COPYRIGHTED MATERIAL INDEX 1087

Transcription

1 INDEX 1087 A Accelerated depreciation, 233 Accounting basis of, 49, 140 Cash to accrual conversion, 51 Accounting changes, 106 Interim reporting, 789 Accounting information Qualitative characteristics of (SFAC 2), 1023 Accounting methods Governmental, 851 Accounting policies, disclosure of, 133 APB 22, 953 Accounting Principles Board Opinions APB 6 (Status of ARB), 949 APB 9 (Results of operations), 950 APB 10 (Various topics), 950 APB 12 (Various topics), 950 APB 14 (Debt), 951 APB 18 (Equity method), 951 APB 21 (Interest on NR and NP), 952 APB 22 (Disclosure of accounting policies), 953 APB 23 (Income taxes), 954 APB 25 (Stock issued to employees), 954 APB 26 (Debt extinguishment), 954 APB 28 (Interim financial reporting), 954 APB 29 (Nonmonetary transactions), 956 APB 30 (Results of operations), 957 Accounting Research Bulletins ARB 43 (Various topics), 945 ARB 45 (LT construction contracts), 948 ARB 51 (Consolidated financial statement), 948 Accounting standards, see also FASB Interpretations, 945 APB, 949 ARB, 945 SFAC, 1022 SFAS, 958 Accounting theory, see also Statements of Financial Accounting Concepts, 41 Capital maintenance theory, 45, 1028 Conceptual framework Basic elements, 44 Cash flow information, 46 Components of, 42 Objectives of financial reporting, 43 Qualitative characteristics, 43 Recognition and measurement, 45 Accounts payable, 286 Accounts receivable, 277 APB 21, 952 Bad debt expense, 278 Pledging and selling, 279 Ratios, 290, 291 Sale of, with recourse, 56 Sales discounts, 278 Transfers of, 281 Write-offs of, 278 Accrual basis, 865 Accrual basis of accounting, 50, 140, 1027 Conversion to, 51 Accrual of expenses, 885 Accruals, 50, 1028 Accrued liabilities, 286 Errors in, 88 Accumulated other comprehensive income, 515, 572 Acid-test (quick) ratio, 290 Acquisition cost Fixed assets, 226 Intangible assets, 237 Inventory, 184 Advances from customers, 287 Agency funds, 861, 882 AICPA Content Specification Outlines, 38 Allowance method, 278 Amortization, 1028 Bonds Issue costs, 358 Premium/discount, 356 Computer software costs, 240, 973 Differential Business combinations, 649, 657, 662, 704 Effective interest method, 359 Equity method investments, 577 Goodwill, 649, 661 Intangibles, in general, 238 Leases Capitalized leased assets, 434, 442 Initial direct costs, 426, 437 Lease bonus (fee), 426, 427 Leasehold improvements, 426 Pensions Unrecognized net gain/loss, 397, 974 Unrecognized prior service cost, 396 Straight-line method, 359 Annuities Future value of, 331, 332 Present value of, 332 Annuity contracts, 976 Annuity due, 333 Appropriations (budgetary), 868 Appropriations of retained earnings, 520 Assets, 1026 Current, 133, 276, 945 Deferred tax, 479 Impairment of, 1010 Infrastructure, 854 Intangible, 237 At-the-money, 759 Available-for-sale securities, 572, 576 Hedge accounting, 755 B COPYRIGHTED MATERIAL Bad debts, 278 Allowance method, 278 Direct write-off method, 278 Bank reconciliations, 276 Adjusting entries, 277 Four-column cash reconciliation, 277 Bankruptcy, corporate, 528 Bargain purchase option, 428, 962 Basic earnings per share, 523 Basis of accounting, 49, 51, 140 Accrual, 865 Modified accrual, 865 Basket purchase of fixed assets, 232 Benefits/years-of-service approach, 394 Bifurcation, 759 Blended component unit, 852 Bonds, 356 Amortization Effective interest vs. straight-line methods, 359 Issue costs, 358 Premium/discount, 356 Callable SFAS 78, 972 Convertible, 359 APB 14, 951 Induced conversions of, 972 Current portion, 286 Disclosure of long-term debt SFAS 47, 969 Extinguishment of debt, 360 Impairment of, 385, 386 SFAS 114, 987 Intercompany transactions in, 657, 704 Investments, 356, 570 Issued with detachable stock purchase warrants, 359 APB 14, 951 Journal entries for, 357 Payable, 356 Valuation example, 356 Bonus arrangements, 286 Bonus method (new partners), 812 Budgetary comparison schedules, 864, 874 Budgeting Fund accounting, 868 Business combinations Acquisition, 653 Changes in ownership, 664 Combined financial statements, 665 Consolidated financial statements, 651 ARB 51, 948 Balance sheet Date of combination, 653, 700 Subsequent to acquisition, 663 Eliminating entries, 655, 659, 706 Income statement, 663 Purchased preacquisition earnings, 665 Intercompany transactions, 656, 703 Bond transactions, 657, 704 Fixed asset transactions, 657, 704 Inventory transactions, 656, 703

