ch12 - Chapter 12-1 Warfield Wyegandt Kieso CHAPTER 12...

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Chapter 12-1
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Chapter 12-2 CHAPTER 12 ACCOUNTING FOR LIABILITIES INTERMEDIATE ACCOUNTING Principles and Analysis 2nd Edition Warfield Wyegandt Kieso
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Chapter 12-3 1. Describe the nature, type, and valuation of current liabilities. 2. Identify various types of bond issues. 3. Describe the accounting valuation for bonds at date of issuance. 4. Describe the accounting procedures for the extinguishment of debt. 5. Identify the criteria used to account for and disclose gain and loss contingencies. 6. Explain the accounting for different types of loss contingencies. 7. Explain the reporting of off–balance-sheet financing arrangements. 8. Indicate how to present and analyze liabilities and contingencies. Learning Objectives Learning Objectives
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Chapter 12-4 Accounting for Liabilities Accounting for Liabilities Current Liabilities Current Liabilities Long-Term Debt Long-Term Debt Special Issues Special Issues What is a What is a liability? liability? What is a current What is a current liability? liability? Issuing bonds Issuing bonds Types of bonds Types of bonds Valuation of Valuation of bonds bonds Contingencies Contingencies Off–balance- Off–balance- sheet financing sheet financing Presentation Presentation and analysis and analysis
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Chapter 12-5 What is a Liability? What is a Liability? FASB, defines liabilities as: probable future sacrifices of economic benefits arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events.” Provided service: ex. Warranties Unearned revenue (liability) is providing services in the future
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Chapter 12-6 What is a Current Liability? What is a Current Liability? Current liabilities are “obligations whose liquidation is reasonably expected to require use of existing resources properly classified as current assets, or the creation of other current liabilities.” Typical Current Liabilities: Accounts payable. Purchase inv. on account Notes payable. Current maturities of long-term debt. next year or operating cycle (longer) Dividends payable. Unearned revenues. Sales taxes payable. Income taxes payable. Employee-related liabilities. LO 1 Describe the nature, type, and valuation of current liabilities. Payment is going to require payment by current assets or creation of another current liability
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Chapter 12-7 Balances owed to others for goods, supplies, or services purchased on open account. Accounts Payable (trade accounts payable) What is a Current Liability? What is a Current Liability? LO 1 Describe the nature, type, and valuation of current liabilities. Arise because of time lag between receipt of goods or services and the payment for them. The terms of the sale (e.g., 2/10, n/30) state period of extended
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ch12 - Chapter 12-1 Warfield Wyegandt Kieso CHAPTER 12...

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