Wilma Reynolds, CPA, a member of the American Institute of Certified Public Accountants (AICPA), is controller of Premium Corporation, a publicly owned enterprise with a now- 60%-owned subsidiary, Service Company. Reynolds has informed Premium’s chief financial officer, Wayne Cartwright, that the $150,000 increase in Premium’s investment in Service, which resulted from Service’s just-completed issuance of additional common stock to the public, should be recognized as an increase in Premium’s additional paid-in capital, in accordance with a proposed standard of the FASB. Cartwright countered that Topic 5-H of the SEC Staff Accounting Bulletins (SAB), which is based on SAB 51 and SAB 84, sanctions recognition of the $150,000 increase as non-operating income of Premium. Cartwright expressed the belief that because the SEC has statutory authority to establish accounting standards, its pronouncements should prevail over those proposed or issued by the FASB. Instructions Do you agree with Wayne Cartwright? In formulating your answer, consider the following: Any Guideline issued by the International Financial Accounting Standard Board Financial Accounting Standard Board The practice in the Ethiopian context
Wilma Reynolds, CPA, a member of the American Institute of Certified Public Accountants (AICPA), is controller of Premium Corporation, a publicly owned enterprise with a now- 60%-owned subsidiary, Service Company. Reynolds has informed Premium’s chief financial officer, Wayne Cartwright, that the $150,000 increase in Premium’s investment in Service, which resulted from Service’s just-completed issuance of additional common stock to the public, should be recognized as an increase in Premium’s additional paid-in capital, in accordance with a proposed standard of the FASB. Cartwright countered that Topic 5-H of the SEC Staff Accounting Bulletins (SAB), which is based on SAB 51 and SAB 84, sanctions recognition of the $150,000 increase as non-operating income of Premium. Cartwright expressed the belief that because the SEC has statutory authority to establish accounting standards, its pronouncements should prevail over those proposed or issued by the FASB. Instructions Do you agree with Wayne Cartwright? In formulating your answer, consider the following: Any Guideline issued by the International Financial Accounting Standard Board Financial Accounting Standard Board The practice in the Ethiopian context
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter18: Comparative Forms Of Doing Business
Section: Chapter Questions
Problem 26P
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Wilma Reynolds, CPA, a member of the American Institute of Certified Public Accountants (AICPA), is controller of Premium Corporation, a publicly owned enterprise with a now- 60%-owned subsidiary, Service Company. Reynolds has informed Premium’s chief financial officer, Wayne Cartwright, that the $150,000 increase in Premium’s investment in Service, which resulted from Service’s just-completed issuance of additional common stock to the public, should be recognized as an increase in Premium’s additional paid-in capital, in accordance with a proposed standard of the FASB. Cartwright countered that
Topic 5-H of the SEC Staff Accounting Bulletins (SAB), which is based on SAB 51 and SAB 84, sanctions recognition of the $150,000 increase as non-operating income of Premium. Cartwright expressed the belief that because the SEC has statutory authority to establish accounting standards, its pronouncements should prevail over those proposed or issued by the FASB.
Instructions
Do you agree with Wayne Cartwright? In formulating your answer, consider the following: Any Guideline issued by the International Financial Accounting Standard Board Financial Accounting Standard Board The practice in the Ethiopian context
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