2 1088 INDEX Minority interest, 653, 662, 708 Retained earnings, 663 Subsequent to acquisition, 656, 702 Example of, 657, 704 Worksheet, 658, 663, 705 Consolidation Of majority-owned subsidiaries (SFAS 94), 978 Date of combination, 649 Purchase method, 649, 653, 700 Deferred tax effects, 486 Differential, 649, 655, 661, 702, 708 Journal entries, 651 Merger, 651 Pooling method, 648 Purchase method, 648, 649, 651, 653, 700 Push-down accounting, 665 SFAS 141, 1003 Statutory consolidation, 651, 696 Business-type activities, 853 C Call option, 759 Callable obligations SFAS 78, 972 Callable preferred stock, 517 Capital expenditures, 233 Capital leases, 424, 434, 625, 963 Capital maintenance theory, 45, 1028 Capital projects funds, 856, 875 Capitalization of interest cost, 226 Diagram of, 227 SFAS 34, 967 Cash, 276 Cash basis of accounting, 50, 140 Conversion to accrual basis, 51 Cash collection recognition basis, 49 Cash flow hedge, 754 Cash flow information (SFAC 7), 46 Cash reconciliation (four-column), 277 Cash surrender value of life insurance, 581 Change in accounting estimate, 110 Changes in accounting principle Income statement presentation, 129 Interim reporting, 789 Changing prices and financial reporting SFAS 89, 977 Collateral, 285 College accounting, 914, 923 Financial statements, 923 College and University Accounting, 885 Common stock, 516 Comparability of information, 44 Comparative financial statements, 140, 945 Compensated absences, 290 SFAS 43, 968 Compensation cost, 991 Completed-contract method, 191 Completion-of-production recognition basis, 49 Component unit, 852 Composite depreciation method, 235 Compounding of interest, 331 Comprehensive annual financial report (CAFR), 851 Comprehensive bases of accounting, 140 Comprehensive income, 46, 128, 131 SFAS 130, 994 Computer software costs, 240 SFAS 86, 973 Conceptual framework, 42 Consignments, 190 Consistency, 44 Constant dollar accounting, 137 Contingencies Compensated absences, 290 Definition, 287 Gains, 290 Liabilities/losses, 287 Litigation, 289 Recording and disclosing, 287 SFAS 5, 959 Contingent issuances of common stock, 527 Contra stockholders equity items, 515 Contributed capital, 515 SFAS 116, 990 Contributions SFAS 116, 990 To not-for-profits, 916 Convertible debt, 359 APB 14, 951 Induced conversions of (SFAS 84), 972 Convertible preferred stock, 516 Corporations Bankruptcy, 528 Quasi reorganization, 529 Reorganization, 529 Cost adjusted for fair value method, 576 Compared to equity method, 576, 578 Cost flow assumptions, 184 Periodic, 184 Perpetual, 185 Cost flow methods, inventory valuation, 185 Direct costing method, 190 Dollar-value LIFO, 187 FIFO, 187 Gross profit method, 189 LIFO, 187 Long-term construction contracts, 191 ARB 45, 948 Lower of cost or market, 186 Market value method, 190 Moving average, 185 Relative sales value method, 190 Simple average, 185 Specific identification, 185 Standard cost method, 190 Variable costing method, 190 Weighted-average, 185 Cost method (Treasury stock), 518 Cost of goods sold, 184 Interim reporting, 789 Cost recovery method, 49, 53 Cost-sharing plans, 881 Cumulative preferred stock, 516 Current assets, 133, 276, 945 Current cost accounting, 45, 139 Current financial resources measurement focus, 865 Current liabilities, 133, 286, 945 ARB 43, Chapter 3A, 945 SFAS 43, 968 Current market value, 45 Current ratio, 290 Curtailment, 976 D Date of business combination, 649 Purchase method, 649, 653 Debt Bad debts, 278 Convertible, 359 APB 14, 951 Induced conversions of, 972 Extinguishment, 360 APB 26, 954 Impairment of, 385, 576, 987 Issued with detachable purchase warrants, 359, 951 Long-term, disclosure of, 969 Modification of terms, 382 Restructure, 382 SFAS 15, 966 Securities, 356, 570 Short-term obligations expected to be refinanced, 286 SFAS 6, 961 Debt service funds, 856, 877 Deferrals, 50, 1028 Deferred compensation, 405 Deferred taxes, 477 APB 23, 954 Business investments, 486 Changing tax rates, 483, 985 Deferred tax asset valuation allowance, 485 Deferred tax assets/liabilities, 479, 985 Balance sheet presentation, 489, 985 Retained earnings presentation, 489 Equity method investments and, 579 Financial statement presentation, 489, 985 Future taxable/deductible amounts, 480, 985 Interim periods FASB I 18, 956 Loss carryforwards/carrybacks, 488 Permanent differences, 477 Scheduling and recording deferred tax amounts, 480 SFAS 109, 984 Subsidiaries and, 487 Temporary differences, 477, 479, 487, 490, 985 Defined benefit pension plan, 394, 881, 976

