Intermediate Accounting
3rd Edition
ISBN: 9780136912644
Author: Elizabeth A. Gordon; Jana S. Raedy; Alexander J. Sannella
Publisher: Pearson Education (US)
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 20, Problem 1BCC
Basis for Conclusions Case 1: Antidilutive Securities
Read paragraphs 95 through 99 m Appendix B Background information and basis tor conclusions in FASB s Statement of Financial Accounting Standards No 128
Required
- a. Why did the Board decide lo require an antidilution sequence that considers securities m the order of most dilutive to least dilutive?
- b. What line items could appear on an income statement after income from continuing operations but before net income? Note that when Statement of Financial Accounting Standards No 128 was written companies reported extraordinary items and the effect of changes in accounting principles on the income statement after income from continuing operations. This is no longer true
- c. The FASB chose income from continuing operations as the number that should be used to determine whether sec unties are dilutive or antidilutive. Why did it choose income from continuing operations as opposed to net income?
- d. Did the constituents who wrote comment letters about the exposure draft of Statement of Financial Accounting Standards No 128 agree with the use of income from continuing operations as opposed to net income as the control number for the determination of which securities are dilutive?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
1. The unrealized gain/loss from investment valuation for trading securities and available-for-sale securities should be reported in:
Select one:
a.
the income statement for both securities.
b.
the balance sheet statement for both securities.
c.
the income statement and the balance sheet statement, respectively.
d.
the balance sheet statement and the income statement, respectively.
In applying the fair value option under ASC 825-10-25 (Predecessor literature Statement of Financial Accounting Standards No. 159: The Fair Value Option for Financial Assets and Financial Liabilities), a company
Select one:
a.
has the option to apply the fair value option to its investments classified as securities held-to-maturity and securities-available-for-sale on an instrument-by-instrument basis.
b.
is required to apply the fair value option to its investments classified as securities held-to-maturity and securities available-for-sale.
c.
has to apply the fair value…
Match each of the items below with its most appropriately-related “letter” classification. (“Letter” classification may be used more than once, or not at all.)A. Fair Value Adjustment G. Available-for-sale debt securities B. Statement of Cash Flows H. Equity holdings between 20% and 50% C. Trading debt securitiesI. Temporary differences, deferred tax assetD. Equity holdings less than 20% J. Permanent differences E. Held-to-maturity debt securities K. Temporary differences, deferred tax liability F. Statute of Limitations L. Equity holdings more than 50% ____ 1. Premiums paid on life insurance of officers (company is the beneficiary).____ 2. Amortized cost; unrealized holding gains or losses not recognized; interest when earned.____ 3. Consolidation of financial statements; parent and subsidiary company income or loss combined.____ 4. Estimated future warranty costs.____ 5. Represents the increase in taxes refundable (or saved) in future yearsas a result of deductible temporary…
Match each of the items below with its most appropriately-related “letter” classification. (“Letter” classification may be used more than once, or not at all.)
A. Fair Value Adjustment G. Available-for-sale debt securities
B.Statement of Cash Flows H. Equity holdings between 20% and 5%
C. Trading debt securitiesI. Temporary differences, deferred tax asset
D. Equity holdings less than 20%
J. Permanent differences
E. Held-to-maturity debt securities
K. Temporary differences, deferred tax liability
F. Statute of Limitations
L. Equity holdings more than 50%
1. Premiums paid on life insurance of officers (company is the beneficiary).
____ 2. Amortized cost; unrealized holding gains or losses not recognized; interest when earned
.____ 3. Consolidation of financial statements; parent and subsidiary company income or loss combined.
____ 4. Estimated future warranty costs
.____ 5. Represents the increase in taxes refundable (or saved) in future yearsas a…
Chapter 20 Solutions
Intermediate Accounting
Ch. 20 - Prob. 20.1QCh. 20 - Prob. 20.2QCh. 20 - If-Converted Method. Does the if-converted...Ch. 20 - Diluted EPS. If all potentially dilutive...Ch. 20 - Diluted EPS. Can diluted earnings per share on...Ch. 20 - Diluted EPS, Convertible Debt, and Preferred...Ch. 20 - Prob. 20.7QCh. 20 - Prob. 20.8QCh. 20 - Prob. 20.9QCh. 20 - EPS Disclosures. is an entity required to present...
Ch. 20 - Prob. 20.11QCh. 20 - Hutchins Company had 200,000 shares of common...Ch. 20 - Prob. 20.2MCCh. 20 - Prob. 20.3MCCh. 20 - Prob. 20.4MCCh. 20 - Refer to the information about Hutchins Company in...Ch. 20 - Prob. 20.6MCCh. 20 - Prob. 20.1BECh. 20 - Prob. 20.2BECh. 20 - Computing Income for Basic EPS. Russo Watches, Ltd...Ch. 20 - Prob. 20.4BECh. 20 - Compute Weighted-Average Number of Shares...Ch. 20 - Compute Weighted-Average Number of Shares...Ch. 20 - Prob. 20.7BECh. 20 - Prob. 20.8BECh. 20 - Prob. 20.9BECh. 20 - Prob. 20.10BECh. 20 - Prob. 20.11BECh. 20 - Computing Basic and Diluted EPS, Options. Nicks...Ch. 20 - Computing Diluted EPS, Convertible Debt. Axelon...Ch. 20 - Computing Basic and Diluted EPS, Preferred Stock....Ch. 20 - Computing Weighted-Average Number of Common Shares...Ch. 20 - Prob. 20.3ECh. 20 - Computing Basic and Diluted EPS, Convertible...Ch. 20 - Prob. 20.5ECh. 20 - Computing Basic and Diluted EPS, Convertible Bonds...Ch. 20 - Computing Basic and Diluted EPS, Convertible Bonds...Ch. 20 - Computing Basic and Diluted EPS, Convertible...Ch. 20 - Computing Basic and Diluted EPS, Options,...Ch. 20 - Computing Basic and Diluted EPS, Convertible...Ch. 20 - Computing Basic and Diluted EPS, Convertible...Ch. 20 - Prob. 20.12ECh. 20 - Prob. 20.1PCh. 20 - Prob. 20.2PCh. 20 - Computing Basic and Diluted EPS. Convertible...Ch. 20 - Prob. 20.4PCh. 20 - Computing Basic and Diluted EPS, Convertible...Ch. 20 - Computing Basic and Diluted EPS, Convertible...Ch. 20 - Prob. 20.7PCh. 20 - Prob. 20.8PCh. 20 - Prob. 1JCCh. 20 - Prob. 1FSCCh. 20 - Prob. 1SSCCh. 20 - Basis for Conclusions Case 1: Antidilutive...Ch. 20 - Basis for Conclusions Case 2: Treasury Stock...
