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Should revenue be recorded for the savings between the cost of $50,000 and the bid of $60,000?
What is the basic problem with the monetary assumption when there has been significant inflation?
Briefly describe the operating procedure for Statements of Financial Accounting Standards.
It is not important to know when cash is received and when payment is made. Comment.
"Costs of transactions exist whether or not the FASB mandates their recognition in financial statements." Comment.
The Emergency Economic Stabilization Act of 2008 was passed during a time of substantial stock market declines in the United States and the world.
"Service revenue is recognized when the service is performed." Is it difficult to determine service revenue? Comment.
Revenue and the related purchased transportation are recognized based on relative transit time, commonly referred to as the percentage-of-completion method.
In addition to the quality of its board and staff, one reason the FASB is able to maintain its position as a world leader is independent and stable funding.
Identify the usual forms of a business entity and describe the ownership characteristic of each.
Consolidated statements may be issued to show financial position as it would appear if two or more companies were one entity.
There are three types of accounting changes: changes in accounting principles, changes in accounting estimates, and changes in reporting entities.
On December 31, 2010, Berkeley changed the specific subsidiaries comprising the group of companies for which consolidated financial statements are presented.
Why do you think that the FASB requires one of two different transition methods when a company adopts a newly required accounting principle?
It may classify the change as a change in accounting principle, a change in accounting estimate, or a change in reporting entity.
How the change is reported in the year of the change, and what disclosures are made in the financial statements or notes.
How does the concept of consistency aid in the analysis of financial statements?
Tim Roberts owns a bar and a rental apartment and operates a consulting service. He has separate financial statements for each.
Management prepares a set of financial statements that conform to generally accepted accounting principles.
Countries have had problems with the stability of their money. Briefly describe the problem caused for financial statements when money does not hold a stable.
Inventory that has a market value below the historical cost should be written down in order to recognize a loss.
Describe the two possible methods that a company could use to report the effect of accounting changes.
How does the accounting for an indirect effect of a change in accounting principle differ between IFRS and U.S. GAAP?
Explain the differences and similarities between each of these types of changes, and explain the correct accounting for each.
Explain a change in accounting estimate and how a company reports it in the period of the change.