3 INDEX 1089 Defined contribution pension plan, 394, 881, 974 Depletion, 237 Depreciation, 233 Accelerated, 233 APB 12, 950 Changes in, 236 Composite (group), 235 Fractional year, 236 Inventory, 235 Physical usage, 235 Straight-line, 233 Derivative financial instruments, 749 Bifurcation, 752 Definition, 750, 759 Disclosure, 758 Embedded, 752 Exclusions, 751 Fair value measurement, 750 Forward exchange contracts, 756 Glossary, 759 Hedging instruments, 750, 752 Cash flow hedge, 754 Fair value hedge, 753 Foreign currency hedge, 755 Inclusions, 751 Initial net investment, 760 SFAS 107, 983 SFAS 133, 998 SFAS 137, 1000 SFAS 138, 1000 Derived tax revenues, 866 Detachable stock purchase warrants, 359 Development stage enterprises, 137, 241 SFAS 7, 961 Differential Business combinations, 649, 655, 661, 702, 708, 710 Equity method investments, 577, 578 Diluted earnings per share, 524 Dilutive securities, 524 Direct costing, 190 Direct financing lease, 424, 427, 431, 965 Financial statement elements, 433 Direct write-off method, 278 Disclosure Accounting policies, 133 APB 22, 953 Contingencies, 287 Depreciable assets (APB 12), 950 Financial instruments Derivative, 758 Fair values of, 758 SFAS 107, 983 Fixed assets Impairment of (SFAS 144), 1010 To be disposed of (SFAS 144), 1010 Interim (APB 28), 954 Leases, 441, 962 Loan impairments, 987 Long-term obligations (SFAS 47), 969 Pensions, 996 Related-party transaction SFAS 57, 971 Securities (SFAS 115), 988 Segments, 796 SFAS 131, 994 Stock compensation (SFAS 123), 991 Discontinued operations, 130, 789 SFAS 144, 1011 Discount on forward contract, 760 Discrete view, 789 Discretely presented component unit, 852 Disposals of fixed assets, 236 SFAS 144, 1010, 1012 Dividends, 518 Payable, 286 Received, 576, 578 Types of, 518 Dollar-value LIFO, 187 Donations, 478 SFAS 116, 990 Double-extension technique, 188 E Earnings per share Basic, 523 Diluted, 524 SFAS 128, 992 Simple capital structure, 523 Weighted-average common shares outstanding, 523 Economic resources measurement focus, 865 Effective interest amortization method, 359 Elimination entries, 655, 659, 702, 706 Eligibility requirements, 866 Embedded derivative instruments, 752, 760 Employee stock ownership plan (ESOP), 531 Employers accounting for postemployment benefits (SFAS 112), 405, 986 Settlements and curtailments of defined benefit pension plans (SFAS 88), 976 Termination benefits (SFAS 88), 976 Encumbrances, 869 Endowment funds, 882 Enterprise funds, 857, 879 Environmental remediation, 960 Equity (net assets), 1026 Equity method of accounting, 576 APB 18, 951 FASB I 35, 949, 950, 952 Compared to cost adjusted for fair value, 576, 577 Deferred tax effects, 579 Differential, 577 Intercompany transactions, 577, 656, 703 Retroactive change to, 579 Equity securities, 516, 570 Error correction, 88, 91 Income statement presentation, 129 Escheat property, 882 Estimated warranty liability, 477 Exchange revenues, 853 Exchange transactions, 866 Executory costs, 962 Expected cash flow approach, 48 Expendable trust funds, 882 Expenditures, 869 Classification, 869 Expenses, 1027 Extraordinary items, 129, 789, 853 APB 9, 950 APB 30, 957 Extinguishment of debt, 360 F Factoring accounts receivable, 279 With recourse, 56, 280 Without recourse, 279 Fair value hedge, 750 FASB Interpretations No. 1 (Accounting changes to inventory), 952 No. 8 (ST obligations repaid prior to being replaced by a LT security), 961 No. 14 (Estimating contingent losses), 960 No. 18 (Interim income taxes), 956 No. 28 (SAR, stock options), 954 No. 30 (Involuntary conversions), 957 No. 35 (Equity method), 949, 950, 952 No. 37 (Translation adjustment), 971 No. 39 (Offsetting of amounts related to certain contracts), 950 No. 46 (Consolidation of variable interest entities), 949 FASB Technical Bulletins TB 85-3 (Operating leases with scheduled rent increases), 966 Feedback value, 44 Fiduciary funds, 881 Agency funds, 861, 881 Investment trust funds, 861, 882 Pension (and other employee benefit) trust funds, 861, 881 Private-purpose trust funds, 861, 882 Statement of changes in net assets, 861 Statement of net assets, 861 Financial instruments Cash, 276 Derivative contracts, 984 Disclosures about fair value of, 758 SFAS 107, 983 Securities Debt, 356, 570 Equity, 516, 570 Financial reporting, 41 Changing prices and SFAS 89, 977 Objectives of, 43 SFAC 1, 1022 Recognition and measurement, 45 SFAC 5, 1024

