disclosed on the financial statements as an asset retirement obligation, loss contingency, or an environmental obligation. APPLICABLE AUTHORITATIVE LITERATURE FASB Accounting Standards Codification (ASC) 410 Asset Retirement and Environmental Obligations FASB Accounting Standards Codification (ASC) 450 Contingencies DISCUSSION OF ALTERNATIVES The following section will address the alternative treatments accounting for both the remedial action and smoke filtration system under US GAAP. Recording
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Pharma Co Date: June 18, 2016 Prepared by: John B. Owens Viewed by: Joseph Walsh Issue: Determine proper accounting treatment for restructuring program costs under GAAP for the year ended December 31, 201X. Background: Pharma is in the process of restructuring a business line. As part of a restructuring, the Pharma is considering the relocation of a manufacturing operation from its present location to a new facility in a different geographic area. The relocation plan would include
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asbestos. For 10 of the 25 warehouses that reside in states with special asbestos handling and removal laws, LOI plans to sell the buildings without ever meeting the criteria to have to remove the asbestos and thus no obligation exists. ASC 240-20-55-58 and ASC 240-20-55-60 state that although timing of the performance of the asset retirement activity is conditional on the factory undergoing major renovations or being demolished, existing regulations create a duty or responsibility for the entity
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Password: 2ChgCxk * The citation format (e.g., ASC 230-10-20) is listed by “topic”, “subtopic”, and “section” respectively under the FASB Accounting Standards Codification system. * When providing quotes, you do not need to copy and paste the entire paragraph. Only the citations and brief summary are needed. You need to specify the topic, subtopic, section, and paragraph if applicable. * An example is provided below: According to ASC 230-10-20, the statement of cash flows classifies
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Chapter 6 Property and Equipment and Other Assets Overview 6.01 Health care entities use various kinds of property and equipment. Those assets are generally significant to the financial position of institutional health care entities, such as hospitals and nursing homes. Typical accounts used to record property and equipment transactions are land, land improvements, buildings and improvements, leasehold improvements, equipment (fixed and movable), leased property and equipment, accumulated depreciation
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C10-13 May 30, 2014 President, Tenth National Bank From: Student Subject: Removal of Asbestos and purchase of office building This is in regards to the removal of asbestos from the buildings owned by Tenth National Bank and the cost for the eradication of the project. The buildings are property, and are considered important components of a company’s assets. I researched assets in accordance to FASB Statements of Financial Accounting Concept No. 6, par. 25 states that assets are probable
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its balance sheet for the first quarter ending March 31, 20x9, BG should account for it by first looking at ASC 410-20-35-3 which states, In periods subsequent to initial measurement, an entity shall recognize period... from the following: a) the passage of time and B) Revisions to either the timing or the amount of the original estimate of undiscounted cash flows. Then we can look at ASC 410-20-35-8 which states, changes resulting from revisions to the timing or the amount of the original estimate
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* Client (LOI) believes that there is not sufficient information (based on ASC 410-20- 25-10) to determine the fair value of the asset retirement obligation as it is currently uncertain as to whether LOI will be required to remove the asbestos. * Client (LOI) does not have sufficient information to measure its asset retirement obligation due to an indeterminate settlement date based on the guidance in ASC 410-20-25-10 * The two warehouses located in states without laws are currently
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we are focusing operating lease with provisions of NeedSpace and WeHaveIt, which has a 10 year lease term, no options to renew or negotiate renewal offered in the contract and the lessee incurs certain cost, repairs and maintenance. In regards to ASC 840 leases, according to 840-10-20 and 840-10-05-9A, 840-10-05-9B an operating lease is when the lessor the owner of the property gives the lessee the right to use property, plant or equipment for a limited amount of time. Meaning the lessee is responsible
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Oil Company Inc Inc. Issue: Determining whether various events require the recording of a loss provision or expense accrual on Oil Company Inc Inc's year-end financial statements. Brief Background: Oil Company Inc Inc. operates in the oil industry and its operations sometimes result in soil contamination. Oil Company Inc Inc.'s policy is to clean up any contamination that it causes. New government regulations require Oil Company Inc Inc. to perform certain actions to
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