ACCT 370-liberty university Questions
and Answers.
4 values being used on a Balance sheet prepared in accordance with US GAAP - Answer
Historical cost
Fair Value
Net Realizable Value
Discounted Present Value
Credit risk analysis for a company typically involves looking at rations in these two categories -
Answer liquidity and solvency ratios
What are the 2 options for presenting other comprehensive income, according to US GAAP? -
Answer One statement approach (net income other comprehensive income= total
comprehensive income)
Goodwill - Answer This account is initially measured as the difference between the
consideration given in an acquisition and the fair value of the separately identifiable net assets
acquired on the acquisition date
Cross-sectional Analysis (benchmarcking) - Answer This type of analysis identifies similarities
and differences across companies or business units at a single point in time
Income from discontinued operations is shown in this way (where/how) on the income
statement - Answer after income from continuing operations (and net of taxes)
matching principle - Answer This says that expenses should be recognized in the same period
in which the revenue generated by these expenses is recognized
Subsequent events - Answer These are significant events that occur after the date of the
financial statements but before the financial statements are issued. They are required to be
disclosed if they are material and likely to influence investors' appraisal of the risk and return
prospects of the entity
retrospective approach - Answer this method of dealing with accounting principle changes
requires that prior years income statements presented for comparative purposes be restated to
reflect use of the new principle unless it is impractical to do so
and Answers.
4 values being used on a Balance sheet prepared in accordance with US GAAP - Answer
Historical cost
Fair Value
Net Realizable Value
Discounted Present Value
Credit risk analysis for a company typically involves looking at rations in these two categories -
Answer liquidity and solvency ratios
What are the 2 options for presenting other comprehensive income, according to US GAAP? -
Answer One statement approach (net income other comprehensive income= total
comprehensive income)
Goodwill - Answer This account is initially measured as the difference between the
consideration given in an acquisition and the fair value of the separately identifiable net assets
acquired on the acquisition date
Cross-sectional Analysis (benchmarcking) - Answer This type of analysis identifies similarities
and differences across companies or business units at a single point in time
Income from discontinued operations is shown in this way (where/how) on the income
statement - Answer after income from continuing operations (and net of taxes)
matching principle - Answer This says that expenses should be recognized in the same period
in which the revenue generated by these expenses is recognized
Subsequent events - Answer These are significant events that occur after the date of the
financial statements but before the financial statements are issued. They are required to be
disclosed if they are material and likely to influence investors' appraisal of the risk and return
prospects of the entity
retrospective approach - Answer this method of dealing with accounting principle changes
requires that prior years income statements presented for comparative purposes be restated to
reflect use of the new principle unless it is impractical to do so