4 1090 INDEX Financial statements, 128 Accounting policies, 133 Balance sheet, 133 Accounts payable, 286 Accounts receivable, 277 Accruals, 50 Bonds payable, 356 Consolidated, 653, 663, 700 Current assets, 133, 276, 945 Current liabilities, 133, 286, 946 Deferred tax assets/liabilities, 489 Example of, 132 Fixed assets, 226 Intangible assets, 237 Inventory, 184, 946 Investments, 570 Notes payable, 334, 952 Notes receivable, 334, 952 Retained earnings, 515 Appropriations, 520 Stockholders equity, 515, 1026 Combined financial statement, 665, 717 Comparative financial statement, 140 Comprehensive income, 128, 131 Consolidated financial statements, 651, 657, 696, 704 ARB 51, 948 Constant dollar accounting, 137 Current cost accounting, 139 Development stage enterprise accounting, 137 Elements of financial statement, 44 SFAC 6, 1025 Foreign currency financial statement, 837, 970 Fund, 856 Government-wide, 852 Income statement, 128 APB 9, 950 Bad debts expense, 278 Change in accounting principle, 129 Consolidated, 663 Correction of an error, 129 Depreciation, 233 Discontinued operations, 130, 957 Earnings per share, 523, 524 Example of, 128, 131 Extraordinary items, 129, 957 Income taxes, 489 Investment income, 576 Unusual or infrequent items, 129 Interim financial statement, 789 APB 28, 954 Not-for-profit, 918, 923, 925 Other comprehensive bases of accounting, 140 Personal financial statement, 784 Prospective financial information, 141 Recognition criteria (SFAC 5), 1024 Retained earnings statement, 128 Appropriations of, 520 Consolidated, 663 Dividends, 518, 947 Prior period adjustments Deferred tax effects, 489 Retroactive change to equity method, 579 SFAS 16, 967 Risks and uncertainties, 139 Statement of affairs, 528 Statement of cash flows, 616 Classification in, 616, 979 Direct presentation, 617, 622, 980 Examples of, 619, 624 Financing activities, 616, 624, 979 Indirect presentation, 617, 620, 980 Investing activities, 616, 624, 979 Noncash investing and financing activities, 617 Objectives of, 616 Operating activities, 616, 620, 622, 624, 979 SFAS 95, 978 Financing activities, 616, 624 Firm commitment, 760 Unrecognized, 755 First-in, first-out (FIFO) method, 187 Fixed assets, 226 Acquisition cost, 226 Basket purchase of, 232 Computer software costs, 240 Depletion, 237 Depreciation, 233 Development stage enterprises, 241 Disclosure of (APB 12), 950 Disposals of, 236 SFAS 144, 1010 Expenditures, capital vs. revenue, 232 Impairment of, 236 SFAS 144, 1010 Insurance on, 237 Intangible assets, 237 Intercompany transactions, 657, 704 Interest capitalization, 226 Diagram of, 227 SFAS 34, 967 Nonmonetary exchanges, 228 Diagram of, 229 Research and development costs, 240 Start-up costs, 239 FOB destination/shipping point, 190 Forecasted transaction, 755, 760 Foreign currency denominated, 756 Foreign currency hedge, 755 Foreign currency transactions, 748, 760 Foreign currency translation, 832 Foreign currency statements, 832 Glossary of terms, 837 SFAS 52, 970 Forward contract, 760 Discount or premium on, 760 Forward exchange contracts, 756, 760, 971 Fractional year depreciation, 236 Franchise agreements, 53 SFAS 45, 968 Functional currency, 838, 970 Fund accounting (GASB 34), 851 Basis, 865 Budgetary accounting, 868 Fiduciary funds, 860, 881 Agency funds, 861, 881 Investment trust funds, 861, 881 Pension (and other employee benefit) trust funds, 861, 881 Private-purpose trust funds, 861, 882 Financial statements, 873 Conversion from fund FS to government-wide FS, 884 Fund, 856 Government-wide statements, 852 Governmental funds, 856, 869 Capital projects funds, 856, 870, 875 Debt service funds, 856, 877 General fund, 856, 868, 870 Permanent funds, 857 Special revenue funds, 856, 868, 874 Interfund transactions, 883 Investments, 884 Management s discussion and analysis, 852 Measurement focus, 865 Nonexchange transactions, 866 Notes to the financial statement, 863 Permanent funds, 879 Proprietary funds, 857, 879 Enterprise funds, 857, 879 Internal service funds, 857, 879 Reporting entity, 852 Required supplementary information, 863 Special assessments, 879 Fund financial statements, 856 Balance sheet, 857, 874, 878 Conversion to government-wide FS, 884 Statement of cash flows, 862 Statement of changes in fiduciary net assets, 864 Statement of fiduciary net assets, 861 Statement of net assets, 860 Statement of revenues, expenditures, and changes in fund balances, 858, 877 Statement of revenues, expenses, and changes in fund net assets, 861 Futures contracts, 760 G Gain, 1027 Gain contingencies, 290, 960 General fund, 856, 868, 870 Generally accepted accounting principles (GAAP) Hierarchy, 41 General-purpose governments, 851 Goods in transit, 190 Goodwill, 237 Amortization of, 478, 649 Impairment, 239 SFAS 142, 1007 Goodwill method (new partners), 812 Government reporting model, 851 Governmental Accounting Standards Board (GASB), 851 Governmental funds, 856, 869

