IntermediateAccounting教科书上习题答案（byJDavidSpiceland）
Chapter 7 Cash and Receivables
QUESTIONS FOR REVIEW OF KEY TOPICS
AACSB assurance of learning standards in accounting and business education require documentation of outcomes asssment. Although schools, departments, and faculty may approach asssment and its documentation differently, one approach is to provide specific questions on exams that become the basis for asssment. To aid faculty in this endeavor, we have labeled each question, exerci and problem in Intermediate Accounting, 6e with the following AACSB learning skills:
Questions AACSB Tags Exercis (cont.)AACSB Tags 7-1Reflective thinking 7-11Analytic
怎样学好初中语文7-2 Reflective thinking 7-12Analytic
7-3Reflective thinking 7-13Analytic
7-4Reflective thinking, Communications 7-14Analytic
7-5Diversity, Reflective thinking 7-15Analytic
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7-6Reflective thinking 7-16Analytic
7-7Reflective thinking 7-17Analytic
7-8Reflective thinking 7-18Diversity, Analytic
7-9Reflective thinking, Communications 7-19Analytic
7-10Reflective thinking 7-20 Reflective thinking
7-11Diversity, Reflective thinking 7-21Analytic
7-12Reflective thinking 7-22Analytic
7-13Reflective thinking 7-23Analytic
7-14Diversity, Reflective thinking 7-24 Analytic
7-15Reflective thinking, Communications 7-25Analytic
7-16 Reflective thinking7-26Analytic
7-17 Reflective thinking7-27 Analytic
优秀班主任发言稿7-18 Reflective thinking7-28 Analytic
7-19 Reflective thinking, Communications7-29 Analytic
7-20 Diversity, Reflective thinking7-30 Reflective thinking,
Communications
Brief Exercis 7-31 Reflective thinking,
Communications 7-1Reflective thinking CPA/CMA
7-2Diversity, Reflective thinking 7-1Analytic
7-3Reflective thinking 7-2Analyticmanual是什么意思
7-4 Analytic 7-3Reflective thinking
7-5Analytic 7-4 Analytic
7-6Analytic 7-5Analytic
7-7Diversity, Reflective thinking 7-6Analytic
7-8Analytic 7-7Analytic
7-9Analytic 7-1Reflective thinking
7-10Analytic 7-2Analytic
7-11Analytic 7-3Analytic
7-12Analytic Problems
7-13 Analytic 7-1Analytic
7-14Reflective thinking 7-2Analytic
7-15 Diversity, Reflective thinking 7-3Analytic
7-16 Analytic 7-4 Analytic
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7-17 Analytic 7-5 Analytic
Exercis7-6 Analytic 7-1Analytic7-7Analytic 7-2Analytic 7-8Analytic 7-3 Diversity, Analytic 7-9 Diversity, Analytic 7-
4Analytic 7-10Analytic 7-5Analytic 7-11Analytic 7-6 Analytic 7-12Analytic 7-7 Analytic 7-13Analytic 7-8Analytic 7-14Analytic 7-9Analytic 7-15 Analytic 7-10Analytic
QUESTIONS FOR REVIEW OF KEY TOPICS
Question 7-1
Cash equivalents usually include negotiable instruments as well as highly liquid investments that have a maturity date no longer than three months from date of purcha.
Question 7-2
Internal control procedures involving accounting functions are intended to improve the accuracy and reliability of accounting information and to safeguard the company’s asts. The paration of duties means that employees involved in recordkeeping should not also have physical responsibility for asts.
Question 7-3
Management must document the company’s internal controls and asss their adequacy. The auditors must provide an opinion on management’s asssment. The Public Company Accounting Oversight Board’s Auditing Standard No. 5, which superdes Auditing Standard No. 2, further requires the auditor to express its own opinion on whether the company has maintained effective internal control over financial reporting.
