FAR1

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Author:
bnovero
ID:
8775
Filename:
FAR1
Updated:
2010-03-03 00:16:07
Tags:
CPA
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Description:
CPA FAR
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  1. Six Most Authoritatie GAAP Prouncements
    • 1. B- Accounting Research Bulletins
    • 2. O- Accounting Principles Board Opionions
    • 3. S- FASB Statements of Financial Accounting Standards
    • 4. S- FASB Staff Positions
    • 5. I- FASB Interpretations
    • 6. I- FASB Statement Implementation Issues
  2. Primary Qualities of Decision Usefulness
    • 1. Relevance
    • 2. Reliabilty
  3. Secondary Qualities of Decision Usefulness
    • 1. Comparability
    • 2. Consistency
  4. Relevance
    • 1. Predictive Value
    • 2. Feedback Value
    • 3. Timeliness
  5. Reliability
    • 1. Neutrality
    • 2. Representational Faithfulness
    • 3. Verfiability
  6. Fundamental Assumptions
    • 1. Entity Assumption
    • 2. Going Concern Assumption
    • 3. Monetary Unit Assumption (inflation are not reflecte in the financial statement)
    • 4. Periodicity Assumption
    • 5. Historical Cost Principle (General Rule)
    • 6. Revenue Recognition Principle
  7. Revenue Recognition Principle
    • 1. Earned
    • 2. Realized or Realizable
  8. Matching Principle
    All expenses incurred to generate a specigic amount of revenue in a period are matched against that revenue.
  9. Conservatism Principle
    The Method that is least likely to overstate assets and understate liabilities

    • 1. defer estimate gains until realized
    • 2. record probable estimated losses immediately
  10. Uses of the Income Statement
    • 1. Determining Profitability
    • 2. Value for investment purposes
    • 3. credit worthiness
  11. Reported on Income Statement
    • 1. Income from Continuing Operations- Gross of Tax
    • 2. Income from Discontinued Operations- Net of Tax
    • 3. Extraordinary Items- Net of Tax
  12. Reported on Statement of Retained Earnings
    Cumulative Effect of Change in Accounting Principle- Net of Tax

    -change from one acceptable method of accounting to another
  13. Line Items above ___________ are shown gross
    "income from continuing operations"
  14. Held for Sale
    • 1. Plan to Sell
    • 2. Available
    • 3. Active Buyer
    • 4. Probable (within one year)
    • 5. Actively Marketed
    • 6. Unlikely will be withdrawn
  15. Components of Comprehensive Income
    • 1. Net Income
    • 2. Other Comprehensive Income (PUFE adjustments)
  16. Components of Net Income
    1. Income of continuing Operations
    2. Discountinued Operations
    3. Extraordinary Items
  17. Other Comprehensive Income
    • 1. Pension Changes in Funded Status
    • 2. Unrealized Gains and Losses
    • 3. Foreign Currency Items
    • 4. Effectiv Portion of Cash Flow Hedges
  18. Segment Profit Formula
    • Revenues
    • Less: Directly traceable coasts
    • Less: Reasonably allocated costs
    • Operating Profit
  19. Valuation Techniques
    • 1. The Market Approach
    • 2. The Income Approach
    • 3. The Cost Approach
  20. The Market Approach
    Uses prices and other relevant information from market transactions involving identical or comporable assets or liabilities to measure fair value
  21. The Income Approach
    converts future amounts, incluiding cash flows or earnings, to a single discounted amount to measure fair value.
  22. The Cost Approach
    uses current replacemtn cost to measuer the fair value of assets
  23. Level 1 Inputs
    • highest priority
    • quoted prices in active markets for identical assets or liabilities
  24. Level 2 Inputs
    • 1. Inputs other than quoted market prices (Ebay)
    • 2. Observable
  25. Level 3 Inputs
    • 1. Subjective
    • 2. Unobservable inputs for the asset or liability

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