Reference no: EM131929174
Accounting Research Method
Part -1:
1) ______________ companies issue financial statements because they are required to do so by the SEC. _________________ companies may issue financial statements as necessary to satisfy the requirements of their investors, lenders, and other stakeholders.
a. Public; private
b. Private; public
c. Domestic; international
d. International; domestic
2) Within which of the following environments is accounting research performed?
a. U.S. public companies
b. U.S. private companies
c. Governmental entities
d. International companies
e. All of the above
3) What two early standard setters were committees formed by the AICPA? (Choose two.)
a. Securities and Exchange Commission (SEC)
b. Financial Accounting Standards Board (FASB)
c. Committee on Accounting Procedure (CAP)
d. Accounting Principles Board (APB)
e. International Accounting Standards Board (IASB)
Part - 2:
4) True or False: The Codification includes auditing guidance.
5) True or False: Guidance in the Codification applies to both public and nonpublic companies.
6) To 9) Label the following Codification reference. Choices: Paragraph, Section, Topic, Subtopic
ASC 840-20-25-1
6)840: __________________
7)20: __________________
8)25: ________________
9)1: _____________
10) to 12) Match the section description to its number. Choices: 05 15 25 30 35 50 55
10)_______ Scope
11) _______ Disclosure
12)_______ Recognition
13) to 16) For each issue below, indicate which Codification section should be consulted.
Choices:a. Overview and Background, b. Recognition, c. Initial Measurement, d. Subsequent Measurement, or e. Disclosure
13)_______Determining what amount (from within a range of possible losses) to record for a loss contingency.
14)_______Determining whether an event occurring after the balance sheet date (a subsequent event) should be recorded.
15)_______This section provides general information on the Codification topic. If you are looking at an unfamiliar Codification topic for the first time, this section is a good place to start.
16)_______Recording the effects of inventory obsolescence.
Part 3:
17) The background section of an issues memo should do which of the following?
a. Provide a brief history of the company and its business.
b. Include all relevant facts necessary to understand the transaction and its accounting.
c. Summarize the key guidance excerpts that will be cited as support for the accounting position.
d. Present the alternative views that will be described in more detail in the memo.
e. All of the above
18) Transactions are often complex. A picture of a transaction can often improve a reader's understanding of the relationships and parties involved in an issue. In what section of the issues memo is this picture generally included?
a. Background/Facts
b. Question/Issue(s)
c. Analysis
d. Conclusion
e. Financial Statement and Disclosure Impacts
19) The book introduces the concept of a guidance sandwich. This means that
a. commentary in your own words should precede and follow all guidance excerpts.
b. any nonauthoritative guidance cited should be preceded and followed by authoritative excerpts.
c. in order to give memo readers context for guidance excerpts, the paragraph in the literature preceding and following your chosen excerpt should also be included in the memo.
d. your analysis section should primarily consist of authoritative excerpts; thus, the analysis section should generally start off with an excerpt and conclude with an excerpt.
Part 4:
20) Nonauthoritative guidance is
a. guidance in the Codification that was issued by standard setters other than the FASB, such as the AICPA and the EITF.
b. any source of accounting guidance or practice not included within the FASB Codification (SEC guidance excepted).
c. guidance recognized by the AICPA that can be used to support an audit opinion.
d. guidance that researchers may choose to cite in lieu of Codification excerpts.
21) True or False: The FASB's Concepts Statements are considered authoritative guidance.
22) FASB Concepts Statement No. 6 ("CON 6") may be useful for which of the following?
a. Determining whether a cost meets the definition of "asset"
b. Offering current viewpoints on recent FASB guidance
c. Evaluating present value measurement issues
d. Benchmarking against other public companies' disclosures
Part 5:
23) The "P.L." in P.L. 98-751 stands for which of the following?
a. Partnership Law
b. Public Law
c. Public Legislation
d. None of the above
24) The Statements on Standards for Tax Services (SSTS) are issued by which of the following?
a. Internal Revenue Service (IRS)
b. U.S. Treasury Department
c. American Institute of Certified Public Accountants (AICPA)
d. American Bar Association (ABA)
25) The U.S. Treasury Department's rules of conduct for practicing before the Internal Revenue Service are called
a. Circular 230.
b. Statements on Standards for Tax Services.
c. Revenue Procedures.
d. the Tax Practitioners' Handbook.
26) In the U.S. Congress, tax legislation is primarily considered by which of the following?
a. The House Finance Committee and the Senate Ways and Means Committee
b. The Senate Finance Committee and the House Ways and Means Committee
c. The House Taxation Committee and the Senate Finance Committee
d. The House Finance Committee and the Senate Taxation Committee
27) If the U.S. House of Representatives and the U.S. Senate pass different versions of a tax bill, the bill is referred to the ___________________________, where the differences are resolved and the resulting compromise bill is then voted on by both houses of Congress.
a. Congressional Taxation Committee
b. Joint Conference Committee
c. Congressional Compromise Committee
d. Joint Committee on Taxation
28) Which of the following citations references a U.S. federal income tax regulation?
a. § 212(a)(1)
b. § 1.212-3
c. ¶ 212.11
d. 26 U.S.C. § 212
29) The hypothetical citation Rev. Rul. 2013-20, 2013-12 I.R.B. 218 refers to which of the following?
a. A Revenue Ruling that can be found on page 218 of the 2013-12 volume of the Internal Revenue Bulletin
b. A Revenue Ruling that can be found on page 20 of the 2013-12 volume of the Internal Revenue Bulletin
c. A Revenue Ruling that can be found on page 12 of the 2013-20 volume of the Internal Revenue Booklet
d. A Revenue Ruling that can be found on page 218 of the 2013-12 volume of the Internal Revenue Booklet
PROBLEM 1:
List the steps in the research process, in order. In some cases, the step has been started for you so you must complete the sentence.
"Step 0": _________________________________________________________
1. _________________________________________________________________
2. Define the ________________. That is, identify the ... _________________________________.
3. Stop...___________________________________________________
4. Search for _____________________________________________________________
5. Analyze _________________________________________________________________
Justify and ..._________________________________________________________________
PROBLEM 2:
Assume that you are accounting for the sale of a product that has a right of return. You are trying to determine when it is appropriate to recognize revenue from the sale. Which two subtopics from the Revenue Recognition topic should you review in order to find the most applicable guidance? Write the two applicable subtopic numbers in the answer blank. Why? Your answer should be in 100 words or less.