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23 Cards in this Set
- Front
- Back
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How do you record an asset purchased on a deferred payment plan?
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At it's cash equivalent price, if that's unavailable, imputed int rate should be used and PV of payments.
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How do you record an asset purchased by issuance of securities?
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FV or FV of the securities issued, whichever is more clear.
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What are 3 assets qualifying for interest capitalization?
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1. Assets constructed or produced for self-use on a repetitive basis.
2. Assets acquired for self use through arrangements requiring down payments or progress payments. 3. Assets constructed or produced as discrete projects for sale or lease. |
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What's the formula for weighted avg rate?
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Total Int / Total Principal
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Is int cost capitalized part of the cost of acquiring the asset & written off over the estimated useful life of the asset?
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Yes
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How do you record an asset by self construction?
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By all directly related costs: DM, DL & additional overhead incurred
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What is a revenue expenditure?
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Expenditures that benefit only the current period are charged to expense as incurred.
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How are assets to be recorded?
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At acquisition cost, which includes all costs reasonably necessary to bring it to the location and to make it ready for its intended use.
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How would the entity paying boot record new asset? Is there any gain recognized?
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No Gain recognized. Record the asset received at the amount of boot paid plus the recorded amount of the asset surrendered.
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Formula for portion of BV sold when receiving boot?
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BV of old asset x (boot/(boot + BV of new asset)
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When an exchange with boot indicates a loss, do you recognize the whole loss or just a portion?
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Whole loss!
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When you're the recipient of boot, how is your gain calculated?
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Realize a gain to the extent the monetary (boot) receipt exceeds a proportionate share of the recorded amount of the asset surrendered.
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T or F
G & L's in general for nonmonetary transactions should be based on FV's? Either asset surrendered or asset received, whichever is more clearly determinable? |
True
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When are the 3 times nonmonetary exchanges should be based on recorded amounts?
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1. Can't tell either FV
2. Trans is an exchange of a product or property held for sale in the normal course of business for a prod or prop to be sold in the same line of business to facilitate sales to customers. 3. Trans lacks comm substance |
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How is a nonreciprocal transfer recorded?
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At FV, G or L should be recognized on the disposition of the asset.
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How are donated assets recorded?
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At FV along with any incidental costs incurred. When received from govt entity , no inc is recognized, off setting CR is to an OE acct. Additionl-PIC-Donated Assets
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What's the diff btw Group & Composite depreciation?
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1 Group-Assets have similar svc lives, no G or L's recognized, CR asset DR ad for same amount less any proceeds received in disposition.
2. Composite-have a wider range of svc lives. Determined by calculating the annual depreciation expense for each asset, adding em up, and putting as a % of total cost of assets. |
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What are the 3 methods of fractional year depreciation?
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1 Depreciation for one year in the year of acq & none in yr of disp.
2 Half year depr in yr of acq & disp. 3 Proportional Depr |
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Formula for Sum of the yrs digits depr?
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HC-SV x Fraction for year
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When reclassifying an asset, do you use BV or FV as new amount?
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Going from Held For Sale to Held & Used reclass will be lower of: FV at date that asset is reclassified or BV before being classified as held for sale, adj for any depr (amortization) that would have been recognized had the asset been originally held & used.
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What's the formula for DDB depr?
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2 / EUL x (HC-AD) or (BV)
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What's the formula for variable charge depr?
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Depr exp =
HC - SV / Total Expected Output or usage x current output or usage |
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What are the 3 categories of impaired assets?
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1 Held for sale
2 Assets Held for use 3 Disposals other than by sale |
