ACCOUNTING:FORAFACTORINGARRANGEMENT,DERECOGNITIONOF RECEIVABLESOCCURSWHEN?A) AGREEMENT IS SIGNEDB) SUBSTANTIALLY ALL RISKS AND REWARDSARE TRANSFERREDC) PARTIAL PAYMENT IS RECEIVEDD) COLLECTION IS GUARANTEED

Explanation of Factoring Arrangement: A factoring arrangement is a financial transaction where a…

Answered: ACCOUNTING: FOR A FACTORING…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter8: Current And Contingent Liabilities

Section: Chapter Questions

Problem 1MCQ

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Th e assumption that the eff ects of transactions and other events are recognized when they occur, not when the cash fl ows occur, is called: A . relevance.
а. Define what is an off-balance sheet activity? Also provide an example of an off-balance sheet liability.
Which of the following returns is consistent with contractual cash flows that are solely payments of principal and interest or SPPI? I. Return of passage of time II. Return for the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation III. Return for the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset IV. Return for amounts to cover expenses and a profit margin a. I, II, III, and IV b. I, II, and III c. I and IV only d. II and III only
Which of the following items is NOT classified as a financial asset? a. promissory notes b. forward exchange contracts c. inventory d. accounts receivable
The modified accrual basis ______. Multiple select question. What solution is it below? (A) records receivables (B) is merely a "light" version of the accrual version is not equivalent to the cash basis (C) accrues expenditures when payable (D) does not recognize long-term assets and liabilities
18. Which of the following contingencies is usually not accrued in the accounts? a. uninsured risk of property loss by fire or other hazardsb. guarantees of indebtedness of othersc. noncollectibility of receivablesd. agreements to repurchase receivables that have been sold
Unless otherwise stated, financial transactions assume the compounding frequency is greater than the payment frequency. Group of answer choices True False
narubhai
Which of the following situations does not base an accounting measure on a present value? Prepaid insurance , leases, pensions or sinking funds
Which of the following is not a pervasive expense recognition principle? a. immediate recognition b. systematic and rational allocation c. cash payment d. association of cause and effect

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ACCOUNTING: FOR A FACTORING ARRANGEMENT, DERECOGNITION OF RECEIVABLES OCCURS WHEN? A) AGREEMENT IS SIGNED B) SUBSTANTIALLY ALL RISKS AND REWARDS ARE TRANSFERRED C) PARTIAL PAYMENT IS RECEIVED D) COLLECTION IS GUARANTEED