Intermediate Accounting 13th Canadian Edition Volume 1 by Kieso TEST BANK

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Test Bank for Intermediate Accounting 13th Canadian Edition, 13ce Volume 1 by Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, Bruce J. McConomy TEST BANK ISBN... -13: 9781119740452 Full chapters included 1 The Canadian Financial Reporting Environment 1-1 Capitalizing on Financial Reporting 1-1 Preview of Chapter 1 1-3 1.1 Financial Statements and Financial Reporting 1-3 Accounting and Capital Allocation 1-4 Stakeholders 1-5 Objective of Financial Reporting 1-6 Information Asymmetry 1-9 1.2 Standard Setting 1-11 Need for Standards 1-11 Parties Involved in Standard Setting 1-12 1.3 Generally Accepted Accounting Principles 1-17 GAAP Hierarchy 1-17 Professional Judgement 1-18 1.4 Challenges and Opportunities for the Accounting Profession 1-18 Impact of Technology 1-20 Sustainability Reporting 1-21 Oversight in the Capital Marketplace 1-23 Centrality of Ethics 1-24 Standard Setting in a Political Environment 1-25 Principles versus Rules 1-26 Conclusion 1-26 2 Conceptual Framework Underlying Financial Reporting 2-1 Measuring the Unconventional 2-1 Preview of Chapter 2 2-3 2.1 Conceptual Framework 2-3 Rationale for a Conceptual Framework 2-3 Development of the Conceptual Framework 2-4 Information Asymmetry Revisited 2-5 Objective of Financial Reporting 2-5 2.2 Qualitative Characteristics of Useful Information 2-6 Fundamental Qualitative Characteristics 2-6 Enhancing Qualitative Characteristics 2-13 Trade-offs 2-14 2.3 Elements of Financial Statements 2-14 Assets 2-15 Liabilities 2-16 Equity 2-17 Revenues/Income 2-18 Expenses 2-18 Gains/Losses 2-18 2.4 Foundational Principles 2-19 Recognition/Derecognition 2-20 Measurement 2-25 Presentation and Disclosure 2-32 2.5 Financial Reporting Issues 2-34 Principles-Based Approach 2-35 Financial Engineering 2-35 Fraudulent Financial Reporting 2-36 2.6 IFRS/ASPE Comparison 2-37 Looking Ahead 2-37 3 Data, Decisions, and Measurement 3-1 How CEO Travel Patterns Can Be Used to Predict Mergers and Acquisitions 3-1 Preview of Chapter 3 3-3 3.1 Data and Decisions 3-3 Data, Digitization, and Digitalization 3-3 Decision-Making in Financial Reporting 3-5 3.2 Measuring Financial Statement Elements 3-10 Valuation Techniques 3-10 Value in Use Measurements 3-15 Disclosures Relating to Measurement 3-16 3.3 Measuring Fair Value Using IFRS 13 3-17 3.4 Present Value Concepts 3-20 The Nature of Interest 3-20 Fundamental Variables in Present Value Calculations 3-21 Different Ways to Perform the Calculations 3-23 Some Additional Calculations 3-31 3.5 IFRS/ASPE Comparison 3-33 A Comparison of IFRS and ASPE 3-34 4 Reporting Financial Performance 4-1 Making Money out of Thin Air 4-1 Preview of Chapter 4 4-3 4.1 Performance 4-3 Business Models and Industries 4-3 Communicating Information about Performance 4-7 4.2 Quality of Earnings/Information 4-8 4.3 Measurement of Income 4-14 4.4 Discontinued Operations 4-16 Component of an Enterprise 4-16 Assets Held for Sale 4-17 Measurement and Presentation 4-18 4.5 The Statement of Income and the Statement of Comprehensive Income 4-20 Presentation 4-20 4.6 The Statement of Retained Earnings and the Statement of Changes in Equity 4-30 Presentation of the Statement