TAILIEUCHUNG - Lecture Accounting principles (8E): Chapter 16 - Coby Harmon

After completing this chapter you should be able to: Discuss why corporations invest in debt and stock securities, explain the accounting for debt investments, explain the accounting for stock investments, describe the use of consolidated financial statements,.and other contents. | CHAPTER 16 INVESTMENTS Accounting Principles, Eighth Edition Discuss why corporations invest in debt and stock securities. Explain the accounting for debt investments. Explain the accounting for stock investments. Describe the use of consolidated financial statements. Indicate how debt and stock investments are reported in financial statements. Distinguish between short-term and long-term investments. Study Objectives 1. On the topic, “Challenges Facing Financial Accounting,” what did the AICPA Special Committee on Financial Reporting suggest should be included in future financial statements? Non-financial Measurements (customer satisfaction indexes, backlog information, and reject rates on goods purchases). Forward-looking Information Soft Assets (a company’s know-how, market dominance, marketing setup, well-trained employees, and brand image). Timeliness (no real time financial information) Why Corporations Invest Cash management Investment income Strategic reasons Accounting for Debt Investments Accounting for Stock Investments Valuing and Reporting Investments Categories of securities Balance sheet presentation Realized and unrealized gain or loss Classified balance sheet Holdings of less than 20% Holdings between 20% and 50% Holdings of more than 50% Recording acquisition of bonds Recording bond interest Recording sale of bonds Long-Term Liabilities Service Cost - Actuaries compute service cost as the present value of the new benefits earned by employees during the year. Future salary levels considered in calculation. Interest on Liability - Interest accrues each year on the PBO just as it does on any discounted debt. Actual Return on Plan Assets - Increase in pension funds from interest, dividends, and realized and unrealized changes in the fair market value of the plan assets. Amortization of Unrecognized Prior Service Cost - The cost of providing retroactive benefits is allocated to pension expense in the future, specifically to the remaining service-years

• Kế toán - Kiểm toán
• Lecture Accounting principles
• Accounting principles
• Stock securities
• Debt investments
• Consolidated financial statements
• Financial statements
• Fundamental accounting principles
• Lecture Fundamental accounting principles
• Accounting information systems
• Fundamental system principles
• Technology based accounting systems
• Accounting information
• Financial accounting
• Managerial accounting
• Managerial cost
• Reporting manufacturing activities
• Merchandising operations
• Accounting cycle
• Completing the accounting cycle
• Classified balance sheet
• Accounting for partnerships
• Partnership form of organization
• Basic partnership accounting