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Study Session 6: Financial Reporting and Analysis: An Introduction

What is the entry for earned & unearned revenue collected in advance?

Hi - would really appreciate it if someone could double check if my reasoning is correct. Thank you!

Recording the earned portion of revenue collected in advance - I have no idea what this means…would it be:

DR Unearned Revenue

CR Revenue

Is it essentially an adjusting entry for unearned revenue?

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Recording the unearned portion of revenue collected in advance

(1) Shock: Recording unearned portion of revenue

DR Cash

CR Unearned Revenue

Does company's total capital expense affect Balance sheet or cash flow?

Hello,

I have encountered this question: A company’s total capital expense spent on a project since its inception is most likely to be shown on its: The answer is Balance Sheet.

The problem is that un Kaplan books they include cash expense under Cash Flow.

I’d love if you could help me with this.

Securities and Exchange Commission Required Fillings- Source of Analysis

Do we have to memorize the SEC required fillings like    Form S-1, Form 10-K, 10-Q , DEF-14A , 8-K   etc. the (LOS 24.b) says about the roles and desirable attributes of standard setting body and regulatory authority but does not say about to learn about the various Forms

Is it required?

Double Declining Depre

Double declining DEPRE:

Hi friends, 

I just watched a video about DDD and I thought, I got this, I am going to do the excercise. Well this didn’t happen, somehow I am not getting even closer to the truth.

The story goes like this: ACME Corp. purchase a new stamping machine for 100,000, paid 10,000 for shipping, 5000 for installation.Based on an estimated salvage value of 25, 000and an economic life of six years, the difference between straight line depreciation and double declining balance depreciation in the 2nd year of the asset’s life is:

A-7220

EPS

Hi All, 

Basic EPS

I am stucked in this excercise: frown

A company had the following changes in stock: 

2,000,000in Shares Outstanding on Dec 31 20X6

March 31, 20X7 company paid a 10%stock dividend

June 30, 20X7 the company sold $10 million face value 7% convertible debentures, convertible into common at $5

expanded accouting equation

we can conclude from the equation, the relationshio between asstes and expenses and revnues :

assets = liabilities + contributed capital+ beginning retained earnings + revenue - expenses - dividends. (1)

the eqution makes sens for me when it’s explaining how we get Owners equity. but when it’s about asstes, the developed form (1), it means that a deacrase in assets “can” result from an increase in expenses or a decrease in revenus!!! it’s not my assumption, that was the answer for a question.

Minority interest

Why is Minority interest part of Profit attributable to shareholders of Volkswagen AG in Reading 22, Exhibit 5 - CFA books?

All income statement lines contain 100% of subsidies. So, I think you have to deduct minority interest from the Profit you get (not add).

For me, this holds true only if Profit attributable to shareholders of Volkswagen AG includes subsidies.

Please help me understand this.

Thank you.

GAAP Vs IFRS

Does CFA test IFRS method of accounting in exam??

Pensions in 2015

This stuff, defined contribution and defined benefit, is not examinable in the 2015 CFA Level 1 exam right? I don’t see it in the LOS but it seems to creep out every now and then. I just want to make sure I really don’t need it. 

Thanks! 

weighted avg share for eps

If 200,000 shares r outstanding on Jan 1, 50,000 issued on June 1 and 2 for 1 split on Aug 1, then is the weighted average no. 333,333.33 ?