Wiley CPAexcel Exam Review 2014 Study Guide, Financial Accounting and Reporting

Wiley CPAexcel® Exam Review 2014 Study Guide: Financial Accounting and Reporting......Page 5
Copyright......Page 6
Contents......Page 7
Preface......Page 9
About the Contributor......Page 11
Introduction......Page 13
Nondisclosure and Computerization of Examination......Page 15
Applying to Take the Examination......Page 16
Attributes of Examination Success......Page 17
Purpose and Organization of this Review Textbook......Page 19
Other Textbooks......Page 20
Working CPA Questions......Page 21
Self-Evaluation......Page 22
Time Allocation......Page 23
Multiple-Choice Feedback......Page 24
Overall Strategy......Page 25
Weekly Review of Preparation Program Progress......Page 26
Time Management of Your Preparation......Page 27
Task-Based Simulation Grading......Page 29
Requesting a Score Review......Page 30
Multiple-Choice Screen Layout......Page 31
Multiple-Choice Question Solutions Approach Example......Page 32
Task-Based Simulations......Page 33
Task-Based Simulations Solutions Approach......Page 34
Research Simulations......Page 36
Time Requirements for the Solutions Approach......Page 38
Test Center and Procedures......Page 39
One week before you are scheduled to sit......Page 40
Exam-taking strategy......Page 41
After taking the examination......Page 42
Content Specification Outlines (CSOs)......Page 43
Skill Specification Outlines (SSOs)......Page 47
Advanced Searches......Page 49
Financial Accounting and Reporting......Page 51
A. Basic Concepts......Page 53
Key Terms......Page 81
Multiple-Choice Questions (1–83)......Page 82
Multiple-Choice Answers and Explanations......Page 91
Simulations......Page 100
Simulation Solutions......Page 107
B. Error Correction......Page 113
Multiple-Choice Questions (1–15)......Page 117
Multiple-Choice Answers and Explanations......Page 119
Simulations......Page 121
Simulation Solutions......Page 125
C. Accounting Changes......Page 130
Key Terms......Page 138
Multiple-Choice Questions (1–29)......Page 139
Multiple-Choice Answers and Explanations......Page 143
Simulations......Page 145
Simulation Solutions......Page 150
D. Financial Statements......Page 156
Key Terms......Page 181
Multiple-Choice Questions (1–117)......Page 183
Multiple-Choice Answers and Explanations......Page 196
Simulations......Page 206
Simulation Solutions......Page 217
A. Determining Inventory and Cost of Goods Sold......Page 229
B. Inventory Valuation and Cost-Flow Methods......Page 230
D. Consignments......Page 238
F. Long-Term Construction Contracts......Page 239
G. Research Component—Accounting Standards Codification......Page 243
H. International Financial Reporting Standards (IFRS)......Page 244
Key Terms......Page 245
Multiple-Choice Questions (1–68)......Page 246
Multiple-Choice Answers and Explanations......Page 255
Simulations......Page 263
Simulation Solutions......Page 270
A. Acquisition Cost......Page 279
B. Capitalization of Interest......Page 280
C. Nonmonetary Exchanges......Page 283
D. Purchase of Groups of Fixed Assets (Basket Purchase)......Page 289
F. Depreciation......Page 290
G. Disposals and Impairment of Value......Page 294
H. Depletion......Page 296
J. Goodwill and Other Intangible Assets......Page 297
M. Computer Software Costs......Page 300
N. Development Stage Enterprises......Page 301
P. International Financial Reporting Standards (IFRS)......Page 302
Key Terms......Page 305
Multiple-Choice Questions (1–102)......Page 306
Multiple-Choice Answers and Explanations......Page 318
Simulations......Page 328
Simulation Solutions......Page 334
B. Bank Reconciliations......Page 341
C. Receivables......Page 343
D. Current Liabilities......Page 353
F. Ratios......Page 359
G. Research Component—Accounting Standards Codification......Page 360
H. International Financial Reporting Standards (IFRS)......Page 361
Key Terms......Page 362
Multiple-Choice Questions (1–117)......Page 364
Multiple-Choice Answers and Explanations......Page 380
Simulations......Page 394
Simulation Solutions......Page 400
Module 13: Present Value......Page 407
A. Fundamentals......Page 408
Key Terms......Page 418
Multiple-Choice Questions (1–25)......Page 419
Multiple-Choice Answers and Explanations......Page 422