5 INDEX 1091 Capital projects funds, 856, 875 Debt service funds, 856, 877 Expenditure classification, 869 General fund, 856, 868, 870 Permanent funds, 857 Special revenue funds, 856, 868, 874 Government-mandated nonexchange transactions, 867 Government-wide financial statements, 852 Conversion from fund FS, 884 Statement of activities, 853, 855 Statement of net assets, 852, 854 Gross profit method, 189 Group depreciation method SFAS 142, 235 Guaranteed residual value, 428 H Health care entities, 914, 924, 927 Financial statements, 925 Health care guide, 924 Hedging, 748, 749, 752 Cash flow hedges, 754 Disclosure, 758 Fair value hedges, 753 Foreign currency hedges, 755 Forward exchange contracts, 756 SFAS 133, 998 SFAS 138, 1000 Held-to-maturity securities, 571, 572, 576 Historical cost principle, 45 I If-converted method, 526 Impairment Of assets acquired with goodwilll, 239 Of fixed assets, 236 Of goodwill SFAS 142, 1007 Of loans, 385 SFAS 114, 987 Of long-lived assets SFAS 144, 1010 Of securities, 576 Imposed nonexchange transactions, 866 Income determination, 49 Completed-contract method, 191 Cost recovery method, 49, 53 Installment method, 49, 52 Net realizable value method, 49 Percentage-of-completion, 49, 191 Real estate sales, 54, 56 Sales basis, 49, 55 Software transactions, 54 Transactions approach, 49 Income tax bases of accounting, 140 Income taxes SFAS 109, 984 Induced conversions of debt SFAS 84, 972 Infrastructure assets, 854 Infrequent item, 129 Initial direct costs, 426, 437 SFAS 91, 977 Initial net investment, 760 Installment sales method, 49, 52, 950 Insurance Cash surrender value of life insurance, 581 Loss account for fixed assets, 237 Intangible assets, 237 Acquisition of, 238 Amortization of, 238 Goodwill, 237 Impairment, 238 SFAS 142, 237 Integral view, 789 Intercompany transactions, 577, 656, 703 Interest Capitalization of, 226 Diagram of, 227 SFAS 34, 967 Compounding, 331 From investments, 576 On notes receivable/payable APB 21, 952 Interest methods of allocation, 49 Interfund transactions, 883 Interim reporting, 789 APB 28, 954 Discrete view, 789 Integral view, 789 Internal service funds, 857, 879 In-the-money, 760 Intrinsic value, 760 Inventory, 184 Acquisition cost, 184 Consignments, 190 Cost of goods sold determination, 184 Errors in, 90 Intercompany transactions in, 656, 703 Items included in, 190 Losses on purchase commitment, 187 Periodic method, 184 Perpetual method, 185 Ratios, 191 Shipping items, 190 Valuation, see Cost flow methods ARB 43, Ch. 4, 945 FASB I 1, 952 Inventory depreciation method, 235 Investing activities, 616, 623 Investment trust funds, 861, 882 Investments, 356, 570, 884 Comprehensive example, 572 Income statement presentation, 576 Investment percentage, 570 Involving significant influence, 576 APB 18, 951 Not involving significant influence, 571 Cost adjusted for fair value method, 576 Example of, 572 Impairment of, 576 Transfers between categories, 575 Involuntary conversions, 478 FASB I 30, 957 L Last-in, first-out (LIFO)method, 187 Leasehold improvements, 426 Leases, 424 Bargain purchase option, 428, 962 Capital lease, 424, 434, 625, 964 Financial statement elements, 433 Contingent rentals, 962 Direct financing lease, 424, 427, 441, 965 Financial statement elements, 434 Disclosure requirements, 441 Executory costs, 962 Fair value of leased property, 962 Free rent/uneven payments, 425 Implicit interest rate, 963 Incremental borrowing rate, 963 Initial direct costs, 426, 437 SFAS 91, 977 Lease bonus (fee), 426 Lease term, 963, 980 Leasehold improvements, 426 Lessee, 425, 426, 434, 442, 962, 963 Lessor, 425, 427, 434, 962, 963 Minimum lease payments, 428, 963 Operating lease, 424, 425, 964 Financial statement elements, 426 With scheduled rent increases, 966 Residual value, 428, 963 Sale-leaseback, 56, 438, 965 Sales-type lease, 56, 424, 965 