of Retained Earnings 4-31 Presentation of the Statement of Changes in Equity 4-32 4.7 Disclosure and Analytics 4-34 Disclosure 4-34 Analytics 4-34 Non-GAAP Measures 4-35 Other Key Measures 4-35 4.8 IFRS/ASPE Comparison 4-36 A Comparison of IFRS and ASPE 4-36 Looking Ahead 4-37 Appendix 4A Application of the Cash and Accrual Bases of Accounting 4-37 Differences between Cash and Accrual Bases 4-37 Conversion from Cash Basis to Accrual Basis 4-39 Theoretical Weaknesses of the Cash Basis 4-42 5 Financial Position and Cash Flows 5-1 Toward Better Disclosure 5-1 Preview of Chapter 5 5-3 5.1 Usefulness of the Statements of Financial Position and Cash Flows from a Business Perspective 5-4 Analyzing a Statement of Financial Position 5-4 Assessing Earnings Quality 5-4 Assessing the Creditworthiness of Companies 5-4 5.2 Usefulness and Limitations of the Statement of Financial Position 5-5 Usefulness 5-5 Limitations 5-6 5.3 Classification in the Statement of Financial Position 5-7 Monetary versus Nonmonetary Assets and Liabilities 5-8 Financial Instruments 5-8 Elements of the Statement of Financial Position 5-9 5.4 Preparation of the Classified Statement of Financial Position (Balance Sheet) 5-11 Current Assets 5-12 Non-current Investments 5-17 Property, Plant, and Equipment 5-17 Intangible Assets and Goodwill 5-19 Other Assets 5-20 Current Liabilities 5-20 Long-Term Debt and Liabilities 5-22 Owners’ Equity 5-22 Statement of Financial Position Format 5-24 5.5 Other Required Disclosures 5-25 Contingencies and Provisions 5-25 Accounting Policies 5-26 Contractual Obligations 5-26 Additional Detail 5-27 Subsequent Events 5-27 5.6 Techniques of Disclosure 5-27 Parenthetical Explanations 5-27 Notes 5-28 Cross-References and Contra Items 5-28 Supporting Schedules 5-29 Terminology 5-29 5.7 Purpose, Content, and Format of a Statement of Cash Flows 5-29 5.8 Preparation of the Statement of Cash Flows 5-32 5.9 Usefulness of the Statement of Cash Flows 5-37 Financial Liquidity 5-38 Financial Flexibility 5-38 Perspectives 5-38 5.10 IFRS/ASPE Comparison 5-41 A Comparison of IFRS and ASPE 5-41 Looking Ahead 5-42 Appendix 5A Ratio Analysis: A Reference 5-42 Business Risks 5-42 Financial Ratios 5-43 6 Revenue Recognition 6-1 Revenue Recognition in the Digital World 6-1 Preview of Chapter 6 6-4 6.1 Understanding the Nature of Sales Transactions from a Business Perspective 6-4 Economics of Sales Transactions 6-4 Legalities of Sales Transactions 6-9 Information for Decision-Making 6-10 6.2 The Asset-Liability Approach to Revenue Recognition: An Overview of the Five-Step Process 6-11 6.3 Identifying the Contract with Customers—Step 1 6-13 Basic Accounting 6-14 Contract Modifications 6-15 6.4 Identifying Separate Performance Obligations—Step 2 6-15 Material Rights 6-18 Warranties 6-19 Upfront Fees 6-21 Series of Goods and Services That Are Substantially the Same 6-21 6.5 Determining the Transaction Price—Step 3 6-22 Variable Consideration 6-22 Time Value of Money 6-27 Non-cash Consideration 6-28 Consideration Paid or Payable to Customers 6-28 6.6 Allocating the Transaction Price to Separate Performance Obligations—Step 4 6-29 6.7 Recognizing Revenue When (or As) Each Performance Obligation Is Satisfied—Step 5 6-33 6.8 Earnings Approach to Revenue Recognition 6-37 Selling Goods 