Codification Essay

675 Words3 Pages
ACCT 5101 (Section 004) Homework Assignment #1 (2011-9-13-Tuesday) Jonathan Nam 1. Briefly describe the primary purposes for the development of the codification. • Simplify user access by codifying all authoritative US GAAP in one spot. • Ensure that the codified content accurately represented authoritative US GAAP as of July 1, 2009. • Create a codification research system that is up to date for the released results of standard-setting activity. • Reduce the amount of time and effort to solve an accounting research issue. • Mitigate the risk of noncompliance through improved usability of the literature. • Provide accurate information with real-time updates as Accounting Standards Updates are…show more content…
b) Explain, using the appropriate terminology in the codification what the following reference relates to: FASB ASC 320-10-35-1. (i.e., explain what each part and sub-part of this reference means using the terms in the Codification’s hierarchy.) 320: Investments-Debt and Equity Securities 10: Overall 35: Subsequent Measurement 320-10-35-1: How to measure Investments in debt securities and equity securities. (Details in the next page) (The system describes 320-10-35-1 as follows.) 35-1 Investments in debt securities and equity securities shall be measured subsequently as follows: • a. Trading securities. Investments in debt securities that are classified as trading and equity securities that have readily determinable fair values that are classified as trading shall be measured subsequently at fair value in the statement of financial position. Unrealized holding gains and losses for trading securities shall be included in earnings. • b.
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