Accy 301 Final Exam

Front 1

Definition of measurement

Back 1

the assignment of numerals and other symbols to represent the magnitude of an attribute of a phenomenon

Front 2

Def. relevance

Back 2

Capacity of info to make a difference in a decision

Front 3

Relevance needs:

Back 3

Predictive and feedback value, timeliness

Front 4

Def. Reliability

Back 4

Reasonably free from error and bias, faithfully represents what it purports to represent

Front 5

Reliability needs:

Back 5

Verifiability, neutrality, rep. faithfulness

Front 6

Def. Rep. Faithfulness

Back 6

Clear identification of underlying attribute of interest

Front 7

Def. Verifiability

Back 7

Independent measures derive the same value

Front 8

2 methods used to estimate bad debt expense

Back 8

Percent of sales
Percent of receivables

Front 9

J/E for BDE

Back 9

BDE
___Allowance for FDA

Front 10

Allw for bad debt effect on statements

Back 10

None on income
No net balance sheet effect

Front 11

Relationship between COGS and inventory

Back 11

Cost of goods available for sale is either allocated into COGS or EI

Front 12

Absorption vs. variable costing

Back 12

Absorption includes variable AND production costs

Front 13

Pre-tax net income, LIFO vs. FIFO

Back 13

Lower under LIFO

Front 14

Different measures of market used in LCM

Back 14

Replacement cost
Net realizable value
NRV - profit

Front 15

Market ceiling and floor

Back 15

Ceiling - Inventory's net realizable value
Floor - NRV - Normal profit margin

Front 16

LIFO reserve

Back 16

FIFO EI - LIFO EI

Front 17

Intangible asset

Back 17

Any current or non-current asset, owned by the company, with probable future benefits, that lacks physical substance, other than financial instruments - only recorded when purchased

Front 18

5 types of intangible assets

Back 18

Marketing
Artistic
Customer
Technology
Contract

Front 19

Separability and intangible assets

Back 19

If the asset is not separable (can't be sold) it is goodwill

Front 20

Def. goodwill

Back 20

The excess of the fair value of the entire company over the sum of the market values of all the identifiable assets (net of liabilities)

Front 21

Depr of goodwill vs. other assets

Back 21

Goodwill is not amortized, only tested for impairment

Front 22

Goodwill impairment

Back 22

If business's FV < BV, then subtract the goodwill's BV - FV

Front 23

Disclosure of goodwill, impairment, and intangible assets

Back 23

Goodwill - Balance sheet
Impairment - Operating section of income statement, unless it is under discontinued operations
Intangible assets - one line on BS

Front 24

R&D on IFRS vs. GAAP

Back 24

GAAP - all expensed
IFRS - Research expensed, development capitalized if:
Technical feasibility reached
Intend to complete
Ability to use or sell
Future economic benefit expected
Adequate resources to complete
Ability to measure expenditure attributable to asset

Front 25

Cost included in depreciation

Back 25

Inventory - all costs to get it there and working
Manufactured - All RM, DL, OH, and interest incurred during the construction period

Front 26

Begin interest capitalization when:

Back 26

Expenditures for the asset have been made
Activities are in progress
Interest cost is being incurred

Front 27

How much to capitalize for depr

Back 27

Lower of actual interest or avoidable interest (average accumulated expenditures * interest rate)

Front 28

Maintenance capitalized as a new asset when:

Back 28

One of:
Useful life has been increased
Quantity of units produced is increased
Quality of units produced is increased

Front 29

Three methods of depr

Back 29

Straight line
Activity
Accelerated (sum of years, declining balance)

Front 30

Activity based depr

Back 30

[(Cost - Salvage Value)/(Expected units)] * Units produced in the year

Front 31

Non-monetary exchanges

Back 31

Recognize on the income statement the gain or loss realized

If gain on similar assets: Gain not recognized, book value of new asset is reduced by the amount of the gain not recognized

Front 32

Def. SCF

Back 32

Statement that provides an explanation of how the company's cash balance has changed from the beginning of the year to the end of the year.

Front 33

Why cash balances are good

Back 33

Not subjective
Provides insight of the validity and sustainability of accrual NI
Debtors want cash

Front 34

Three sections in SCF

Back 34

Operating
Investing
Financing

Front 35

Operating activities

Back 35

Events or transactions that enter into the determination of the NI (cash basis rev and exp)

Front 36

Approaches of operating cash flow

Back 36

Direct
Indirect - 98%

Front 37

3 indirect approaches to operating accrual NI

Back 37

Items that affected NI but not cash (depr, ammor)
Items that affected NI and cash but not operating activity (sale of property/equip)
Operating items from which the income effect differs from the cash effect

Front 38

General rule of indirect approach

Back 38

Increase to current asset = Negative adjustment to NI

Increase to current liability = Positive adjustment to NI

Front 39

Def. Cash flow from investing activities

Back 39

Cash flows that result from the purchase/sale of productive assets (equip), marketable securities, or companies/divisions (long term assets)

Front 40

Def. Cash flows form financing activities

Back 40

Cash flows from selling its own stocks/bonds, paying dividends, buying back shares, or borrows money (long-term liabilities/equity)

Front 41

J/E for impairment

Back 41

Loss on impairment
___Goodwill

Front 42

Avoidable interest J/E

Back 42

Building xx
____Interest expense xx