Question 7-4
A compensating balance is an amount of cash a depositor (debtor) must leave on deposit in an account at a bank (creditor) as curity for a loan or a commitment to lend. The classification and disclosure of a compensating balance depends on the nature of the restriction and the classification of the related debt. If the restriction is legally binding, then the cash will be classified as either current or noncurrent (investments and funds or other asts) depending on the classification of the related debt. In either ca, note disclosure is appropriate. If the compensating balance arrangement is informal and no contractual agreement restricts the u of cash, note disclosure of the arrangement including amounts involved is appropriate. The compensating balance can be included in the cash and cash equivalents category of current asts. Question 7-5
Yes, IFRS and U.S. GAAP differ in how bank overdrafts are treated. Under IFRS, overdrafts can be offt against other cash accounts. Under U.S. GAAP overdrafts must be treated as liabilities.
Answers to Questions (continued)
Question 7-6
Trade discounts are reductions below a list price and are ud to establish a final price for a transaction. The reduced price is the starting point for initial valuation of the transaction. A cash discount is a reduction, not in the lling price of a good or rvice, but in the amount to be paid by a credit customer if the receivable is paid within a specified period of time.
The gross method of accounting for cash discounts considers discounts not taken as part of sales revenue. The net method considers discounts not taken as interest revenue, becau they are viewed as compensation to the ller for allowing the buyer to defer payment.
Question 7-8
When returns are material and a company can make reasonable estimates of future returns, an allowance for sales returns is established. At a financial reporting date, this provides an estimate of t
he amount of future returns for prior sales, and involves a debit to sales returns and a credit to allowance for sales returns for the estimated amount. Allowance for sales returns is a contra account to accounts receivable. When returns actually occur in the future reporting period, the allowance for sales returns is debited.
Question 7-9
Even when specific customer accounts haven’t been proven uncollectible by the end of the reporting period, bad debt expen properly should be matched with sales revenue on the income statement for that period. Likewi, since it’s not expected that all accounts receivable will be collected, the balance sheet should report only the expected net realizable value of that ast. So, to record the bad debt expen and the related reduction of accounts receivable when the amount hasn’t been determined, an estimate is needed. In an adjusting entry, we record bad debt expen and reduce accounts receivable for an estimate of the amount that eventually will prove uncollectible.
If uncollectible accounts are immaterial or not anticipated, or it’s not possible to reliably estimate uncollectible accounts, an allowance for uncollectible accounts is not appropriate. In the few cas, any bad debts that do ari simply are written off as bad debt expen at the time they prove uncollectible.
Answers to Questions (continued)
Question 7-10
The income statement approach to estimating bad debts determines bad debt expen directly by relating uncollectible amounts to credit sales. The balance sheet approach to estimating future bad debts indirectly determines bad debt expen by estimating the net realizable value for accounts receivable that exist at the end of the period. In other words, the allowance for uncollectible accounts at the end of the period is estimated and then bad debt expen is determined by adjusting the allowance account to reflect net realizable value.
Question 7-11
A company has to parately disclo trade receivables and receivables from related parties under U.S. GAAP, but not under IFRS.
Question 7-12
The assignment of all accounts receivable in general as collateral for debt requires no special accounting treatment other than note disclosure of the agreement. Question 7-13
The accounting treatment of receivables factored with recour depends on whether certain criteria are met. If the criteria are met, the factoring is accounted for as a sale. If they are not met, the factoring is accounted for as a loan. In addition, note disclosure may be required. Accounts receivable factored without recour are accounted for as the sale of an ast. The difference between the book value and the fair value of proceeds received is recognized as a gain or a loss.
Question 7-14
U.S. GAAP focus on whether control of asts has shifted from the transferor to the transferee. In contrast, IFRS focus on whether the company has transferred “substantially all of the risks and rewards of ownership,” as well as whether the company has transferred control. Under IFRS:
If the company transfers substantially all of the risks and rewards of ownership, the transfer is treated as a sale.
选修课英文If the company retains substantially all of the risks and rewards of ownership, the transfer is treated as a cured borrowing. If neither conditions 1 or 2 hold, the company accounts for the transaction as a sale if it has transferred control, and as a cured borrowing if it has retained control.
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Answers to Questions (continued)
When a note is discounted, a financial institution, usually a bank, accepts the note and gives the ller cash equal to the maturity value of the note reduced by a discount. The discount is computed by applying a discount rate to the maturity value and reprents the financing fee the bank charges for the transaction.