6-37 Selling Services 6-39 Measurability and Collectibility 6-39 6.9 Other Revenue Recognition Issues 6-39 Repurchase Agreements 6-39 Bill-and-Hold Arrangements 6-40 Principal-Agent Relationships 6-41 Consignments 6-42 Summary of Other Revenue Recognition Issues 6-43 6.10 Presentation, Disclosure, and Analytics 6-44 Presentation and Disclosure 6-44 Analytics 6-47 6.11 IFRS/ASPE Comparison 6-49 A Comparison of IFRS and ASPE 6-49 Looking Ahead 6-50 Appendix 6A Long-Term Contracts 6-51 Percentage-of-Completion Method 6-51 Measuring the Progress Toward Completion 6-52 Zero-Profit Method 6-57 Completed-Contract Method 6-58 Losses on Long-Term Contracts 6-59 Loss in Current Period on a Profitable Contract 6-59 Loss on an Unprofitable Contract 6-60 7 Cash and Receivables 7-1 Managing Receivables in Risky Times 7-1 Preview of Chapter 7 7-3 7.1 Understanding Cash and Accounts Receivable 7-4 How Do Companies Manage and Control Cash? 7-4 What Types of Companies Have Extensive Accounts Receivable? 7-4 What Are the Types of Accounts Receivable? 7-6 How Do Companies Manage Accounts Receivable? 7-6 7.2 Cash 7-7 What Is Included in Cash? 7-8 Reporting Cash 7-8 Summary of Cash-Related Items 7-11 7.3 Receivables 7-12 7.4 Recognition and Measurement of Accounts Receivable 7-14 Trade Discounts 7-15 Cash Discounts (Sales Discounts) 7-15 Sales Returns and Allowances 7-15 Non-Recognition of Interest Element 7-16 Measurement of Accounts Receivable after Acquisition 7-17 7.5 Impairment of Accounts Receivable 7-17 Estimating Uncollectible Trade Accounts Receivable 7-17 Allowance Method 7-19 Effects on Accounts 7-22 Direct Write-Off Method 7-23 7.6 Notes and Loans Receivable 7-23 Recognition and Measurement of Short-Term Notes and Loans Receivable 7-23 Recognition and Measurement of Long-Term Notes and Loans Receivable 7-25 7.7 Derecognition of Receivables 7-32 Secured Borrowings 7-33 Sales of Receivables 7-33 Securitized Receivables—Transparency 7-39 7.8 Presentation, Disclosure, and Analytics 7-39 Presentation and Disclosure 7-39 Analytics 7-41 7.9 IFRS/ASPE Comparison 7-42 A Comparison of IFRS and ASPE 7-42 Looking Ahead 7-43 Appendix 7A Methods for Controlling Cash 7-44 Management and Control of Cash 7-44 Using Bank Accounts 7-44 The Imprest Petty Cash System 7-45 Physical Protection of Cash Balances 7-46 Reconciliation of Bank Balances 7-46 8 Inventory 8-1 Inventory Management after COVID-19 8-1 Preview of Chapter 8 8-4 8.1 Understanding Inventory 8-4 What Types of Companies Have Inventory? 8-4 Inventory Categories 8-4 Inventory Planning and Control 8-5 Information for Decision-Making 8-5 8.2 Recognition of Physical Goods Included in Inventory 8-7 Accounting Definition of Inventory 8-7 Goods Included in Inventory 8-8 8.3 Inventory Errors 8-14 Ending Inventory Misstated 8-14 Purchases and Inventory Misstated 8-16 8.4 Measurement of Inventory—Costs Included 8-17 Volume Rebates 8-17 Product Costs 8-19 8.5 Measurement and Inventory Accounting Systems 8-21 Perpetual System 8-21 Periodic System 8-22 Comparing Perpetual and Periodic Systems 8-22 Supplementary System—Quantities Only 8-23 8.6 Measurement and Cost Formulas 8-23 Specific Identification 8-24 Weighted Average Cost 8-26 First-In, First-Out (FIFO) 8-27 Choice of Cost Formula 8-29 Last-In, First-Out (LIFO) 8-29 8.7 Measurement and the Lower of Cost and Net Realizable Value (LC&NRV) Principle 8-30 What Is Net Realizable Value? 