Financial statement elements, 434 Security deposits, 426 SFAS 13, 962 SFAS 98, 980 Summary, 441 Lending activities, 337, 338, 360 Liabilities, 1026 Contingent, 287 Current, 133, 286, 946 Deferred tax, 479 Environmental remediation, 960 Short-term, expected to be refinanced, 286, 961 LIBOR, 760 Life insurance cash surrender value of, 581 Link-chain technique, 189 Liquidation dividends, 519 Litigation, contingencies and, 289 Loans Acquisition/origination costs, 977 Impairment of, 385 SFAS 114, 987 Interfund, 883 Local currency, 838 Long-term construction contracts, 191 ARB 45, 948 Loss carryforwards/carrybacks Deferred tax effects, 488 Losses, 1027 Contingent, 287, 959

6 1092 INDEX On long-term construction contracts, 193 On purchase commitments, 187 Lower of cost or market method, 186 M Management s discussion and analysis, 852 Market value method, 190 Marketable securities, 570 Accounting for, 570 Equity method, 570 APB 18, 951 Deferred tax effects, 486, 579 Matching, 1028 Measurement focus, 865 Minority interest, 653, 662, 708 Modified accrual basis, 865 Moving average method, 185 N Net assets (equity), 1026 Net operating loss carryovers Deferred tax effects, 488 Net patient revenue, 925 Net realizable value, 45, 49 Net settlement, 760 Neutrality of information, 44 Noncash investing and financing activities, 617 Nondetachable stock purchase warrants, 360 Nonexchange revenues, 853 Nonexchange transactions, 866 Nonexpendable trust funds, 882 Nonmonetary exchanges, 56, 228 APB 29, 956 Diagram of, 229 FASB I 30, 957 Notes, 335 Nonrefundable loan origination fees (SFAS 91), 977 Notes payable, 286, 334 APB 21, 952 Notes receivable, 334 APB 21, 952 Notes to the financial statements, 863 Not-for-profit accounting, 914, 1026 Colleges and universities, 923 FASB and AICPA standards for, 914 Financial statements, 918, 923, 925 Health care entities, 924, 927 Illustrative transactions, 920 Not-for-Profit Guide, 914 Notional amount, 750, 761 O Omnibus opinion APB 10, 950 APB 12, 950 Operating activities, 616, 618, 620, 622, 979 Operating cycle, 133, 291 Operating lease, 424, 425, 964 Financial statement elements, 426 With scheduled rent increases, 966 Operating segment, 795 Operational efficiency ratios, 291 Ordinary annuities, 331, 332 Organization costs, 240 Other comprehensive bases of accounting, 140 Other comprehensive income, 994 Other intangible assets, 237 Out-of-the-money, 761 P Paid-in capital, 515 Par value method (treasury stock), 518 Participating preferred stock, 516 Partnerships, 811 Admission of new partners, 812 Bonus method, 812 Goodwill method, 812 Death of partner, 814 Dissolution of, 812 Formation of, 811 Income/loss allocation, 811 Incorporation of, 818 Interest, sale of, 815 Liquidation of, 815 Transactions between partners, 815 Withdrawal of partner, 814 Payroll tax liability, 286 Pension (and other employee benefit) trust funds, 861, 881 Pensions, 393 Accumulated benefit obligation, 973 Annuity contract, 976 Curtailment, 977 Defined benefit plan, 394, 976 Defined contribution plan, 394, 974 Disclosures, 976, 996 Employer sponsor s vs. plan s accounting and reporting, 393 Employer s accounting, 394 Funding of pension liability, 394 Market-related value of plan assets, 396, 974 Measurement date, 976 Pension cost/expense, 395, 974 Accrued or prepaid, 394, 974 Components of, 395 Actual return on plan assets, 396, 973 Expected return on plan assets, 396 Gain or loss, 396, 974 Interest on projected benefit obligation, 396 Prior service cost, 396, 974 Service cost, 395, 974 Projected benefit obligation, 396, 974 Settlement, 976 SFAS 87, 973 SFAS 88, 976 SFAS 132, 996 Single-employer defined benefit plans, 974 Termination benefits, 977 Percentage-of-completion method, 49, 191 Period costs, 184 Periodic inventory method, 184 Permanent differences, 478 Permanent funds, 857, 879 Permanently restricted net assets, 1026 Permanently restricted resources, 923 Perpetual inventory method, 185 Personal financial statements, 784 Personal property taxes, 947 Petty cash, 276 Physical usage depreciation, 235 Pledging accounts receivable, 279 Point of sale recognition basis, 49 Pooling method, 648 Postemployment benefits, 405 SFAS 112, 986 Postretirement benefits other than pensions, 403 Disclosures, 405 SFAS 106, 980 Predictive value, 44 Preferred stock, 516 Callable, 517 Convertible, 516 Cumulative, 516 Participating, 516 Premium on forward contract, 760 Premium plans, contingent