1.Company X leases property for 10 years and makes improvements to the property. It agrees to remove improvements at the end of the lease. At what amount does X recognize its obligation to remove the improvementsat the time it enters into the lease?

2.Identify two conditions that must be met for an asset group to be classified as held for sale. Enter each on a separate line.

3.What are the two conditions for reporting a disposed component as a discontinued operation?Enter each on a separate line

4.Company X leases property for 10 years and makes improvements to the property. It agrees to remove improvements at the end of the lease. At what amount does X recognize its obligation to remove the improvementsat the time it enters into the lease?

5.Deadbeat has a legal obligation to pay Goodsport $5 million for work that Goodsport did to prepare the factory that Deadbeat leases from Goodsport for operation. Suppose it is highly unlikely [only a 5% chance] that Goodsport will require Deadbeat to pay. What is the effect on Deadbeat's obligation? 6.Subsid, a segment of company Parent, carries goodwill on its balance sheet. Give an example of an event would cause Parent to assess whether the goodwill is impaired.

7.Badnews has $3m of goodwill on its balance sheet. An adverse event causes Badnews to test goodwill for impairment. Badnews determines that its fair value is $98m. Badnews's carrying value is $100m. How much of an impairment loss of goodwill, if any, should it record?

8.What is the condition for deciding that an asset group is impaired under US GAAP?A law has been passed in 20x1 that will require Stinko to install water filters in 20x2. Why isn't Stinko to recognize that requirementat year-end 20x1 under U.S. GAAP.

What is the condition for deciding that an asset group is impaired under US GAAP?

9.What is the condition for deciding that an asset group is impaired under US GAAP?

10.If Deadbeat has an obligation that is unlikely to be enforced by Goodsport, identify a condition under which Deadbeat can derecognize that obligation,other than by paying it.DEBTOR IS LEGALLY RELEASED .

11. Rufus paid Dufus $4 million cash for an empty building that is appraised at $5 million.

If the appraisal is accurate, what amount does Rufus recognize the acquisition? Briefly explain.

 

Answer rating: 100% (QA)

Answer 1 Company X recognizes its obligation to remove the improvements at the end of the lease at the present value of the estimated cost to remove t... View the full answer