Chapter 6: Revenue RecognitionRead: Chapter 6 and partly 13 on warrantyIn-class exercises: BE6-7‚ EX6-11‚ EX6-9‚ EX6-16‚ EX6-18 Practice exercises: EX6-7‚ BE6-11‚ P6-1‚ P6-2‚ E13-17 There are two main conceptual views on how to account for revenues/sales: Earnings approach Contract-based approach Earnings Approach Revenues are recognized when the following criteria are met: 1. Performance is achieved: a. risks and rewards transferred and/or earnings process substantially complete‚ and
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Depreciation Expense = $170‚000; Administrative Expenses = $150‚000; Interest Expense = $30‚000; Marketing Expenses = $80‚000; and Taxes = $300‚000; Li’s operating profit margin is equal to | | | Student Answer: | | 25.67% | | | | 35.67% | | | | 36.67% | | | | 50.00% | | Instructor Explanation: | Operating Profit Margin = EBIT/Sales = $1‚100‚000/$3‚000‚000 = 36.67% AACSB: Analytic skills | | | | Points Received: | 0 of 1 | | Comments: | | | |
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$51. The option expires on July 31‚ 2010. On March 31‚ 2010‚ the market value of Reese stock was $48 per share and the time value of the option was $120. The put option is not designated as a hedge. If the company has to prepare financial statements on March 31‚ 2010‚ what would the entry be? A debit to the Put Option and a a. credit to Unrealized Holding Gains/Losses – Income $805. b. credit to Unrealized Holding Gains/Losses – Equity $805. c. credit to Unrealized Holding Gains/Losses – Income
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Accounting Tutorial Question Topic 2 Week 5 Question 1 Encik Abbul has a sundry shop business registered under the name of Prudential Enterprises. The following is the summarised version of the bad debts‚ doubtful debts and the A/Receivables accounts of his business start in 2011. (The accounting period of the business is similar to the normal calendar year) Year | Account Receivables | Bad debts already written off during the year | Allowance for doubtful debts (percentage of outstanding
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Accounting plays an important role in the life of organizations. There are several types of accounting such as financial‚ management and governmental accounting‚ taxation‚ audit. These types are usually focusing on different types of users that are interested in different types of information. In this essay I will examine the differences between financial accounting and management accounting. The basic difference between financial and management accounting is their target group. Management accounting
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NOT-FOR-PROFIT ORGANISATIONS 13 2 Not-for-profit organisations Key points Many not-for-profit organisations (NFPs) feel they are poorly understood by government and the general public. Pressures to be more efficient have seen overhead spending reduced at considerable detriment to effectiveness and improved resource allocation over time (allocative efficiency). The sector is diverse‚ but NFPs display some common behavioural patterns: – Whereas the behaviour of for-profit business is driven mostly
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THE DIFFERENCES BETWEEN CONVENTIONAL AND ISLAMIC ACCOUNTING ABSTRACT The concern of this project paper is to explore the differences between Islamic accounting and its conventional counterpart. The distinctions need to be addressed as both accounting is presently thought of many people as synonymous. There is danger for such kind of perception because the basic building blocks for respective accounting are worlds apart. As for professional accountants who have been taught on the idea for accounting
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THE DIFFERENCES BETWEEN CONVENTIONAL AND ISLAMIC ACCOUNTING ABSTRACT The concern of this project paper is to explore the differences between Islamic accounting and its conventional counterpart. The distinctions need to be addressed as both accounting is presently thought of many people as synonymous. There is danger for such kind of perception because the basic building blocks for respective accounting are worlds apart. As for professional accountants who have been taught on the idea for accounting
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198 Accounting Standard (AS) 14 (issued 1994) Accounting for Amalgamations Contents INTRODUCTION Definitions EXPLANATION Types of Amalgamations Methods of Accounting for Amalgamations The Pooling of Interests Method The Purchase Method Consideration Treatment of Reserves on Amalgamation Treatment of Goodwill Arising on Amalgamation Balance of Profit and Loss Account Treatment of Reserves Specified in A Scheme of Amalgamation Disclosure Amalgamation after the Balance Sheet Date ACCOUNTING STANDARD
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Governmental Acct. Chapter 1 Homework 1-1) What justifies the different accounting & financial reporting practices of gvmt. & not-for-profit organizations as compared with business organizations? The fact that governments may have a monopoly on the services that they provide and the taxpayers must provide resources to them regardless of what they are‚ and efficiency is hard to measure as well as the quantity or quality of the services. 1-2) Describe the principal differences that distinguish
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