liabilities for, 288 Primary government, 852 Prior period adjustments, 129, 950 Deferred tax effects, 489 Retroactive change to equity method, 579 SFAS 16, 967 Prior service cost, 396, 974 Private-purpose trust funds, 861, 882 Product costs, 50 Product financing arrangements, 56 Product warranties, contingent liabilities for, 288 Proof of cash, 277 Property dividends, 519 Property taxes, 286, 947 Proprietary funds, 857, 879 Enterprise funds, 857, 879 Internal service funds, 857, 879 Statement of cash flows, 862 Statement of changes in net assets, 861 Statement of net assets, 860 Prospective financial information, 141 Purchase commitments Disclosure of (SFAS 47), 969 Losses on, 187 Purchase method, see also Business combinations, 648 Accounting, date of combination, 648 Consolidated balance sheet, 652, 697 Purchase of groups of fixed assets, 232 Push-down accounting, 665 Put option, 761 Q Qualitative characteristics of accounting information, 43, 1023

7 INDEX 1093 Quasi reorganization, 529 ARB 43, Ch. 7A, 945 Quick (acid) ratio, 290 R Ratio analysis Acid-test (quick), 290 Book value of common stock, 531 Current, 290 Days in inventory, 191, 291 Days in receivables, 291 Debt to equity, 532 Dividend payout, 531 Inventory turnover, 191, 291 Length of operating cycles, 291 Rate of return on common stockholders equity, 531 Receivable turnover, 291 Real estate sales, 54, 56 SFAS 66, 972 Transactions, 53 Real property taxes, 947 Realization, 1028 Reclassification adjustments, 131 Recognition, 45, 1025 Reimbursement, 866 Related-party disclosures SFAS 57, 971 Relative sales value method, 190 Relevance/reliability of information, 44 Remeasurement (foreign currency), 838 Rent Free or uneven payments, 425 Reorganizations, 529 Reportable operating segments, 994 Reporting currency, 838 Reporting entity, 852 Representational faithfulness, 44 Required supplementary information (RSI), 863 Research and development costs, 240 SFAS 2, 958 Residual value, 428, 963 Guaranteed, 428 Unguaranteed, 429 Retained earnings, 515 Appropriations of, 520 Retained interests, 282 Retirement of assets, 1009 Retirement of stock, 518 Revenue, 1027 Revenue expenditures, 233 Revenue recognition, 45, 1024 Cost recovery method, 53 Franchise agreements, 53 Installment sales, 52 Long-term construction contracts, 191, 948 Nonmonetary exchanges, 56 Product financing arrangements, 56 Real estate transactions, 53, 56 Receivables, sale with recourse, 56 Sale-leaseback transactions, 56, 438, 965 Sales-type leases, 56, 424, 431, 965 SFAC 5, 1024 Software, 54 When right of return exists, 56 SFAS 48, 969 Reversing entries, 51 Risk, 139 S Sale-leaseback transactions, 56, 438, 965 Sales Of accounts receivable, 279 With recourse, 56, 280 Without recourse, 279 Of real estate, 56 SFAS 66, 972 Transactions, 53 With right of return, 56 SFAS 48, 969 Sales basis of revenue recognition, 49, 55 Sales discounts, 278 Sales-type lease, 56, 424, 431, 965 Financial statement elements, 433 Schedule of employer contributions, 863 Schedule of funding progress, 863 Scrip dividends, 519 Secured borrowing, 281 Securities Available-for-sale, 572, 576, 988 Debt, 356, 570 Equity, 515, 570 Held-to-maturity, 571, 572, 576, 988 Impairment of, 989 Income statement presentation of, 576, 988 Trading, 571, 572, 576, 988 Transfers between categories of, 575, 989 Securitizations, 284 Security deposits, 426 Segment reporting, 795 APB 30, 957 Disclosure, 796, 797 Restatement, 797 SFAS 131, 994 Selling accounts receivable, 279 Servicing assets, 283 Settlement value, 45 Shipping terms, 190 Short-term obligations expected to be refinanced, 286 SFAS 6, 1025 Simple average method, 185 Software costs, 240 Software revenue recognition, 54 Solvency ratios, 290 Special assessments, 879 Special items, 853 Special revenue funds, 856, 868, 874 Special-purpose entities, 652, 697 Special-purpose governments, 851 Specific identification method, 185 Split-interest agreements, 917 Standard costing of inventory, 190 Start-up activities, 239 Statement of activities, 853, 855 Statement of affairs, 528 Statement of changes in fiduciary net assets, 861 Statement of fiduciary net assets, 861 Statement of Financial Accounting Standards SFAS 35, 880 Statement of net assets, 852, 854 Statements of Financial Accounting Concepts SFAC 1 (Reporting objectives), 43, 1022 SFAC 2 (Accounting information), 43, 1023 SFAC 5 (Recognition and measurement), 45, 1024 SFAC 6 (Financial