Simulations......Page 425
Simulation Solutions......Page 428
B. Bonds......Page 431
Key Terms......Page 437
Multiple-Choice Questions (1–45)......Page 438
Multiple-Choice Answers and Explanations......Page 443
Simulations......Page 448
Simulation Solutions......Page 452
C. Debt Restructure......Page 457
Key Terms......Page 462
Multiple-Choice Questions (1–8)......Page 463
Multiple-Choice Answers and Explanations......Page 465
Simulations......Page 467
Simulation Solutions......Page 469
D. Pensions......Page 470
Key Terms......Page 486
Multiple-Choice Questions (1–43)......Page 488
Multiple-Choice Answers and Explanations......Page 494
Simulations......Page 499
Simulation Solutions......Page 501
E. Leases......Page 503
Key Terms......Page 524
Multiple-Choice Questions (1–60)......Page 525
Multiple-Choice Answers and Explanations......Page 533
Simulations......Page 540
Simulation Solutions......Page 544
A. Overview of Deferred Tax Theory......Page 549
B. Permanent and Temporary Differences Defined......Page 550
C. Deferred Tax Assets and Liabilities......Page 552
D. Deferred Tax Related to Business Investments......Page 560
E. Loss Carryforwards and Carrybacks......Page 562
F. Financial Statement Presentation of Income Tax......Page 563
I. International Financial Reporting Standards (IFRS)......Page 565
Key Terms......Page 567
Multiple-Choice Questions (1–44)......Page 568
Multiple-Choice Answers and Explanations......Page 574
Simulations......Page 580
Simulation Solutions......Page 584
Module 15: Stockholders’ Equity......Page 589
B. Preferred Stock......Page 590
C. Stock Subscriptions......Page 591
D. Treasury Stock Transactions......Page 592
E. Retirement of Stock......Page 593
F. Dividends......Page 594
H. Appropriations of Retained Earnings (Reserves)......Page 595
I. Share-Based Payments......Page 596
J. Accounting Entries for the Share-Based Payments to Employees......Page 597
K. Basic Earnings Per Share......Page 599
L. Diluted Earnings Per Share......Page 601
M. Corporate Bankruptcy......Page 605
O. Quasi Reorganization......Page 607
Q. Employee Stock Ownership Plan (ESOP)......Page 609
S. Research Component—Accounting Standards Codification......Page 610
T. International Financial Reporting Standards (IFRS)......Page 611
Key Terms......Page 613
Multiple-Choice Questions (1–94)......Page 614
Multiple-Choice Answers and Explanations......Page 626
Simulations......Page 638
Simulation Solutions......Page 644
A. Concepts of Accounting and Investment Percentage......Page 651
B. Investments in Which Significant Influence Does Not Exist......Page 652
C. Investments Where Significant Influence Does Exist......Page 659
G. Stock Rights......Page 663
I. Research Component—Accounting Standards Codification......Page 665
J. International Financial Reporting Standards (IFRS)......Page 666
Key Terms......Page 667
Multiple-Choice Questions (1–64)......Page 668
Multiple-Choice Answers and Explanations......Page 676
Simulations......Page 684
Simulation Solutions......Page 691
A. Objectives of the Statement of Cash Flows (See outline of SFAS 95, [ASC Topic 230])......Page 699
B. Statement of Cash Flows Classification......Page 700
C. Direct or Indirect Presentation in Reporting Operating Activities......Page 701
D. Example of Statement of Cash Flows......Page 704
G. International Financial Reporting Standards (IFRS)......Page 711
Key Terms......Page 712
Multiple-Choice Questions (1–39)......Page 713
Multiple-Choice Answers and Explanations......Page 718
Simulations......Page 724
Simulation Solutions......Page 730
A. Scope—Acquisition Method......Page 737
B. The Acquisition Method for Business Combinations......Page 738
C. Consolidated Financial Statements......Page 741
D. Pelican Corp. and Swan Corp.—Acquisition of Swan, 100% Acquisition......Page 744
E. Pelican Corp. and Swan Corp.—Date of Combination Consolidated Balance Sheet—Acquisition Method (100% Acquisition)......Page 746
F. Consolidated Financial Statements Subsequent to Acquisition......Page 749
G. Intercompany Transactions and Profit Confirmations......Page 750
H. Pelican Corp. and Swan Corp. — Subsequent Consolidated Financial Statements......Page 751
I. Noncontrolling Interest......Page 756
