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CGMA Management Level Test

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CGMA Management Level Test What does it mean that accounting for deferred taxes follows a financial position approach? - ✔✔The temporary differences are derived from differences in carrying valu ... e from the book purposes and tax purposes Taxable temporary differences give rise to what? - ✔✔DTLs A DTA can only be recognized to the extent there will be taxable income to offset it. Otherwise a what is needed - ✔✔Valuation allowance What is the journal entry (including the temporary difference for a revaluation surplus of PPE) - ✔✔PPE (dr), Revaluation surplus/OCI (cr), deferred tax liability (cr) How are DTAs and DTLs classified on the BS? - ✔✔Noncurrent assets/liabs What is the key factor in determining how a lease is classified? - ✔✔Whether the lease transfers substantially all of the risks and rewards incidental to ownership What are four criteria of an intangible asset? - ✔✔Identifiable, separable, controllable, cost of asset must be able to be reliably measured T or F? Is internally generated GW recognized on the BS? - ✔✔False! Describe the rules for capitalizing internally generated intangible assets - ✔✔Expenses from the research phase cannot be capitalized. All costs in development phase can (except advertising, relocation, and reorganization) What is the "recoverable amount" in an impairment test? - ✔✔The higher of the value in use or the FV - costs to sell What are the five steps of rev rec? - ✔✔1. ID the contract 2. ID the POs 3. Determine the txn price 4. Allocate the txn price to the POs 5. Rec rev as POs satisfied Are warranties separate POs? - ✔✔If warranty is just assuring the product complies with agreedupon specs, then no. Else yes. How do you know when a PO is satisfied? - ✔✔When control is transferred to the customer What is a contract asset? - ✔✔When part of the PO has been satisfied but the entity has not yet received the revenue Formula for EPS - ✔✔NI - Pref Divs / WASO Formula for a securities impact on EPS - ✔✔incremental earnings (net of tax) / incremental shares What is a provision? - ✔✔An obligation from a past event for which it is probable that settlement will be made, and the amount of the settlement can be reliably estimated True or False? Future major repairs are provisions - ✔✔False! Could sell the asset. But warranties are Is a provision needed for future operating losses? - ✔✔No! What are the rules surrounding recognizing a provision for a onerous contract? - ✔✔Recognize the "least net cost" to fulfill the contract as a provision When is a provision needed for restructuring costs? - ✔✔When a detailed formal plan exists and there is a valid expectation it will be carried out. But retraining, marketing, and investment in new systems are excluded! Describe a contingent liability - ✔✔An almost pro [Show More]

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