Financial Reporting and Securities Accounting: Fair Value Methods and Recognition

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Finance - Personal Finance

jake12testoswi Created by 10 mon ago

Cards in this deck(27)

For actively trading securities, unrealized holding gains/losses are recognized in _____ as per the Fair Value method.

For available-for-sale securities, unrealized holding gains/losses are recognized in _____, bypassing the income statement.

For held-to-maturity securities, unrealized holding gains/losses are _____ because the fair value is irrelevant.

For equity ownership with insignificant influence (0% - 20%), the reporting method used is the _____ method.

For equity ownership with significant influence (20% - 50%), the _____ method is used, where unrealized gains/losses are not recognized.

For controlling influence (over 50% ownership), _____ financial statements are prepared, and unrealized gains/losses are not recognized.

When financial income is less than taxable income, future deductible amounts create a _____ tax asset.

When financial income is more than taxable income, future taxable amounts create a _____ tax liability.

The near-term ability to generate cash to service working capital needs and debt service requirements is known as _____ risk.

The longer-term ability to generate cash internally or from external sources to satisfy capital expenditures and debt repayment needs is known as _____ risk.

The _____ ratio and quick ratio are examples of liquidity ratios.

The _____ ratio and long-term debt-to-equity ratio are examples of solvency ratios.

The times interest earned, operating cash-to-debt, and free cash flow-to-debt ratios are examples of _____ ratios.

When calculating basic debt ratios using both the income statement and balance sheet, use the _____ of two values.

Income from municipal bonds and life insurance proceeds on the death of a key executive are examples of permanent book-tax differences that are _____ taxed.

Expenses related to obtaining tax-exempt income and premiums paid for life insurance policies of key executives are examples of permanent book-tax differences that are _____ deducted.

Cash advances from customers and bad debt expense are examples of items that create a _____ tax asset.

Depreciation using MACRS and prepaid expenses are examples of items that create a _____ tax liability.

The effective tax rate formula is calculated as total tax expense divided by _____ financial income.

Total tax expense is the sum of current tax expense and _____ tax expense.

Income tax payable is calculated as taxable income minus temporary and permanent differences, multiplied by the _____ rate.

The treasury stock method assumes hypothetical proceeds from the exercise of options are used to purchase treasury shares at the _____ market price.

Dilutive securities are those whose exercise or conversion _____ EPS.

Anti-dilutive securities are those whose exercise or conversion _____ EPS and are ignored in diluted EPS calculations.

Income tax expense in the tax formula is calculated as total tax expense divided by financial income subject to tax multiplied by the _____ rate.

Inventory turnover is calculated as COGS divided by _____ inventory.

Days in inventory is calculated as 365 divided by _____ turnover.

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Financial Reporting and Securities Accounting: Fair Value Methods and Recognition

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