TThe basic rules for interest capitalization are set forth in Statement of Financial Accounting Standards (SFAS) No. 34, Capitalization of Interest Cost. Under this statement, interest incurred throughout the construction period of a project should be included as part of the cost of the asset under construction rather than reported as an expense of the period. The construction period extends from the initial preconstruction activities (e.g., obtaining necessary permits) until an asset is ready
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harmonize accounting practices between countries. 2. Which of the following is true about the FASB after the mandatory adoption of IFRS by US companies? a. The FASB will serve in an advisory capacity to the IASB. b. The FASB will remain the designated standard-setter for US companies, but incorporate IFRS into US GAAP. c. The role of the FASB post-IFRS adoption has not been determined. d. The FASB will cease to exist. 3. Milestones in the transition plan for mandatory adoption of IFRS by
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of this handout for your group’s assigned question). Additional Guidelines 1. The memo should be 1-2 pages long. 2. The presentation can be a maximum of 10 slides long. 3. You must reference the appropriate FASB standard under the Accounting Standards Codification (ASC) when supporting your responses. See login information below for access to the ASC. 4. Email the presentation and memo to the instructor (joseph.johnson@ucf.edu) and teaching assistant (wmahamad@knights.ucf.edu)
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INTRODUCTION International Financial Reporting Standards (IFRS) In 2011, international financial reporting standards (IFRS) will replace generally accepted accounting principles (GAAP). This means Canadian publicly-traded companies will be required to present financial statements in accordance with IFRS. This change will not only affect those involved in the development of financial information but also those who use this information. Economic globalization brings increased demand for high quality
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The Trueblood Case Studies: Case 04-7 – Lighthouse * Lighthouse is a provider of locating services to the shipping industry. Lighthouse’s Ship Finder service is a one-way messaging service that routes messages from the ships at sea to the shipping company’s offices. These messages provide the shipping company with detailed information related to ship location, speed, and current local weather. In order to utilize the Ship Finder service, Lighthouse must install a dedicated hardware unit
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Case No. 3—Case 12-9 Rough Waters Ahead As defined in the FASB Codification, ASC 360-10-20, an asset group is “the unit of accounting for a long-lived asset or assets to be held and used, which represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities”. Therefore, after reading this definition, the assets and liabilities that are included in the asset group calculation for purposes performing the recoverability
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Runway Discount (“Runway”) is an online retailer that sells discounted high-end fashion. Runway employed a customer refer-a-friend program, that is existing customers can refer friends and get $25 credit for the next purchase of merchandise. In order to get the $25 referral credit, it must meet two of the requirements: first, the referral credit will occur when an existing customer referred a new customer and the new customer have purchased merchandise on Runway’s website. Second, the existing customers
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Case 9-4 How should NeedsSpace account for the two obligations noted as provisions in the lease agreement? ● Provision 1: “Lessor may require the lessee to perform general repairs and maintenance on the leased premises.” By entering the lease agreement, NeedsSpace (the lessee) becomes legally and contractually responsible for performing general repair and maintenance on the leased premises. Assuming that the lessee is required to make deposits to financially protect the lessor concerning
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requiring removal of asbestos when significantly renovated or demolished | Plan to operate indeterminately | Issue Should LOI recognize an asset retirement obligation for each of the categories of warehouses with asbestos? Analysis FASB Accounting Standards Codification (ASC) Subtopic 410-20 Asset Retirement Obligations presents the relevant guidance on asset retirement obligations. Per ASC 410-20-15-2, asset retirement obligations include: “a. Legal obligations associated with the retirement of
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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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