Formula Sheet Mini Test

FAR Formula Sheet
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Chapter 1
Statements of Financial Accounting Concepts (SFAC) -
What are the Four most authoritative GAAP

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What are the characteristics of accounting information

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1.
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2.
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1a.
2a.
What components are on the income statement?

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What component is on the statement of retained earnings?
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1
FAR Formula Sheet
Cumulative effect of change in accounting principle

Accounting changes are broadly classified into 3 categories:
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Examples
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Examples
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Examples
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Define comprehensive income and its components -
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Public companies must report segment information about
2
FAR Formula Sheet
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Must report as operating segment if it’s greater than _______ of either:

1.
2.
3.
= Operating profit (loss) for segment
Chapter 2
What is the patent amortization length?
Define technological feasibility –

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How does that affect costs for Computer software development costs, developed to be sold, leased or licensed?
How do you capitalize the software costs:
How does that differ from Computer software developed internally or obtained for internal use only?
3
FAR Formula Sheet
Are the capitalized costs amortized?
= ending bal prepaid insurance
= end bal rent receivable
= end bal accrued salaries payable
Sales revenue =
Completed contract method

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Percentage of completion method, When do you use this method?
How is income recognized under % completion method?

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When is the installment method used? And how is revenue recognized

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FAR Formula Sheet
Gross profit earned =
Gross profit % =
Gross profit =
Deferred gross profit =
B/S A/R =
Define an exchange that has commercial substance

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Record the J/E for exchanges with commercial substance
Exchanges lacking commercial substance or when __________________________

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When do you use the exact method in P/S?
New total P/S equity =
New partner contribution amount =

5
FAR Formula Sheet
When do you use the bonus method for P/S?

Book value =
Bonus =
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When do you use the goodwill method for P/S?

Implied value =
Goodwill =
Then allocate …
In periods of inflation
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FX transactions –
FX translation –
Functional currency –
Remeasurement ( )–
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Translation ( )–
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Remeasurement method: _____________________________

B/S
• Monetary =
• Non-monetary =
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I/S
6
FAR Formula Sheet
• Non B/S related items (COGS) -
• B/S related items (Depreciation, Bond Amortization) =
• Equity =
• Currency gain/loss =
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Translation method ( ): ____________________________

I/S
• Income =
• Expenses =
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B/S
• Assets =
• Liabilities =
• Equity =
• Retained earnings =
• Accumulated Translation adjustment =
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Chapter 3
Trading Securities –
Unrealized gain/losses -
Available for sale –

Unrealized gain/losses -
Held to Maturity Securities -

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Reclassification; transfer of security from one group to another

From To Adjustment
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7
FAR Formula Sheet
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What happens when you sell of security from any category? What is the J/E?
Cost method ( )–
Equity Method ( )–
Consolidate ( )-
What another name for the cost method -

What are the B/S JE’s under the cost method?
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What are the I/S J/E’s under the cost method?

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Equity Method -
What are the main B/S entriess under the equity method?
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What are the I/S J/E’s under the equity method?

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8
FAR Formula Sheet
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Record as good will if -
Record as extraordinary gain if –
Eliminate Sub’s old equity
What are the consolidating workpaper eliminating journal entry’s ___________________
Determining purchased goodwill or extraordinary gain formula
________________________
=
__________________________________
=
What do you do when inventory has been sold intercompany?

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Chapter 4
Working capital =
Current ratio =
Quick ratio (acid test ratio) =
2/10 n/30 = get discount of 2% if paid within 10 days, or the entire amount is due in 30 days
Make JE under Gross method =
9
FAR Formula Sheet
Make JE under Net method =
Factoring without recourse –

JE
Factoring with recourse –
Adjusted cash balance =
F.O.B. shipping point –

F.O.B. destination –
Market ceiling –
Market floor –
In a period of inflation, how will the inventory method affect NI?
How do you calculate FIFO method -
How do you calculate LIFO method -
How do you calculate Dollar value LIFO?
10
FAR Formula Sheet
LIFO periodic =
How do you calculate weighted Avg method =

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Moving Avg method –

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When can you use Gross Profit method and how do you calculate it?
Conventional Retail method –
FIFO Retail method –
How do you calculate interest capitalization? What are the 2 rules?
1.
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2.
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What is Sum of years digit and how do you calculate it?