Additional Business Textbook Solutions
Find more solutions based on key concepts
Dave Nelson recently retired at age 48, courtesy of the numerous stock options he had been granted while presid...
Managerial Accounting: Creating Value in a Dynamic Business Environment
Analysis of inventory errors A2 Hallam Company’s financial statements show the following. The company recently ...
FINANCIAL ACCT.FUND.(LOOSELEAF)
Plantwide and Departmental Overhead Allocation; Activity-Based Costing; Segmented Income Statements Koontz Comp...
Introduction To Managerial Accounting
Based on your answers to the above questions, should Lockwood invest in the machinery?
Horngren's Financial & Managerial Accounting, The Managerial Chapters (6th Edition)
Discussion Analysis A13-41 Discussion Questions 1. How do managers use the statement of cash flows? 2. Describ...
Managerial Accounting (4th Edition)
Preparing Financial Statements from a Trial Balance The following accounts are taken from Equilibrium Riding, I...
Fundamentals Of Financial Accounting
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- 1. More than one measurement bases apply to investments in debt securities and investment in equity under PFRS 9. What are these measurement bases?2. Identify critical questions to be asked in applying PFRS 9 in the measurement of financial assets.3. How would you distinguish an equity instrument from a debt instrument?arrow_forwardFor investments in equity securities, which will result in recording income based on the income of the investee? Select one: a. Held-to-maturity classification b. Trading classification O C. Available-for-sale classification O d. Equity method of accountingarrow_forwardAll of the following are true of the effect of fair value accounting on the financial statements except: a. any difference between the original cost or the prior period’s fair value must be recorded b. changes in the fair value of trading securities are recognized on the income statement c. valuation allowance accounts are reported on the balance sheet d. changes in the fair value of available-for-sale securities are recognized on the income statementarrow_forward
- Accounting type Question: Securities premium reserve account is shown on the liabilities side in the balance sheet under the heading A. Reserves and surplus B. Current liabilities and provisions C. Share capital D. All of thesearrow_forwardTrading securities, by definition, are properly classified in the statement of financial position as: Select one: O a. Shareholders' equity O b. Other assets O c. Intangibles O d. Current assetsarrow_forward3. Which of the following categories of investments are reported at their fair values on the balance sheet and have unrealized holding gains and losses included as a separate component of stockholders' equity? a. held-to-maturity debt securitiesb. marketable securitiesc. available-for-sale securitiesd. trading securitiesarrow_forward
- 1. Investments in debt securities are classified for accounting purposes as: A. Financial asset at amortized cost (AC), fair value through other comprehensive income (FVOCI) or fair value through profit or loss (FVPL) B. Financial asset at amortized cost (AC) or fair value through other comprehensive income (FVOCI) only C. Trading, Available-for-Sale (AFS) or Held-to-Maturity (HTM) D. Available-for-Sale (AFS) or Held-to-Maturity (HTM) onlyarrow_forward6. Unrealized gains and losses on investments in trading securities are reported a. as a current assetb. on the income statementc. on the balance sheet as part of stockholders' equityd. as a contra assetarrow_forwardzed 3. Which of the following reclassifications of financial assets is permitted under PFRS 9? a. Reclassification from FVPL designation to Amortized cost b. Reclassification from FVOCI (election) to FVPL C. Reclassification from held for trading equity securities to the if a ord, amortized cost d. Reclassification from amortized cost and to FVPL ofarrow_forward
- Changes in the fair value of held to maturity securities are: A. not recognized. B. recognized on the income statement and as part of stockholders' equity. C. reported as part of stockholders' equity. D. recognized on the income statement.arrow_forwardI-Equity investments held for trading fall under FVPL II-Equity Investments at FVPL are presented as current assets in a properly classified statement of financial position a. Both statements are true b. Only statement II is true c. Both statements are false d. Only statement I is truearrow_forwardUnder FASB 52, the temporal method requires that: A. translation gains and losses are included in the reported net income. В. translation gains and losses are only included in stockholder's equity. C. translation gains and losses should not be considered. D. none of these, QUESTION 13 A CFO should be least worried about A. transaction exposure. B. translation exposure. C. economic exposure. D. none of the options QUESTION 14 The most effective way to hedge translation exposure is: A. to buy forward contract. B. to buy call option contract. C. to use balance sheet hedge. D. to use regression method.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Auditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage Learning
Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Financial instruments products; Author: fi-compass;https://www.youtube.com/watch?v=gvxozM3TUIg;License: Standard Youtube License