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Complete the following homework questions and upload answers (saved in a Word document) to this assignment.
Chapter 5 - Using Nonauthoritative Sources to Supplement Codification Research(#16, 19, 20, 21 in your text)
Exercises involving firm guidance
16. Locate EY's latest guide book (referred to as the Financial Reporting Developments series) on share-based payment. Using the table of contents, identify one topic that is addressed (listed) within the Scope section. State the year of publication for the guide your used.
AICPA resources
19. Using the AICPA website, go to "Research" then "Technical Hotline". Locate a recent Technical Q&A on this site and summarize the issue. Next, describe how a researcher might search for a specific Q&A (e.g. in a publication that complies these responses?). Specify.
Performing research using company filings
20. Using the SEC website, locate Yahoo's most recent Form 10-K. Describe:
a. How you went about locating the 10-K. (Describe your search path.)
b. When was this form filed?
c. In what footnote can investors read about the company's intangible assets?
d. Brainstorm: In what circumstances might a peer company (accounting researcher) want to review the company's intangible assets disclosure?
Consideration of IFRS
21. Using ifrs.org (under IFRS then Standards):
a. Identify the international accounting standard that corresponds to the FASB's ASC 820, Fair Value Measurement.
b. Next, compare the definition of fair value used in that standard to the definition of fair value in ASC 820-10-35-2. (You may have to create a no-cost login to view this file).
c. Explain, broadly, a circumstance in which a researcher might look to the IASB's fair value guidance.
Chapter 6 - Scope and Recognition Guidance: A Brief Introduction (#3, 10, 11, 15, 21, 25 in your text)
Scope Exercises
3. A company has entered into a forward contract for the purchase of gold, in 2 years, for $1200/oz. Does this arrangement meet the definition of a derivative? Analyze all required parts of the definition. (You may simply refer to the guidance excerpts included within this chapter to respond.)
10. Locate Deloitte's most recent guide to income tax accounting, A Roadmap to Accounting for Income Taxes. Does Deloitte believe that refundable tax credits (whose realization does not depend on the generation of future taxable income) are within the scope of Topic 740 (Income Taxes)? Explain.
11. An entity incurs a liability to an employee that must be settled through the issuance of the company's stock, and this liability is unrelated to services provided by the employee. Is this situation within the scope of the Stock Compensation topic? Explain.
Recognition Exercises
15. Assume that Schwartz, Inc. is a public company with a calendar year end. Schwartz must determine when and how it will adopt the revised revenue standards.
a. In what period must Schwartz first apply ASC 606-10?
b. How must the standard be initially applied (prospectively, retrospectively)? Explain.
c. Could Schwartz early adopt, if it chose to do so?
21. You own a company that sells and installs home security systems, and you routinely purchase complete camera systems for installation in customer homes. One camera system manufacturer has offered you $800 cash back after your tenth camera system purchase. So far this year, your company has purchased nine camera systems and expects to place its tenth order next month. Should this probable rebate be recognized, and how? Responding using existing (not pending) content.
25. A customer got serious food poisoning from Tasty Feast restaurant on March 30, 20x2, necessitating a trip to the emergency room. On April 5, 20x2, the customer initiated a lawsuit. At December 31, 20x2, Tasty Feast estimated its probable loss to be $50,000. In January 20x3, before issuance of Tasty Feast's financial statements, a judge ruled in favor of the customer and awarded the customer $80,000 in damages. Must the company recognize the effects of this ruling in its 20x2 financial statements? Explain.
Attachment:- Chapters case studies.rar