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11
FAR Formula Sheet
Explain Double declining balance, how do you calculate it?

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What is Units of production and how do you calculate it?

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What is Depletion and how do you calculate it?
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= end accum dep
Chapter 5
Ordinary Annuity –
Annuity Due –
On the present value table: Ordinary annuity =
On the PV table: Annuity due =
Present value of $1 –
Present value of an Ordinary annuity –
Lessee accounting for operating leases– the renter

12
FAR Formula Sheet
Lease bonus –
What is a Leasehold improvement and how do you account for it –
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How does lessee account for:

Non-refundable security deposit –
Refundable security deposit –
Lessor accounting – the owner
How does the lessor account for:

Non-refundable security –
Refundable security –
Capital Lease – purchase/ownership

What is the Lessee capital lease criteria –
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What is the difference between a sales type lease and direct financing lease
What is the Lessor (seller) criteria for sales type/direct financing -
13
FAR Formula Sheet
The lessee records the capitalized lease amount at the ______________ of:
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For the interest rate use the ______________ of:

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What are the depreciation rules for the capitalized lease on the lessee’s books?
What is the layout to account for lessee’s lease liability and asset amortization? (F5-17)
(1) (2) (3) (4)
Lessor accounting sales type lease (_____ profit streams)

• Gross investment =
• PV of minimum lease payments =
• Net investment =
• Unearned interest revenue =
• COGS =
What is the associated JE?
Lessor accounting direct financing lease (_______ profit streams)

• Gross investment =
• Net investment =
• Unearned interest revenue =
What is the associated JE?
14
FAR Formula Sheet
Calculate excess gains for Sale-leaseback leases under operating and capital leases
Operating Lease
= Excess Gain
Capital Lease
= Excess Gain
Define each and when you recognize the gain

"major" sale-leasebacks –
"minor" sale-leasebacks –
In “betweener” sale leasebacks -
Real Economic loss in sales back lease -
Artificial loss in sales back lease -
How do you classify a sub lease -
15
FAR Formula Sheet
Stated (nominal) rate =
Discount =
Premium =
Total interest revenue =
Nondetachable warrants –
Detachable warrants –
2 methods to bond amortization methods: _____________________ and _____________________________

Define ________________:
Periodic amortization =
Interest expense =
___________________________ – required by GAAP

I/S
Interest expense =
B/S
Interest paid =
Amortization =
Unamortized discount =
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Bonds book value =
Draw Graph Pg F5-47
How do you account for bonds sold or issued between interest dates requires additional entries for accrued
interest at time of sale?
Total cash received =
Accrued interest =
16
FAR Formula Sheet
Bond sinking fund -
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Serial bonds
2 amortization methods:
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Convertible bonds – nondetachable warrants

The conversion is recorded under 2 methods:
Book value method
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Market Value Method
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Convertible bonds – detachable warrants

What is the JE at issue date?
Recorded under 2 methods:

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How do you calculate and account for Extinguishment of debt
Gain or loss =
17
FAR Formula Sheet
Give examples of troubled debt restructuring and how you calculate the gain/loss
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Ordinary gain/loss =
Possible extraordinary gain/loss =
= End interest payable
Chapter 6
Define and when they are used

• Accumulated benefit obligation (ABO) –
• Projected benefit obligation (PBO) -
• Prior Service Cost (PSC) -

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What is the I/S expense formula and the resulting JE’s
18
FAR Formula Sheet
Unfunded accrued pension cost =
Prepaid pension cost =
On the B/S, what creates an intangible pension asset?
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How much is recorded as additional pension liability and other comprehensive income?
Total payroll tax liability =
Payroll tax expense =
DTA =
DTL =
Tax chart (F6-32)
Chapter 7
Reporting gains and losses: Define the term and where its reported
19
FAR Formula Sheet
Speculative derivatives –
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Fair value hedge –