J. Additional Issues Regarding Business Combinations......Page 763
K. Additional Disclosures......Page 765
O. International Financial Reporting Standards (IFRS)......Page 766
Key Terms......Page 767
Multiple-Choice Questions (1–79)......Page 768
Multiple-Choice Answers and Explanations......Page 778
Simulations......Page 786
Simulation Solutions......Page 791
A. Foreign Currency Transactions......Page 797
B. Derivative Instruments and Hedging Activities......Page 799
D. International Financial Reporting Standards (IFRS)......Page 811
Key Terms......Page 812
Multiple-Choice Questions (1–51)......Page 815
Multiple-Choice Answers and Explanations......Page 820
Simulations......Page 825
Simulation Solutions......Page 831
A. Personal Financial Statements (ASC Topic 274)......Page 837
Multiple-Choice Questions (1–17)......Page 839
Multiple-Choice Answers and Explanations......Page 842
B. Interim Reporting......Page 844
Key Terms......Page 845
Multiple-Choice Questions (1–19)......Page 846
Multiple-Choice Answers and Explanations......Page 849
C. Segment Reporting......Page 851
Key Terms......Page 855
Multiple-Choice Questions (1–12)......Page 856
Multiple-Choice Answers and Explanations......Page 858
Simulations......Page 859
Simulation Solutions......Page 861
D. Partnership Accounting......Page 863
Key Terms......Page 873
Multiple-Choice Questions (1–23)......Page 874
Multiple-Choice Answers and Explanations......Page 878
Simulations......Page 882
Simulation Solutions......Page 886
E. Foreign Currency Translation......Page 889
Key Terms......Page 896
Multiple-Choice Questions (1–13)......Page 897
Multiple-Choice Answers and Explanations......Page 899
Simulations......Page 901
Simulation Solutions......Page 906
Module 21: Governmental (State and Local) Accounting......Page 909
B. Governmental Accounting Concepts......Page 910
C. The Government Reporting Model......Page 911
F. Government-Wide Financial Statements......Page 913
G. Fund Financial Statements......Page 920
I. Required Supplementary Information (RSI) other than MD&A......Page 929
K. Accounting by Governments for Certain Events and Transactions......Page 932
L. Budgetary Accounting for the General and Special Revenue Funds......Page 937
M. Expenditure Classification for Governmental Funds......Page 939
N. Accounting for the General Fund......Page 940
P. Accounting for Capital Projects Funds......Page 945
Q. Debt Service Funds......Page 948
R. Permanent Funds......Page 950
T. Accounting for Proprietary Funds......Page 951
U. Accounting for Fiduciary Funds......Page 953
V. Reporting Interfund Activity......Page 955
X. Conversion from Fund Financial Statements to Government-Wide Financial Statements......Page 957
Y. Public College and University Accounting (Governmental)—GASB Statement No. 35......Page 958
Key Terms......Page 963
Multiple-Choice Questions (1–138)......Page 965
Multiple-Choice Answers and Explanations......Page 980
Module 22: Not-for-Profit Accounting......Page 995
A. FASB and AICPA Standards for Private Sector Nonprofits......Page 996
B. College and University Accounting—Private Sector Institutions......Page 1005
C. Health Care Organization Accounting—Private Sector......Page 1007
D. Health Care Organization Accounting—Governmental......Page 1009
Key Terms......Page 1010
Multiple-Choice Questions (1–83)......Page 1011
Multiple-Choice Answers and Explanations......Page 1021
Accounting Principles Board Opinions Cross-Reference......Page 1029
Statements of Financial Accounting Standards Cross-Reference......Page 1030
Presentation (ASC Topic 200)......Page 1032
Assets (ASC Topic 300)......Page 1048
Liabilities (ASC Topic 400)......Page 1060
Equity (ASC Topic 500)......Page 1069
Revenue (ASC Topic 600)......Page 1073
Expenses (ASC Topic 700)......Page 1075
Broad Transactions (ASC Topic 800)......Page 1092
Industry (ASC Topic 900)......Page 1121
Statements of Financial Accounting Concepts (SFAC)......Page 1126
Appendix A: Financial Accounting and Reporting Sample Examination......Page 1137
Appendix B: Sample Financial Accounting and Reporting Testlet Released by AICPA......Page 1171
Appendix C: 2013 Released AICPA Questions for Financial Accounting and Reporting......Page 1179
Index......Page 1199