HORNGREN'S ACCOUNTING - Tenth Edition
Where is the current portion of notes payable reported on the balance sheet?
What is an amortization schedule?
What is a mortgage payable?
What is a bond payable?
What is the difference between the stat
joint and separate assessment
relevant to ACCA Qualification Papers F6 and P6 (MYS)
With effect from the year of assessment 2001, either a husband or wife
(referred to as the 'joining party') can elect that his or her total income shall
be aggregated with
Future Value of an Annuity Due
-Annuity due = assumes periodic rents occur at
the beginning of each period.
-This means an annuity due will accumulate
interest during the first period (in contrast to an
ordinary annuity rent, which will not).
-In other wo
-Fringe Benefits = Non-cash benefits to employees in addition to their cash compensation. They are taxable to
the employee on receipt.
Taxable Fringe Benefits
-Taxable fringe benefits = fringe benefits not specifically excluded from gross
-Up until 30 days after the grant date, employees can make what is known as an 83(b) election; once made,
however, this election is irrevocable.
-If the employee makes the 83(b) election, the value of the restricted stock is taxed on the gr
Valuation of Long-Term Bonds
-A long-term bond produces two cash flows:
(1) periodic interest payments during the life of the bond, and
(2) the principal (face value) paid at maturity.
-The periodic interest payments represent an annuity.
-The principal r
COMPOUND INTEREST TABLES
-Future Value Factor (FVF) for 1 =
FVF n ,i=(1+i)n
FVFn,i = future value for n periods at i interest
n = number of periods
i = rate of interest for a single period
-Interest is generally expressed in terms of an annual rate, but m
Limits on salary deductibility
-Employers are generally allowed to deduct reasonable compensation paid to employees.
-Determining whether compensation is reasonable in amount is a facts and circumstances test that involves
considering the duties of the em
Future Value of a Single Sum
Future Value=PV (FVF n ,i )
Present Value of a Single Sum
-The present value is the amount needed to invest now, to produce a known future value.
-The PV is always a smaller amount than the known FV, due to earned and accumula
The Nature of Interest
-Interest = is payment for the use of money. It is the excess cash received or repaid over and above the amount
lent or borrowed (principle).
-Variables in Interest Computation:
Principle = the amount borrowed or invested
PRESENT VALUE MEASUREMENT
-Expected Cash Flow Approach = uses a range of cash flows and incorporates the probabilities of those cash
flows to provide a more relevant measurement of present value.
-To illustrate the expected cash flow model, assume that th
Chapter 12 Compensation
SALARY AND WAGES
-Current compensation paid to employees in the form of salary and wages has tax consequences to both
employees and employers.
Employee Considerations for Salary and Wages
-Salary = earn a fixed amount of compensati
-Many situations arise in which a series of dollar amounts are paid or received periodically.
EX: installment loans or sales, invested funds, or a series of realized cost savings.
-Such a process of period payment represents the accumulation of
F8 Audit and
a guide to using the
ACCAs self-study guide for F8 is a fantastic resource designed especially to help
you if you are taking F8. Hopefully you have already had a chance to take a look
at this but if not you can fi
a guide to reflection
for retake students
ACCAs retake guide for F9 is a fantastic resource designed especially to help you
if you are retaking F9. Hopefully you have already had a chance to take a look at
this but if not you can
refund of czech vat
to foreign tourists
RELEVANT TO ACCA QUALIFICATION PAPER f6 (CZE)
The Czech VAT Act lays down rules for the refund of VAT in various situations. This article looks
at the process of refunding Czech VAT to visitors fro
Present Value of an Annuity Due
-In determining the present value of an annuity due, there is always one fewer discount period.
-Because each cash flow comes exactly one period sooner in the present value of the annuity due, the present
value of the cash
Group-Term Life Insurance
-Employees may exclude from income the employer-provided benefit for the first $50,000 of group-term life
insurance. Any remaining group-term life insurance benefit is taxable.
Health and Accident Insurance Benefits
Employer Considerations for Stock Options
-With NQOs, employers deduct the bargain element that employees recognize as income when the employees
exercise the NQOs.
-NQOs is usually viewed as performance-based compensation. As a resul
MORE COMPLEX SITUATIONS
-Solving time value Problems often requires using more than one table.
-For example, a business problem may need computations of both present value of a single sum and present
value of an annuity.
-Two such common situations are:
RATE OF INTEREST.
This rate, unless otherwise stated, is an annual rate that must be adjusted to reflect the length of the
compounding period if less than a year.
NUMBER OF TIME PERIODS.
This is the number of co
Chapter 6 Accounting and the Time Value of Money
BASIC TIME VALUE CONCEPTS
-Time value of money = A dollar received today is worth more than a dollar promised at sometime in the
Because there is opportunity to invest todays dollar and rec
-Compound Interest = is computed on principal and on any interest earned that has not been paid or
withdrawn. It is the return on (or growth of) the principal for 2 or more time periods.
-Compounding computes interest not only on the principal but also on
Demo Doc 1: Bonds Payable: Straight-Line Amortization
Angle Corp. issued $10,000 maturity value of bonds payable for $9,639 cash on January 1,
2030. The bonds had a stated rate (or coupon rate) of 6%, but the market rate was 8%.
Interest is pai
corporation tax losses part 1
relevant to new ACCA Qualication Paper F6 (IRL)
This is the first of two articles on how losses incurred by a company
can be used against profits in the current, previous, or future