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Unformatted text preview: 1. Which of the following sets of conditions would give rise to the accrual of a contingency under current generally accepted accounting principles? Amount of loss is reasonably estimable and occurrence of event is probable. 2. SFAS No. 13 establishes specific criteria for the treatment of leases. If any of the criteria are met, the lessee must treat the lease as a capital lease. 3. Which of the following is a correct statement of one of the capitalization criteria? The lease term is equal to or more than 75% of the estimated economic life of the leased property. 4. Underfunded pension plans may be indicators of past and continuing cash flow problems. 5. Refer to Table 14-5. During the year the plan was amended to increase benefits to retirees. The present value of the additional benefits (also called prior service costs) is equal to $35,000 (as...
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- Fall '08
- Accounting, Prime number, Smith Company