating segments even if they don’t meet the test of 10%.

Answer 27

Rev- include inter company and external sales, should be 10% or more of combined rev in and out of all operating segments.

The greater of:
If profit is 10% or more of combined of all operating segment profit or

The loss is 10% or more of combine loss of all operating segments.

Assets- 10% or more of combined assets.

Question 29

Must disclose segment profit/ loss, assets and certain related items. Cash flow not required

Answer 29

IFRS require segment liabilities is the segment is major

Question 30

Reclassification of trading securities: transfers are accounted for at FV

Answer 30

Transfer from trading–unreal gain or loss are already in earnings shall not reverse

To trading – unreal gain or loss at date must rec in earning right away

Held to mat to available for sale– rec gain or loss to OCI

Question 32

Amortize over life excess of FV over BV of identifiable asset

Answer 32

Do not amort or impair goodwill when using equity, the total equity investments should be tested for impairment instead .