Case 9-4 How should NeedsSpace account for the two obligations noted as provisions in the lease agreement? ● Provision 1: “Lessor may require the lessee to perform general repairs and maintenance on the leased premises.” By entering the lease agreement, NeedsSpace (the lessee) becomes legally and contractually responsible for performing general repair and maintenance on the leased premises. Assuming that the lessee is required to make deposits to financially protect the lessor concerning
Words: 1778 - Pages: 8
concerns about the proper way to account for and report them in financial reports. The airlines, the Securities and Exchange Commission (SEC), the American Institute of Certified Public Accountants (AICPA), and the Financial Accounting Standards Board (FASB) had each voiced concerns about measuring the expenses and reporting airlines’ obligations under frequent flier programs. The percentage of revenue passenger miles (the number of miles flown by revenue passengers including free-flight-award passengers;
Words: 2444 - Pages: 10
Studies SOLUTIONS Case: Accounting for Lease Extension (Revised and updated 5/2013) Jack leases an office building from Jill. The lease is classified as an operating lease under the guidance of ASC Topic 840, Leases. The lease does not include any renewal options upon the expiration, but Jack is in the process of negotiating an extension of the lease. Jack proposes to make a single up-front payment of $1.2 million to Jill in exchange for an extension of the lease at the current rate for another 10 years
Words: 1851 - Pages: 8
Client Understanding I am excited to be working with your organization to improve the financial practices. After reviewing the firm’s financial records there are a few additional items needed to complete the accounting evaluations. The additional items being requested are adjusting lower cost of market inventory, recording gain or loss on assets, adjusting goodwill and capitalizing interest on building construction. I understand the firm is concern with why the additional information is being
Words: 1151 - Pages: 5
Advertising whereby the only connection the consumer has to the product is the advertising and the only way a consumer can act on the advertisement or commercial is to return a coupon or make a phone call. Direct-response advertising is geared to eliminate an intermediary in the purchase process. It can utilize a wide range of media, from matchbook covers to print or radio and television, although it is typically conducted through the mail. In direct-response advertising, the effectiveness of the
Words: 3520 - Pages: 15
Recent Activities at the FASB Presentation Transcript 1. Recent Activities at the FASB Corporate Reporting and Governance Conference California State University, Fullerton September 2005 Katherine Schipper, Financial Accounting Standards Board The views expressed in this presentation are my own, and do not represent positions of the Financial Accounting Standards Board. Positions of the Financial Accounting Standards Board are arrived at only after extensive due process and deliberation.
Words: 3971 - Pages: 16
Journal of Economic Perspectives—Volume 24, Number 1—Winter 2010—Pages 93–118 Did Fair-Value Accounting Contribute to the Financial Crisis? Christian Laux and Christian Leuz I n its pure form, fair-value accounting involves reporting assets and liabilities on the balance sheet at fair value and recognizing changes in fair value as gains and losses in the income statement. When market prices are used to determine fair value, fair-value accounting is also called mark-to-market accounting
Words: 14541 - Pages: 59
This is due to the fact that in recent years, the Financial Accounting Standards Board (FASB) has issued several standards that are considered more principles-based than rule-based. Nonetheless, that does not mean that principles-based accounting is better. Therefore, this paper will examine the pros, cons, ethics and virtues of both rules-based accounting and principles-based accounting. Keywords: GAAP; FASB; SEC; Principles-Based Accounting; Rules-Based Accounting Introduction Accounting can
Words: 2499 - Pages: 10
world has become increasingly connected. Businesses are embracing opportunities abroad and gathering investors from a progressively growing international market. Globalization has given rise to a number of questions regarding multicultural business practice. It has also created a need for universal financial reporting that is consistent and useful to all of its users, international and domestic alike. Due to this growing concern, the International Accounting Standards Board was established and has created
Words: 1106 - Pages: 5
Commission. The report begins with general information about the corporation which includes some background about the company as well as description of the type of industry they are. Crestline is a publicly traded management company that not only leases, but also owns and manages hotels and apartments (p. 1). One of the main sections of the annual report includes a synopsis of the events that have occurred throughout the year, that have affected the company’s financial position. Crestline goes
Words: 1151 - Pages: 5
