Professional research : FASB Codification Essay

From the analysis, relevant requirements to CCA are AASB 112 para. 79 and 80 (a), (b), (c) and (e), which require expense components to disclose separately. Also, para. 81(ab), (c(1)), (g) and 82A, regarding separate disclosure of tax consequences of other comprehensive income, numerical representation clarifying the relationship between tax expense and accounting profit, disclosure of amount of deferred tax assets and liabilities in balance sheet and income tax expense in income statement, and potential tax consequences have been followed respectively.

You use a perpetual inventory system and value the inventory using FIFO. Prior to making adjusting year-end entries you valued the inventory at the lower-of-cost or-market. Justify why you valued the inventory at lower-of-cost or-market.

In 1973 the Financial Accounting Standards Board (FASB) was established to set the financial accounting standards in the United States of America for nongovernmental entities. These standards are collectively called U.S. Generally accepted Accounting Principles, or U.S. GAAP. The Securities and Exchange Commission (SEC) and the American Institute of Certified Public Accountants acknowledge the authority of these standards (FASB, n.d). A “proven, independent due process” is used to collect the viewpoints of the financial statements prepares and users for the constant improvement of these standards. An Accounting Status Update(ASU) is not an authoritative source however documents the amendments to communicate the changes in the FASB Codification for a user to understand the reason and future of those changes (FASB, n.d).

The FASB accounting codification is an advanced system that allows certified public accountants and other users to quickly access non-SEC authoritative content, perform relevant research, and submit timely and appropriate feedback. The FASB codification research system is a real-time, online database that allows users to access codification whose primary aim is to simplify the accessibility and structure of all authoritative generally accepted accounting principles, reduce the time and effort invested when researching accounting-related issues, decrease the risk of non-compliance with the generally accepted accounting principles, provide access to all authoritative information from a single place, facilitate the updating of accounting standards, and foster research and convergence efforts for the FASB (Wiley, 2017).

S29.Equity securities acquired by a corporation which are accounted for by recognizing unrealizedholding gains or losses as other comprehensive income and as a separate component ofstockholders' equity are

In 1973, the Financial Accounting Standards Board (FASB) was created and their mission is “to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors, and users of financial information.” (FASB.org, 2009a). The FASB is a private, not-for-profit organization whose primary purpose is to develop generally accepted accounting principles (GAAP) within the United States. The Securities and Exchange Commission (SEC) designated the FASB as the organization responsible for setting accounting standards for public companies in the U.S. Therefore, the FASB plays a vital and important role in protecting the financial well being and the overall stability of our

Contribution income statement is an income statement that classifies cost by behavior (fixed cost and variable cost). Traditional income statement is sometimes called the functional income statement. It is an income statement prepared in the multiple-step or single –step income statement format which conforms to Generally Accepted Accounting Principles (GAAP) and can be used for external financial reporting. The main difference between the two is that the contribution income statement list variable costs first, followed by fixed costs. Keeping in mind that GAAP and does not permit businesses to use

The CCA system consists of 38 declining balance classes, 10 straight line classes and several “additional allowance” provisions. All CCA classes are outlined in 24 pages and similar assets may appear more than once in several classes (FEI Canada, 2008).

Since the net income reported in the statement of cash flows is transferred from the profit and loss account which is the difference between revenue and expenditures all of two types;

This week I selected to answer the 1st question: describe the classified income statement and identify the statement’s four sections and the important financial relationships found with in the statement. First, it is important to identify what is a classified income statement. According to Hermanson, a classified income statement, also referred as a multiple-step income statement, divides both revenues and expenses into operating and non-operating items, separates operating expenses into selling and administrative expenses (1998). Furthermore, the classified income statement is broken up into four sections: operating revenues, cost of goods sold, operating expenses and non-operating revenues and expenses.

Reasons for differences between net income and comprehensive income: The reasons for differences between net income and comprehensive income as reported in the financial statements are the comprehensive income includes foreign currency translation adjustment (net of tax), decline of unrealized gains on available-for-sale securities (net of tax effect), and amortization of unrealized loss on terminated Euro Currency Swap (net of tax).

Companies record asset gains and asset losses in an account called Other Comprehensive Income or OCI. If the Accumulated Other Comprehensive Income related to gains and losses is considered to be too large and must be amortized, then it should include amortization of the net gain or loss as component of pension expense only if the beginning of the year the net gain or loss in Accumulated OCI exceeded the corridor approach. Companies should immediately recognize any net income for certain gains and losses--if they arise from a single occurrence which is indirectly related to the operation of the pension plan and not in the ordinary course of the employer 's business.

This method defines whether or not a transaction is classified as operating income or non-operating income.

| Below is an excerpt from the cash flow statement of a firm for fiscal year 2003: Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Amortization of software Tax benefits of employee stock plans Special charges (Gains)/losses on investments Change in operating assets and liabilities: Receivables Inventories Pension assets Other assets Accounts payable Pension liabilities Other liabilities Net cash provided by operating activities Cash flows from investing activities: Payments for plant and other property Proceeds from disposition of plant and other property Investment in software Purchases of marketable securities and other investments Proceeds from disposition of marketable securities and other investments Net cash used in investing activities

This study provides information about the emergence and adoption process of revenue recognition of FASB (Financial Accounting Standard Board) and International Accounting Standard Board (IASB). Its crucial financial reporting performance by business