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Unformatted text preview: BYP CASE RESEARCH CASE 8-11 IDRIS ONIKOSI ACCT 3110 Requirement 1. 1. SFAS No. 49, FASB Standard on accounting for product financing arrangements provides authoritative guidance on this issue. Product financing arrangements include agreements in which a sponsor Balboa Lumber: A. Sells the product to another entity (the enterprise through which the financing flows), and in a related transaction agrees to repurchase the product (or a substantially identical product); B. Arranges for another entity to purchase the product on the sponsor's behalf and, in a related transaction, agrees to purchase the product from the other entity; or C. Controls the disposition of the product that has been purchased by another entity in accordance with the arrangements described in either (a) or (b) above. Summary This Statement specifies criteria for determining when an arrangement involving the sale of inventory is in substance a financing arrangement. A product financing arrangement is a transaction in which an enterprise substance a financing arrangement....
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- Fall '09