The four-step process ud to account for a discounted note receivable is as follows:
1. Accrue any interest revenue earned since the last payment date (or date of the
rollout
note).
2. Compute the maturity value.
3. Subtract the discount the bank requires (discount rate times maturity value
times the remaining length of time from date of discounting to maturity date) from the maturity value to compute the proceeds to be received from the bank (maturity value less discount).
/doc/2db73084591b6bd97f192279168884868762b8ba.html pute the difference between the proceeds and the book value of the note
and related interest receivable. The treatment of the difference will depend on whether the discounting is accounted for as a sale or as a loan. If it’s a sale the difference is recorded as a loss or gain on the sale; if it’s a loan the difference is viewed as interest expen or interest revenue.
Question 7-16
greA company’s investment in receivables is influenced by veral related variables, to include the level of sales, the nature of the product or rvice, and credit and collection policies. The receivables turnover and average collection period ratios are designed to monitor receivables.
Question 7-17
The items necessary to adjust the bank balance might include deposits outstanding (including undeposited cash), outstanding checks, and any bank errors discovered during the reconciliation process. The items necessary to adjust the book balance mi ght include collections made by the bank on the company’s behalf, rvice and other charges made by the bank, NSF (nonsufficient funds) check charges, and any company errors discovered during the reconciliation process.
Answers to Questions (concluded)
Question 7-18
A petty cash fund is established by transferring a specified amount of cash from the company’s general checking account to an employee designated as the petty cash custodian. The fund is replenished by writing a check to the petty cash custodian for the sum of the bills paid with petty cash. The appropriate expen accounts are recorded from petty cash vouchers at the time the fund is replenished.
Question 7-19
When a creditor’s investment in a receivable becomes impaired, due to a troubled debt restructuring or for any other reason, the receivable is re-measured bad on the discounted prent value of currently expected cash flows at the loan’s original effective rate (regardless of the extent to which expected cash receipts have been reduced). The extent of the impairment is the difference between the carrying amount of the receivable (the prent value of the receivable’s cash flows prior to the restructuring) and the prent value of the revid cash flows discounted at the loan’s original effective rate. This difference is recorded as a loss at the time the receivable is reduced.
Question 7-20
No. Under both U.S. GAAP and IFRS, a company can recognize in net income the recovery of impairment loss of accounts and notes receivable.
BRIEF EXERCISES
Brief Exerci 7-1
The company could improve its internal control procedure for cash receipts by gregating the duties of recordkeeping and
the handling of cash. Jim Seymour, responsible for recordkeeping, should not also be responsible for depositing customer checks.
Brief Exerci 7-2
Under IFRS the cash balance would be $245,000, becau they could offt the two accounts. Under U.S. GAAP the balance would be $250,000, becau they could not offt the two accounts.
Brief Exerci 7-3
All of the items would be included as cash and cash equivalents except the U.S. Treasury bills, which would be included in the current ast ction of the balance sheet as short-term investments.
Brief Exerci 7-4
Income before tax in 2012 will be reduced by $2,500, the amount of the cash discounts.
$25,000 x 10 = $250,000 x 1% = $2,500
Brief Exerci 7-5
Income before tax in 2011 will be reduced by $2,500, the anticipated amount of cash discounts.
$25,000 x 10 = $250,000 x 1% = $2,500
Brief Exerci 7-6
Estimated returns = $10,600,000 x 8% = $848,000
Less: Actual returns (720,000)
Remaining estimated returns $128,000空间站的意思
Brief Exerci 7-7
Singletary cannot combine the two types of receivables under U.S. GAAP, as the director is a related party. Under IFRS a combined prentation would be allowed. Brief Exerci 7-8
(1) Bad debt expen = $1,500,000 x 2% = $30,000
(2) Allowance for uncollectible accounts:
Beginning balance $25,000
Add: Bad debt expen 30,000
Deduct: Write-offs (16,000)
Ending balance $39,000
Brief Exerci 7-9
(1) A llowance for uncollectible accounts:
Beginning balance $ 25,000
Deduct: Write-offs (16,000)
Required allowance (33,400)*
