Select Transactions Flashcards
Change in estimate requires a ——— application
Prospective application (I.e. change in depreciation method or useful life of PPE)
A change in accounting principle requires a ——— application
Retrospective (I.e. LIFO to FIFO)
A prior period correction of an error requires what 2 things?
1) Retrospective application and 2) restatement
Hedge
Use a hedging instrument to hedge against a hedging item
When domestic currency weakens, a ___ is recorded by A/R; when it strengthens a _ is recorded?
Foreign exchange gain; Foreign exchange loss
Assets and liabilities are translated using what rate at the balance sheet date?
The current or “spot” rate
Income statement accounts (revenue) are translated using what rate?
The weighted-average exchange rate
Where are foreign currency translation gains/losses reported?
Other Comprehensive Income on the balance sheet
Which of the following expenses related to the business combination should be included, in total, in the determination of net income of the combined corporation for the period in which the expenses are incurred?
Finder’s fees & Issuance fees for for equity securities
Finder’s fees: yes
Issuance Fees: No
The excess of the market price over the exercise price of a stock option is called what?
“The intrinsic value”
In nonmonetary exchanges, the asset received should be recorded at
The FV of asset received or surrendered, whatever is more evident
Software costs are reported at the lower of
Unamortized cost or NRV
An impairment loss exists when an asset’s carrying value exceeds its what?
Sum of undiscounted cash flows