8-31 Application of the LC&NRV Principle 8-31 Evaluation of the LC&NRV Principle 8-35 8.8 Exceptions to Lower of Cost and Net Realizable Value 8-35 Inventories Measured at Net Realizable Value 8-35 Inventories Measured at Fair Value Less Costs to Sell 8-36 8.9 Measuring Inventory Using Estimates 8-40 The Need for Estimates 8-40 Gross Profit Method 8-41 8.10 Presentation, Disclosure, and Analytics 8-43 Presentation and Disclosure of Inventories 8-43 Analytics 8-44 8.11 IFRS/ASPE Comparison 8-47 A Comparison of IFRS and ASPE 8-47 Looking Ahead 8-48 Appendix 8A The Retail Inventory Method of Estimating Inventory Cost 8-48 Retail Method Terminology 8-49 Special Items 8-51 Evaluation of Retail Inventory Method 8-52 Appendix 8B Accounting Guidance for Specific Inventory 8-53 9 Investments 9-1 Environmental, Social, and Governance Investing 9-1 Preview of Chapter 9 9-3 9.1 Understanding Investments 9-4 Types of Investments 9-4 Types of Companies That Have Investments 9-5 Information for Decision-Making 9-9 Measurement: Overview 9-9 9.2 Measurement—Cost/Amortized Cost Model 9-11 Investments in Shares of Other Entities 9-11 Investments in Debt Instruments of Other Entities 9-12 9.3 Measurement—Fair Value through Net Income (FV-NI) Model 9-16 9.4 Measurement—Fair Value through Other Comprehensive Income (FV-OCI) Model 9-21 Investments in Shares of Other Entities 9-23 Investments in Debt Instruments of Other Entities 9-25 9.5 Measurement—Impairment Models 9-28 Incurred Loss Impairment Model 9-28 Expected Loss Impairment Model 9-29 Fair Value Loss Impairment Model 9-33 Summary of Impairment Models 9-33 9.6 Strategic Investments—Investments in Associates 9-34 Significant Influence 9-34 Equity Method 9-35 Summary of Accounting Standards for Associates 9-39 9.7 Strategic Investments—Investments in Subsidiaries 9-40 9.8 Presentation, Disclosure, and Analytics 9-41 Presentation and Disclosure 9-42 Analytics 9-44 9.9 IFRS/ASPE Comparison 9-45 A Comparison of IFRS and ASPE 9-46 10 Property, Plant, and Equipment: Accounting Model Basics 10-1 Fair Value Accounting Makes Sense for BAM 10-1 Preview of Chapter 10 10-3 10.1 Definition and Recognition of Property, Plant, and Equipment 10-3 Property, Plant, and Equipment—Business Perspective 10-4 Property, Plant, and Equipment—Characteristics 10-4 10.2 Cost Elements 10-6 Self-Constructed Assets 10-7 Borrowing Costs 10-8 Dismantling and Restoration Costs 10-9 10.3 Measurement of Cost for Nonmonetary Exchange 10-10 Cash Discounts Not Taken 10-10 Deferred Payment Terms 10-11 Lump-Sum Purchases 10-12 Nonmonetary Exchanges 10-13 Contributed Assets and Government Grants 10-18 10.4 Measurement of Costs Associated with Specific Assets 10-19 Land 10-20 Buildings 10-20 Leasehold Improvements 10-20 Equipment 10-21 Investment Property 10-21 Natural Resource Properties 10-21 Biological Assets 10-22 10.5 Measurement after Acquisition 10-24 Cost and Revaluation Models 10-25 Fair Value Model 10-28 10.6 Costs Incurred after Acquisition 10-31 Additions 10-32 Replacements, Major Overhauls, and Inspections 10-32 Rearrangement and Reinstallation 10-35 Repairs 10-35 10.7 IFRS/ASPE Comparison 10-36 A Comparison of IFRS and