Name: Score:
20 Multiple choice questions
Term 1 of 20
Regarding accounting for bonds issued at face value:
- when a bond is issued at face value the coupon of interest is equal to the market rate of interest
- since the interest rates are the same the company will be able to sell the bond for full face value
- in order to account for this bond the company must record the receipt of cash and the bond
payable liability when the bond is issued
- they will also have to account for the interest payments and the pay back of the bond
Motivation to Increase Operating Cash Flow
Accounting for Bonds Issued at Face Value
Operating and Financial Leverage
Current Tax Assets and Liabilities
, Term 2 of 20
- under both IFRS and US GAAP, revenue is recognized when it is realizable
- IFRS has different rules for the sale of a good and rendering of a service, the main difference
being when a service is provided, the percentage of completion must be known
US GAAP states four conditions that need to be met in order for revenue to be realizable:
- there is an arrangement between buyer and seller
- product has been delivered or service rendered
- price is determined or determinable
- seller is likely to collect the money from the buyer
IFRS requires
- seller transferred risk/rewards to ownership of goods of the buyer
- the entity doesn't have managerial involvement to the degree associated with ownership or
effective control of the goods sold
- the amount of revenue can be measured reliably
- it is probable that the economic benefits associated with the transaction will flow to the entity
- the costs incurred for the tra
Current Assets - Trade (AR) Receivables
Differences Between IFRS and GAAP
Percentage-of-Completion Method
Chart of Accounts/Common Accounts
20 Multiple choice questions
Term 1 of 20
Regarding accounting for bonds issued at face value:
- when a bond is issued at face value the coupon of interest is equal to the market rate of interest
- since the interest rates are the same the company will be able to sell the bond for full face value
- in order to account for this bond the company must record the receipt of cash and the bond
payable liability when the bond is issued
- they will also have to account for the interest payments and the pay back of the bond
Motivation to Increase Operating Cash Flow
Accounting for Bonds Issued at Face Value
Operating and Financial Leverage
Current Tax Assets and Liabilities
, Term 2 of 20
- under both IFRS and US GAAP, revenue is recognized when it is realizable
- IFRS has different rules for the sale of a good and rendering of a service, the main difference
being when a service is provided, the percentage of completion must be known
US GAAP states four conditions that need to be met in order for revenue to be realizable:
- there is an arrangement between buyer and seller
- product has been delivered or service rendered
- price is determined or determinable
- seller is likely to collect the money from the buyer
IFRS requires
- seller transferred risk/rewards to ownership of goods of the buyer
- the entity doesn't have managerial involvement to the degree associated with ownership or
effective control of the goods sold
- the amount of revenue can be measured reliably
- it is probable that the economic benefits associated with the transaction will flow to the entity
- the costs incurred for the tra
Current Assets - Trade (AR) Receivables
Differences Between IFRS and GAAP
Percentage-of-Completion Method
Chart of Accounts/Common Accounts