statements), 44, 1025 SFAC 7 (Cash flow information), 46, 1029 Statements of Financial Accounting Standards SFAS 2, 958 SFAS 5, 959 SFAS 6, 961 SFAS 7, 961 SFAS 13, 962 SFAS 15, 966 SFAS 16, 967 SFAS 34, 967 SFAS 43, 968 SFAS 45, 968 SFAS 47, 969 SFAS 48, 969 SFAS 52, 832, 970 SFAS 57, 971 SFAS 66, 972 SFAS 78, 972 SFAS 84, 972 SFAS 86, 973 SFAS 87, 973 SFAS 88, 976 SFAS 89, 977 SFAS 91, 977 SFAS 94, 978 SFAS 95, 978 SFAS 98, 980 SFAS 106, 980 SFAS 107, 983 SFAS 109, 477, 984 SFAS 112, 986 SFAS 114, 382, 987 SFAS 116, 914, 990 SFAS 117, 914, 918 SFAS 118, 382 SFAS 123, 991 SFAS 123 Revised, 520 SFAS 124, 915 SFAS 128, 992 SFAS 129, 993 SFAS 130, 131, 515, 994 SFAS 131, 994 SFAS 132, 996 SFAS 133, 749, 998 SFAS 134, 1000

8 1094 INDEX SFAS 135, 1000 SFAS 136, 915, 916, 1000 SFAS 137, 749, 1000 SFAS 138, 749, 1000 SFAS 140, 281, 285, 1000 SFAS 141, 1003 SFAS 141(R), 1005 SFAS 142, 237, 1007 SFAS 143, 1009 SFAS 144, 238, 1010, 1012 SFAS 145, 382, 1012 SFAS 146, 1012 SFAS 147, 1013 SFAS 149, 749, 1013 SFAS 150, 1014 SFAS 151, 184, 1014 SFAS 152, 1014 SFAS 153, 1015 SFAS 154, 89, 106, 236, 1015 SFAS 155, 749 SFAS 157, 133, 228, 356 SFAS 158, 398 SFAS 159, 135, 290, 338, 356, 382 SFAS 160, 1020 Statements of Governmental Accounting Standards Board GASB 1, 852 GASB 6, 879 GASB 9, 860 GASB 25, 861 GASB 27, 882 GASB 31, 884 GASB 33, 866, 875 GASB 34, 851, 856, 863 GASB 35, 885 GASB 36, 879 GASB 37, 882 GASB 38, 863 GASB 39, 852, 888 GASB 40, 863 GASB 42, 877 GASB 43, 861 GASB 48, 867 GASB 49, 868 GASB 50, 861 GASB 51, 867 GASB 52, 879 Statements of Position SOP 96-1, 960 SOP 97-2, 54 Stock Common, 516 Dividends, 519, 580 Issued to employees APB 25, 954 Preferred, 516 Retirement of, 518 Splits, 519, 580 Subscriptions, 517 Treasury, 517 Warrants, 359, 951 Stock appreciation rights FASB I 28, 954 Stock dividends, 520, 580 ARB 43, Ch. 7B, 945 Stock options ARB 43, Ch. 13B, 945 Stock ownership plans for employees, 531 Stock purchase warrants, 359, 951 Stock rights, 531, 580 Stock splits, 519, 580 ARB 43, Ch. 7B, 947 Stock subscriptions, 517 Stockholders equity, 515 Common stock, 516 Comprehensive income, 515 Preferred stock, 516 Retained earnings appropriated, 520 SFAS 128, 992 SFAS 129, 993 Stock, types of, 516 Treasury stock transactions, 517 Stockholders equity ratios, 531, 532 Straight-line amortization, 359 Straight-line depreciation, 233 Subsidiaries Consolidation of (SFAS 94), 978 Deferred tax effects, 487 Summary of significant accounting policies, 953 Sum-of-the-years digits method, 233 Swap contracts, 761 Swaption, 761 T Temporarily restricted net assets, 1026 Temporarily restricted resources, 921 Temporary differences, 477, 479, 486, 490 Donated asset, 478 Estimated warranty liability, 477 Goodwill, 478 Involuntary conversion of assets, 478 Plant assets and accumulated depreciation, 478 Unearned rent (royalty) revenue, 477 Temporary Differences, 477 Time value of money, 45, 331 Amortization of bond interest, 356 Annuities, 331, 333 Applications of, 333 Bonds payable/bond investments, 356 Compounding interest, 331 Debt restructure, 382 Effective interest vs. straight-line amortization method, 359 Expected cash flow, 48 Factor tables, 332 Future value Of an amount, 331 Of an annuity due, 333 Of an ordinary annuity, 331 Leases, 424 Notes receivable/payable, 334 Pensions, 393 Present value Of a future amount, 45, 331 Of an annuity due, 333 Of an ordinary annuity, 332 SFAC 7, 46 Timeliness of information, 44 Trading securities, 571, 572, 576 Transaction gain or loss, 761 Transfer of assets, 281 Transfer of receivables, 279 Translation adjustments, 838 Translation of foreign currency, 832 SFAS 52, 834 Treasury stock, 517 APB 6, 949 ARB 43, Ch. 1B, 945 Treasury stock method (to test dilutiveness), 525 Troubled debt restructure, 382 SFAS 15, 966 U Uncertainties, 139 Unconditional purchase obligations, 969 Underlyings, 750, 761 Unearned rent (royalty) revenue, 477 Unguaranteed residual value, 429, 963 University accounting, 914, 923 Unrecognized firm commitment, 755 Unrestricted net assets, 1027 Unusual item, 129 V Variable costing of inventory, 190 Variable interest entities, 652, 697 Variance power, 916 Verifiability of information, 44 Voluntary nonexchange transactions, 867 W Warranties, contingent liabilities for, 288 Warrants, detachable stock purchase, 359, 951 Weighted-average method, 185 With vs. without recourse, 279 Working capital, 950 Write-offs of accounts receivable, 278