ASPE 10-36 Looking Ahead 10-38 Appendix 10A Capitalization of Borrowing Costs 10-39 Qualifying Assets 10-39 Capitalization Period 10-40 Avoidable Borrowing Costs 10-40 Disclosures 10-44 Appendix 10B Revaluation: The Proportionate Method 10-44 11 Depreciation, Impairment, and Disposition 11-1 Accounting for Assets That Become Liabilities 11-1 Preview of Chapter 11 11-3 11.1 The Importance of Depreciation, Impairment, and Disposition from a Business Perspective 11-3 11.2 Depreciation 11-4 Factors Considered in the Depreciation Process 11-5 11.3 Depreciation—Methods of Allocation and Calculation 11-8 Straight-Line Method 11-9 Diminishing Balance Method 11-10 Activity Methods 11-12 Other Methods 11-13 11.4 Depletion of Mineral Resources 11-14 Pattern of Depletion 11-15 Estimating Recoverable Reserves 11-16 Liquidating Dividends 11-17 11.5 Other Depreciation Issues 11-18 Depreciation and Partial Periods 11-18 Revision of Depreciation Rates 11-20 11.6 Impairment 11-22 Indicators of Impairment 11-24 Impairment—Measurement and Recognition Models 11-24 Asset Groups and Cash-Generating Units 11-28 11.7 Held for Sale and Derecognition 11-30 Long-Lived Assets to Be Disposed of by Sale 11-31 Derecognition 11-31 11.8 Presentation, Disclosure, and Analytics 11-33 Presentation and Disclosure 11-33 Analytics 11-35 11.9 IFRS/ASPE Comparison 11-38 A Comparison of IFRS and ASPE 11-38 Looking Ahead 11-39 Appendix 11A Depreciation and Income Tax 11-40 Capital Cost Allowance Method 11-40 12 Intangible Assets and Goodwill 12-1 Goodwill Impairment Is on the Line 12-1 Preview of Chapter 12 12-3 12.1 The Business Importance and Characteristics of Goodwill and Intangible Assets 12-3 Characteristics of Goodwill 12-4 Characteristics of Intangible Assets 12-5 12.2 Recognition and Measurement of Intangible Assets at Acquisition 12-6 Purchased Intangibles 12-6 Intangibles Purchased in a Business Combination 12-7 Prepayments 12-7 12.3 Recognition and Measurement of Internally Developed Intangible Assets 12-9 Identifying Research and Development Phase Activities 12-10 Accounting for Research Phase Costs 12-10 Accounting for Development Phase Costs 12-11 Costs Included and Excluded 12-11 12.4 Recognition and Measurement of Intangible Assets after Acquisition 12-12 Limited-Life Intangibles 12-14 Indefinite-Life Intangibles 12-16 12.5 Specific Intangibles 12-16 Marketing-Related Intangible Assets 12-16 Customer-Related Intangible Assets 12-19 Artistic-Related Intangible Assets 12-19 Contract-Based Intangible Assets 12-20 Technology-Based Intangible Assets 12-21 12.6 Impairment and Derecognition 12-23 Impairment of Limited-Life Intangibles 12-23 Impairment of Indefinite-Life Intangibles 12-24 Derecognition 12-25 12.7 Goodwill—Recognition and Measurement 12-25 Internally Generated Goodwill 12-25 Purchased Goodwill 12-26 Bargain Purchase 12-28 Valuation after Acquisition 12-29 12.8 Goodwill—Impairment 12-31 12.9 Presentation, Disclosure, and Analytics 12-33 Presentation and Disclosure 12-33 Analytics 12-36 12.10 IFRS/ASPE Comparison 12-38 A Comparison of IFRS and ASPE 12-38 Looking Ahead 12-39 Appendix 12A Valuing Goodwill 12-40 Excess-Earnings Approach 12-40 Total-Earnings Approach 12-44 Other Valuation Methods 12-45 [Show More]

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