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Cash flow hedge –

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Foreign operation currency hedge –
How do you account for Treasury Stock under the Cost method – used 95% of the time
• Repurchase
• Re-sell at gain
• Re-sell at a loss and there is not enough is APIC to cover the loss
How do you account for Treasury Stock under the Legal or par value method -
• Repurchase at a gain
• Repurchase at a loss
20
FAR Formula Sheet
How do you account for Property dividends
How do you account for stock dividends –

- Small stock dividend -
- Large stock dividend -
Basic EPS =
Weighted avg # of C/S outstanding =
Diluted EPS =
For options and other similar instruments -

Additional shares outstanding =
Direct method required disclosures are

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Indirect method –
21
FAR Formula Sheet
Cash received from customers =
= ending balance A/R
Cash paid to suppliers

= Ending inventory
= end A/P
When given changes in accounts

Purchases =
Cash paid =
Accrual basis interest expense =
Direct method
Inflows (increase cash)
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Outflows (decrease cash)
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Indirect method – reconciliation
22
FAR Formula Sheet
= cash flow from operations
Chapter 8
Governmental Funds –
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Governmental fund types include
Proprietary Funds –
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23
FAR Formula Sheet
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Proprietary fund types include
Fiduciary Funds –
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Fiduciary fund types include
Chapter 9
What are the required elements in government wide F/S

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24
FAR Formula Sheet
What comprises the statement of net assets in the gov’t wide F/S
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What are the 3 categories in the statement of activities in the gov’t wide F/S)
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What are the 3 program revenue categories?

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Fund Financial Statements (F9-19)

What are the criteria to be considered a major fund? must meet both criteria:
1.
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2.
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How do you prepare the reconciliation between gov’t wide and fund F/S?
B/S –
Statement of revenues, expenditures and changes in fund balance –
25
FAR Formula Sheet
Discuss the statement of cash flows differences under governmental accounting. 6 differences:
1.
2.
3.
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4.
5.
6.
What are the required F/S for not-for-profits?

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Formula Sheet Mini Test

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Formula Sheet Mini Test

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FAR Formula Sheet

Statements of Financial Accounting Concepts (SFAC) -

What are the Four most authoritative GAAP

What are the characteristics of accounting information

What components are on the income statement?

Cumulative effect of change in accounting principle

Public companies must report segment information about

Must report as operating segment if it’s greater than _______ of either:

= Operating profit (loss) for segment

What is the patent amortization length?

Define technological feasibility –

How do you capitalize the software costs:

Are the capitalized costs amortized?

= ending bal prepaid insurance

= end bal rent receivable

= end bal accrued salaries payable

Completed contract method

Percentage of completion method, When do you use this method?

How is income recognized under % completion method?

When is the installment method used? And how is revenue recognized

Gross profit earned =

Deferred gross profit =

Define an exchange that has commercial substance

Record the J/E for exchanges with commercial substance

Exchanges lacking commercial substance or when __________________________

When do you use the exact method in P/S?

New total P/S equity =

New partner contribution amount =

When do you use the bonus method for P/S?

When do you use the goodwill method for P/S?

Remeasurement method: _____________________________

Translation method ( ): ____________________________

Available for sale –

Held to Maturity Securities -

Reclassification; transfer of security from one group to another

What another name for the cost method -

What are the I/S J/E’s under the cost method?

What are the I/S J/E’s under the equity method?

Record as good will if -

Record as extraordinary gain if –

Eliminate Sub’s old equity

What are the consolidating workpaper eliminating journal entry’s ___________________

Determining purchased goodwill or extraordinary gain formula

What do you do when inventory has been sold intercompany?

Make JE under Net method =

Factoring without recourse –

Factoring with recourse –

Adjusted cash balance =

F.O.B. shipping point –

In a period of inflation, how will the inventory method affect NI?

How do you calculate FIFO method -

How do you calculate LIFO method -

How do you calculate Dollar value LIFO?

How do you calculate weighted Avg method =

Moving Avg method –

Conventional Retail method –

FIFO Retail method –

How do you calculate interest capitalization? What are the 2 rules?

What is Sum of years digit and how do you calculate it?

Explain Double declining balance, how do you calculate it?

What is Units of production and how do you calculate it?

= end accum dep

On the present value table: Ordinary annuity =

2 methods to bond amortization methods: _ and _________