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27 Cards in this Set
- Front
- Back
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Revenue recognition requirements |
1. persuasive evidence of an arrangement exists-singed a contract 2. delivery has occurred or services have been rendered-risk transferred 3. price is fixed and determinable - 4. collection is reasonable assured |
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realization vs. recognition |
realization : get cash recognized : record on F/S |
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franchisor accounting : earned revenue |
when substantial performance occured |
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exception for intangible asset should be capitalized |
1. legal fees and other costs related to a successful defense of asset 2. registration or consulting fees 3. design cost 4. other direct cost to secure the asset |
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A patent is amortized over the shorter of its estimated life or remaining legal life. |
as front |
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start-up cost- including organizational costs |
expense |
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maintaining goodwill |
expense |
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research and development cost |
expense, except 1. alternative use in the future ( over its useful life) 2. on the behalf of others. |
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IFRS intangible asset should be expense except |
1.technological feasibility has been established. 2. the entity intends to complete the intangible asset 3.the entity has the ability to use or sell the intangible asset 4. the intangible asset will generate future economic benefits. 5. adequate resources are available to complete the development and sell or use the asset. |
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amortization of capitalized software costs |
the greater of 1.percentage of revenue 2. straight line |
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impairment for finite live asset |
two step. 1. CV vs. undiscounted future net cash flows 2. CV vs. FV |
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impairment for infinite live asset |
step 2 only |
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impairment for IFRS |
CV vs. recoverable amount |
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IFRS recoverable amount |
the greater of fair value - cost to sell vs. asset's value in use. |
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goodwill impairment GAAP |
two step 1. BV vs. FV 2. implied goodwill vs. goodwill |
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Goodwill impairment IFRS is first allocated to goodwill then allocated to pro rata basis to other assets. |
one step CGU's carrying value vs. recoverable amount recoverable amount = greater of FV- cost to sell vs. value in use value in use= future cash flow |
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completed contract method us GAAP only |
as fron |
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change in recognition method is treated as |
change in principal |
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exchanges lacking commercial substance |
gains: no boot is received = no gain. boot is paid , no gain. boot is received <25% = proportional boot is received >25% all gain for both parties |
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foreign translation |
from functional currency -> reporting currency start from income statement,
gain/loss to AOCI |
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remeasurement method )temporal method) |
from foreign currency -> functional currency start from b/s gain/loss to i/s 2 plugs. 1. in R/E/ 2. in gain /loss |
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remeasurement method b/s and i/s presentation |
b/s monetary item-> current/ year end non-monetary -> historical i/s non-balance sheet related items-> WAR b/s related historical rate |
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translation method bs and is |
b/s asset= C liab = C C/s= H retained earnings= beg r/E + translated net income |
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non-monetary exchange has commercial substance |
the gain or loss is the difference between the FV and BV of the asset given up. |
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functional currency is |
of the environment in which the subsidiary primarily generate and expend cash. |
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foreign currency -> functional currency |
remeasurement |
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foreign currency -> reporting cy functional currency -> reporting currency |
translation |
