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ACC Exam 3
Multiple Choice/ true false
20
Accounting
Undergraduate 4
11/09/2015

Additional Accounting Flashcards

 


 

Cards

Term
b. the settlement rate decreases
Definition
An actuarial loss occurs when:
a. the settlement rate increases
b. the settlement rate decreases
c. the actual return exceeds the expected return
d. the plan is amended to increase benefits
Term
b. the plan is amended to increase benefits
Definition
The amount of prior service cost is affected when:
a. the settlement rate increases
b. the plan is amended to increase benefits
c. the settlement rate decreases
d. the actual return exceeds the expected return
Term
d. none of the above is an example of a temporary difference that would result in a deferred tax asset
Definition
Which of the following is an example of a temporary difference that would result in a deferred tax asset?
a. short-term investments when an unrealized gain is recognized for accounting purposes during the holding period while the actual gain on date of disposal is used for tax purposes
b. income on long-term construction contracts when percentage of completion is used for accounting purposes and completed contract is used for tax purposes
c. use of a longer depreciation period for accounting purposes than is used for tax purposes
d. none of the above is an example of a temporary difference that would result in a deferred tax asset
Term
a. a gain on installment sales is recognized for tax purposes as the receivable is collected, but was recognized earlier for accounting purposes when the sale was made
Definition
A future "taxable amount" would result from:
a. a gain on installment sales is recognized for tax purposes as the receivable is collected, but was recognized earlier for accounting purposes when the sale was made
b. the company uses statutory depletion for tax purposes, but uses cost depletion for books
c. recognizing product warranty costs for tax purposes as the warranty conditions are met, but recognized for accounting purposes earlier on the accrual basis
d. all of the above are examples situations that would result in a future taxable amount
Term
b. "more likely than not" that only a portion of the gross amount of the deferred tax assets is expected to be realized
Definition
A valuation allowance would exist as a contra account to the deferred tax assets if it is:
a. "more likely than not" that all of the gross amount of the deferred tax assets is expected to be realized
b. "more likely than not" that only a portion of the gross amount of the deferred tax assets is expected to be realized
c. "probable" that some amount of the assets is absolutely realizable
d. "possible" that the entire amount is to be realized
Term
b. defined contribution
Definition
RST's pension plan does not guarantee a specific amount during retirement. Instead, the company funds $8,000 each year for each employee who has worked for the company for at least 10 years. The pension plan is characterized as:
a. contributory
b. defined contribution
c. defined benefit
d. cannot determine without seeing the benefit formula
Term
False
Definition
T/F
The "asset/liability method" of accounting for inter-period income tax allocation requires that deferred income taxes payable be computed by first determining income tax payable and income tax expense and then the resulting difference is debited/credited to deferred income tax asset/liability.
Term
True
Definition
T/F
The corridor used in amortizing gains and losses is equal to ten percent of the greater of the beginning projected benefit obligation or the beginning fair value of the fund.
Term
True
Definition
T/F
An increase in the deferred tax asset allowance account would increase income tax expense
Term
False
Definition
T/F
Inter-period income tax allocation involved deciding how the total income tax amount
Term
False
Definition
T/F
If an additional pension liability must be recorded, the credit is to an appropriately designed liability account (such as additional pension liability) and the debit is to pension expense
Term
False
Definition
T/F
Actuarial or experience gains or losses are usually reported as extraordinary items because they rarely occur
Term
False
Definition
T/F
Defined benefit pension plans do not specify benefits per period after retirement; as a result, pension expense is based directly on the specified contributions
Term
False
Definition
T/F
In any given year of a pension plan, the amount funded and the amount recognized as pension expense must be equal
Term
False
Definition
T/F
Prior service cost, like service cost, is expensed as incurred
Term
DTL
Definition
DTA/DTL
The installment sales method is used for tax purposes. Sales are recorded on an accrual basis for book purposes.
Term
DTL
Definition
DTA/DTL
Percentage of completion method is used for books. Completed contract method is used for tax purposes.
Term
DTL
Definition
DTA/DTL
The tax life of a depreciable asset is 4 years. Its useful life is 6 years.
Term
DTA
Definition
DTA/DTL
Contingent liabilities reported in the balance sheet are tax deductible when paid.
Term
DTA
Definition
DTA/DTL
There is an existing net operating loss carryover.
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