Questions from Financial Accounting

Q: Recognizing rights and obligations embodied in all executory contracts would eliminate a

Recognizing rights and obligations embodied in all executory contracts would eliminate a means of off-balance-sheet financing.” How might such an action confuse and possibly mislead financial statemen...

Q: What role does a special purpose entity or variable interest entity serve

What role does a special purpose entity or variable interest entity serve in achieving off balance-sheet financing involving the sale of receivables?

Q: The principal accounting issue involving deferred compensation relates to when firms recognize

The principal accounting issue involving deferred compensation relates to when firms recognize compensation cost as an expense.” Explain.

Q: Over sufficiently long periods of time, why is the total amount

Over sufficiently long periods of time, why is the total amount of an employer’s pension expense equal to the cash the employer pays into a pension plan, instead of the cash the pension plan pays reti...

Q: During 2013, Pandora Company wrote off $2,200 of

During 2013, Pandora Company wrote off $2,200 of accounts receivable as uncollectible. Pandora Company collected no cash during 2013 for amounts it had written off in previous years. The balance in th...

Q: Under what circumstances would an employer firm report both a net pension

Under what circumstances would an employer firm report both a net pension asset and a net pension liability on its balance sheet? Why don’t U.S. GAAP and IFRS permit the firm to net these amounts and...

Q: When an employer firm recognizes the change in either a pension asset

When an employer firm recognizes the change in either a pension asset or pension liability for a period, the offsetting credit or debit required by U.S. GAAP is usually to Other Comprehensive Income....

Q: Distinguish between the following pairs of terms: a. Debt

Distinguish between the following pairs of terms: a. Debt securities classified as “held-to-maturity” versus “available for sale.” b. Equity securities classified as “trading” versus “available for sa...

Q: What is the reasoning for including unrealized gains and losses on trading

What is the reasoning for including unrealized gains and losses on trading securities in income but including unrealized gains and losses on available-for-sale securities in Other Comprehensive Income...

Q: Reporting marketable available-for-sale securities at fair value on

Reporting marketable available-for-sale securities at fair value on the balance sheet but not including the unrealized gains and losses in income is inconsistent and provides an opportunity for earnin...